The State Budget Apocalypse
December 20, 2010 7:14 AM Subscribe
CBS investigates the next financial meltdown: The coming crisis with U.S. state budget shortfalls.
Some highlights:
Some highlights:
California, which faces a $19 billion budget deficit next year, has a credit rating approaching junk status. It now spends more money on public employee pensions than it does on the state university system, which had to increase its tuition by 32 percent.There are a number of linked videos in line with the article. The primary video can also be seen on YouTube (unfortunately with ads): State Budgets: Day of Reckoning.
Arizona is so desperate it sold off the state capitol, Supreme Court building and legislative chambers to a group of investors and now leases the buildings from their new owner. The state also eliminated Medicaid funding for most organ transplants.
New Jersey...has the highest taxes in the country, a $10 billion deficit and a depressed economy when first-year Governor Chris Christie took office. But after looking at the books, he decided to walk away from a long-planned and much-needed project with New York and the federal government to build a rail tunnel into Manhattan. It would have helped the economy and given employment to 6,000 construction workers.
Illinois...currently has about $5 billion in outstanding bills in [Illinois state Comptroller Dan Hynes]'s office and not enough money in the state's coffers to pay them. He says they're six months behind.
Metafilter: Hey, did you see 60 Minutes last night?
posted by Horace Rumpole at 7:20 AM on December 20, 2010 [24 favorites]
posted by Horace Rumpole at 7:20 AM on December 20, 2010 [24 favorites]
I laughed pretty hard at the advertisement for the 60 Minutes ipad app on the bottom of the screen. I assume that's why you linked this article, right?
posted by cellphone at 7:29 AM on December 20, 2010
posted by cellphone at 7:29 AM on December 20, 2010
This is all too real and it's nationwide. South Carolina is expected to be $800 million in the hole this year. Welfare payments are being cut by 20%, hospice care is getting cut, money for prescriptions for diabetics is getting cut. Depressing stuff.
posted by ND¢ at 7:30 AM on December 20, 2010
posted by ND¢ at 7:30 AM on December 20, 2010
I think anyone who has an interest in this topic would be very well served by reading this post at self-evident.org. Really - I know very little about municipal finance, and a lot of how it works is non-intuitive, so I thought it was a great piece.
posted by JPD at 7:31 AM on December 20, 2010 [8 favorites]
posted by JPD at 7:31 AM on December 20, 2010 [8 favorites]
Nevada has a $6.5B 2yr budget and a 2011/2012 budget gap of $2.5B, or almost 40% of our budget is missing.
posted by SirOmega at 7:33 AM on December 20, 2010
posted by SirOmega at 7:33 AM on December 20, 2010
For all the Republican hysteria about Obama as a socialist, I'll laugh my ass off when honest-to-goodness actual class warfare eventually does come to the US due to an unshakable faith in Tax-Cut Jesus.
As long as I'm not up against the wall myself.
posted by bardic at 7:35 AM on December 20, 2010 [8 favorites]
As long as I'm not up against the wall myself.
posted by bardic at 7:35 AM on December 20, 2010 [8 favorites]
Why aren't people paying attention
People do not understand budgets. Most people don't understand how a credit card really works. They think money just comes from somewhere. Nobody understands value, use value, exchange value, or net worth. How are they going to understand or provide any input into this debate?
Also, they're in denial - but see the point about credit cards, above.
posted by carter at 7:37 AM on December 20, 2010 [6 favorites]
People do not understand budgets. Most people don't understand how a credit card really works. They think money just comes from somewhere. Nobody understands value, use value, exchange value, or net worth. How are they going to understand or provide any input into this debate?
Also, they're in denial - but see the point about credit cards, above.
posted by carter at 7:37 AM on December 20, 2010 [6 favorites]
You know that Club for Growth thing about starving the government and then drowning it in the bathtub?
This is the gurgling noise.
posted by at by at 7:45 AM on December 20, 2010 [16 favorites]
This is the gurgling noise.
posted by at by at 7:45 AM on December 20, 2010 [16 favorites]
Does the massive financial hole the US pushed the world into at the end of 2008 not prove that nobody, anywhere, really understands how debt work?
posted by Artw at 7:46 AM on December 20, 2010
posted by Artw at 7:46 AM on December 20, 2010
A lot of people I know seem to think that their credit card limit is their net worth in some way. "I have $$$" = "I have not reached my limit yet." That leads I think to people assuming that net worth can be generated from thin air (see the housing boom for example).
Maybe I should have said, using a credit card prevents people thinking about how to manage money. This is quite a large problem. A quick random Web search came up with figures of $850 billion credit card debt in the US, about $16,000 per household.
posted by carter at 7:51 AM on December 20, 2010
Maybe I should have said, using a credit card prevents people thinking about how to manage money. This is quite a large problem. A quick random Web search came up with figures of $850 billion credit card debt in the US, about $16,000 per household.
posted by carter at 7:51 AM on December 20, 2010
Private sector America understands perfectly well that credit has costs: the personal savings rate has dramatically improved in the past couple of years, and corporate cash balances are at extremely high levels.
I wouldn't have written this a year ago, but I think now that state and local governments know this too. Even California and New York recognize that further tax hikes simply move jobs to Texas, and that paying semi-skilled government workers like they were on a GM assembly line before Toyota started to export isn't sensible.
posted by MattD at 8:04 AM on December 20, 2010
I wouldn't have written this a year ago, but I think now that state and local governments know this too. Even California and New York recognize that further tax hikes simply move jobs to Texas, and that paying semi-skilled government workers like they were on a GM assembly line before Toyota started to export isn't sensible.
posted by MattD at 8:04 AM on December 20, 2010
Minnesota is facing a similar, and similarly massive, crisis. Our governor for eight years, Tim Pawlenty, was true believer in "never ever raise taxes." His budgeting was a mixture of smoke and mirrors -- he often balanced things with the hep of massive federal aid, which he would then publicly pooh-pooh -- and let individual cities make up shortfalls with skyrocketing property taxes and cutting services. Our schools are deeply in debt, as Pawlenty repeatedly deferred payments to them, and many have gone to four-day school weeks as a budget-saving measure. Libraries are closing down. Parks are closing down. Police officers are getting cut. There's no money to plow roads. And we're still looking at a $6 billion budget shortfall. In the meanwhile, as Pawlenty leaves office and prepares to begin the presidential campaign that he has yet to announce but has been grooming himself for for four years, he declares we have a balanced budget and money in the bank and the projected shortfalls are nothing but pessimism or politicking -- never mind that we have money in the bank only because of the very same federal money that Pawlenty is about to start touring the country to condemn.
And Pawlenty's successor was a Tenther who had spent his time in the State House of Representatives trying to pass unconstitutional laws that would void federal law in Minnesota, and whose tax plan was to slash Minnesota government by a third. I say plan, but he had no plan. He was just going to start cutting, probably inspired by Pawlenty, who himself had a habit of going through the state budget and line-item vetoing anything he disapproved of, which were, of course, all social safety net stuff -- Pawlenty eviscerated health care to the poor, as an example. These are all "treat government like a business" people, and yet they apparently didn't have enough business experience to know that, in the short term, it actually costs more to make massive changes to a large system, because they move by an enormous force of inertia. If you want to fix that, you go through and carefully look at the system, how it works, and how it can be made more efficient. It's a very time-consuming process, but they wanted to just cut cut cut and let the system figure it out on its own, which doesn't make a for a smaller or cheaper government, just a less effective one. And this guy, Emmer, who was basically a magnified version of Pawlenty, garnered enough votes to trigger an automatic recall. We did vote in a governor who promised to raise taxes, but also replaced the Democratic-run bicameral with a conservative one, pretty much guaranteeing gridlock.
This is how bad Minnesotans are at understanding the budget. I'm not surprised to hear the rest of the country likewise sucks.
posted by Astro Zombie at 8:07 AM on December 20, 2010 [25 favorites]
And Pawlenty's successor was a Tenther who had spent his time in the State House of Representatives trying to pass unconstitutional laws that would void federal law in Minnesota, and whose tax plan was to slash Minnesota government by a third. I say plan, but he had no plan. He was just going to start cutting, probably inspired by Pawlenty, who himself had a habit of going through the state budget and line-item vetoing anything he disapproved of, which were, of course, all social safety net stuff -- Pawlenty eviscerated health care to the poor, as an example. These are all "treat government like a business" people, and yet they apparently didn't have enough business experience to know that, in the short term, it actually costs more to make massive changes to a large system, because they move by an enormous force of inertia. If you want to fix that, you go through and carefully look at the system, how it works, and how it can be made more efficient. It's a very time-consuming process, but they wanted to just cut cut cut and let the system figure it out on its own, which doesn't make a for a smaller or cheaper government, just a less effective one. And this guy, Emmer, who was basically a magnified version of Pawlenty, garnered enough votes to trigger an automatic recall. We did vote in a governor who promised to raise taxes, but also replaced the Democratic-run bicameral with a conservative one, pretty much guaranteeing gridlock.
This is how bad Minnesotans are at understanding the budget. I'm not surprised to hear the rest of the country likewise sucks.
posted by Astro Zombie at 8:07 AM on December 20, 2010 [25 favorites]
That's true. I think they know now, but recession and depression have been a good wake-up call. Really we're still dealing with the fallout of pre-2008 behavior.
posted by carter at 8:08 AM on December 20, 2010 [1 favorite]
posted by carter at 8:08 AM on December 20, 2010 [1 favorite]
$6 million? I meant $6 billion.
posted by Astro Zombie at 8:08 AM on December 20, 2010
posted by Astro Zombie at 8:08 AM on December 20, 2010
Similar in tone to this recent Financial Post article about the debt of Canadian provinces
posted by HLD at 8:10 AM on December 20, 2010
posted by HLD at 8:10 AM on December 20, 2010
"Even California and New York recognize that further tax hikes simply move jobs to Texas"
Excuse me? California screwed the pooch precisely because they voted to not allow the state legislature to raise taxes back in the 80's.
"paying semi-skilled government workers"
It's a shame you don't have any teachers, fire-fighters, or cops in your family or circle of friends. I'd love to see you share your "wisdom" with them and not get punched in the face.
posted by bardic at 8:11 AM on December 20, 2010 [15 favorites]
Excuse me? California screwed the pooch precisely because they voted to not allow the state legislature to raise taxes back in the 80's.
"paying semi-skilled government workers"
It's a shame you don't have any teachers, fire-fighters, or cops in your family or circle of friends. I'd love to see you share your "wisdom" with them and not get punched in the face.
posted by bardic at 8:11 AM on December 20, 2010 [15 favorites]
Quick, cut taxes!
posted by Bovine Love at 8:13 AM on December 20, 2010
posted by Bovine Love at 8:13 AM on December 20, 2010
The USA really needs to start paying for all the stuff you've got. All your infrastructure is falling apart and yet your politics seems focussed on so many other short-term events.
Sorry - but you don't get 1st world infrastructure without paying and paying and paying. Think (Western) European taxes are high? We live all together in a closely-packed little set of archipelagos, peninsulas and islands. You lot live in low-density housing spread out across a huge continent. That means you are paying for even more concrete and metal than we do.
The myth of the independent prospector heading west on his own energies is long since gone (and it was never really true either - see Metafilter's own Charlie Stross on the subject here: Charlie's Diary on Space Cadets) There was always a huge east coast infrastructure providing resources for the plucky wagon trains.
Infrastructure is damn costly and needs to be constantly replaced - just ask the water companies in the UK. So that means long-term costs will simply rise and rise and rise for all of you. See here for a simple example: The Interstate 40 Bridge Collapse at Webbers Falls
It's long past time for you to have a rational discussion about what level of infrastructure you're willing to tolerate - schools, roads, communications and so-on. You can't continue to have what you've got with the money you are putting in.
Good luck with that. :-)
posted by Hugh Routley at 8:14 AM on December 20, 2010 [28 favorites]
Sorry - but you don't get 1st world infrastructure without paying and paying and paying. Think (Western) European taxes are high? We live all together in a closely-packed little set of archipelagos, peninsulas and islands. You lot live in low-density housing spread out across a huge continent. That means you are paying for even more concrete and metal than we do.
The myth of the independent prospector heading west on his own energies is long since gone (and it was never really true either - see Metafilter's own Charlie Stross on the subject here: Charlie's Diary on Space Cadets) There was always a huge east coast infrastructure providing resources for the plucky wagon trains.
Infrastructure is damn costly and needs to be constantly replaced - just ask the water companies in the UK. So that means long-term costs will simply rise and rise and rise for all of you. See here for a simple example: The Interstate 40 Bridge Collapse at Webbers Falls
It's long past time for you to have a rational discussion about what level of infrastructure you're willing to tolerate - schools, roads, communications and so-on. You can't continue to have what you've got with the money you are putting in.
Good luck with that. :-)
posted by Hugh Routley at 8:14 AM on December 20, 2010 [28 favorites]
I think CA legislators have understood the ramifications of state spending for a long time, but the public initiative process combined with a huge discrepancy in how the public perceives bonds vs taxes has taken away a lot of legislative control over budgets in the last couple decades. I think the optimal solution is to tax boom years and generate a surplus for the lean times, but that's not possible after a number of initiatives that passed.
posted by BrotherCaine at 8:14 AM on December 20, 2010 [3 favorites]
posted by BrotherCaine at 8:14 AM on December 20, 2010 [3 favorites]
I am sure the invisible hand of the market will save things, and hopefully lower taxes in the process.
posted by Theta States at 8:16 AM on December 20, 2010
posted by Theta States at 8:16 AM on December 20, 2010
While I appreciate the FPP I don't think the article linked is very good; for example, the big story wasn't mentioned until page four - Municipal Bonds and the upcoming wave of defaults.
Pitched to conservative retail investors for literally, decades, proponents pitch the relative security and preferential tax treatment of these assets. And in sound economic times a revenue anticipation note (aka RAN) can be smart investments.
The New York Times ran a very interesting article a couple of weeks ago, which pointed out (without using the phrase) that much of the debt states and municipalities are currently struggling with is structural; that is, not likely to be eliminated once the economy moves (demonstratively) out of recession.
A particularly interesting excerpt:
The biggest problem facing investors in municipal bonds at this point isn't so much the collapsing tax base, rather the withdrawal of the two big bond insurers from the market; Ambac (Nov 20th 2009, btw, the most recent Ambac bankruptcy news is here, if you're scouting out bargains) and MBIA has been sued into inaction, no longer writing policies to insure municipal bonds. Assured Guaranty reportedly is still writing policies, but their balance sheet is much, much smaller and they don't the liquidity to cover the absence of the two giants in this sector.
If you're at all puzzled about bond insurance (who isn't?), Crains did a rather nice writeup entitled How to talk to your kids about...bond insurance that might help, a good overview can be found here, but all you've really got to know is its exactly what the name implies: insurance that will compensation investors for losses should the issuer (i.e., state or municipality) fail to pay. Bond insurance is of particular importance since without it many issues either wouldn't make it to market or could only doing so by offering very high coupons (rates of interest).
The market has been widely anticipating problems in this sector; if we look at one of the larger Municipal bond ETFs, Barclays National Municipal, we see its currently yielding 3.65% while their 7-10 year treasury ETF is yielding 2.99%.
Yep, a triple tax free municipal bond fund yielding more than comparable US treasuries. So even with in spite of the advantageous tax treatment, the market consider municipal bonds risker. You can always see these things (in this case, default) coming if you just look at the data and yes, collapses in the municipal bond sector will be a messy affair and more than likely will ripple.
I don't think anyone wants to be long munis or US treasuries at this point. I sold a fairly large position in two year treasuries once The Fed started actively purchasing (QE2, don't you know); they're seriously distorting the yield curve at this point and its getting difficult to read the market.
All this during a time when, as I mentioned about one month ago, there is some serious inflation pressure building up in the system, and since some of this data is difficult to find on the internet I posted some Bloomberg screen grabs here.
Check your your 401Ks, mutual funds or any other investment where you don't have full clarity; you may have exposure and not realise it.
posted by Mutant at 8:17 AM on December 20, 2010 [33 favorites]
Pitched to conservative retail investors for literally, decades, proponents pitch the relative security and preferential tax treatment of these assets. And in sound economic times a revenue anticipation note (aka RAN) can be smart investments.
The New York Times ran a very interesting article a couple of weeks ago, which pointed out (without using the phrase) that much of the debt states and municipalities are currently struggling with is structural; that is, not likely to be eliminated once the economy moves (demonstratively) out of recession.
A particularly interesting excerpt:
Sidenote: this is a very unusual recession, one that clearly violates the Zaronwitz rule and reiterates my oft stated belief that economies move long cycles.
The finances of some state and local governments are so distressed that some analysts say they are reminded of the run-up to the subprime mortgage meltdown or of the debt crisis hitting nations in Europe.
The biggest problem facing investors in municipal bonds at this point isn't so much the collapsing tax base, rather the withdrawal of the two big bond insurers from the market; Ambac (Nov 20th 2009, btw, the most recent Ambac bankruptcy news is here, if you're scouting out bargains) and MBIA has been sued into inaction, no longer writing policies to insure municipal bonds. Assured Guaranty reportedly is still writing policies, but their balance sheet is much, much smaller and they don't the liquidity to cover the absence of the two giants in this sector.
If you're at all puzzled about bond insurance (who isn't?), Crains did a rather nice writeup entitled How to talk to your kids about...bond insurance that might help, a good overview can be found here, but all you've really got to know is its exactly what the name implies: insurance that will compensation investors for losses should the issuer (i.e., state or municipality) fail to pay. Bond insurance is of particular importance since without it many issues either wouldn't make it to market or could only doing so by offering very high coupons (rates of interest).
The market has been widely anticipating problems in this sector; if we look at one of the larger Municipal bond ETFs, Barclays National Municipal, we see its currently yielding 3.65% while their 7-10 year treasury ETF is yielding 2.99%.
Yep, a triple tax free municipal bond fund yielding more than comparable US treasuries. So even with in spite of the advantageous tax treatment, the market consider municipal bonds risker. You can always see these things (in this case, default) coming if you just look at the data and yes, collapses in the municipal bond sector will be a messy affair and more than likely will ripple.
I don't think anyone wants to be long munis or US treasuries at this point. I sold a fairly large position in two year treasuries once The Fed started actively purchasing (QE2, don't you know); they're seriously distorting the yield curve at this point and its getting difficult to read the market.
All this during a time when, as I mentioned about one month ago, there is some serious inflation pressure building up in the system, and since some of this data is difficult to find on the internet I posted some Bloomberg screen grabs here.
Check your your 401Ks, mutual funds or any other investment where you don't have full clarity; you may have exposure and not realise it.
posted by Mutant at 8:17 AM on December 20, 2010 [33 favorites]
It's long past time for you to have a rational discussion about what level of infrastructure you're willing to tolerate - schools, roads, communications and so-on. You can't continue to have what you've got with the money you are putting in.
You assume that rational discussion is possible in America.
It is not.
posted by T.D. Strange at 8:24 AM on December 20, 2010 [5 favorites]
You assume that rational discussion is possible in America.
It is not.
posted by T.D. Strange at 8:24 AM on December 20, 2010 [5 favorites]
I didn't say all government employees are semi-skilled; the pay of the actually skilled ones is not particularly high. It's the total compensation of the ones who semi-skilled that is the problem - gold-plated retirement, health and paid-time-off unlike anything they could hope to get in the private sector with the same resume and skill set.
posted by MattD at 8:25 AM on December 20, 2010 [1 favorite]
posted by MattD at 8:25 AM on December 20, 2010 [1 favorite]
Even California and New York recognize that further tax hikes simply move jobs to Texas
Except for the part where the state of Texas can't meet its financial obligations because Governor Goodhair and the Legislature cut taxes so deeply. Every department in the state and everything funded by or through the state, including all that stuff Christie was talking about in NJ, even K-12 education, is looking at massive budget cuts. The only thing that's untouched is football, which is sacred, and "funds itself" anyway.
The only good thing about the Republican supermajority in the next biennium is that they will own the way the state finally blows up from a decade of tax cut mania and mismanagement.
posted by immlass at 8:26 AM on December 20, 2010 [1 favorite]
Except for the part where the state of Texas can't meet its financial obligations because Governor Goodhair and the Legislature cut taxes so deeply. Every department in the state and everything funded by or through the state, including all that stuff Christie was talking about in NJ, even K-12 education, is looking at massive budget cuts. The only thing that's untouched is football, which is sacred, and "funds itself" anyway.
The only good thing about the Republican supermajority in the next biennium is that they will own the way the state finally blows up from a decade of tax cut mania and mismanagement.
posted by immlass at 8:26 AM on December 20, 2010 [1 favorite]
In California, firefighters and cops are paid well. Extremely well.
I have numerous municipal clients, and have had the dubious pleasure of sitting in council and staff sessions watching the sausage get made. They very quietly disparage the cost of "public safety" against other items in the budgets, but few will come out publicly against the local cops, and nobody comes out against firefighters.
Teachers here don't get paid so well, and they deal with layoffs just about every year. Some schools have literally closed their doors.
City staffs have faced cutbacks here as well. Furloughs, hourly reductions, unfilled job positions, and layoffs too. Even the courts have two furlough days a month last I checked, and I think they may be up to four. The local county probation department has closed some divisions, and kicked the probationers over to the local cities. I was told by someone in the know that the courts very quietly decided not to prosecute certain crimes if the defendants pleaded not guilty - charges may be deferred indefinitely or dropped entirely.
However, the local police just upgraded the lights on all their vehicles to new LED based bars. They are very sleek and pretty.
posted by Xoebe at 8:27 AM on December 20, 2010 [7 favorites]
I have numerous municipal clients, and have had the dubious pleasure of sitting in council and staff sessions watching the sausage get made. They very quietly disparage the cost of "public safety" against other items in the budgets, but few will come out publicly against the local cops, and nobody comes out against firefighters.
Teachers here don't get paid so well, and they deal with layoffs just about every year. Some schools have literally closed their doors.
City staffs have faced cutbacks here as well. Furloughs, hourly reductions, unfilled job positions, and layoffs too. Even the courts have two furlough days a month last I checked, and I think they may be up to four. The local county probation department has closed some divisions, and kicked the probationers over to the local cities. I was told by someone in the know that the courts very quietly decided not to prosecute certain crimes if the defendants pleaded not guilty - charges may be deferred indefinitely or dropped entirely.
However, the local police just upgraded the lights on all their vehicles to new LED based bars. They are very sleek and pretty.
posted by Xoebe at 8:27 AM on December 20, 2010 [7 favorites]
Mutant, you're right, it's structural. I also think that it's cultural, and that the two are linked in complex and mutually-reinforcing ways.
posted by carter at 8:27 AM on December 20, 2010 [2 favorites]
posted by carter at 8:27 AM on December 20, 2010 [2 favorites]
In America we vote on Jesus first and loudest (For!) and then, if there's time, we punt on fiscal issues.
posted by 2bucksplus at 8:29 AM on December 20, 2010 [1 favorite]
posted by 2bucksplus at 8:29 AM on December 20, 2010 [1 favorite]
"gold-plated retirement, health and paid-time-off unlike anything they could hope to get in the private sector with the same resume and skill set."
You don't know any low-level government workers, do you?
I can assure you that garbage men do not get a "gold-plated retirement," nor do "young black bucks" and "welfare queens" use their food stamps for T-bone steaks.
And the notion that private sector workers are by nature more gifted than public sector ones is idiotic. Just ask the board of Lehman Brothers.
Seriously mate, Zombie Reagan just called me up to let you know that even he doesn't spout this type of Randian bullshit any longer. Because it' both stupid and pathetic.
posted by bardic at 8:30 AM on December 20, 2010 [32 favorites]
You don't know any low-level government workers, do you?
I can assure you that garbage men do not get a "gold-plated retirement," nor do "young black bucks" and "welfare queens" use their food stamps for T-bone steaks.
And the notion that private sector workers are by nature more gifted than public sector ones is idiotic. Just ask the board of Lehman Brothers.
Seriously mate, Zombie Reagan just called me up to let you know that even he doesn't spout this type of Randian bullshit any longer. Because it' both stupid and pathetic.
posted by bardic at 8:30 AM on December 20, 2010 [32 favorites]
Yeah I know I saw footage the other day of the movie studios and Silicon Valley offices literally airlifting
I saw that footage. In the airlift were all the non-managerial IT and coding jobs, all the animation jobs, all the film processing, all the non-union post-production jobs, etc. They didn't go to Texas though...they went to South Korea, Russian, Croatia, Singapore and Bangalore.
posted by spicynuts at 8:30 AM on December 20, 2010 [5 favorites]
And the notion that private sector workers are by nature more gifted than public sector ones is idiotic. Just ask the board of Lehman Brothers.
Whenever anyone makes this ludicrous claim about private sector people being smarter, more efficient, more productive, whatever, I get this feeling that I must be smoking crack because I look around my gigantic, bloated, corporate bureaucracy at all the lazy ass A/P, Payroll, Secretarial, IT, etc, half ass middle-management and the incompetence and carelessness I see I guess can only be explained by my massive cocaine intake. Everyone else must see a shining beacon of ambition and Rhodes Scholar levels of accomplishment. Yeah, it's gotta be me.
posted by spicynuts at 8:33 AM on December 20, 2010 [12 favorites]
Whenever anyone makes this ludicrous claim about private sector people being smarter, more efficient, more productive, whatever, I get this feeling that I must be smoking crack because I look around my gigantic, bloated, corporate bureaucracy at all the lazy ass A/P, Payroll, Secretarial, IT, etc, half ass middle-management and the incompetence and carelessness I see I guess can only be explained by my massive cocaine intake. Everyone else must see a shining beacon of ambition and Rhodes Scholar levels of accomplishment. Yeah, it's gotta be me.
posted by spicynuts at 8:33 AM on December 20, 2010 [12 favorites]
It's the total compensation of the ones who semi-skilled that is the problem - gold-plated retirement, health and paid-time-off unlike anything they could hope to get in the private sector with the same resume and skill set.
So which ones do you think are "skilled" and which do you think are not? And the rolling-in-lard compensation that you speak of accrues to skilled and semi-skilled both, right? How do you decide which ones get compensation and which ones don't? If the compensation is cut by the governor and the legislature, the gold-plated Cadillac semi-skilled class that you seem to think exists will be decimated, but so will the gold-plated skilled Mercedes Benz class that you seem to think exists.
posted by blucevalo at 8:39 AM on December 20, 2010
So which ones do you think are "skilled" and which do you think are not? And the rolling-in-lard compensation that you speak of accrues to skilled and semi-skilled both, right? How do you decide which ones get compensation and which ones don't? If the compensation is cut by the governor and the legislature, the gold-plated Cadillac semi-skilled class that you seem to think exists will be decimated, but so will the gold-plated skilled Mercedes Benz class that you seem to think exists.
posted by blucevalo at 8:39 AM on December 20, 2010
"this ludicrous claim about private sector people being smarter, more efficient, more productive"
It's just typical Republican boiler-plate, along with the idea that tax cuts create jobs. (Really? The Bush tax cuts prove this is categorically untrue.)
But Americans don't do facts, logic, or reason any longer.
All praise Tax-Cut Jesus.
posted by bardic at 8:40 AM on December 20, 2010 [5 favorites]
It's just typical Republican boiler-plate, along with the idea that tax cuts create jobs. (Really? The Bush tax cuts prove this is categorically untrue.)
But Americans don't do facts, logic, or reason any longer.
All praise Tax-Cut Jesus.
posted by bardic at 8:40 AM on December 20, 2010 [5 favorites]
I saw that footage. In the airlift were all the non-managerial IT and coding jobs, all the animation jobs, all the film processing, all the non-union post-production jobs, etc. They didn't go to Texas though...they went to South Korea, Russian, Croatia, Singapore and Bangalore.
So what your saying is we will never be able to compete purely on low wages and taxes and shouldn't bother trying, right? We should just have reasonable rates of taxation at the state and federal level, rates that are sustainable and foster a safe and stable business environment as well as a social safety net, you know things American could lead the world in.
posted by 2bucksplus at 8:42 AM on December 20, 2010
So what your saying is we will never be able to compete purely on low wages and taxes and shouldn't bother trying, right? We should just have reasonable rates of taxation at the state and federal level, rates that are sustainable and foster a safe and stable business environment as well as a social safety net, you know things American could lead the world in.
posted by 2bucksplus at 8:42 AM on December 20, 2010
@sio: "Ah I see. They dont see it as a loan but as money they already have. Interesting. "
I have a neighbor who has a Ph.D. in science who was appalled -- APPALLED -- when she found out I hadn't maxed out my credit card because, "That's your money! And you're not using it!" She started pointing out all the things I could be buying with it that I "need" -- a new couch, a new car. And, yeah, okay, my car is old, and my couch is crappy (but I have a toddler, who wants a nice one?). But she just didn't see why, until all my "needs" were met, I should stop maxing my card out.
She and her husband (also a Ph.D.) max their cards on a routine basis, pay them down a bit, and max them out again. They have one child, own a five-bedroom house with a family room, living room, office, rec-room, formal dining room, eat-in kitchen, full basement, etc., and "can't" downsize. They "need" all those rooms. When one of them needed extensive dental work they had to pay down their cards for six months before they could charge the co-pays (re-maxing-out the cards). They paid off an emergency room visit co-pay for almost two years. As soon as they finished car payments they bought a new car. They bought an entire houseful of furniture (much of it in rooms they don't use!) on credit. All at once. And it's not that they HAVE to live paycheck-to-paycheck; they both make excellent money, but they opt to budget this way. It boggles my mind.
But what boggles my mind more is that it drives her absolutely batshit that I live in a two-and-a-half bedroom house and don't max out my credit cards because, "You could get so much more mortgage! And that money is YOUR money on the credit cards! You have to use it!"
On the main topic, our local municipal government just patted themselves on the back for holding the line on property taxes, "protecting our citizens from increases in this recession" and then excoriated the school district for raising taxes. Well, the state owes our district MILLIONS of dollars (they caught up to around $9.5 million but I think we're back down to around $30 million owed, and we are required by law to provide all these programs they're supposed to be funding -- special ed is a notably expensive one -- whether they fund them or not), and the way the city made their budget was by putting a brand new tax on natural gas that hits the average homeowner for $34/year, and hits the school district for $30,000/year. Which is of course another $30,000 we have to raise through property taxes, because the district has no other taxing mechanism, unlike the city.
The district's property tax rate rise is around $13 for the average homeowner -- considerably less than the $34 for the natural gas rate. (Which will also tend to hit poor and elderly homeowners in our community very hard, as they tend to have less-insulated houses.) And if the city taxes the school district (and all other governmental entities that use any heat) for natural gas, where, exactly, does the city think other governmental entities will get that money except by raising taxes?
Too much bullshitting out there to have a rational conversation.
posted by Eyebrows McGee at 8:42 AM on December 20, 2010 [21 favorites]
I have a neighbor who has a Ph.D. in science who was appalled -- APPALLED -- when she found out I hadn't maxed out my credit card because, "That's your money! And you're not using it!" She started pointing out all the things I could be buying with it that I "need" -- a new couch, a new car. And, yeah, okay, my car is old, and my couch is crappy (but I have a toddler, who wants a nice one?). But she just didn't see why, until all my "needs" were met, I should stop maxing my card out.
She and her husband (also a Ph.D.) max their cards on a routine basis, pay them down a bit, and max them out again. They have one child, own a five-bedroom house with a family room, living room, office, rec-room, formal dining room, eat-in kitchen, full basement, etc., and "can't" downsize. They "need" all those rooms. When one of them needed extensive dental work they had to pay down their cards for six months before they could charge the co-pays (re-maxing-out the cards). They paid off an emergency room visit co-pay for almost two years. As soon as they finished car payments they bought a new car. They bought an entire houseful of furniture (much of it in rooms they don't use!) on credit. All at once. And it's not that they HAVE to live paycheck-to-paycheck; they both make excellent money, but they opt to budget this way. It boggles my mind.
But what boggles my mind more is that it drives her absolutely batshit that I live in a two-and-a-half bedroom house and don't max out my credit cards because, "You could get so much more mortgage! And that money is YOUR money on the credit cards! You have to use it!"
On the main topic, our local municipal government just patted themselves on the back for holding the line on property taxes, "protecting our citizens from increases in this recession" and then excoriated the school district for raising taxes. Well, the state owes our district MILLIONS of dollars (they caught up to around $9.5 million but I think we're back down to around $30 million owed, and we are required by law to provide all these programs they're supposed to be funding -- special ed is a notably expensive one -- whether they fund them or not), and the way the city made their budget was by putting a brand new tax on natural gas that hits the average homeowner for $34/year, and hits the school district for $30,000/year. Which is of course another $30,000 we have to raise through property taxes, because the district has no other taxing mechanism, unlike the city.
The district's property tax rate rise is around $13 for the average homeowner -- considerably less than the $34 for the natural gas rate. (Which will also tend to hit poor and elderly homeowners in our community very hard, as they tend to have less-insulated houses.) And if the city taxes the school district (and all other governmental entities that use any heat) for natural gas, where, exactly, does the city think other governmental entities will get that money except by raising taxes?
Too much bullshitting out there to have a rational conversation.
posted by Eyebrows McGee at 8:42 AM on December 20, 2010 [21 favorites]
In California, firefighters and cops are paid well. Extremely well.
Okay, but firefighters do have to risk their lives from time to time when doing their jobs. It seems like something that would be hard to put a value to, but I would expect to be paid a premium for that. People get paid much more to push money around and proofread legal documents.
posted by snofoam at 8:43 AM on December 20, 2010
Okay, but firefighters do have to risk their lives from time to time when doing their jobs. It seems like something that would be hard to put a value to, but I would expect to be paid a premium for that. People get paid much more to push money around and proofread legal documents.
posted by snofoam at 8:43 AM on December 20, 2010
So what your saying is we will never be able to compete purely on low wages and taxes and shouldn't bother trying, right?
What I was saying is that if you want to have a real discussion, flippant B.S. like 'Yeah I watched that footage of that airlift' doesn't help.
posted by spicynuts at 8:45 AM on December 20, 2010
Check your your 401Ks, mutual funds or any other investment where you don't have full clarity; you may have exposure and not realise it.
But surely equities are riskier still. What's the alternative? Cash?
posted by escabeche at 8:46 AM on December 20, 2010
But surely equities are riskier still. What's the alternative? Cash?
posted by escabeche at 8:46 AM on December 20, 2010
This sort of thinking isn't limited to the U.S. I'm already girding myself for my Annual Christmas Argument with my wife's uncle, who believes that all would be well with Canada if we could just cut taxes for everything but cops and the military, abolish unions, privatize everything, stop admitting (non-white is the subtext) immigrants and throw all the lazy bums exploiting the welfare system into jail. I live in Toronto, so I'm setting the over/under on the number of minutes after I enter his house and before he gloatingly brings up Rob Ford at seven.
posted by The Card Cheat at 8:47 AM on December 20, 2010 [4 favorites]
posted by The Card Cheat at 8:47 AM on December 20, 2010 [4 favorites]
There are also obvious reasons you don't want cops and firefighters in their fifties and sixties, whereas that's not a problem with a white-collar career. (A few higher-up officers of course, but not the bulk of your squadrons.) Sorry, but they risk their lives on a daily basis. Local governments should compensate them accordingly and offer them the chance to retire in their mid-40's.
And when they start making anywhere near what a corporate lawyer or an IB guy makes we can talk about inequity.
posted by bardic at 8:50 AM on December 20, 2010 [1 favorite]
And when they start making anywhere near what a corporate lawyer or an IB guy makes we can talk about inequity.
posted by bardic at 8:50 AM on December 20, 2010 [1 favorite]
"but firefighters do have to risk their lives from time to time when doing their jobs. It seems like something that would be hard to put a value to, but I would expect to be paid a premium for that."
Which I'm fine with, but what's unsustainable is the pensions. The model used now in many states is that you work for Government Entity X for 30 years, you're entitled to a full pension that reflects your highest-paid years. So you start working for the government at 22 (let us say), fresh out of college, retire at 52, and expect to live until 82. We're paying you to work for 30 years, then paying you 80% of that cost to NOT work for 30 MORE years, plus possibly paying for your retirement healthcare costs. That's simply unsustainable.
The old model where the public sector paid smaller-but-reasonable salaries and gold-plated benefits for a handful of retirement years before you died has been replaced by a model where the public sector often (not always, but generally true for jobs requiring less than graduate degrees) pays considerably more than the private sector for similar skills, and still gets gold-plated benefits that now often last far LONGER than one's working life now that lifespans are so extended.
To maintain that model, salaries need to be realigned (although public-sector unions are often the most powerful, so that seems unlikely) and pension rights MUST be reduced -- require more working years for a full pension. Adjust pensions to reflect whole-life earnings rather than only "last few years at high pay scale" earnings. SOMETHING. But we can't pay people to work for 30 years and then pay them nearly the same amount to NOT work for 30 years. We just can't afford that.
posted by Eyebrows McGee at 8:51 AM on December 20, 2010 [6 favorites]
Which I'm fine with, but what's unsustainable is the pensions. The model used now in many states is that you work for Government Entity X for 30 years, you're entitled to a full pension that reflects your highest-paid years. So you start working for the government at 22 (let us say), fresh out of college, retire at 52, and expect to live until 82. We're paying you to work for 30 years, then paying you 80% of that cost to NOT work for 30 MORE years, plus possibly paying for your retirement healthcare costs. That's simply unsustainable.
The old model where the public sector paid smaller-but-reasonable salaries and gold-plated benefits for a handful of retirement years before you died has been replaced by a model where the public sector often (not always, but generally true for jobs requiring less than graduate degrees) pays considerably more than the private sector for similar skills, and still gets gold-plated benefits that now often last far LONGER than one's working life now that lifespans are so extended.
To maintain that model, salaries need to be realigned (although public-sector unions are often the most powerful, so that seems unlikely) and pension rights MUST be reduced -- require more working years for a full pension. Adjust pensions to reflect whole-life earnings rather than only "last few years at high pay scale" earnings. SOMETHING. But we can't pay people to work for 30 years and then pay them nearly the same amount to NOT work for 30 years. We just can't afford that.
posted by Eyebrows McGee at 8:51 AM on December 20, 2010 [6 favorites]
I think anyone who has an interest in this topic would be very well served by reading this post at self-evident.org.
Thanks, that was really interesting. Someone posted that Wordsworth poem to a listserv I'm on the other day with a comment about muni bonds, but I didn't realize that he actually wrote it after Pennsylvania defaulted on bonds he held:
Thanks, that was really interesting. Someone posted that Wordsworth poem to a listserv I'm on the other day with a comment about muni bonds, but I didn't realize that he actually wrote it after Pennsylvania defaulted on bonds he held:
To the Pennsylvaniansposted by enn at 8:51 AM on December 20, 2010 [3 favorites]
by William Wordsworth
Days undefiled by luxury or sloth,
Firm self-denial, manners grave and staid,
Rights equal, laws with cheerfulness obeyed,
Words that require no sanction from an oath,
And simple honesty a common growth--
This high repute, with bounteous Nature's aid,
Won confidence, now ruthlessly betrayed
At will, your power the measure of your troth!--
All who revere the memory of Penn
Grieve for the land on whose wild woods his name
Was fondly grafted with a virtuous aim,
Renounced, abandoned by degenerate Men
For state-dishonour black as ever came
To upper air from Mammon's loathsome den.
AFSCME Response to One-Sided 60 Minutes Report on State and Local Budgets
posted by oneswellfoop at 8:56 AM on December 20, 2010
posted by oneswellfoop at 8:56 AM on December 20, 2010
But surely equities are riskier still. What's the alternative? Cash?
not a comment on the creditworthiness of muni debt, just pointing out that holding a distressed debt security is tantamount to holding equity anyway.
posted by JPD at 8:57 AM on December 20, 2010
not a comment on the creditworthiness of muni debt, just pointing out that holding a distressed debt security is tantamount to holding equity anyway.
posted by JPD at 8:57 AM on December 20, 2010
I am so, so, so fucking tired of the first solution to our problems being "cut entitlements". Like there's some mystical sect of entitlement collectors growing insanely rich off government largesse.
Look around. Where are they? They don't exist. Yes, some people successfully game the system; that will happen no matter what system is in place. But saying entitlements (which is a loaded term, much like "activist judge", that means whatever the utterer deems it to mean) are the bane of our existence is ludicrous.
We've cut taxes and then cut them more. We've given the uber rich a pass on estate taxes. We've made earning money on money easier and more profitable than earning money on labor. We've let our business overlords send our jobs away and create a nation of bean-counters, burger-flippers and "at-will" slaves. We've absolutely ignored every sector of our infrastructure. And, now that we're in a hole, they want to fuck the average citizen even more to pay the bill.
It's ridiculous. It's, at the heart, immoral.
posted by Benny Andajetz at 9:00 AM on December 20, 2010 [30 favorites]
Look around. Where are they? They don't exist. Yes, some people successfully game the system; that will happen no matter what system is in place. But saying entitlements (which is a loaded term, much like "activist judge", that means whatever the utterer deems it to mean) are the bane of our existence is ludicrous.
We've cut taxes and then cut them more. We've given the uber rich a pass on estate taxes. We've made earning money on money easier and more profitable than earning money on labor. We've let our business overlords send our jobs away and create a nation of bean-counters, burger-flippers and "at-will" slaves. We've absolutely ignored every sector of our infrastructure. And, now that we're in a hole, they want to fuck the average citizen even more to pay the bill.
It's ridiculous. It's, at the heart, immoral.
posted by Benny Andajetz at 9:00 AM on December 20, 2010 [30 favorites]
> It's ridiculous. It's, at the heart, immoral.
"The modern conservative is engaged in one of man's oldest exercises in moral philosophy; that is, the search for a superior moral justification for selfishness." -John Kenneth Galbraith
posted by The Card Cheat at 9:08 AM on December 20, 2010 [28 favorites]
"The modern conservative is engaged in one of man's oldest exercises in moral philosophy; that is, the search for a superior moral justification for selfishness." -John Kenneth Galbraith
posted by The Card Cheat at 9:08 AM on December 20, 2010 [28 favorites]
"It's ridiculous. It's, at the heart, immoral."
I'm happy to go one step further and claim that in many cases the calls for "ending entitlements to government workers" are basically racist dog-whistles against lower-end public service types as well (mailmen, clerical workers, public utility grunts) who are often people of color.
I grew up in Washington, DC where this is almost always the case but still, I can't help but feel it's just a further extension of the welfare queen/young buck buying T-bones with food-stamps racist mythology we inherited from Reagan.
posted by bardic at 9:10 AM on December 20, 2010 [7 favorites]
I'm happy to go one step further and claim that in many cases the calls for "ending entitlements to government workers" are basically racist dog-whistles against lower-end public service types as well (mailmen, clerical workers, public utility grunts) who are often people of color.
I grew up in Washington, DC where this is almost always the case but still, I can't help but feel it's just a further extension of the welfare queen/young buck buying T-bones with food-stamps racist mythology we inherited from Reagan.
posted by bardic at 9:10 AM on December 20, 2010 [7 favorites]
I have a neighbor who has a Ph.D. in science who was appalled -- APPALLED -- when she found out I hadn't maxed out my credit card because, "That's your money! And you're not using it!"
I have a hard time believing this story. What does she do when you point out that she's choosing to pay 30% higher prices on everything she buys because she has to pay the price+interest? Does she just stick her fingers in her ears and say, "LALALANOT LISTENING!"? Does she claim she's happy to pay an extra $1,000 to get her furniture RIGHT NOW instead of waiting a month or two save the money to buy it in cash without interest?
posted by straight at 9:14 AM on December 20, 2010 [1 favorite]
I have a hard time believing this story. What does she do when you point out that she's choosing to pay 30% higher prices on everything she buys because she has to pay the price+interest? Does she just stick her fingers in her ears and say, "LALALANOT LISTENING!"? Does she claim she's happy to pay an extra $1,000 to get her furniture RIGHT NOW instead of waiting a month or two save the money to buy it in cash without interest?
posted by straight at 9:14 AM on December 20, 2010 [1 favorite]
Why isn't Florida on this list? We're currently facing a $3 billion state budget deficit!
posted by saulgoodman at 9:17 AM on December 20, 2010
posted by saulgoodman at 9:17 AM on December 20, 2010
I can't help but feel it's just a further extension of the welfare queen/young buck buying T-bones with food-stamps racist mythology we inherited from Reagan.
Cadillacs. You forgot the Cadillacs.
posted by blucevalo at 9:24 AM on December 20, 2010
Cadillacs. You forgot the Cadillacs.
posted by blucevalo at 9:24 AM on December 20, 2010
> I can't help but feel it's just a further extension of the welfare queen/young buck buying T-bones with food-stamps racist mythology we inherited from Reagan.
These myths predate Reagan: Welfare Cadillac - Stonewall Jackson
posted by The Card Cheat at 9:30 AM on December 20, 2010
These myths predate Reagan: Welfare Cadillac - Stonewall Jackson
posted by The Card Cheat at 9:30 AM on December 20, 2010
> I can assure you that garbage men do not get a "gold-plated retirement," nor do "young black bucks" and "welfare queens" use their
> food stamps for T-bone steaks.
>
> Seriously mate, Zombie Reagan just called me up to let you know that even he doesn't spout this type of Randian bullshit any longer.
> Because it' both stupid and pathetic.
posted by bardic at 11:30 AM on December 20 [+] [!]
bardic, this construction of yours really looks like you're calling out MattD for using the phrases "gold-plated retirement," "young black bucks," and "welfare queens." Let's you make it clear that nobody has said anything about black bucks or welfare queens but you, OK?
posted by jfuller at 9:32 AM on December 20, 2010 [2 favorites]
> food stamps for T-bone steaks.
>
> Seriously mate, Zombie Reagan just called me up to let you know that even he doesn't spout this type of Randian bullshit any longer.
> Because it' both stupid and pathetic.
posted by bardic at 11:30 AM on December 20 [+] [!]
bardic, this construction of yours really looks like you're calling out MattD for using the phrases "gold-plated retirement," "young black bucks," and "welfare queens." Let's you make it clear that nobody has said anything about black bucks or welfare queens but you, OK?
posted by jfuller at 9:32 AM on December 20, 2010 [2 favorites]
Okay, but firefighters do have to risk their lives from time to time when doing their jobs. It seems like something that would be hard to put a value to, but I would expect to be paid a premium for that. People get paid much more to push money around and proofread legal documents..
Cops have it safe compared to electricians risking their lives every day, going by the figures of how many are killed on the job. (Well, I exaggerate, cops are slightly safer, not much more so). Risk should be compensated, but we (or the cruel invisible hand) should be consistent about it, and we have a wider range of similarly risky careers out there than perhaps many people realise. And I think the consensus of that context is that the risk premium isn't all that high :-/
posted by -harlequin- at 9:45 AM on December 20, 2010
Cops have it safe compared to electricians risking their lives every day, going by the figures of how many are killed on the job. (Well, I exaggerate, cops are slightly safer, not much more so). Risk should be compensated, but we (or the cruel invisible hand) should be consistent about it, and we have a wider range of similarly risky careers out there than perhaps many people realise. And I think the consensus of that context is that the risk premium isn't all that high :-/
posted by -harlequin- at 9:45 AM on December 20, 2010
People get paid much more to push money around and proofread legal documents.
I don't get paid worth crap to do the latter.
posted by JanetLand at 9:53 AM on December 20, 2010
I don't get paid worth crap to do the latter.
posted by JanetLand at 9:53 AM on December 20, 2010
America is in the hole. This is the first shovel-full of dirt. It will be thrown on the face.
posted by weezy at 9:57 AM on December 20, 2010
posted by weezy at 9:57 AM on December 20, 2010
TACKSES AR BAD. NO NU TAKSES.
posted by Mental Wimp at 10:08 AM on December 20, 2010
posted by Mental Wimp at 10:08 AM on December 20, 2010
These myths predate Reagan: Welfare Cadillac - Stonewall Jackson
Yes, but Reagan was the first president to build his political philosophy on these myths.
posted by Mental Wimp at 10:10 AM on December 20, 2010
Yes, but Reagan was the first president to build his political philosophy on these myths.
posted by Mental Wimp at 10:10 AM on December 20, 2010
"I have a hard time believing this story. What does she do when you point out that she's choosing to pay 30% higher prices on everything she buys because she has to pay the price+interest? Does she just stick her fingers in her ears and say, "LALALANOT LISTENING!"? Does she claim she's happy to pay an extra $1,000 to get her furniture RIGHT NOW instead of waiting a month or two save the money to buy it in cash without interest?"
It's a little unclear. They're unwilling to spend the time to pay OFF the cards so they could buy with money they have now, when it means they have to put off buying stuff they want NOW. I mean, once you're in a credit hole, even when you make good money, you don't get out of it immediately. I mean, at this point, it would probably take them 2-3 years of belt-tightening and not buying toys to pay off the cards, and they're just used to making payments every month. They have around six computers for the two of them, plus a couple for the kid; they have lots of monthly subscriptions to online games and cable and things like that; they buy lots of expensive-but-arcane toys for their hobbies that then never get used. (Backyard wood-fired brick pizza oven. Not kidding.) I think they're just basically totally unwilling to confront their spending. I mean, it doesn't bother her that I don't spend all my money -- it bothers her that MY CAR IS TEN YEARS OLD and I don't get a loan to get a new one. It bothers her that my house is too small for us (and she's right, it's getting there) and I'm reluctant to get a new mortgage for a larger amount when I could qualify for one. It bothers her that my couch is ancient and ugly and I have free credit and won't buy a new one. If I had shiney new stuff she feels I need, I don't think my "available credit" would bother her so much.
I thought the fact that they IMMEDIATELY got rid of a car as soon as they paid it off and got a new one, also bought on credit, spoke volumes. The car was only five years old and ran fine. They could have driven it for another couple years and saved the payments and at least had a better down payment on the new one. But that's not what they do.
I absolutely assure you it's true. She kept accosting me for days every time she caught me outside with more suggestions of what I could put on my credit card that I "needed" because mine wasn't nice enough. It got very awkward.
Anyway, they have some other oddities. Their kid isn't allowed to play with kids who eat hotdogs, for one.
posted by Eyebrows McGee at 10:25 AM on December 20, 2010 [1 favorite]
It's a little unclear. They're unwilling to spend the time to pay OFF the cards so they could buy with money they have now, when it means they have to put off buying stuff they want NOW. I mean, once you're in a credit hole, even when you make good money, you don't get out of it immediately. I mean, at this point, it would probably take them 2-3 years of belt-tightening and not buying toys to pay off the cards, and they're just used to making payments every month. They have around six computers for the two of them, plus a couple for the kid; they have lots of monthly subscriptions to online games and cable and things like that; they buy lots of expensive-but-arcane toys for their hobbies that then never get used. (Backyard wood-fired brick pizza oven. Not kidding.) I think they're just basically totally unwilling to confront their spending. I mean, it doesn't bother her that I don't spend all my money -- it bothers her that MY CAR IS TEN YEARS OLD and I don't get a loan to get a new one. It bothers her that my house is too small for us (and she's right, it's getting there) and I'm reluctant to get a new mortgage for a larger amount when I could qualify for one. It bothers her that my couch is ancient and ugly and I have free credit and won't buy a new one. If I had shiney new stuff she feels I need, I don't think my "available credit" would bother her so much.
I thought the fact that they IMMEDIATELY got rid of a car as soon as they paid it off and got a new one, also bought on credit, spoke volumes. The car was only five years old and ran fine. They could have driven it for another couple years and saved the payments and at least had a better down payment on the new one. But that's not what they do.
I absolutely assure you it's true. She kept accosting me for days every time she caught me outside with more suggestions of what I could put on my credit card that I "needed" because mine wasn't nice enough. It got very awkward.
Anyway, they have some other oddities. Their kid isn't allowed to play with kids who eat hotdogs, for one.
posted by Eyebrows McGee at 10:25 AM on December 20, 2010 [1 favorite]
Eyebrows McGee: "We're paying you to work for 30 years, then paying you 80% of that cost to NOT work for 30 MORE years, plus possibly paying for your retirement healthcare costs. That's simply unsustainable."
Currently a public employee, and the grandson of public employees, so the following is obviously biased, but: simply stating "that's simply unsusttainable " is not convincing evidence.
Don't get me wrong, KPERS is facing trouble, but it's not some actuarial surprise of longevity, but rather fiscal and political. Let me offer some facts regarding KPERS, conflicting and unusual:
1. KPERS assumes a long term market return of 8 percent. I think this is pretty aggressive / optimistic.
2. For a number of years prior to 2009, KPERS was paying retirees "13th checks". Because it was doing so well in the markets.
3. Since 2008, the fund is now some 8 billion in the hole, as a direct result of poor market performance.
4. The average KPERS check is 990 a month. By your numbers, that's basically $350k per lifetime in payments, ignoring time discount. Not a particularly large pension. My Board of Regents 403b will have roughly twice that by the time I retire.
5. Via the above link, the state has not properly funded it's own liabilities for over a decade.
The money is there, but it's been poorly managed and management itself has been poorly managed.
posted by pwnguin at 10:26 AM on December 20, 2010
Currently a public employee, and the grandson of public employees, so the following is obviously biased, but: simply stating "that's simply unsusttainable " is not convincing evidence.
Don't get me wrong, KPERS is facing trouble, but it's not some actuarial surprise of longevity, but rather fiscal and political. Let me offer some facts regarding KPERS, conflicting and unusual:
1. KPERS assumes a long term market return of 8 percent. I think this is pretty aggressive / optimistic.
2. For a number of years prior to 2009, KPERS was paying retirees "13th checks". Because it was doing so well in the markets.
3. Since 2008, the fund is now some 8 billion in the hole, as a direct result of poor market performance.
4. The average KPERS check is 990 a month. By your numbers, that's basically $350k per lifetime in payments, ignoring time discount. Not a particularly large pension. My Board of Regents 403b will have roughly twice that by the time I retire.
5. Via the above link, the state has not properly funded it's own liabilities for over a decade.
The money is there, but it's been poorly managed and management itself has been poorly managed.
posted by pwnguin at 10:26 AM on December 20, 2010
You know, as one of these horrible evil state workers who supposedly is robbing everyone blind... bite me.
I'm looking at a 3% pay cut with the next state budget. I haven't had a pay raise since 2008, while my health care premium has doubled during that time. In the next state budget, I'm looking at a 40% increase in health care premiums just from the state paying less into the system.
You're looking at 5% of the population of metro Seattle taking a 3% pay cut and a giant kick in the groin from the state health care system. If 5% of the town curbs their discretionary spending by 3% of their take home, what do you think will happen to the local economy? What happens when the lack of sales tax revenue leads the state to slash worker pay even more?
And keep in mind that government workers, for as much as people complain about their cushy pensions, generally make 70-75% of what they could make in the private sector. In times of recession, people run to government jobs for security, but they run back out the moment there's any sign of economic growth.
And the terrible pension system that's creating a $4B long term shortfall in the Washington budget? That's not about pensioners and greedy state workers. It's about legislatures continually raiding the pension fund to plug budget shortfalls for the last 30 years. It got so bad that all state workers now get an option of a defined plan that can't be raided (but pays much less than the original system) or a 403(b) the government matches with the same amount it deposits into the new pension system. Still, you have thousands of state workers retiring in the next 10 years, and there's no money to pay their guaranteed pensions backed by Full Faith And Credit, all because the last 20 legislatures have cost-shifted into the future, and now it's time to pay up.
I don't know I'm totally on board with Mutant's inflation thinking. The economy is going to have start moving up at a pace faster than a tortoise for that to really happen, and I'm feeling that what we're seeing in commodities are what we saw with oil in 2008 -- a bubble that will inflate and pop the moment Goldman decides it's time to get out. Everyone needs a place to stash their money, but artificial price increases always result in insanity, anger, and then the music stops on the musical chairs and the little investor gets screwed.
But at the same time, I can't help but look at what he's saying and thinking we're in for short-term stagflation. The economy wants to grow, but something's holding it back. And the increase in commodity prices suggests the institutional investors want it to grow and grow now. Until the block breaks, we'll just have a string of short-term bubbles. After the wheat bubble pops, then where does the money go? Or gold? Wow, gold is really, really out of whack right now.
But what that means is prices are going to rise in very irregular ways while wages continue to decrease or hold steady. Total stagflation. So the Fed will have to choose between capital destruction or capital expansion, and either way, there be dragons.
And to tie all this together... the easiest way to get demand up would be Keynesian spending. For example, the Feds shoveling money to the states to pay workers and backstop the indigent health care system. But there are too many Hayek readers in Washington right now. And after 80 years of Keynesian theory combined with all this idiotic cost-shifting on every level, you can't just cut the cord and let the system crash. And that's why the GOP and Dems chose in September 2008 to swallow hard and go with the bailouts. Letting the system go would have led to the GOP being wiped clean off the map and the Dems having to recover from 20% unemployment and a global depression. They may all sound like Ron Paul now, but they know what gets them returned to Washington every election.
posted by dw at 10:27 AM on December 20, 2010 [12 favorites]
I'm looking at a 3% pay cut with the next state budget. I haven't had a pay raise since 2008, while my health care premium has doubled during that time. In the next state budget, I'm looking at a 40% increase in health care premiums just from the state paying less into the system.
You're looking at 5% of the population of metro Seattle taking a 3% pay cut and a giant kick in the groin from the state health care system. If 5% of the town curbs their discretionary spending by 3% of their take home, what do you think will happen to the local economy? What happens when the lack of sales tax revenue leads the state to slash worker pay even more?
And keep in mind that government workers, for as much as people complain about their cushy pensions, generally make 70-75% of what they could make in the private sector. In times of recession, people run to government jobs for security, but they run back out the moment there's any sign of economic growth.
And the terrible pension system that's creating a $4B long term shortfall in the Washington budget? That's not about pensioners and greedy state workers. It's about legislatures continually raiding the pension fund to plug budget shortfalls for the last 30 years. It got so bad that all state workers now get an option of a defined plan that can't be raided (but pays much less than the original system) or a 403(b) the government matches with the same amount it deposits into the new pension system. Still, you have thousands of state workers retiring in the next 10 years, and there's no money to pay their guaranteed pensions backed by Full Faith And Credit, all because the last 20 legislatures have cost-shifted into the future, and now it's time to pay up.
I don't know I'm totally on board with Mutant's inflation thinking. The economy is going to have start moving up at a pace faster than a tortoise for that to really happen, and I'm feeling that what we're seeing in commodities are what we saw with oil in 2008 -- a bubble that will inflate and pop the moment Goldman decides it's time to get out. Everyone needs a place to stash their money, but artificial price increases always result in insanity, anger, and then the music stops on the musical chairs and the little investor gets screwed.
But at the same time, I can't help but look at what he's saying and thinking we're in for short-term stagflation. The economy wants to grow, but something's holding it back. And the increase in commodity prices suggests the institutional investors want it to grow and grow now. Until the block breaks, we'll just have a string of short-term bubbles. After the wheat bubble pops, then where does the money go? Or gold? Wow, gold is really, really out of whack right now.
But what that means is prices are going to rise in very irregular ways while wages continue to decrease or hold steady. Total stagflation. So the Fed will have to choose between capital destruction or capital expansion, and either way, there be dragons.
And to tie all this together... the easiest way to get demand up would be Keynesian spending. For example, the Feds shoveling money to the states to pay workers and backstop the indigent health care system. But there are too many Hayek readers in Washington right now. And after 80 years of Keynesian theory combined with all this idiotic cost-shifting on every level, you can't just cut the cord and let the system crash. And that's why the GOP and Dems chose in September 2008 to swallow hard and go with the bailouts. Letting the system go would have led to the GOP being wiped clean off the map and the Dems having to recover from 20% unemployment and a global depression. They may all sound like Ron Paul now, but they know what gets them returned to Washington every election.
posted by dw at 10:27 AM on December 20, 2010 [12 favorites]
Oh, I did ask her why she didn't go "room-at-a-time" on the furniture, and she said she hated living in a house with so many empty rooms, it just felt weird, and she'd rather just get it all done at once, and it's not like they could have people over if they didn't have furniture! They don't ever have people over anyway, but that seemed beside the point.
posted by Eyebrows McGee at 10:28 AM on December 20, 2010
posted by Eyebrows McGee at 10:28 AM on December 20, 2010
Has anyone said it yet?
"I love the smell of deficits in the morning!"
posted by mmrtnt at 10:29 AM on December 20, 2010
"I love the smell of deficits in the morning!"
posted by mmrtnt at 10:29 AM on December 20, 2010
The economy wants to grow, but something's holding it back.
Consumer spending. Between high unemployment, the shutting down of the house-as-ATM, and people reducing consumer credit, you create a significant reduction in demand. Lower demand drops prices, discouraging suppliers, thus decreasing supply. Decreased supply needs less labor to meet, thus....
Commercial credit isn't the answer -- rates are cheap-to-free, and there's money aplenty out there. Indeed, many companies are sitting on stacks of cash, or using that to repurchase outstanding stock. They're not going to expand production until there's an increase in demand.
If you think there's a bit of a feedback problem here -- you are right.
posted by eriko at 10:32 AM on December 20, 2010
Consumer spending. Between high unemployment, the shutting down of the house-as-ATM, and people reducing consumer credit, you create a significant reduction in demand. Lower demand drops prices, discouraging suppliers, thus decreasing supply. Decreased supply needs less labor to meet, thus....
Commercial credit isn't the answer -- rates are cheap-to-free, and there's money aplenty out there. Indeed, many companies are sitting on stacks of cash, or using that to repurchase outstanding stock. They're not going to expand production until there's an increase in demand.
If you think there's a bit of a feedback problem here -- you are right.
posted by eriko at 10:32 AM on December 20, 2010
Their kid isn't allowed to play with kids who eat hotdogs, for one.
they must be discordians
posted by pyramid termite at 10:32 AM on December 20, 2010 [2 favorites]
they must be discordians
posted by pyramid termite at 10:32 AM on December 20, 2010 [2 favorites]
Okay, but firefighters do have to risk their lives from time to time when doing their jobs. It seems like something that would be hard to put a value to, but I would expect to be paid a premium for that.
Loggers and fishermen have far greater risks of death & dismemberment but you don't see people queuing up to pin medals on their chests or call them heroes for doing their job.
posted by Civil_Disobedient at 10:37 AM on December 20, 2010
Loggers and fishermen have far greater risks of death & dismemberment but you don't see people queuing up to pin medals on their chests or call them heroes for doing their job.
posted by Civil_Disobedient at 10:37 AM on December 20, 2010
Meanwhile, in North Dakota, which got itself a State Bank after a popular uprising, is running a nice surplus. Has a record number of employed, with a 3.8% unemployment rate, and the fast growing economy in the US.
On the other hand, it's near the bottom in personal income, dead last in retirement income, and one fucking boring place to live ... unless you're in love with sunflowers.
posted by Twang at 10:38 AM on December 20, 2010 [1 favorite]
On the other hand, it's near the bottom in personal income, dead last in retirement income, and one fucking boring place to live ... unless you're in love with sunflowers.
posted by Twang at 10:38 AM on December 20, 2010 [1 favorite]
Loggers and fishermen have far greater risks of death & dismemberment but you don't see people queuing up to pin medals on their chests or call them heroes for doing their job.
I didn't say anything about medals, but lots of jobs in the private sector also pay a premium based on risk, including Alaskan fishing jobs. All I was saying was that dangerous jobs in general tend to pay a premium when the job involves risk and I think that makes sense. If there are dangerous jobs that don't pay a premium, that doesn't make sense to me.
posted by snofoam at 10:43 AM on December 20, 2010
I didn't say anything about medals, but lots of jobs in the private sector also pay a premium based on risk, including Alaskan fishing jobs. All I was saying was that dangerous jobs in general tend to pay a premium when the job involves risk and I think that makes sense. If there are dangerous jobs that don't pay a premium, that doesn't make sense to me.
posted by snofoam at 10:43 AM on December 20, 2010
The economy wants to grow, but something's holding it back.
Unemployment.
The national jobless rate edged up by 0.2 percentage point between October and November to 9.8 percent, but was little different from a year earlier.
The stimulus wasn't big enough, and what money was spent was held hostage by extraordinary partisan politics.
We had 10 years of war, and it's likely to be followed by a Lost Decade-type period that will actually last only about one more year. Fingers crossed. ;-)
posted by Cool Papa Bell at 10:46 AM on December 20, 2010
Unemployment.
The national jobless rate edged up by 0.2 percentage point between October and November to 9.8 percent, but was little different from a year earlier.
The stimulus wasn't big enough, and what money was spent was held hostage by extraordinary partisan politics.
We had 10 years of war, and it's likely to be followed by a Lost Decade-type period that will actually last only about one more year. Fingers crossed. ;-)
posted by Cool Papa Bell at 10:46 AM on December 20, 2010
Paying cops less leads (theoretically) to more thuggish and extortionary cops.
posted by a robot made out of meat at 10:49 AM on December 20, 2010 [1 favorite]
posted by a robot made out of meat at 10:49 AM on December 20, 2010 [1 favorite]
It's a shame you don't have any teachers, fire-fighters, or cops in your family or circle of friends.
You realize, I'm sure, that not every government employee fits into this category.
One of the most irritating things about the last election cycle was the constant martyring of what I think of as the Big Three (teachers, cops/firefighters and nurses).
There are plenty of ... less than essential government jobs out there that could be reduced or eliminated , but if the conversation always devolves into "OMG, why do you hate the children" then we'll never get anywhere.
posted by madajb at 10:58 AM on December 20, 2010
You realize, I'm sure, that not every government employee fits into this category.
One of the most irritating things about the last election cycle was the constant martyring of what I think of as the Big Three (teachers, cops/firefighters and nurses).
There are plenty of ... less than essential government jobs out there that could be reduced or eliminated , but if the conversation always devolves into "OMG, why do you hate the children" then we'll never get anywhere.
posted by madajb at 10:58 AM on December 20, 2010
Yep, a triple tax free municipal bond fund yielding more than comparable US treasuries.
Here's what I, Joe Layman, don't understand. This is Vanguard's New York Tax-Exempt Money Market Fund, which invests in NY municipal securities. Historically, it's returned about 2%. Currently, it's returning 0.12%. If municipal securities are riskier than they were a couple of years ago, why is it returning so much less?
posted by Combustible Edison Lighthouse at 11:02 AM on December 20, 2010
Here's what I, Joe Layman, don't understand. This is Vanguard's New York Tax-Exempt Money Market Fund, which invests in NY municipal securities. Historically, it's returned about 2%. Currently, it's returning 0.12%. If municipal securities are riskier than they were a couple of years ago, why is it returning so much less?
posted by Combustible Edison Lighthouse at 11:02 AM on December 20, 2010
Which I'm fine with, but what's unsustainable is the pensions.
Nope. They're eminently sustainable. All you have to do is, between the worker and employer, make contributions to the pension fund that will in expectation provide the the required income stream. It's so far from rocket science that it's not even funny.
As pwnguin notes, these are not, in the grand scheme of things, particularly large sums that need to be accrued before retirement. His numbers make it sound even worse than it is, because you don't need the full amount of someone's check when they're 80 when they notionally retire at 52: you only need an amount that can be expected to grow, over 30 years of compounding, into the required amount.
All you need to do is set aside the required contributions, somewhere between the employee and employer, and not fuck with them. Both of these turn out to be difficult; states often don't want to set anything aside now because people vote now. States would often rather just not fund things and leave it to legislators and citizens 30 years from now to worry about. And of course states can find it difficult to avoid the temptation to monkey around with the retirement funds, since they're often very large. $132B here in NY.
posted by ROU_Xenophobe at 11:06 AM on December 20, 2010 [1 favorite]
Nope. They're eminently sustainable. All you have to do is, between the worker and employer, make contributions to the pension fund that will in expectation provide the the required income stream. It's so far from rocket science that it's not even funny.
As pwnguin notes, these are not, in the grand scheme of things, particularly large sums that need to be accrued before retirement. His numbers make it sound even worse than it is, because you don't need the full amount of someone's check when they're 80 when they notionally retire at 52: you only need an amount that can be expected to grow, over 30 years of compounding, into the required amount.
All you need to do is set aside the required contributions, somewhere between the employee and employer, and not fuck with them. Both of these turn out to be difficult; states often don't want to set anything aside now because people vote now. States would often rather just not fund things and leave it to legislators and citizens 30 years from now to worry about. And of course states can find it difficult to avoid the temptation to monkey around with the retirement funds, since they're often very large. $132B here in NY.
posted by ROU_Xenophobe at 11:06 AM on December 20, 2010 [1 favorite]
Florida has the lowest number of state employees per capita in the nation; it also pays state employees less than any other state on average.
And yet, our billionaire Republican Governor Elect swept into office with promises to cut the workforce further in large numbers, including cutting the prison budget by 40% (and increasing privatization of the prison industry), and drastically expanding programs that redirect public school funding from the public school system into private and for-profit programs when Florida already has one of the largest private and charter school systems and yet still finds itself somewhere in the 40th place range in terms of academic performance.
Florida has been almost exclusively under Republican control for over 15 years, and in that time, with increasing deregulation, we've seen our entire real estate market collapse under the weight of massive amounts of systemic fraud largely due to state regulatory cut-backs and relaxed regulatory and enforcement standards that Republicans have championed. We've also seen massive property tax cuts that, far from stimulating our local economies, have only contributed to mounting and unprecedented revenue deficits, further contributing to economic decline as the stimulatory effects of state services are blunted.
"Shrinking" the government (as nonsensical and misplaced as that figure of speech is in the first place) is not the solution, it's the problem. Period.
posted by saulgoodman at 11:08 AM on December 20, 2010 [6 favorites]
And yet, our billionaire Republican Governor Elect swept into office with promises to cut the workforce further in large numbers, including cutting the prison budget by 40% (and increasing privatization of the prison industry), and drastically expanding programs that redirect public school funding from the public school system into private and for-profit programs when Florida already has one of the largest private and charter school systems and yet still finds itself somewhere in the 40th place range in terms of academic performance.
Florida has been almost exclusively under Republican control for over 15 years, and in that time, with increasing deregulation, we've seen our entire real estate market collapse under the weight of massive amounts of systemic fraud largely due to state regulatory cut-backs and relaxed regulatory and enforcement standards that Republicans have championed. We've also seen massive property tax cuts that, far from stimulating our local economies, have only contributed to mounting and unprecedented revenue deficits, further contributing to economic decline as the stimulatory effects of state services are blunted.
"Shrinking" the government (as nonsensical and misplaced as that figure of speech is in the first place) is not the solution, it's the problem. Period.
posted by saulgoodman at 11:08 AM on December 20, 2010 [6 favorites]
Here's what I, Joe Layman, don't understand. This is Vanguard's New York Tax-Exempt Money Market Fund, which invests in NY municipal securities. Historically, it's returned about 2%. Currently, it's returning 0.12%. If municipal securities are riskier than they were a couple of years ago, why is it returning so much less?
(massive oversimplification)
There are two components to return for a bond fund - the Risk free rate and the level of credit risk the fund takes. In the case of this fund the holdings are all very short duration (40 days) which means credit risk is very low, so you are unlikely to see the impact of a decline in the perceived creditworthiness of issuing municipalities. The reason why the yield has declined is due to the change in the risk free rate.
posted by JPD at 11:12 AM on December 20, 2010
(massive oversimplification)
There are two components to return for a bond fund - the Risk free rate and the level of credit risk the fund takes. In the case of this fund the holdings are all very short duration (40 days) which means credit risk is very low, so you are unlikely to see the impact of a decline in the perceived creditworthiness of issuing municipalities. The reason why the yield has declined is due to the change in the risk free rate.
posted by JPD at 11:12 AM on December 20, 2010
There are plenty of ... less than essential government jobs out there that could be reduced or eliminated , but if the conversation always devolves into "OMG, why do you hate the children" then we'll never get anywhere.
Name a few.
posted by notyou at 11:14 AM on December 20, 2010
Name a few.
posted by notyou at 11:14 AM on December 20, 2010
1. KPERS assumes a long term market return of 8 percent. I think this is pretty aggressive / optimistic.
Could be worse, the Oregon system guaranteed it. heh.
posted by madajb at 11:21 AM on December 20, 2010
Could be worse, the Oregon system guaranteed it. heh.
posted by madajb at 11:21 AM on December 20, 2010
Combustible Edison Lighthouse: " Currently, it's returning 0.12%. If municipal securities are riskier than they were a couple of years ago, why is it returning so much less?"
Comparative advantage. When the subprime mess fell upon us, money manaegrs stopped buying CDOs and moved to safer, less risky investments. Moreover, every time their existing holdings were downgraded, they're required to divest and buy "safe" assets. As risky as muni bonds are, the alternatives are assumed to be that much worse. But .12% still paying a risk penalty relative to the Treasuries, which seem to defy me every time I think "they can't go much lower than that": 3 month Tbills are trading at .08%
Also, don't forget that the tax incentives should result in lower rates, since 2 percent tax free is the same return as 3 percent with a 33 percent tax.
posted by pwnguin at 11:25 AM on December 20, 2010
Comparative advantage. When the subprime mess fell upon us, money manaegrs stopped buying CDOs and moved to safer, less risky investments. Moreover, every time their existing holdings were downgraded, they're required to divest and buy "safe" assets. As risky as muni bonds are, the alternatives are assumed to be that much worse. But .12% still paying a risk penalty relative to the Treasuries, which seem to defy me every time I think "they can't go much lower than that": 3 month Tbills are trading at .08%
Also, don't forget that the tax incentives should result in lower rates, since 2 percent tax free is the same return as 3 percent with a 33 percent tax.
posted by pwnguin at 11:25 AM on December 20, 2010
As far as I can tell, the only government employees who are overpaid are the ones who are responsible for legislating their own salaries.
posted by Faint of Butt at 11:33 AM on December 20, 2010 [3 favorites]
posted by Faint of Butt at 11:33 AM on December 20, 2010 [3 favorites]
"Paying cops less leads (theoretically) to more thuggish and extortionary cops."
Perhaps we could fund police departments based on the drug money or (even better) the white collar crime money that they seize? (Allowing for due process, of course, to avoid a formalized extortion racket.) Let them earn their own shiny new LED lights.
Call it, I dunno, No Cop Left Behind.
posted by rokusan at 11:38 AM on December 20, 2010
Perhaps we could fund police departments based on the drug money or (even better) the white collar crime money that they seize? (Allowing for due process, of course, to avoid a formalized extortion racket.) Let them earn their own shiny new LED lights.
Call it, I dunno, No Cop Left Behind.
posted by rokusan at 11:38 AM on December 20, 2010
Perhaps we could fund police departments based on the drug money or (even better) the white collar crime money that they seize? (Allowing for due process, of course, to avoid a formalized extortion racket.)
We've been doing that with drug money for 20 years now in the US. I refer you to the Tulia drug bust case for an idea of some of the problems with the policy.
posted by immlass at 11:52 AM on December 20, 2010
We've been doing that with drug money for 20 years now in the US. I refer you to the Tulia drug bust case for an idea of some of the problems with the policy.
posted by immlass at 11:52 AM on December 20, 2010
I feel like I have a drunk uncle who is on his fifth DUI. He's calling me from jail asking to bail him out again.
I feel a family obligation... so I do it.
On the way home he asks me to stop at the liquor store....
posted by Bighappyfunhouse at 12:07 PM on December 20, 2010
I feel a family obligation... so I do it.
On the way home he asks me to stop at the liquor store....
posted by Bighappyfunhouse at 12:07 PM on December 20, 2010
Name a few.
Well, I can only speak from my own City's experiences but:
1) We have a 52.25 FTE IT department for a 1467 FTE City.
Given the IT needs of the city, this is excessive.
2) We have a Health & Fitness Director whom we pay over $60k. Since the City is self-insured, this could make sense, but given that the health plan is third-party administered, are we duplicating services?
3) We have both a City spokesperson and a Fire/EMS spokesperson. There really isn't that much news generated every day.
Now, I fully admit that these come with my own biases, but when cost-cutting immediately devolves into an argument about schools or police, then nothing useful gets accomplished.
posted by madajb at 12:37 PM on December 20, 2010
Well, I can only speak from my own City's experiences but:
1) We have a 52.25 FTE IT department for a 1467 FTE City.
Given the IT needs of the city, this is excessive.
2) We have a Health & Fitness Director whom we pay over $60k. Since the City is self-insured, this could make sense, but given that the health plan is third-party administered, are we duplicating services?
3) We have both a City spokesperson and a Fire/EMS spokesperson. There really isn't that much news generated every day.
Now, I fully admit that these come with my own biases, but when cost-cutting immediately devolves into an argument about schools or police, then nothing useful gets accomplished.
posted by madajb at 12:37 PM on December 20, 2010
Thanks JPD and pwnguin. I'm still mystified as to where to put shorter term cash, but I suppose I should just be grateful to have it at this point.
posted by Combustible Edison Lighthouse at 12:53 PM on December 20, 2010
posted by Combustible Edison Lighthouse at 12:53 PM on December 20, 2010
You probably know nothing about the IT needs of the city--but either way, the city is not the state is not the Federal government. They all have their own authority. Many city budgets don't even run into the millions. City governments in general are not at all these massive, byzantine bureaucracies you're suggesting.
The IT needs of the state, on the other hand, are not discretionary in many cases due to Federal reporting requirements and the due to massive data collection and analysis functions state governmental entities routinely perform. The modern state government's functions are inextricably connected to and dependent on IT systems.
The problem IMO is that many ordinary Americans (especially in rural areas) and the politicians who represent them don't truly understand how these governmental entities work, and fail to grasp what the limits of their power are and what their legally obliged duties and functions are.
Often, if you haven't personally experienced a thing, you can't truly imagine it.
So, many people simply can't imagine what it is these various governmental entities do all the time, and the public's imagination is more than ready to fill in the breech (especially when egged on in their feverish imaginings by the ever-present propagandist of the right). But these facts do not imply that these various governmental entities aren't fulfilling vital public functions. For instance, many people aren't even aware of what storm water treatment services are, and yet, that doesn't mean those aren't essential services. The public's situational ignorance or frequent tendency to undervalue the many indispensable services provided by entities at different levels of government does nothing to diminish the real-world necessity for many of those undervalued functions.
posted by saulgoodman at 12:57 PM on December 20, 2010 [2 favorites]
The IT needs of the state, on the other hand, are not discretionary in many cases due to Federal reporting requirements and the due to massive data collection and analysis functions state governmental entities routinely perform. The modern state government's functions are inextricably connected to and dependent on IT systems.
The problem IMO is that many ordinary Americans (especially in rural areas) and the politicians who represent them don't truly understand how these governmental entities work, and fail to grasp what the limits of their power are and what their legally obliged duties and functions are.
Often, if you haven't personally experienced a thing, you can't truly imagine it.
So, many people simply can't imagine what it is these various governmental entities do all the time, and the public's imagination is more than ready to fill in the breech (especially when egged on in their feverish imaginings by the ever-present propagandist of the right). But these facts do not imply that these various governmental entities aren't fulfilling vital public functions. For instance, many people aren't even aware of what storm water treatment services are, and yet, that doesn't mean those aren't essential services. The public's situational ignorance or frequent tendency to undervalue the many indispensable services provided by entities at different levels of government does nothing to diminish the real-world necessity for many of those undervalued functions.
posted by saulgoodman at 12:57 PM on December 20, 2010 [2 favorites]
Perhaps we could fund police departments based on the drug money or (even better) the white collar crime money that they seize?
Such laws already exist. It's called asset forfeiture. And you don't even have to be found guilty of anything for the cops to keep everything. Profit!
posted by Thorzdad at 1:05 PM on December 20, 2010
Such laws already exist. It's called asset forfeiture. And you don't even have to be found guilty of anything for the cops to keep everything. Profit!
posted by Thorzdad at 1:05 PM on December 20, 2010
@ROU_Xenophobe: "All you have to do is, between the worker and employer, make contributions to the pension fund that will in expectation provide the the required income stream."
Maybe it's different where you are, but when I pay my local property tax bill, I pay more into pension funds than I pay for current employees, services, AND buildings/grounds/maintenance. That seems unsustainable to me.
@jamaro: I can think of other examples too; we had friends struggling to pay their bills (recently out of school, new mortgage, unexpected expenses, etc.) who redid all of the floors in their house as hardwood on credit. They were barely affording groceries and somehow hardwood floors rose to the top of the "must have" list. (And their floors were fine before, I was there before and after.) I knew a retired woman who was going under and refused to take fewer than four vacations to Disney per year. "I'll cut anything, but not that!" Except of course she wouldn't cut anything else either.
posted by Eyebrows McGee at 1:10 PM on December 20, 2010
Maybe it's different where you are, but when I pay my local property tax bill, I pay more into pension funds than I pay for current employees, services, AND buildings/grounds/maintenance. That seems unsustainable to me.
@jamaro: I can think of other examples too; we had friends struggling to pay their bills (recently out of school, new mortgage, unexpected expenses, etc.) who redid all of the floors in their house as hardwood on credit. They were barely affording groceries and somehow hardwood floors rose to the top of the "must have" list. (And their floors were fine before, I was there before and after.) I knew a retired woman who was going under and refused to take fewer than four vacations to Disney per year. "I'll cut anything, but not that!" Except of course she wouldn't cut anything else either.
posted by Eyebrows McGee at 1:10 PM on December 20, 2010
Meanwhile, in North Dakota, which got itself a State Bank after a popular uprising, is running a nice surplus. Has a record number of employed, with a 3.8% unemployment rate, and the fast growing economy in the US.
On the other hand, it's near the bottom in personal income, dead last in retirement income, and one fucking boring place to live ... unless you're in love with sunflowers.
See, this is what I tell people: I moved from being a state employee in one of the states doing the Walk of Broke Ass Shame up there in the FPP to being a state employee in a state well off enough that I don't pay medical premiums (yup, socialist healthcare). I'll take the sunflowers over the beach, thank you.
I thought North Dakota was seeing an oil boom. Which raises an interesting question in terms of why the oil workers aren't getting paid jack
The oil workers I know are getting paid money hand over fist. Admittedly, most of the folks I meet are doing well enough to visit (to the side of the state that doesn't have oil). Also, try to get a hotel in Minot, Dickinson, or even Bismarck some nights and tell me there isn't a boom.
posted by librarylis at 1:11 PM on December 20, 2010
On the other hand, it's near the bottom in personal income, dead last in retirement income, and one fucking boring place to live ... unless you're in love with sunflowers.
See, this is what I tell people: I moved from being a state employee in one of the states doing the Walk of Broke Ass Shame up there in the FPP to being a state employee in a state well off enough that I don't pay medical premiums (yup, socialist healthcare). I'll take the sunflowers over the beach, thank you.
I thought North Dakota was seeing an oil boom. Which raises an interesting question in terms of why the oil workers aren't getting paid jack
The oil workers I know are getting paid money hand over fist. Admittedly, most of the folks I meet are doing well enough to visit (to the side of the state that doesn't have oil). Also, try to get a hotel in Minot, Dickinson, or even Bismarck some nights and tell me there isn't a boom.
posted by librarylis at 1:11 PM on December 20, 2010
Name a few.
Up here in Portland we hand out free money to poor people. We pay for apartments for homeless people. We give money to unemployed non-citizens.
Other cities actually bus their homeless and mentally ill to Portland. I mean this literally: they pay for one-way tickets and send them up here, instruct them on where to get free services, various pitfalls to avoid (for example, to qualify for aid you're not supposed to have a cell phone, because presumably if you can afford a cell phone you aren't destitute) so they instruct people to say that they're borrowing the phone from a friend. And that's just for starters.
The problem is that there's no easy way to bring up these rampant abuses without the lines quickly blurring (deliberately or ignorantly or both). If you bring up food stamp abuses the big-L liberals think you're planning class-o-cide on the homeless, but when you mention the long-term benefits of subsidizing mixed-income housing and your a Godless Commie bastard.
I think the real problem is that people are just too goddamned stupid.
posted by Civil_Disobedient at 1:13 PM on December 20, 2010 [3 favorites]
Up here in Portland we hand out free money to poor people. We pay for apartments for homeless people. We give money to unemployed non-citizens.
Other cities actually bus their homeless and mentally ill to Portland. I mean this literally: they pay for one-way tickets and send them up here, instruct them on where to get free services, various pitfalls to avoid (for example, to qualify for aid you're not supposed to have a cell phone, because presumably if you can afford a cell phone you aren't destitute) so they instruct people to say that they're borrowing the phone from a friend. And that's just for starters.
The problem is that there's no easy way to bring up these rampant abuses without the lines quickly blurring (deliberately or ignorantly or both). If you bring up food stamp abuses the big-L liberals think you're planning class-o-cide on the homeless, but when you mention the long-term benefits of subsidizing mixed-income housing and your a Godless Commie bastard.
I think the real problem is that people are just too goddamned stupid.
posted by Civil_Disobedient at 1:13 PM on December 20, 2010 [3 favorites]
The economy wants to grow, but something's holding it back.
Demographic shift, partly. There was a bubble of births post-WWII ("Baby Boomers"), with live births dropping off starting in the 60s, reaching a low in the early 70s and not rebounding till the late 70s or early 80s. This "Generation X" (the cursed gen) gets a lot of flak for being slackers, but mostly it's just that there are not that many of them, they can't keep up with the older generation. So now 40 some years later, when Gen X is at the peak of its productive years and the prior boomer/bubble generation is moving towards retirement, it is creating a vacuum - fewer taxes being paid, fewer opportunities being created. It's really predictable, just look at live-birth graphs from 40 years ago. Good news is the next generation after X is bigger than the boomers, the leading edge is in their late 20s now, so hopefully when they start coming into the workforce over the next decade we'll see a pickup in markets.
posted by stbalbach at 1:55 PM on December 20, 2010 [2 favorites]
Demographic shift, partly. There was a bubble of births post-WWII ("Baby Boomers"), with live births dropping off starting in the 60s, reaching a low in the early 70s and not rebounding till the late 70s or early 80s. This "Generation X" (the cursed gen) gets a lot of flak for being slackers, but mostly it's just that there are not that many of them, they can't keep up with the older generation. So now 40 some years later, when Gen X is at the peak of its productive years and the prior boomer/bubble generation is moving towards retirement, it is creating a vacuum - fewer taxes being paid, fewer opportunities being created. It's really predictable, just look at live-birth graphs from 40 years ago. Good news is the next generation after X is bigger than the boomers, the leading edge is in their late 20s now, so hopefully when they start coming into the workforce over the next decade we'll see a pickup in markets.
posted by stbalbach at 1:55 PM on December 20, 2010 [2 favorites]
There are plenty of ... less than essential government jobs out there that could be reduced or eliminated...
Name a few.
California has a mind-boggling array of state agencies and commissions with overlapping agendas and jurisdictions. It's is quite frankly bizarre.
Aging:
California Commission on Aging
California Department of Aging
Coastal conservation:
California Coastal Commission
California Coastal Conservancy
San Francisco Bay Conservation and Development Commission
Climate change:
California Air Resources Board
Cool California
California Climate Change Portal
I'm certain they all do good work and will not say, "Hey, we don't need to worry about the elderly, the beaches and the air."
But the idea that none of these agencies can't be at least consolidated and made more efficient is just as bizarre.
posted by Cool Papa Bell at 1:55 PM on December 20, 2010 [2 favorites]
Name a few.
California has a mind-boggling array of state agencies and commissions with overlapping agendas and jurisdictions. It's is quite frankly bizarre.
Aging:
California Commission on Aging
California Department of Aging
Coastal conservation:
California Coastal Commission
California Coastal Conservancy
San Francisco Bay Conservation and Development Commission
Climate change:
California Air Resources Board
Cool California
California Climate Change Portal
I'm certain they all do good work and will not say, "Hey, we don't need to worry about the elderly, the beaches and the air."
But the idea that none of these agencies can't be at least consolidated and made more efficient is just as bizarre.
posted by Cool Papa Bell at 1:55 PM on December 20, 2010 [2 favorites]
There are plenty of ... less than essential government jobs out there that could be reduced or eliminated , but if the conversation always devolves into "OMG, why do you hate the children" then we'll never get anywhere.
This is a textbook example of handwaving. Exactly which are these jobs? Every "waste and fraud" crier out there gives the same line, as though it were written by someone else, but they never seem to come with much beyond things that would save 0.001%.
posted by Mental Wimp at 2:03 PM on December 20, 2010
This is a textbook example of handwaving. Exactly which are these jobs? Every "waste and fraud" crier out there gives the same line, as though it were written by someone else, but they never seem to come with much beyond things that would save 0.001%.
posted by Mental Wimp at 2:03 PM on December 20, 2010
Maybe it's different where you are, but when I pay my local property tax bill, I pay more into pension funds than I pay for current employees, services, AND buildings/grounds/maintenance. That seems unsustainable to me.
But if your local property taxes are paying for municipal and county government, then they have not a single goddam thing to do with state budget shortfalls, state retirement systems, or state employee pension benefits.
And, yes, it's different where I am. State contributions to the state retirement systems are at very high levels now, but even those very high levels are still something like 1/9 of current salaries, not over 100% of them as you assert. Of course, the state doesn't pay 1/9 all the time; it made no or minimal contributions through much of the better times... which is of course part of the problem.
Reasonable pensions are easily affordable if, between the state and the employee, continuous sensible contributions are made and the fund isn't fucked around with. The primary reason you're seeing crap like this happen now is not that pensions aren't sustainable; it's the aftermath of decades of refusing to pay into the system what was well-known needed to be paid into it and decades of fucking around with the funds. The lesson isn't SLASH PENSIONS!!! The lesson is just to boringly fund them through good times and bad (or deduct from employees to make them do it, or some convex combination of both), and DON'T FUCK WITH THEM.
posted by ROU_Xenophobe at 2:06 PM on December 20, 2010
But if your local property taxes are paying for municipal and county government, then they have not a single goddam thing to do with state budget shortfalls, state retirement systems, or state employee pension benefits.
And, yes, it's different where I am. State contributions to the state retirement systems are at very high levels now, but even those very high levels are still something like 1/9 of current salaries, not over 100% of them as you assert. Of course, the state doesn't pay 1/9 all the time; it made no or minimal contributions through much of the better times... which is of course part of the problem.
Reasonable pensions are easily affordable if, between the state and the employee, continuous sensible contributions are made and the fund isn't fucked around with. The primary reason you're seeing crap like this happen now is not that pensions aren't sustainable; it's the aftermath of decades of refusing to pay into the system what was well-known needed to be paid into it and decades of fucking around with the funds. The lesson isn't SLASH PENSIONS!!! The lesson is just to boringly fund them through good times and bad (or deduct from employees to make them do it, or some convex combination of both), and DON'T FUCK WITH THEM.
posted by ROU_Xenophobe at 2:06 PM on December 20, 2010
There's absolutely no logic that can be absorbed there. I've tried to help and every thing I've said has hit a seamless wall of denial or maybe incomprehension but more denial I think. The only other time I've encountered it is when talking to alcoholics or people with a gambling problem.
Yes, I have a sister who is like this as well. They disconnect their financial problems from their acquisitiveness. She has very expensive tastes and can't imagine buying anything because it's cheaper. It has to cost a lot to be good.
That said, these are not the majority of people. They really are people with an affliction as you mention. They probably are no more than 10% of the population, but that's enough to cause a problem.
posted by Mental Wimp at 2:08 PM on December 20, 2010
Yes, I have a sister who is like this as well. They disconnect their financial problems from their acquisitiveness. She has very expensive tastes and can't imagine buying anything because it's cheaper. It has to cost a lot to be good.
That said, these are not the majority of people. They really are people with an affliction as you mention. They probably are no more than 10% of the population, but that's enough to cause a problem.
posted by Mental Wimp at 2:08 PM on December 20, 2010
But the idea that none of these agencies can't be at least consolidated and made more efficient is just as bizarre.
This is such a platitude though, it adds nothing to any deep understanding.
Of course, there are systems somewhere that could benefit from streamlining and other optimizations. There's no point in arguing something, it seems to me, that's not uniquely true now. Inefficiency and redundancy aren't always necessarily bad things. There's a lot of research that shows that systems with inefficiency and redundancy built-in are more robust and less failure prone than more nominally efficient systems.
There's also no shortage of systems that are stretched far beyond the limit, that can no longer adequately fulfill their functions because they've been left to atrophy without sufficient increases in staffing or operational funding.
To me, the idea that there aren't far more agencies out there that are chronically understaffed and underfunded, that can't even begin to adequately perform their core functions because they've been squeezed to death in the recent mad-rush to deregulate is the more bizarre idea. But then, I was around to watch, for instance, when Florida's Department of Insurance regulation was folded into its Division of Financial Services with many of its regulatory responsibilities weakened or abandoned in the process. So I'm coming at this from the perspective of someone who's been watching deregulation happen firsthand for close to a decade now.
posted by saulgoodman at 2:10 PM on December 20, 2010
This is such a platitude though, it adds nothing to any deep understanding.
Of course, there are systems somewhere that could benefit from streamlining and other optimizations. There's no point in arguing something, it seems to me, that's not uniquely true now. Inefficiency and redundancy aren't always necessarily bad things. There's a lot of research that shows that systems with inefficiency and redundancy built-in are more robust and less failure prone than more nominally efficient systems.
There's also no shortage of systems that are stretched far beyond the limit, that can no longer adequately fulfill their functions because they've been left to atrophy without sufficient increases in staffing or operational funding.
To me, the idea that there aren't far more agencies out there that are chronically understaffed and underfunded, that can't even begin to adequately perform their core functions because they've been squeezed to death in the recent mad-rush to deregulate is the more bizarre idea. But then, I was around to watch, for instance, when Florida's Department of Insurance regulation was folded into its Division of Financial Services with many of its regulatory responsibilities weakened or abandoned in the process. So I'm coming at this from the perspective of someone who's been watching deregulation happen firsthand for close to a decade now.
posted by saulgoodman at 2:10 PM on December 20, 2010
You probably know nothing about the IT needs of the city
I actually know quite a bit about it, but don't let me get in the way of your assumptions.
Many city budgets don't even run into the millions.
My City's budget for FY11 is just over 455 million.
City governments in general are not at all these massive, byzantine bureaucracies you're suggesting.
I was not suggesting any such thing. Merely that when it comes to budgeting, we always trot out the same sacred cows with the same entrenched positions.
But these facts do not imply that these various governmental entities aren't fulfilling vital public functions.
I work very closely with all levels of my City government in my role as a volunteer, including weekly meetings with some departments. These are not faceless bureaucrats to me. However, that does not preclude me from looking closely at their cost and necessity in a time of reduced funding.
posted by madajb at 2:11 PM on December 20, 2010
I actually know quite a bit about it, but don't let me get in the way of your assumptions.
Many city budgets don't even run into the millions.
My City's budget for FY11 is just over 455 million.
City governments in general are not at all these massive, byzantine bureaucracies you're suggesting.
I was not suggesting any such thing. Merely that when it comes to budgeting, we always trot out the same sacred cows with the same entrenched positions.
But these facts do not imply that these various governmental entities aren't fulfilling vital public functions.
I work very closely with all levels of my City government in my role as a volunteer, including weekly meetings with some departments. These are not faceless bureaucrats to me. However, that does not preclude me from looking closely at their cost and necessity in a time of reduced funding.
posted by madajb at 2:11 PM on December 20, 2010
I'm certain they all do good work and will not say, "Hey, we don't need to worry about the elderly, the beaches and the air."
But the idea that none of these agencies can't be at least consolidated and made more efficient is just as bizarre.
You're right, CPB, they could be made more efficient I'm sure. I've worked in a large private industry and am familiar with many for whom I've consulted. I've also worked in a large public university, and have consulted with both state and federal government agencies. You know what? They all have about the same amount of organizational waste. About 20% is deadwood. I'm not sure it's possible to get it below that if you're dealing with humans.
Of course, the Clinton administration did do some reorganization at the federal level that saved some money. The DOD wastes enormous sums daily and the DHS is almost a total waste of money, so I take it back. We could probably save some money. How big a slice, I have no idea.
posted by Mental Wimp at 2:12 PM on December 20, 2010 [1 favorite]
But the idea that none of these agencies can't be at least consolidated and made more efficient is just as bizarre.
You're right, CPB, they could be made more efficient I'm sure. I've worked in a large private industry and am familiar with many for whom I've consulted. I've also worked in a large public university, and have consulted with both state and federal government agencies. You know what? They all have about the same amount of organizational waste. About 20% is deadwood. I'm not sure it's possible to get it below that if you're dealing with humans.
Of course, the Clinton administration did do some reorganization at the federal level that saved some money. The DOD wastes enormous sums daily and the DHS is almost a total waste of money, so I take it back. We could probably save some money. How big a slice, I have no idea.
posted by Mental Wimp at 2:12 PM on December 20, 2010 [1 favorite]
I actually know quite a bit about it, but don't let me get in the way of your assumptions.
Well, I apologize for being short, but it's unfortunately common for people to make quick and lazy assumptions about IT issues they can't even begin to properly evaluate--especially among those most likely to lead the "shrink government" charge, who are frequently inclined to anoint themselves instant experts on every highly specialized and difficult subject under the sun when its politically advantageous.
That's a mighty big budget. Compared to my annual income. But any budget reckoned in the millions amounts to petty change compared to the state and Federal level. I just find it really hard to get worked up about city budgets as a general rule, but if that's what gets your goat, more power to you.
posted by saulgoodman at 2:23 PM on December 20, 2010
Well, I apologize for being short, but it's unfortunately common for people to make quick and lazy assumptions about IT issues they can't even begin to properly evaluate--especially among those most likely to lead the "shrink government" charge, who are frequently inclined to anoint themselves instant experts on every highly specialized and difficult subject under the sun when its politically advantageous.
That's a mighty big budget. Compared to my annual income. But any budget reckoned in the millions amounts to petty change compared to the state and Federal level. I just find it really hard to get worked up about city budgets as a general rule, but if that's what gets your goat, more power to you.
posted by saulgoodman at 2:23 PM on December 20, 2010
There's no point in arguing something, it seems to me, that's not uniquely true now.
The "name one" stance is a platitude, too. If you can save 10 percent ... well, isn't that 10 percent saved? It may not be a great thing, but how is this a bad thing?
I was around to watch, for instance, when Florida's Department of Insurance regulation was folded into its Division of Financial Services with many of its regulatory responsibilities weakened or abandoned in the process.
Consolidation does not equal abandonment of regulatory responsibilities. If it happens, it's incompetence or enemy action. But you don't solve that problem by keeping things separate. You only spend more money.
To me, the idea that there aren't far more agencies out there that are chronically understaffed and underfunded, that can't even begin to adequately perform their core functions because they've been squeezed to death in the recent mad-rush to deregulate is the more bizarre idea.
But there's a greater point being missed -- if there's no revenue coming in, regulation is not the answer. You'll have great regulation and still have understaffed agencies.
For decades, California has been losing business to Nevada and Arizona because of California's overall tax burden. Heck, the Vancouver film industry was created by California's over-regulation and tax burdens (and the cheap Canadian dollar ... but that exchange rate hasn't been true for years). New Mexico and Louisiana are following suit, drawing dollars away from film and television production because nimble film companies will always chase higher margins.
Now ... I'm not saying "ZOMG, California is taxed to death." Far from it. But if the California political climate, as a for example, lacks any kind of political will to even start making these kinds of decisions where they don't hurt, imagine how quickly they'll tackle the things that will hurt.
posted by Cool Papa Bell at 2:24 PM on December 20, 2010 [1 favorite]
The "name one" stance is a platitude, too. If you can save 10 percent ... well, isn't that 10 percent saved? It may not be a great thing, but how is this a bad thing?
I was around to watch, for instance, when Florida's Department of Insurance regulation was folded into its Division of Financial Services with many of its regulatory responsibilities weakened or abandoned in the process.
Consolidation does not equal abandonment of regulatory responsibilities. If it happens, it's incompetence or enemy action. But you don't solve that problem by keeping things separate. You only spend more money.
To me, the idea that there aren't far more agencies out there that are chronically understaffed and underfunded, that can't even begin to adequately perform their core functions because they've been squeezed to death in the recent mad-rush to deregulate is the more bizarre idea.
But there's a greater point being missed -- if there's no revenue coming in, regulation is not the answer. You'll have great regulation and still have understaffed agencies.
For decades, California has been losing business to Nevada and Arizona because of California's overall tax burden. Heck, the Vancouver film industry was created by California's over-regulation and tax burdens (and the cheap Canadian dollar ... but that exchange rate hasn't been true for years). New Mexico and Louisiana are following suit, drawing dollars away from film and television production because nimble film companies will always chase higher margins.
Now ... I'm not saying "ZOMG, California is taxed to death." Far from it. But if the California political climate, as a for example, lacks any kind of political will to even start making these kinds of decisions where they don't hurt, imagine how quickly they'll tackle the things that will hurt.
posted by Cool Papa Bell at 2:24 PM on December 20, 2010 [1 favorite]
This is a textbook example of handwaving. Exactly which are these jobs?
I listed 3. I'm not sure the Internet needs a detailed description on how to reduce my City's budget.
Every "waste and fraud" crier out there gives the same line, as though it were written by someone else, but they never seem to come with much beyond things that would save 0.001%.
Where did you get "waste and fraud" from?
It is possible to reduce my City's budget by probably 5% by eliminating things that are nice to have, but not essential*.
In fact, the "Doomsday" scenario could drop the budget by closer to 15%. Of course, at that point, you're down to services required by law and those that keep the lights on.
The point I'm trying to make, apparently poorly, is that there is slack to be found in most government entities, and spending a little time and effort to find it could make more money available for things we really need in an era of lessening revenue.
* In the opinion of the budget committee.
posted by madajb at 2:32 PM on December 20, 2010
I listed 3. I'm not sure the Internet needs a detailed description on how to reduce my City's budget.
Every "waste and fraud" crier out there gives the same line, as though it were written by someone else, but they never seem to come with much beyond things that would save 0.001%.
Where did you get "waste and fraud" from?
It is possible to reduce my City's budget by probably 5% by eliminating things that are nice to have, but not essential*.
In fact, the "Doomsday" scenario could drop the budget by closer to 15%. Of course, at that point, you're down to services required by law and those that keep the lights on.
The point I'm trying to make, apparently poorly, is that there is slack to be found in most government entities, and spending a little time and effort to find it could make more money available for things we really need in an era of lessening revenue.
* In the opinion of the budget committee.
posted by madajb at 2:32 PM on December 20, 2010
That's a mighty big budget. Compared to my annual income. But any budget reckoned in the millions amounts to petty change compared to the state and Federal level.
Sure, but you have to start somewhere, right? heh.
Besides, the City budget is a manageable 400 pages. I don't want to think what the state or federal ones are.
posted by madajb at 2:36 PM on December 20, 2010
Sure, but you have to start somewhere, right? heh.
Besides, the City budget is a manageable 400 pages. I don't want to think what the state or federal ones are.
posted by madajb at 2:36 PM on December 20, 2010
California has a mind-boggling array of state agencies and commissions with overlapping agendas and jurisdictions. It's is quite frankly bizarre.
Similarly IL; it's just astonishing the contempt that goes into government here.
On the other hand, every state and private university that I've been affiliated with was also a bit nuts and the large insurance firms that Ms. Vegetable worked for were also basket cases. It's difficult to be quantitative, and I think every office worker can tell the same story. How many and how expensive workers should it take to do the things done by some random office created partly to do a job and partly for control and patronage? How much are we willing to spend for auditors to go through every level of institution looking for make-work and consolidation opportunity? How do we keep those people honest?
posted by a robot made out of meat at 2:59 PM on December 20, 2010
Similarly IL; it's just astonishing the contempt that goes into government here.
On the other hand, every state and private university that I've been affiliated with was also a bit nuts and the large insurance firms that Ms. Vegetable worked for were also basket cases. It's difficult to be quantitative, and I think every office worker can tell the same story. How many and how expensive workers should it take to do the things done by some random office created partly to do a job and partly for control and patronage? How much are we willing to spend for auditors to go through every level of institution looking for make-work and consolidation opportunity? How do we keep those people honest?
posted by a robot made out of meat at 2:59 PM on December 20, 2010
saulgoodman: "You probably know nothing about the IT needs of the city--but either way, the city is not the state is not the Federal government. "
Are you the lone guy who's worked in govt IT believes they're operating efficiently or intelligently? I'm pretty sure most people can point to someone and say "what the hell do they do all day?" Partially, that's a visibility problem. At the very least, Oracle has a vice grip on the govt procurement process, and buys up anyone who beats them at it. The budget crunch is slowly opening eyes to cheaper alternatives, but certain Oracle certified employees aren't going to be happy about it.
And maybe this isn't universal, but it seems like the average staff:manager in the IT shops I've worked in, and the shops coworkers came from, was roughly 5:1. One guy from a IT dept serving mental health tole to me how that department's management went through several consultants in a row who all came back the same analysis: too many managers, not enough employees. 10:1 should be doable, and as a bonus it cuts the number of meetings in half, as there's fewer manager's schedules to fill!
posted by pwnguin at 3:25 PM on December 20, 2010
Are you the lone guy who's worked in govt IT believes they're operating efficiently or intelligently? I'm pretty sure most people can point to someone and say "what the hell do they do all day?" Partially, that's a visibility problem. At the very least, Oracle has a vice grip on the govt procurement process, and buys up anyone who beats them at it. The budget crunch is slowly opening eyes to cheaper alternatives, but certain Oracle certified employees aren't going to be happy about it.
And maybe this isn't universal, but it seems like the average staff:manager in the IT shops I've worked in, and the shops coworkers came from, was roughly 5:1. One guy from a IT dept serving mental health tole to me how that department's management went through several consultants in a row who all came back the same analysis: too many managers, not enough employees. 10:1 should be doable, and as a bonus it cuts the number of meetings in half, as there's fewer manager's schedules to fill!
posted by pwnguin at 3:25 PM on December 20, 2010
California's Budget by Agencies
Eliminate the Commission on Aging and you will save $439,000.
Now, my point isn't that the department is waste or essential, just that we have these linky thingies, and we can inform these discussions with specifics.
We've got this nice internet here, might as well use it.
posted by dglynn at 3:37 PM on December 20, 2010
Eliminate the Commission on Aging and you will save $439,000.
Now, my point isn't that the department is waste or essential, just that we have these linky thingies, and we can inform these discussions with specifics.
We've got this nice internet here, might as well use it.
posted by dglynn at 3:37 PM on December 20, 2010
Are you the lone guy who's worked in govt IT believes they're operating efficiently or intelligently?
I'm a private IT contractor, formerly a business analyst and currently a software developer, who has, among other things, helped orchestrate the elimination of whole state bureaus. Many of my colleagues and peers carry around a lot of cynical prejudices about the inefficiency and incompetence of government employees--but then, they are the competition, in a sense. Me, I've worked with some damn smart and hardworking people in state government, and think it's disgusting how quick people are to prejudge or dismiss public sector folks.
posted by saulgoodman at 6:38 PM on December 20, 2010 [2 favorites]
I'm a private IT contractor, formerly a business analyst and currently a software developer, who has, among other things, helped orchestrate the elimination of whole state bureaus. Many of my colleagues and peers carry around a lot of cynical prejudices about the inefficiency and incompetence of government employees--but then, they are the competition, in a sense. Me, I've worked with some damn smart and hardworking people in state government, and think it's disgusting how quick people are to prejudge or dismiss public sector folks.
posted by saulgoodman at 6:38 PM on December 20, 2010 [2 favorites]
To be clear, "helped orchestrate" in the sense of analyzing the organization's business processes and recommending steps to improve efficiency. I've never personally sought to eliminate a job.
posted by saulgoodman at 6:55 PM on December 20, 2010
posted by saulgoodman at 6:55 PM on December 20, 2010
"Loggers and fishermen have far greater risks of death & dismemberment but you don't see people queuing up to pin medals on their chests or call them heroes for doing their job."
Sure, but do they keep your kids from being abducted or your home from burning down or help your kid get into college or otherwise stay doomed to a blue collar or service job for the rest of her life?
Obviously there's waste in any system and cops and fire-fighters and teachers aren't exempt. But it's called "public service" for a reason.
This should be a point of pride and honor, not the veritable Scarlet Letter the GOP would like to turn it into.
posted by bardic at 7:13 PM on December 20, 2010 [1 favorite]
Sure, but do they keep your kids from being abducted or your home from burning down or help your kid get into college or otherwise stay doomed to a blue collar or service job for the rest of her life?
Obviously there's waste in any system and cops and fire-fighters and teachers aren't exempt. But it's called "public service" for a reason.
This should be a point of pride and honor, not the veritable Scarlet Letter the GOP would like to turn it into.
posted by bardic at 7:13 PM on December 20, 2010 [1 favorite]
cutting the prison budget by 40% (and increasing privatization of the prison industry),
That's bad news for Florida then.
For-profit incarceration winds up being a bad deal for everyone involved- the "cost savings" of privatized prisons are based on studies which are outdated, methodologically flawed, and tainted because the "researchers" conducting them are actually paid shills to the private correction industry. Plus, a guard is 49% more likely to be assaulted in a private prison (and an inmate is 65% more likely)- despite the fact that a state prison is 7 times more likely to house violent offenders than a private one. This is because they choose who they admit, and the picking and choosing of inmates also helps skew their cost analysis, since they don't take inmates with expensive chronic medical conditions.
Even with that, and the cut corners wrt substandard training, low wages, and low staff-to-inmate ratios; they still wind up costing more per inmate per day than a state prison- and that's not even counting the costs incurred by budget overruns, contract fraud, or financial & regulatory manipulation. They also make sure the contracts allow them to raise the per diem rates (the fee they charge the state per inmate per day) every year for the duration of the contract- with no upper limit.
Then too, the bigger the private prison industry gets in your state, the more power their lobbyist stooges at ALEC gain. ALEC helps pass laws and sentencing guidelines to keep the industry profitable- they were instrumental in getting AZ's new immigration bill passed, for example.
Additional info on private prisons and sources for the numbers are here.
posted by Hiding From Goro at 7:52 PM on December 20, 2010 [3 favorites]
That's bad news for Florida then.
For-profit incarceration winds up being a bad deal for everyone involved- the "cost savings" of privatized prisons are based on studies which are outdated, methodologically flawed, and tainted because the "researchers" conducting them are actually paid shills to the private correction industry. Plus, a guard is 49% more likely to be assaulted in a private prison (and an inmate is 65% more likely)- despite the fact that a state prison is 7 times more likely to house violent offenders than a private one. This is because they choose who they admit, and the picking and choosing of inmates also helps skew their cost analysis, since they don't take inmates with expensive chronic medical conditions.
Even with that, and the cut corners wrt substandard training, low wages, and low staff-to-inmate ratios; they still wind up costing more per inmate per day than a state prison- and that's not even counting the costs incurred by budget overruns, contract fraud, or financial & regulatory manipulation. They also make sure the contracts allow them to raise the per diem rates (the fee they charge the state per inmate per day) every year for the duration of the contract- with no upper limit.
Then too, the bigger the private prison industry gets in your state, the more power their lobbyist stooges at ALEC gain. ALEC helps pass laws and sentencing guidelines to keep the industry profitable- they were instrumental in getting AZ's new immigration bill passed, for example.
Additional info on private prisons and sources for the numbers are here.
posted by Hiding From Goro at 7:52 PM on December 20, 2010 [3 favorites]
CPB: "Heck, the Vancouver film industry was created by California's over-regulation and tax burdens (and the cheap Canadian dollar ... but that exchange rate hasn't been true for years)."
And Canadian private and state investment in film development had nothing to do with it. Not saying that the factors you mention aren't important, just that they didn't create the Vancouver film industry.
posted by sneebler at 10:03 PM on December 20, 2010
And Canadian private and state investment in film development had nothing to do with it. Not saying that the factors you mention aren't important, just that they didn't create the Vancouver film industry.
posted by sneebler at 10:03 PM on December 20, 2010
I have a hard time believing this story.
I don't. I have a neighbor like Eyebrows McGee's, albeit on a slightly smaller scale. For instance, when they had twins, raising the number of their kids to 3, they spent about $55,000 adding another bedroom and bath (and expanding and remodeling their kitchen) to a house that already had four bedrooms, two bathrooms, a formal dining room--because they "needed the space." In their view, they had to spend that money because their house had two bedrooms upstairs and two on the first floor, and they had to have three bedrooms on the same floor so that they didn't have to sleep on a different floor than any of the kids. My solution to that problem would probably have been something like having all three kids share a room until some of them were old enough to sleep a floor away from parents, or temporarily having one parent sleep upstairs and one downstairs, or just trying things out with their older daughter on a separate floor to see if that might actually work.
She has said to me--trying to get me to agree with her in an argument with her husband about money--that she just doesn't think it's realistic to live without credit card debt. "What am I supposed to do, not take a vacation? I need a vacation!"
I'm not perfect when it comes to money, God knows, so I may be throwing stones from my glass house here, but this particular person suffers from a serious thinking distortion in terms of "needs" versus "wants."
posted by not that girl at 3:00 AM on December 21, 2010 [1 favorite]
I don't. I have a neighbor like Eyebrows McGee's, albeit on a slightly smaller scale. For instance, when they had twins, raising the number of their kids to 3, they spent about $55,000 adding another bedroom and bath (and expanding and remodeling their kitchen) to a house that already had four bedrooms, two bathrooms, a formal dining room--because they "needed the space." In their view, they had to spend that money because their house had two bedrooms upstairs and two on the first floor, and they had to have three bedrooms on the same floor so that they didn't have to sleep on a different floor than any of the kids. My solution to that problem would probably have been something like having all three kids share a room until some of them were old enough to sleep a floor away from parents, or temporarily having one parent sleep upstairs and one downstairs, or just trying things out with their older daughter on a separate floor to see if that might actually work.
She has said to me--trying to get me to agree with her in an argument with her husband about money--that she just doesn't think it's realistic to live without credit card debt. "What am I supposed to do, not take a vacation? I need a vacation!"
I'm not perfect when it comes to money, God knows, so I may be throwing stones from my glass house here, but this particular person suffers from a serious thinking distortion in terms of "needs" versus "wants."
posted by not that girl at 3:00 AM on December 21, 2010 [1 favorite]
"I have a hard time believing this story."
I'd have to agree with both not that girl and Eyebrows McGee on this one. We do an absolutely dreadful job of educating people about money. And this shortfall in what I'd argue to be basic life skills impacts all of us, even those who are knowledgeable about money.
This ignorance is one of the reasons we've had speculative bubbles in different markets about once every ten years on average. Yes, over the past four or five centuries we've seen bubbles that frequently, and we know that one of the components of almost all speculative manias is ignorance.
In contrast to what you might read on the internet these bubbles predate and are absolutely not a product of Central Banking, The Fed or Bank of England; there are basic human emotions involved with money that we don't fully understand. Combine ignorance with money, add a little bit of leverage (e.g., credit cards or mortgages) and you've got a recipe for a disaster.
Those people that kept purchasing houses before the collapse, when many folks warned the valuations were out of whack? Gleefully bragging to any and all listeners about the 25% (or more!) YOY increases in their "investments"? They didn't have a clue about fair value and growth rates, other metrics we'd look at and therefore didn't know if their gains were sustainable or not. We saw the same behaviour during the dot-com run up, and in fact as a component of almost every speculative mania over the past four hundred years.
I know I've said this before on Metafilter but I believe ignorance of finance to be a very serious problem in The United States as well as most of the G7. Basic financial literacy all too often just isn't present, and people just don't know how to handle their finances. They get themselves in all sorts of messes. And I don't think it's really their fault at all, as these skills just aren't taught. They don't realise the importance of this information. Undeniably it is a major problem, but one that never seems to grab the media's attention.
Ever wonder why otherwise reasonably intelligent people - folks that have studied, taken advanced degrees (e.g., the two Ph.D.s cited), worked hard to achieve professional success - end up filing for bankruptcy, sometimes more than once? Or work all their lives, scimping and saving and perhaps even investing, but are forced into a markedly lower standard of living upon retirement? Or outright poverty when they miss a few paycheques?
More often than not, it because they are ignorant of the basics - liquidity, current interest rates, the rate of inflation, what the long term returns of stock market are, when they have to start saving and how much they must save to achieve their financial goals. There is, of course, an element of luck that will snare even the most astute, the most prepared, but the predominant factor in this equation is ignorance.
With the exception of luck, these are all failings of the education system, shortcomings that almost everyone leaves high school or even University burdened with.
So yeh, a sad but easy to believe story. And one that's all too common I'm afraid.
posted by Mutant at 5:19 AM on December 21, 2010 [2 favorites]
I'd have to agree with both not that girl and Eyebrows McGee on this one. We do an absolutely dreadful job of educating people about money. And this shortfall in what I'd argue to be basic life skills impacts all of us, even those who are knowledgeable about money.
This ignorance is one of the reasons we've had speculative bubbles in different markets about once every ten years on average. Yes, over the past four or five centuries we've seen bubbles that frequently, and we know that one of the components of almost all speculative manias is ignorance.
In contrast to what you might read on the internet these bubbles predate and are absolutely not a product of Central Banking, The Fed or Bank of England; there are basic human emotions involved with money that we don't fully understand. Combine ignorance with money, add a little bit of leverage (e.g., credit cards or mortgages) and you've got a recipe for a disaster.
Those people that kept purchasing houses before the collapse, when many folks warned the valuations were out of whack? Gleefully bragging to any and all listeners about the 25% (or more!) YOY increases in their "investments"? They didn't have a clue about fair value and growth rates, other metrics we'd look at and therefore didn't know if their gains were sustainable or not. We saw the same behaviour during the dot-com run up, and in fact as a component of almost every speculative mania over the past four hundred years.
I know I've said this before on Metafilter but I believe ignorance of finance to be a very serious problem in The United States as well as most of the G7. Basic financial literacy all too often just isn't present, and people just don't know how to handle their finances. They get themselves in all sorts of messes. And I don't think it's really their fault at all, as these skills just aren't taught. They don't realise the importance of this information. Undeniably it is a major problem, but one that never seems to grab the media's attention.
Ever wonder why otherwise reasonably intelligent people - folks that have studied, taken advanced degrees (e.g., the two Ph.D.s cited), worked hard to achieve professional success - end up filing for bankruptcy, sometimes more than once? Or work all their lives, scimping and saving and perhaps even investing, but are forced into a markedly lower standard of living upon retirement? Or outright poverty when they miss a few paycheques?
More often than not, it because they are ignorant of the basics - liquidity, current interest rates, the rate of inflation, what the long term returns of stock market are, when they have to start saving and how much they must save to achieve their financial goals. There is, of course, an element of luck that will snare even the most astute, the most prepared, but the predominant factor in this equation is ignorance.
With the exception of luck, these are all failings of the education system, shortcomings that almost everyone leaves high school or even University burdened with.
So yeh, a sad but easy to believe story. And one that's all too common I'm afraid.
posted by Mutant at 5:19 AM on December 21, 2010 [2 favorites]
What seems to be missing here is the fact that across the US in the late '90s and early '00s taxes were cut substantially, especially for upper incomes. This was a mighty national effort by the conservative Republicans to take advantage of tax resentment in order to decrease taxes on the rich. The political will came from the surpluses generated by the Clinton economy, and taxes were recalibrated as though the good times would never end. They did and now we're stuck with inadequate revenues. The FIRST step should be to restore those tax rates, then see if we need to cut.
posted by Mental Wimp at 5:25 AM on December 21, 2010
posted by Mental Wimp at 5:25 AM on December 21, 2010
There are many sins of my 20s that still plague me. I am oh-so greatful that a comfortable debt-load is something I've managed to escape, as having a budget and a light at the end of the debt tunnel has ended up empowering me against all of the others sins of my 20s.
posted by Theta States at 6:04 AM on December 21, 2010
posted by Theta States at 6:04 AM on December 21, 2010
reasonably intelligent people [...] end up filing for bankruptcy
It's better than the alternative I see working families do here in AZ all the time, which is not knowing when to admit they've made a mistake and file for bankruptcy. They just pay and pay, robbing Peter to pay Paul in order to keep up with servicing the debt and paying fees, never even touching the principal. It's pretty telling that whenever the more financially-savvy upper-middle income earners started filing and/or walking away from unsustainable debt that bankruptcy regulations were "reformed" before too many regular people stared getting ideas. Rather than start a derail in which nobody's mind is changed, I'll just say that we've all heard the arguments a hundred times, I understand why people might disagree with me, and I always do my best to respond to PM's .
posted by Hiding From Goro at 11:05 AM on December 21, 2010
It's better than the alternative I see working families do here in AZ all the time, which is not knowing when to admit they've made a mistake and file for bankruptcy. They just pay and pay, robbing Peter to pay Paul in order to keep up with servicing the debt and paying fees, never even touching the principal. It's pretty telling that whenever the more financially-savvy upper-middle income earners started filing and/or walking away from unsustainable debt that bankruptcy regulations were "reformed" before too many regular people stared getting ideas. Rather than start a derail in which nobody's mind is changed, I'll just say that we've all heard the arguments a hundred times, I understand why people might disagree with me, and I always do my best to respond to PM's .
posted by Hiding From Goro at 11:05 AM on December 21, 2010
massive amounts of systemic fraud largely due to state regulatory cut-backs and relaxed regulatory and enforcement standards that Republicans have championed.... "Shrinking" the government (as nonsensical and misplaced as that figure of speech is in the first place) is not the solution, it's the problem. Period.
DFR's hate public government. They loooooove private government. No offense to the South in general, but considering what's happened since we got a long string of Southern presidents, and a long losing streak.
It's lucky for you Obama got elected to take some of the pressure off. So far he's batting below Lyndon.
posted by Twang at 1:01 PM on December 21, 2010
DFR's hate public government. They loooooove private government. No offense to the South in general, but considering what's happened since we got a long string of Southern presidents, and a long losing streak.
It's lucky for you Obama got elected to take some of the pressure off. So far he's batting below Lyndon.
posted by Twang at 1:01 PM on December 21, 2010
I have a hard time believing this story.
I know I've told this story on MeFi before, but I can't find it:
Couple of years ago our whole family came into stock after a relative died. We each got an equal portion of stock, including my mother.
I told my mom I was going to sell out as soon as I got the stock. "Why would you do that?" she said. "Why don't you instead take out a loan on margin? Then you can continue to collect the dividends!"
I went ahead and sold. Mom took out the margin loan.
Six months later, as the stock tanked, Mom was getting margin called almost every day, whittling away at the stock. Eventually she had to sell out, taking a huge loss and still owning money on the margin loan.
I still don't understand why she thought taking out a loan against the stock was such a good idea, especially given that a) we all would have sold at a loss (the stock was off a couple bucks from the price when we inherited it) and b) she was just going to spend it, anyway, not plow it into new investments.
So, yeah, people do all sorts of stupid things with money, things that are totally incomprehensible, because they just don't understand it. I've wondered if it's because we all fear it.
posted by dw at 1:48 PM on December 21, 2010
I know I've told this story on MeFi before, but I can't find it:
Couple of years ago our whole family came into stock after a relative died. We each got an equal portion of stock, including my mother.
I told my mom I was going to sell out as soon as I got the stock. "Why would you do that?" she said. "Why don't you instead take out a loan on margin? Then you can continue to collect the dividends!"
I went ahead and sold. Mom took out the margin loan.
Six months later, as the stock tanked, Mom was getting margin called almost every day, whittling away at the stock. Eventually she had to sell out, taking a huge loss and still owning money on the margin loan.
I still don't understand why she thought taking out a loan against the stock was such a good idea, especially given that a) we all would have sold at a loss (the stock was off a couple bucks from the price when we inherited it) and b) she was just going to spend it, anyway, not plow it into new investments.
So, yeah, people do all sorts of stupid things with money, things that are totally incomprehensible, because they just don't understand it. I've wondered if it's because we all fear it.
posted by dw at 1:48 PM on December 21, 2010
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posted by Artw at 7:20 AM on December 20, 2010