Happy New Year!

Back in the long, long ago – B.F. (before Facebook), I’d find articles that I thought were interesting and I’d briefly blog something about them. Now I can just hit “share” and throw it up to Facebook or Twitter.

I won’t do a 2014 roundup post because year-end roundup posts generally suck.

1. A common refrain among Republicans is that cutting taxes spurs economic activity. Cutting them for the wealthiest Americans is supposed to somehow magically “trickle down” to the rest of us plebes. The problem is that you can cut taxes down to a certain point where the whole thing stops working. Consider, for instance, Kansas, where Governor Sam Brownback cut the living shit out of taxes. He said that doing so would be like a shot of “adrenaline” to the economy.

Like most states, Kansas’ state budget must be balanced every year. As it stands now, Brownback’s tax cuts have been so disastrous that the state is staring down a $280 million budget shortfall that has to be made up somehow. From Salon: 

Brownback has reduced state contributions to Kansas’ pension fund — already one of the worst-funded in the nation — and cut highway funding. In an ironic twist, the vociferously anti-health reform governor is also relying on Obamacare to help fill the state’s budget gap; Brownback is transferring $55 million in revenue from a Medicaid drug rebate program expanded in the Affordable Care Act into the state’s general fund.

But those measures won’t suffice to make up Kansas’ budget shortfall, and with education and health services already cut virtually to the bone, Brownback may have no choice but to rethink his tax cuts.

That’s too bad for anyone in Kansas who relies on state services of any sort. In Forbes, one commentator says that tax cuts may not have had enough time to work (LOL), but admits,

Everybody knew the tax cuts would cost money; the fiscal note for 2014 estimated that the cuts would cost $800 million in 2014. But the tax cut package was sold as a panacea for all that ails the Kansas economy. Gov. Sam Brownback (R) predicted that the tax cuts would spur economic development, investment, and a lot of job creation. Indeed, Arthur Laffer, who developed the Kansas tax cut plan, practically guaranteed success. But it didn’t work. The Kansas economy is stagnating, the deficit has grown, and the state’s bond ratings have been embarrassingly downgraded.

And in case you were wondering,

The tax cuts’ failure to magically transform Kansas has prompted much discussion. Michael Leachman and Chris Mai at the CBPP wrote a paper skewering the Kansas experiment, saying the tax cuts cost money, the benefits inured to the rich, and the economy took a hit because of less government spending. They say that as a result, the state’s economy remains in the doldrums. The CBPP opposed the Kansas tax cuts from the beginning, and Leachman and Mai’s paper is one big “I told you so.” Even The Wall Street Journal wrote a piece noting that the Kansas failure has caused conservative politicians in other states to rethink significant tax cuts.

On another note, remember how people like Kathy Weppner and Carl Paladino feted former Texas Governor Rick Perry? Let’s see how great Texas’ economy does in our new era of $60/bbl oil. The Erie County unemployment rate is 5.7%. The national average is 5.8%. And unlike Texas, our public schools don’t teach kids that Moses was one of the Founding Fathers.

2.  Here are some arguments as to why prosecco is as good as – if not better than – champagne.

3. The Dow Jones Industrial Average topped 18,000 last week. Let’s revisit a great anti-Obama op-ed from March 2009 entitled, “Obama’s Radicalism is Killing the Dow”. Ah, memories.

The cartoons are courtesy of Marquil at EmpireWire.com.

Enjoy 2015.

Merry Christmas!

TpUE29w1. On Tuesday December 23, 2014, The Dow Industrial Average traded above 18,000 for the first time in its history.

2. Have you bought gas for your car lately?

3. The US economy grew 5% in 3Q 2014, the most since Bush’s Iraq quagmire began.

4. More than 50% of Americans now think the economy is “good” as opposed to “poor”. Consumer confidence was higher than expected, thanks in part to gas prices coming down.

Donn Esmonde Looks at things Backwards

Donn Esmonde is an Ass” is the name of the series, and he seldom, if ever disappoints. In Friday’s column, he devoted about 550 words to talking about how lame Byron Brown is and how Bernie Tolbert sure is swell for trying.

Bernie Tolbert doesn’t need or want my sympathy. But I can’t help feeling sorry for the guy. Taking on Byron Brown is like trying to grab a puff of smoke or lasso a shadow. Nothing sticks to the Teflon Mayor.

On Brown’s two-term watch, Buffalo lost another 20,000 people. Schools went deeper into the dumpster, while he watched the charter school revolution from the sidelines. His anti-poverty “plan” for America’s third-poorest city was a lame, idea-absent rehash. Buffalo is basically a ward of the state, which covers a third of its budget and the bulk of its school costs.

The “charter school revolution” is city people suburbanizing city schools. Pull kids and money out of the traditional public schools, so your kids can have a Williamsville experience without moving to Williamsville. Esmonde has an especial hard-on for suburban schools, and has spent three or four columns advocating for the decimation of what had until recently been one of the best districts in the region. Esmonde’s concern-trolling about schools is utter nonsense, given his complete transformation into a tea party Sith lord.

Brown backed a proposed Bass Pro store that would have smothered the downtown waterfront, and a Seneca casino that experts say does us more harm than good. But mostly, he is mum – even on obvious causes such as expanding ECC’s downtown campus. Nearly two-thirds of respondents rated him no better than average in a Buffalo News leadership survey. He is vision-lite, cliche-heavy and largely uninspiring.

You would think that the man would be fighting for his political life. Instead, the mayor is livin’ easy.

2/3 of respondents in a poll rated Brown as “average”. The Siena Poll that the Buffalo News and Channel 2 commissioned, the cross-tabs for which have never been released.

Polls show him far ahead of Tolbert, who is barely known and fights a 6-to-1 dollar disadvantage. The Democratic primary in September decides the race, as city Republicans are an endangered species. My wish to see a progressive, idea-driven mayor in this lifetime may never be granted (in lieu of that, I’d settle for a Super Bowl). Pollster Steven Greenberg can’t explain Brown’s cushy lead, given abysmal marks on schools and job creation.

Esmonde uses the word “progressive”. It is to laugh. But while city Republicans may be an “endangered species”, you’d think that the underdog candidate, Sergio Rodriguez, might merit a mention. I mean, the guy has ideas, he’s saying a lot of what Esmonde is saying in this piece, and he has a name!

Which brings us to Brown’s political genius – he has mastered the art of low expectations. By keeping his head in the foxhole, by not championing big ideas and sweeping reforms, he has conditioned people not to expect much. So he can take credit for anything good that happens – even when, like the waterfront or downtown revival, it doesn’t have much to do with him – while avoiding blame for problems. It helps that Brown was preceded by three-term Mayor Tony Masiello, who, if possible, set an even lower bar.

At least Jimmy Griffin had an executive temperament, along with a temper.

A bolder, tougher, more visionary mayor would lobby for a regional planning board, to slow sprawl and funnel new business into the city. He would protect one of the city’s few resources – its stock of great old buildings – by data-basing historic properties and hammering negligent owners. He would push for mixed-income housing in the suburbs, to lighten the city’s heavy poverty load. He would embrace the choice of charter schools, while demanding accountability from traditional ones. And on and on.

How exactly does the mayor of the City of Buffalo “push for mixed-income housing in the suburbs”? Does he ask nicely, or is there some interjurisdictional power he has that I’m not aware of?

But Esmonde is partially right – to have Byron Brown record ads touting Geico, which is hiring way the fuck up in North Amherst somewhere, is an obscenity of the highest order. The city of Buffalo is precisely the place that Geico should have located its sprawling call center, but instead it went to North Bumfuck because it got a swell deal from whatever IDAs had handouts at the ready. It is the people who live in the city of Buffalo who are in desperate need of $30,000 entry-level white-collar cubicle jobs like the ones at Geico, because the manufacturing jobs are gone and working at McDonalds frankly sucks.

Byron Brown and Warren Buffett and the Buffalo News all think locating Geico up near Quebec was a swell idea.

A decent wage, a decent job, and some semblance of an opportunity are the very foundation on which you build a better future for young, underserved and underprivileged city residents. Not your “stock of great old buildings”.

Esmonde and his preservation-first cohorts have it backwards. Fixing up great old buildings doesn’t turn around the local economy, but turning around the local economy will help spur more fixing up of great old buildings. The focus on Buffalo’s hardware is well-managed by exquisitely touchy people who think that attracting “cultural tourists” to see the Darwin Martin house and other buildings is the antidote to a half-century of decline. Our town is replete with ultra-wealthy foundations sporting the names of the founders of businesses that long ago abandoned Buffalo, all of which seem to think that their deep pockets provide an avenue for them to tell everyone how they’re doing it wrong. Meanwhile, the best thing anything with the name “Oshei” in it could do is open a Goddamn windshield wiper factory in Buffalo.

Regular people will rehab your pretty old buildings when it makes economic sense to do so. People will do it when you don’t have to retain a preservation activist to help navigate your way to tax credits, and around demonstrations and litigation. People will preserve our “great old buildings” when they have money to do it. And how do you create wealth in a shit economy? You make sure you have a decent educational system, and that there are available jobs to help lift a generation out of poverty and into the economic mainstream.

Instead, we applaud the fact that Geico brings thousands of jobs to the sticks – just a few bus transfers and a commute that would make Long Islanders cringe! It’s appalling. It’s sickening. It’s a disgrace.

His city is on life support, yet Brown shows little passion and champions few causes. What, me worry?

Granted, the mayor has strengths. He is likable, projects concern and looks good – all political pluses. The streets get plowed, and the garbage is picked up. And his timing is good. He is in office while the waterfront is shaping up and downtown is repopulating. Albany and Washington dollars, not city money, stoke the waterfront, and downtown revival is traceable mainly to market forces and momentum. Still, the rising tide lifts his boat. As numerous insiders have told me, Brown stays out of the way and shows up for the ribbon-cuttings.

Brown stays out of the way? The stories of institutional, tolerated bribery and corruption within City Hall are legion.

In Buffalo, the city of low expectations, it goes a long way. A lot further, I think, than it should.

An irony here is that Esmonde does so much to keep those expectations low and stupid.

What's At Stake

Why Obama Now. Prepared by an animator for the Simpsons, and if it does nothing more, it should help popularize the term “Horse and Sparrow” as a euphemism for trickle down / supply side. 

Gas and the Dow

During the second Presidential debate, this exchange happened

MR. ROMNEY:…If you’re paying less than you paid a year or two ago, why, then the strategy is working. But you’re paying more. When the president took office, the price of gasoline here in Nassau County was about a buck eighty-six a gallon. Now it’s four bucks a gallon. Price of electricity is up.

If the president’s energy policies are working, you’re going to see the cost of energy come down. I will fight to create more energy in this country to get America energy-secure. And part of that is bringing in a pipeline of oil from Canada, taking advantage of the oil and coal we have here, drilling offshore in Alaska, drilling offshore in Virginia where the people want it.

MS. CROWLEY: Let me —

MR. ROMNEY: Those things will get us the energy we need.

MS. CROWLEY: Mr. President, could you address — because we did finally get to gas prices here — could you address what the governor said, which is: If your energy policy was working, the price of gasoline would not be $4 a gallon here. Is that true?

PRESIDENT OBAMA: Well, think about what the governor — think about what the governor just said. He said when I took office, the price of gasoline was 1.80 (dollars), 1.86 (dollars). Why is that? Because the economy was on the verge of collapse; because we were about to go through the worst recession since the Great Depression as a consequence of some of the same policies that Governor Romney is now promoting. So it’s conceivable that Governor Romney could bring down gas prices, because with his policies we might be back in that same mess. (Audience murmurs.)

I’ve seen a bunch of Republicans make this charge – that it’s Obama’s fault that gas prices have skyrocketed from a reasonable $1.80/gallon to the current $4.00/gallon. But that is so fundamentally misleading – such a basic symptom of Romnesia

If it’s Obama’s fault that gas prices have gone from $1.80/gal in February 2009 to $4.00/gal in October 2013, then it’s also his fault that the Dow Jones Industrial Average has skyrocketed from 8,000 to 13,300 in that same time. 

 

What else? Well, let’s take a look at some more trends

Retail Sales: 

 Unemployment: 

Car sales: 

Highest since 2007: 

So, don’t listen to the doom and gloom, and don’t succumb to Romnesia, whereby you completely forget what happened in 2008.