Sunday, October 14, 2012

November 7th



On November 7th, the election will be over, and, barring some unexpected legal problem, we will know who won the presidency.  Half the country will be jubilant, half will be disappointed.  But no crowds will be rioting in the streets, as in other countries.  If the Republican wins, the transition in Washington will be peaceful, and President Obama will call President-elect Romney and wish him well. If the Democrat wins, Romney will do the same.  There is a message there, for other countries.

But the President, whoever he is, may soon wish he lost.  The problems the country faces are arguably the most intractable most of its citizens have ever experienced.  The national debt is over 16 trillion dollars, and it is growing with every tick of the second hand. (See USDebtClock.org.) Household debt is larger than disposable income. Student debt is approaching 1 trillion dollars. Our industrial production is headed south. Pension obligations are impossible to meet.  The problem is most acute in the public sector, but even in the private sector there is big trouble brewing. General Mills, for instance, has an unrealistic 9.5% target for its investments, and the median expected rate of return for S&P500 companies is 7.8%.  How many investors are making 7.8% these days? Hard-up pensioners and the unemployed are going to demand increased services, except that we can’t afford the services we’re already providing.

So the economic picture is horrendous.  The international picture is as bad.  In our efforts to export our values, we have managed to create millions of enemies over the past decade.  Some of them lost brothers or parents or children in Iraq and Afghanistan, and they have long memories, and they blame us.  The president also has to deal with a Eurozone that is falling apart and with Asian countries that have quarrels with China and expect us to support them militarily.  Israel is lobbying for us to attack Iran.  “Us” is the American taxpayer, who already is deep in debt.

Why does anyone want to be president anyway?  To fly around on Air Force One?  To give the State of the Union address? To enjoy a comfortable retirement, writing books and being protected by the Secret Service? But Barack Obama already has that.  Besides, whatever bad things happen (and you can be sure they will), he will get blamed.  I am sure that George Bush thought he was doing the right thing going to war in Iraq and Afghanistan, but most people today believe he orchestrated the worst foreign-policy blunder in modern history.  Given the world situation, it is possible that one of the two men now running for president may take the title from him.

On November 7th, the real winner may be the man who lost the election.

Saturday, October 13, 2012

October's Bright Blue Weather


October is, in my opinion, the most beautiful month of all in Maine.  Clear skies, colored foliage, lonely beaches, cool temperatures, formations of birds headed south – what more could a person want?  To top it off, television offers baseball playoffs and professional football.

Many of the neighbors are fleeing to warmer climes, and the point is steeped in deathly silence at night.  One can’t question their judgment; January is only 10 weeks away, and January can be bitter cold, with cutting winds and blinding snowstorms that make you wish you too were in Florida.

Most of the people who own properties on the Point are senior citizens, and old age, as a friend keeps reminding me, “isn’t for sissies.”  So the EMTs at KEMS (the Kennebunkport Emergency Medical Services) know the neighborhood well.  Some people, looking ahead, are selling their homes, and I have never seen so many choice houses (five) on the market around the Point. At the same time, several new homes have been built recently, some of them replacing tear-downs.  The new construction has certainly been keeping the local tradesmen busy; it is not uncommon to see 15 or more panel trucks parked on the street near one of the projects, month after month.

Most of the boats in the bay and in the river have been hauled, but on these crisp days one can still see large sailboats on the horizon, making for Cape Porpoise or down east.  You don’t see many lobster boats, probably because the lobstermen have been discouraged by low prices.

The other day I saw a dead seal pup on the beach. I called the authorities, thinking they would come to investigate, but the next day the seal was still there, a seagull pecking at it gingerly.

October also means things have to be done:  Time to wash and store the summer clothes and unpack the sweatshirts and flannel pajamas and sweaters and heavy shirts.  Time to change the sheets on the bed – off with the cotton, on with the flannel. Time to put the down comforter into its duvet, a tricky job.  Time for storm windows and sliders, time to store the deck furniture, time to store hoses and unstore snow shovels and blower.  So much to do, but somehow the chores seem simple when the weather is so inviting.

Friday, October 12, 2012

The Vice-Presidential Debate


Not that the vice-presidential debate matters a whole lot, but I thought Biden won by a nose.   

The problems for Paul Ryan: (1) He was oversold as a bright young financial whiz who would thrash Biden on economic matters. He is bright, but not that bright. (2) He had a tough hand to play. It’s easy to sell the notion that we can solve our economic problems by simply taxing the rich, that no one else has to worry, not the old, the sick, your grandmother, veterans, college students, etc.  Few voters want to hear someone try to sell castor oil. (3) Despite smiling (some would say snickering) too much, Biden was the more aggressive debater, seizing every chance to filibuster.  (4) The first 20 minutes of the debate was given to foreign policy, which played into Biden’s strength.  No matter how he tried to wiggle, Ryan sounded as if he wanted war with Iran, the sooner the better.  At 9:23 PM, the moderator switched the topic to the economy, which is presumably Paul Ryan’s strong suit.  But in a segment that ostensibly was on the economy, the subject somehow quickly returned to foreign policy:  Afghanistan, Syria, and back to Iran.  Again Paul Ryan showed the hawkish side of the Republican’s plea for a “more robust” foreign policy, attacking the very idea of apologizing for anything, even things that seem to demand a presidential apology.  It doesn’t seem to occur to some people that an apology can be seen as a sign of moral strength.

The final few minutes of the debate were spent on the candidates’ Catholicism, specifically on their positions on abortion. This segment was a draw. That is, no minds were changed. People who were pro-life are still pro-life; those who were pro-choice are still pro-choice.

It is safe to say that few if any votes were won or lost by last night’s debate. If you chose to watch the Yankees – Orioles baseball game, you didn’t miss anything important.


Monday, October 08, 2012

The Trip Wire

The House Intelligence Committee today recommended that the U.S. government not do business with two Chinese firms, Huawei and ZTE, and it urged U.S. companies not to buy their equipment. The Committee alleged that the two firms pose a security threat to this country. This could be the trip wire that sets off a trade war, and it deserves more attention than it is getting.

To begin with, Hauwei and ZTE are both world-class companies, with operations in the U.S. and over 100 other countries. Huawei is the world's second-largest maker of telecommunications equipment and a major customer of dozens of U.S. firms. ZTE makes cell phones and related products for AT&T, Sprint, Verizon, and T-Mobile, among others. The linkages are so tight between these firms and their U.S. suppliers and customers that it would be easy for Huawei and ZTE to retaliate for the blackballing.

The House panel charges that the two Chinese firms are so heavily dominated by the Chinese government that they cannot be trusted with critical elements of the U.S. telecommunications infrastructure.  Most of the evidence in being withheld on security grounds, but the allegations are plausible. In most advanced countries, the governments and their telecom companies are in bed together. U.S. telecommunications companies are known to collaborate with the government in wiretapping, and our security agencies are not likely to welcome outsiders to the party.

One complication is that thousands of U.S. jobs are at risk. Many capital-equipment makers count Hauwei and ZTE as customers. ZTE recently announced a $2 billion expansion of its U.K. operation, and Prime Minister Cameron rolled out the red carpet, touting the boost to the U.K economy. Huawei and ZTE can offer the kinds of jobs that most countries want, and if the U.S. pressures Cameron to call off the deal with ZTE,  some other country would welcome them with open arms.

Cyberwarfare and protection of intellectual property are sensitive issues, and they certainly make technology trade with Chinese firms difficult. But igniting a trade war is not the answer. The topic should be at the top of the agenda in any bilateral trade negotiation between the U.S. and China. Another complication right now is presidential politics. I am sure the two campaign teams are hard at work today, each trying to position itself as "tougher on China" than its opponent.

But the possible consequences of today's announcement are serious.  Unfortunately, they also include a nightmare scenario.

Saturday, October 06, 2012

Winners and Losers



Winner: Romney. I expected that, in a debate with the President, Mitt Romney would sound like a blithering idiot. Wrong. Mitt was energetic, agreeable, smart. It was the Mitt Romney the Republicans kept telling us we would eventually see. The President, a master orator who shines with a scripted speech and a teleprompter, was so-so but a pale shadow of the Obama we saw at Grant Park in 2008. The only question is whether "the real Romney" emerged too late in the game. I am still in the undecided column, waiting to hear the candidates discuss foreign policy - not a major issue for most voters, but a big issue for me, because after Vietnam, Iraq, and Afghanistan, I think another military crusade would destroy what's left of our economy and our credibility among the 95 percent of the world's population who don't live in the U.S.A..

Loser: Bobby Valentine. He should have been fired the day after he publicly questioned the commitment of Kevin Youklis (of all people). In fact, from the outset he was the wrong man for the job. There's enough blame to go around, since the front office made several questionable trades.  The 2012 season left a bad taste with Red Sox nation, and next year you may see a rarity at Fenway Park: thousands of empty seats.  

Winner; Matt Ryan. Here's the setup: Atlanta is trailing, 28-27, with less than a minute left to play and Atlanta on its own 1-yard line. Hopeless? No. Quarterback Ryan heaves a long pass, which is completed, and the Falcons kick a field goal to win the game. It was the third last-minute comeback of the young season for Ryan and the Falcons.

Winner: Steve Martin. His new 3-DVD set, "Steve Martin: The Television Stuff," is a fine collection of Martin's early stand-up work, before he decided to quit comedy-club gigs and TV specials in favor of the movies. The routines are not all choice; he is sometimes too crude for my taste, but the best of the humor is really hilarious, and he displays more talent than any one person should be allowed to have. He is a virtuoso on the banjo. He juggles. He is a magician. He tap dances (creditably) with Gregory Hines. And of course he is a master of visual comedy, especially in his "wild and crazy guy" skits. Accompanying the routines is an interesting interview with Martin, who is now in his late 60's. (Where did the years go?)

Loser: Hewlett-Packard. I am sad to see H-P falling into the scrap heap of American business because, although I spent a considerable part of my career competing against the folks in Palo Alto, I always respected H-P, and I regarded them as a class act. But the former titan of the test world has now become an also-ran of the digital world. What happened? For openers, H-P chose to look outside the company for their last four CEOs, including the current leader, Meg Whitman. What does it tell you when a company considers none of its 100,000-plus employees presidential material? Bill Hewlett and Dave Packard would have been ashamed.