Tag: economy

2012 Math

~ Jim Eltringham ~ Leave a comment

Friday’s downgrade of America’s credit rating and the subsequent stock market skittishness naturally means a new round of speculation on President Obama’s re-election chances.  This week Gallup released state-by-state job approval numbers that paint a picture of an incumbent with some work to do.

President Obama’s approval ratings are listed as “below average” (under 44% or so) in 18 states,  representing 162 electoral votes.  Including three other typically “red” states where his ratings are average but still low (Arizona, Mississippi, and Georgia) would bring that total to 195.  Throwing in North Carolina and Virginia – traditionally Republican states the President carried by narrow margins in 2008 – the number jumps to 223, or 47 electoral votes shy of victory.  That scenario would make Ohio and Florida (with a combined 47 electoral votes) especially critical.

Should this be cause for Republican celebration?  Not so fast.

Not factored into these numbers, of course, is election performance – the poll measures only approval rating, not his performance against specific opponents or even the “Generic GOP candidate.”  He has 173 electoral votes in his pocket where he has above average approval ratings, plus another 45 in states which he is likely to win (Wisconsin, Michigan, Washington, and Oregon).  That gives the President a total of 218 electoral votes in house money.  And Presidential house money is worth more than challenger house money.

As Gallup notes, George W. Bush’s approval ratings were pretty low heading into the 2004 race – around 48%.  His massive campaign apparatus found his supporters in the right places and got them to the polls – the type of blocking and tackling the Obama campaign was good at in 2008.  Gallup’s numbers may seem optimistic for Republicans, but they actually paint a pretty good picture for the President.

Going green

~ Jim Eltringham ~ Leave a comment

Check this out:

This commercial, which appeared on Good Morning America today, sends two interesting messages about the environmental movement here on the 40th anniversary of Earth Day.

First, if you do not live green, a barrage of tiny fists will rain down justice upon you unless your socks and underwear are earth-friendly. Be afraid.

Second, ecological awareness can lead to economical success.  The New York Times reports that environmentalism is now a business practice for many big companies.  Some activists are nonplussed:

To many pioneers of the environmental movement, eco-consumerism, creeping for decades, is intensely frustrating and detracts from Earth Day’s original purpose.

“This ridiculous perverted marketing has cheapened the concept of what is really green,” said Denis Hayes, who was national coordinator of the first Earth Day and is returning to organize this year’s activities in Washington. “It is tragic.”

Those that frown on corporate participation miss an important aspect of American business: left to their own devices, companies are reflections of culture.  If Hanes is push eco-socks and 20th Century Fox is adjusting normal schedules to release the highest-grossing movie in history on Earth Day, it’s because environmentalism is recognized as an important social value.  What isn’t recognized as an important social value is government regulation, which is why environmental consciousness has not always translated into support for the environmental political movement.

What might a more middle-of-the-road environmental movement look like?  Organizations which promote ecologically sound personal activity and issue report cards on corporate green initiatives should be the centerpiece.  Individuals are already interested in becoming more environmentally friendly and can vote with their own behaviors and their own wallets if properly informed.

No one wants to be beaten up by a gang of toddlers in a shopping mall, right?

Sunday Funnies: The next big debate

~ Jim Eltringham ~ Leave a comment

With the government health care overhaul being made official tonight, the next big thing will be the financial reform bill, as Democrats try to get back on the American peoples’ good side.  How will they do it?  Maybe by creating a giant (and, in many ways, redundant) oversight agency to police the financial markets.  Sure, it speaks to a problem that happened two years ago, but Wall Street is an easy straw man.

Funny or Die does a good job acting as the White House’s comedy video department – they stick to the message and, frankly, produce hilarious videos.  Here, they use the ghosts of Saturday Night Live presidential impersonators past (with Jim Carrey filling in for the late Phil Hartman as Ronald Reagan) to plug the next overreaching government program.

Roll over, Liberty.

The cost of doing anything

~ Jim Eltringham ~ Leave a comment

Starting this week, my daily commute costs 20 cents extra.  The “temporary” DC Metro fare hike lasts only until June 27 – just in time for the start of Metro’s next fiscal year, when they will likely institute a more permanent and steeper fare hike to cover their operating deficit.

Today, the Post Office – like Metro, facing an institutionalized budget shortfall – is recommending reductions in service and may look to increase postage rates.

From the consumer standpoint, Metro riders and people who still use the mail are being asked to pay more for less service.   And while these organizations are probably rife with waste and fraud, the simple fact is that the 44 cents earned from the sale of a stamp or the $1.90 in revenue from a basic, one-way fare doesn’t do as far as it used to.  Inflation affects everyone.

Which brings us to Jim Bunning’s assault on common decency, humanity, America, and of course extending unemployment benefits with money the federal government, quite simply, does not have.

Running up deficits and debt in order to fund stimulus projects or propping up financial institutions – or even to “help” those who are out of work – is an attractive short-term strategy, but a long-term repercussion of financial instability is inflation.

In other words, this program to help the unemployed actually raises prices – like the cost of Metro fare to get to a job interview, or the price of a postage stamp to send a thank you note after a job interview, or the price of food for breakfast to make sure you’re sharp at your job interview.  It’s like feeding the hungry with food that induces vomiting.

So, is Jim Bunning really being all that unreasonable for drawing a line in the sand and asking for spending restraint?  Or is doing more than any other Senator to help the unemployed?

Sunday Funnies: Learning economics doesn’t have to suck

~ Jim Eltringham ~ Leave a comment

The President’s proposed spending freeze has touched off a debate between Keynesian liberals and free marketers over the role – and capabilities – of government spending.  Perhaps you have seen talking heads bickering about these theories, but the best way to articulate this century-old dichotomy of economic theory is, of course, a rap battle:

What does it say about the state of journalism that this actually outlines economic theories better

He should have sung “Tomorrow”

~ Jim Eltringham ~ Leave a comment

President Obama is calling for a new stimulus package, this one specifically targeted to create jobs.  Though the President is no doubt a gifted orator, one can’t help but feel like the speech to the Brookings Institution was a little familiar… But where have we heard it before?

Of course, this speech comes on the same day that news broke that $6 million of the last stimulus went to PR work coordinated by firms run by Democratic operative Mark Penn.

Maybe the President should have looked at this speech instead:

From the “well, someone is making money, right?” file

~ Jim Eltringham ~ Leave a comment

The New York Times has a story in its tech section on Sunday that could just as easily have appeared in Style.  The piece profiled Rent the Runway, a company which rents high-end designer dresses online – just like Netflix does with movies.

Dressflix, if you will.

The silver lining of a down economy is that new markets emerge, and the astute businesses that find those new markets can carve out a niche for themselves.  That’s especially true for Rent the Runway, which makes money by helping people save money.

If I’d only known you could do this 8 years ago…

~ Jim Eltringham ~ Leave a comment

Trina Thompson is suing Monroe College in New York because her degree has not helped her find a job.  At first this sounds like a funny, silly story, but there’s a lot going on here.

Thompson’s complaints reek of self-delusion.  She calls out Monroe’s Office of Career Advancement, which gave her numerous job leads that didn’t pan out: “They favor more toward students that got a 4.0. They help them more out with the job placement,” says Thompson.  Right.  That’s why the graduates with 4.0 GPAs are getting more jobs than her and her respectable-but-not-perfect 2.7.

She goes on to say that other unemployed grads should take the same course of action: “It doesn’t make any sense: They went to school for four years, and then they come out working at McDonald’s and Payless. That’s not what they planned.”

If Thompson’s inability to understand her own predicament is heartbreaking – and it is – then the conditions which allow her current course of action are equally infuriating.  Thompson has not hired an attorney, and has filed a “poor person order” to be exempt from other fees associated with the lawsuit.  There’s no risk for her, but Monroe College has to spend valuable resources defending itself – resources that could make education better or cheaper for other students.  Not to mention that Thompson’s time might be better spent earning money at McDonald’s or Payless and looking for better employment than putting together a case which will likely (hopefully) be laughed out of court.   And the punchline is this: if you were hiring someone, and Googled their name, and you read that they were suing their college because they couldn’t find a job, would you hire them?  I wouldn’t.

Of course, maybe Thompson could solve that issue by suing the media.

Paul Krugman is a regular Alfred Einstein

~ Jim Eltringham ~ Leave a comment

If you are an avid watcher of the History Channel’s series The Universe (as I am), you may have seen the episode that discusses an interesting paradox: While Einstein’s theories pointed to an expanding universe, Einstein himself believed that the universe was in a “steady state” – that there was no Big Bang, and thus the universe had always been – and always would be – the same size.  Einstein refused to believe the facts which his own work put in front of his eyes.

I thought about that again this week when I read Paul Krugman’s opinion piece complaining about profitable Wall Street companies – not because they are profitable, but because their profits are drawn from what he calls socially destructive behaviors.  As an example, he points out that Goldman-Sachs engages in high-speed trading that uses technology available to large brokerage firms that small brokerage firms may not have access to.  Krugman likens it to insider trading because these firms take advantage of a faster flow of information and analysis of trends; it’s a risky move, he says, and it sucks money out of the economy that could go to more responsible players.

Risky behaviors lead to higher profits, but government backstops take away the risk without limiting the reward.  In another recent column, Krugman grouses about Wall Street profiting from bailouts – yet, in the same column, argues that banking rescues are necessary.  When children reach out to touch a hot stove, they get burned and are more cautious in the future; Krugman seems to be the type of parent who would keep a toddler out of the kitchen altogether but then wonder the child is so fearless and reckless around a neighbor’s range.

Krugman is obviously smart – they don’t publish “Winning a Nobel Prize for Dummies” – but he’s a smart columnist, not an economic policymaker.

(By the way, before you correct me on the title, go back and watch Kingpin again…)

Reach out and touch a hornet’s nest

~ Jim Eltringham ~ Leave a comment

A simple move by AT&T to block part of a website which most of us have never seen may spark a broad debate over how we get access to the internet.

4chan is more than a home for crude images; it is also a hub of online mavens and connectors – part community, part cultural incubator.  Now-ubiquitous internet themes and memes – like the phrase “epic fail,” those “I can has cheezburger?” LOL cats, and of course, the Rickroll – all originated on 4chan’s message boards before spreading to all corners of the internet.  So when AT&T partially pulled the plug on access to some parts of 4chan for their DSL subscribers, it was only a matter of time before word was spread far and wide (digitally, at least).

DailyKos actually has a pretty good timeline on what happened as well as the ongoing conversation – much of which includes calls to action against AT&T.  Lost among the various accounts is a report – mentioned in a 4chan community alert on YouTube – that AT&T may have blocked sections of the site due to child pornography.  And when AT&T finally announced the reasoning behind the shutdown, they blamed hacker attacks that appeared to be originating from a 4chan IP address.

Either way, the controversy has stirred up the debate over net neutrality – the idea that the government would make it illegal for an internet provider, like AT&T, to regulate internet traffic by prioritizing some destinations or users.  Of course, if the service provider isn’t acting as the traffic cop, someone will – which will make entities like Google and Facebook more influential in what content you see (which is a big reason companies like Google tend to love net neutrality).

The debate is, however, moot in many ways.  Very passionate members of the 4chan community – as well as their sympathizers – discussed ways to take action and make their voices heard, including the contact information of top AT&T executives.  Regardless of what federal regulations are or are not in place, nothing moves a company like dissatisfied customers.

(In the interest of full disclosure, I work for a company whose parent company has AT&T as a client.  Though I have offered strategic advice on the account, including offering my take on some of the issues discussed above, I’ve never executed any actual projects for them.)