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Thursday, December 17, 2015

No. 000100 Random #STLNFL Stadium thoughts

Some random thoughts on the #STLNFL Stadium:

  • Do they not teach new journalism in journalism school? Millions of words have been written or spoken but only Ray Hartmann has bothered to actually take any sort of a look at the likely motives or incentives of the principals. An Exercise in Political Futility? Again, great job Ray!

  • No law says journalists cannot take a hard look at potential graft and cronyism issues in the Saint Louis proposal. There are at least two, suggested by The Economist.

No journalist, however, has even given lip service to either of the following.


First, who exercised any control over the design process? Neither the St. Louis Regional Convention and Sports Complex Authority nor the Governor nor the City have any expertise, skill, or knowledge in designing stadiums or surrounds.

Second, there was no competitive bidding for the project. The contractors were not selected as "lowest and best bidders after due opportunity for competition."

London is considering building an NFL stadium projected to cost only $600 millions (est). Spurs courting NFL



Wednesday, October 21, 2015

Equality: James Madison on Equality No. 00099

Equality: James Madison, Parties




Equality: Thomas Jefferson supported silent laws promoting Equality and Progressive Taxation No. 00098

Equality: Thomas Jefferson to James Madison




Russ Roberts and Alan Greenspan Facilitied the Lesser Depression; Devil in the Details No. 00097

Last night and this morning I engaged in a lengthy Twitter exchange with Russ Roberts  regarding his admission that his bias directs his economics and his economics policies.

My challenge was what was relevant was his motives not his bias (for even a dog knows the difference between being tripped over an being kicked).

While he denies such, Roberts is a conservative in that all his policy proscriptions always, at the end, line up with the financial and political interests of the .01%.

I have challenged Roberts to answer the arguments of Jefferson and Madison for, inter alia, silent laws that promote equality and equal political power but he has not and I doubt he will answer.

I have also challeged Roberts to explain why Jefferson was wrong in advocating for the University of Virginia.

In the course of his defense, Roberts asserted he wasn't a voice for the .01 because he opposed the bank bailouts. The problem is that the bank bailouts didn't bail out the Kochs, the .01%, they bailed out the lower class, the 85/90 to 99%.

Putting aside that when an economist has no skin in the game but argues that someone else should take the hit is about as self serving as one can get (you better duck and run for cover), one who actually knows the details knows that Roberts about was applying the well know tactic that a good offense is the best defense.

To understand why requires a knowledge of how the financial crisis came about deep within the applicable federal regulations.

I learned in 2001 the mis-workings of Greenspan when I took on a case where the appraiser for a national bank's loans had no office but was working out of a bar in Southern Illinois. A real estate developer was preparing the appraisals and bringing to the bar to be signed and sealed, naturally for cash. The bank would then securitize the loans, all with the watching and approving eye of Alan Greenspan engaged in Galt-style financial regulation of the sort approved of by Roberts (if Roberts didn't know this was how loans were being made he has no business advocating the US public should take the hit for bad loans).

To the specifics. At the time, federal bank regulations detailed that loans made by national banks had to be appraised. The professionalism of the appraiser was to be a check on bad loans. To assure professionalism, the bank originating the loan was supposed to hire the appraiser who would then tend to be honest because his economic and legal duties ran to the lending bank. Here is the applicable regulation:


Subsection (b)(1) is pretty straight forward. If the lending national bank had hired and paid the fee appraiser with his office in a bar, that would pass muster under the regulation. But, that was not what was going on. Recall, the real estate developer who was building and selling homes was preparing loan applications for its buyers and hiring the appraiser, paying him in cash.

Section (b)(2) applies directly to the transactions as they were actually being conducted. The loans were suitable for making and securitization if, and only if, the real estate developer was a financial services institution.

One would naturally ask, do the regs say what is a financial services institution? The answer: "No," leaving it up to the OCC, which regulated the national bank, and the Federal Reserve, which regulated its holding company, to determine who  or what was a financial services institution.

Greespan, with his wacko-libertarian ideas, had no problem classifying everyone, including the real estate developer who was taking loan apps so as to sell new homes, as a financial services institution.

Very simply, by constructing a single regulation (hidden deep withing CFR), Greenspan and the OCC completely deregulated the underwriting and securitization of home loans in the United States. 

No license was required. Anyone could call themselves a financial services institution, take loan applications and submit them to a national bank. A national bank could then make the loan and resell such via securitization, dodging the risk of loss if the loan went bad, leading the public to believe the loan underwriting process had been supervised for safety and soundness when, in fact, it was as corrupt as possible when those with the greatest financial interest in the transaction could select and hire the appraiser, paying them cash to assure their disloyalty.

On October 6, 2008 Economist Robert H. Dugger said what Greenspan was doing was "packing US debt as sausage, wrapped such up as Credit Default Swaps with mouse hairs" not filet mignon at 33:40 

That my friends is the free market world for which Russ advocates; sausage wrapped to imply it is filet mignon but in reality, sausage with mouse hairs.

Saturday, February 14, 2015

Hanaway's Mendacity and Messenger's Editorial Malpractice No. 000096

Hanaway said Missouri's roads are in need of more money. But rather than backing tax increases or tolls, she said Missouri could redirect as much as $500 million to roads by finding about 2 percent savings in Missouri's annual operating budget.

 

quote context: http://pllqt.it/pwGykx

Wednesday, February 11, 2015

If Demographics is Destiny, where will St. Louis and Kansas City be in 2030? No. 000095

Facts:

Saint Louis Area Population with grow at one-half the national rate, increasing by 180,772 (7.455%)

Atlanta Area Population with growth at four times the national rate, increasing by 2,787,088 (59.02%)

Kansas City Area Population with growth at the national rate, increasing by 296,965  (15.17%)

Here is the tool

Other Cities:

MSP 646,619 (20.27%)

Indianapolis 663,150 (38.17%)

Louisville 184,295 (15.20%)

Nashville 574,758 (37.88)

 

 

 

 

Tuesday, February 10, 2015

Part 4; A Reply to Alderman Antonio French No. 000094

Alderperson Antonio French has replied to my last post, which I deeply respect.  He writes on Twitter:

 

I have no recollection of every meeting Alderperson French and have never spoken with him in person, so let me begin by saying what I understand him to be saying, after which I will comment briefly.

First, he says that even the Board does not know the facts. For starters, he says the Board does not know how many people are current NGA employees or what taxes they collectively pay to the City.

Second, he says the Board does not know how the composition of NGA's work force might change contemporaneous with the move. (No one would have expectations that long term estimates are at hand).

Third, he thinks this is an example of the "government" picking winners and losers.

Fourth, he says this is just a gamble for current residents.

If Alderperson French would step back to looking at this situation with some altitude and perspective I believe he would come to see that he has made a massive indictment of the governance of the City of Saint Louis, both its Mayor and Board.

The City and the rest of the Saint Louis Region finds itself in a situation almost like the prisoners' dilemma, a part of game theory familiar to every economist. In a prisoner's dilemma the opportunity to reward others is removed and without that opportunity the prisoners will not cooperate when rational individuals would.

With regard to the NGA, because only the City of Saint Louis has an earnings tax, it is in a position to reward other parts of the Region if they would cooperate in directing the NGA to the City of Saint Louis.

Viewed through this lens, it is plain the NGA situation has reached a head because Mayor Slay lacks the skills and ability to have negotiated rewards and arrived at a Regional agreement on location of NGA in the City. Had the Mayor done his job he would have a regional agreement in hand on the site location and there would be no uncertainty.

Second, Mr. French also indicts the Board's competency by noting that it has failed to assure itself that the City provides it with the information needed for it to accurately evaluate the choices and options before it. In the case of the earnings tax, returns are filed with the City that identify the employer and place of employment. His lack of information is his own fault.

Last, Life presents many many occasions where government picks between winners and losers. There will likely be many losers if the City of St. Louis loses the earnings taxes paid by NGA's employees. So, if, as Editor Messenger charges, Alderperson French has been about sabotaging Bill 263, he is picking winners and losers. In this particular case the losers will be people not provided City services if earning tax collections drop. These could be some of the same people who may be displaced by condemnation for the new NGA site for who knows tomorrow.

 

Part 3: Tony Messenger, Antonio French, Arrogance, Sabotage, and Urban Redevelopment No. 000093

The City of Saint Louis fears losing a goose laying golden eggs, the Federal Government's National Geospatial Agency, which is looking for a new site among several possible locations in the greater Saint Louis Region.

What is at stake are taxes, specifically the 1% earnings tax on gross incomes now paid by NGA's employees to the City of Saint Louis. These taxpayers make no demands on the City for services and don't vote---most all live out of the City and commute by car to the current NGA location---so these taxes are now pure gravy or profit to the City.

We do not know why---for the Post and our other local media has no sources and never actually discovers and reports inside news---but for unknown reasons finding a suitable site within the vast empty expanses of the City of Saint Louis has been beyond the capabilities of the Mayor and Board of Alderpersons. 

The original solution was to plopp NGA's "fort," and that is what is would be, right in the middle of Paul McKee's Northside Redevelopment. It would be a "fort," like all post 9/11 Federal Buildings, wholly self-contained. No coffee shops or dry cleaners or cafes or other signs of real urban life are ever going to see customers walking out of the building or buildings and across the street. 

Now, due to unknown facts and circumstances (the Mayor's statement that the McKee site wasn't big enough makes no sense) there is felt to be a need to move the location onto a 100 acre tract now occupied by as many as 50 city residents. Given the importance of keeping NGA how could the Mayor not have known of NGA's requirements for a larger site?

Via Bill 263 the Board has been considering giving Land Clearance and Redevelopment the power of eminent domain to acquire the site.

Alderman Antonio French has been opposing Bill 263, seeking to remove the eminent domain provisions from the bill, leading to this Twitter exchange between French and Editor Messenger:

  • Let's first deal with Antonio French and then Editor Messenger.

Alderman French, this blog post from Phys.org warrants more than one read: Study shows parasites may resort to sabotage if there are conflicting interests with a host.The City of Saint Louis is the host. Editor Messenger says you are engaging in sabotaging activities. 

  • As for Editor Messenger, well, first, there went any hope for Regional support: "Would you rather it go to Scott AFB?"

If the Post and its Editors were truly interested in the prosperity of the entire region the question would never be asked. The question would simply be, for the whole community, what would be the best location?

To the point, the best location could well be in North Saint Louis County with easy access to the Airport and possible extension of Metro Link, you know #Ferguson.

Sunday, February 8, 2015

Want Growth. Tax and build great research institutions No. 000092

Forget tax cuts!!! The sole path forward on creating great jobs is innovation through research universities.

Silicon Valley really is more innovative, study finds

From the San Jose Mercury News reports on a new study:

First, "there is a higher initial quality of startups -- people are being drawn there, they graduate from its universities, they are more ambitious," Stern said.

And, "Silicon Valley supercharges that effect, helping them along, so they deliver on their promise." 

They found that the highest-quality startups are centered around research institutions, such as universities and national laboratories. Stanford, UC Berkeley, Lawrence Livermore, Caltech, UCLA and UC Irvine each host regions of entrepreneurial quality.

"Research centers attract extremely bright, curious, energetic and ambitious people -- people who want to change the world in a positive way. Increasingly, they want to realize their dreams in their own ventures, not buried in a large company," said Steve Ciesinski, president of Global Partnerships at Menlo Park's SRI International and a lecturer at the Stanford Graduate School of Business. 

 

"With more education on how to start and build companies being evangelized at places like Stanford, SRI and many other research institutions, it's no longer so intimidating to researchers to start up a venture based on their breakthrough science and technology," he said.

 

Saturday, February 7, 2015

Part 2: Tony Messenger continues to threaten the Ferguson Commission and all our progress. No. 000091

Part 2: With Friends Like This, Who Needs Enemies

Mr. Messenger's Saturday Editorial finds him as a Brian Williams journalist, fervently "courting celebrity," as Ms. Dowd labels the species. 

Today, Mr. Messenger writes:

The Ferguson Commission’s various critics … are looking for opportunities for this very important commission to fail.

If true, why does he write?

To be sure, the commission has had a misstep or two. To help it get up and running quickly, as Gov. Jay Nixon called for when appointing its 16 members, the commission hired a few consultants to plan initial meetings and coordinate media without going through a state bidding process. The commission hired an executive director, Bethany Johnson-Javois, one of its own members. She is also on the board of the nonprofit Deaconess Foundation, which employs Rev. Wilson. She might be the best person for the job, but the rushed process clouds clear judgment.

Only two people have questioned the startup work of the Commission which was funded by private and not public dollars, which Mr. Messenger omits to write about. One is a reactionary Tea Party candidate for attorney general and the second is a lawyer working for a law firm that handles Koch Brothers legal work.

It is going to be pretty hard to cabin a charge that the Commission had a "rushed process." Mr. Messenger, as he always does, on cue delivered the money quote.

Mr. Messenger then contradicts himself, writing the Commision should rush to judgment to act:

Its issue going forward is that as a body funded by both public and private sources, and one pushing for massive change in a region that prefers the status quo, it will find enemies in politics, in government, in the private sector, in the media. Criticism will grow if more successes, like the push for municipal court reform, aren’t apparent before the commission’s final report is filed.

Mr. Messenger has the cart before the horse. The Commission needs to produce one or more credible reports before it urges action.

For example, contrary to Mr. Messenger, no one should have any enthusiasm for the action, to date, on municipal court reform. Why? None of the proposals deal with the fundamental core issue which is, How to fund services in North Saint Louis County? 

That brings us to Mr. Messenger's flippant regard for the funding of the Commission. The Commission has no funding source capable of sustaining the research necessary to make the report meaningful. The Governor has sought funding but Messenger rains water on that idea.

Now lawmakers are questioning the source of the $350,000 budget of the Office of Community Engagement even as Ms. Coleman argues for more state money.

At best, the office is redundant. It duplicates on-the-ground efforts taking place in Ferguson by many existing and newer nonprofits. And its budget problems distract focus from the Ferguson Commission. It is critical that the commission continues its important work studying policing and educational deficiencies in north St. Louis County, healing racial divides and pushing for reforms, such as those underway in municipal courts.

Mr. Nixon should make the Ferguson Commission stronger by subtraction. Perhaps St. Louis County Executive Steve Stenger, who plans an office similar to the one run by Ms. Coleman, can put her to work locally.

Regarding the kind of research necessary, let's return to the work that Dr. Carr has already done, in preparing a Vision 2020 report for Southwestern Illinois.

Dr. Carr has identified low education attainment as the primary driver of poor economic performance in the Saint Louis region. 

Comparision, Education and Income, Saint Louis and MSP

In raw numbers, our Saint Louis workforce, taken as a whole, has only 75% of the skills of the workforce in Minneapolis. Closing this education and skill gap is the only way for the Saint Louis region to transform itself into a high value added (post manufacturing) service economy.

Software and robots promise that, within 10 years, 75% of all jobs will require some substantial education post high school.

The Ferguson Commission Report must tackle how to close this gap and how to finance such through taxes. Only an extraordinarily well done report can accomplish that mission.

Last, Mr. Messenger call for "the Rev. Wilson to do what Mr. Nixon can't: Rally the community behind the Ferguson Commission."

Mr. Messenger again misjudges. The reason why the community is "vacillatin" on the Ferguson Commission is that it is not composed of strong-willed, independent-minded people who are willing to speak their minds and turn them loose on our Region.

Is this how the Commission is composed?

Robert Seawright wrote last year about the New York Federal Reserve undertaking, post the 2008-09 financial crisis, a study of itself to try to understand why the NY Fed hadn’t spotted the behavior of the big banks that led to the crisis:

As I have noted before, and consistent with the academic literature, critical thinking is impossible without sufficient subject matter expertise; and such expertise mandates the understanding of the strengths, weaknesses, subtleties and consequences to all the underlying positions and viewpoints relating to a particular decision. We all love to be right and quite naturally think we are right. Better decision-making means challenging assumptions like that by carefully asking and considering overlapping questions such as the following.

◾ Can you suggest others?

◾ How might I be wrong?

◾ Have I considered the strongest renderings and arguments of opposing viewpoints?

◾ Have I given opposing views a fair hearing?

◾ Have I checked and re-checked my work, data and assumptions?

◾ What does the available data say and suggest?

◾ What would it take to convince myself otherwise?

◾ What do I have to gain (or lose) by changing my mind?

◾ What do the (other) experts say?

◾ What do I see/know/get that those who disagree with me don’t?

◾ What’s in it for me?

◾ What’s in it for them?

◾ What do my best and smartest colleagues (friends) say?

◾ Have I considered the most generous versions of opposing arguments?

◾ Can I argue the other side effectively?

Neither the Rev. Wilson nor the other members of the Commission have yet shown "sufficient subject matter expertise; and such expertise mandates the understanding of the strengths, weaknesses, subtleties and consequences to all the underlying positions and viewpoints relating to a particular decision" to warrant anything but "vacillatin," with the exception of Dr. Carr.

Mr. Messenger wants Rev. Wilson to "Gather business leaders and protesters, lawmakers and the many people with an earnest interest in positive change. Help a community that is dealing with rising violence, a lack of empathy, continuing distrust between the police and the people they serve, and the distractions of daily life. Help St. Louis understand why the unique and unprecedented work of the Ferguson Commission is so important."

That task is several bridges too far for Rev. Wilson. He lacks sufficient subject matter expertise. He doesn't have an understanding of the strengths, weaknesses, subtleties and consequences to all the underlying positions and viewpoints to be carrying that large of bucket and he shouldn't try.

 

 

 

 

Why I might support Eric Schmitt's new income cuts No. 000090

Mark Twain remarked, "There is no native American criminal class except Congress." 

Unfortunately, he never saw the Missouri Tea Party mindset GOP. If he had, he might have been the first to remark, "You can't fix stupid." Why? How else does one explain the desire of out-state Missouri GOPsters to cut income taxes they don't pay, giving new meaning to cutting off one's nose to spit one's face.

A few facts:

  1. Outstate Missouri does not pay significant amounts of state income taxes. The goose laying the golden egg is the Saint Louis region. As the Post reported last September, "The St. Louis region, [is] the economic engine of the entire state ([with]49 percent of business payroll, 51 percent of individual income taxes)." Take away Kansas City and the rest of Missouri pays very little in state income taxes.
  2. This internal balance of payments problem causes considerable economic damage to Saint Louis, lowering the number of jobs, income, and property tax values in exactly the same way as federal income taxes negatively impact Rust Belt cities like Saint Louis.
  3. Outstate Missouri benefits from this imbalance in state spending in at least three ways

  • First, through the foundation formula which results in our best school districts in Saint Louis having to self-fund while taxes from Saint Louis are diverted to outstate schools that undertax significantly.

  • Second, through state maintenance of what should be local roads under the 1952 legislation by which the Missouri Highway Department took over 12,000 miles of county highways, bringing 95 percent of all Missourians to within two miles of a hard-surfaced road.

  • Institutional location with important state institutions like the Capital, the University of Missouri, Columbia, prisons and hospitals being located outside our major metropolitan areas.

Thus, it is a stunning political feat that Saint Louis area Republicans have convinced outstate GOPSters to cut income taxes, which tax cuts will benefit Saint Louis (and Kansas City) but not outstate Missouri.

The tax cuts will not bring jobs and prosperity to outstate Missouri.

First, the amount of money is immaterial, even if the theory that tax cuts lead to economic growth were true. Witness Kansas, that is a lie, a big lie.

Second, what outstate Missouri needs is more government spending, on education and training for a service economy, not less. Bruce Greenwald explains that people cannot self-finance the transition to a high value service economy. Listening carefully to his comments about the transition to a manufacturing economy from an agricultural one during World War II, at 10:30

What the tax cuts will do for Saint Louis will be to give us breathing room to continue to self fund K-12 education. They will not lead to growth or prosperity.

Governor Jay Nixon and the the outstate Missouri K-12 education establishment understand what is at stake but clearly the vast majority of GOP senate and house members have no idea what they have done by partying and sleeping with Grover Norquist and the economic quack Art Laffer.

 

 

 

Tony Messenger continues to threaten the Ferguson Commission and all our progress. Part #1 No. 000089

Last week we took time to forewarn advocates for economic growth and development in Missouri and Saint Louis that Tony Messenger was not your friend. No person is more responsible than Mr. Messenger for the lack of progress in Missouri and Saint Louis on every front.

Due to a variety of factors the Post's editorial page is the only possible vehicle for leading Saint Louis to understanding why our incomes (and growth) have fallen below the national average and will, most likely, continue to lag behind unless we substantially change our ways. Changing our ways includes Ferguson but Ferguson is not the cause of our problems. Ferguson is but a canary in a coal mine warning us of the falling incomes, decay, and obsolescence afoot equally in Cabool as Ferguson.  

The last thing we need is a "Brian Williams" journalist, unrestrained by the truth, seeking to make himself a celebrity but that is exactly what we have. If you think not, read for moment his latest editorial, Time for Ferguson Commission to rally the region.

Did you catch the Brian Williams technique. Here it is, "Appointing Ms. Coleman was a political solution to a political problem at a time in which he had not yet decided that the Ferguson Commission was necessary." That is fiction, nor was Ms. Coleman appointed merely to work on Ferguson. The Post itself reported Ms. Coleman was appointed to work on low income problems across the entire State of Missouri. Appointment of a Ferguson Commission, an idea not original with Mr. Messenger, had been under discussion almost from the moment Twitter made the shooting of Michael Brown everything we understand it to mean today.

Across our state, Missouri communities are facing serious issues involving race, educational and economic opportunities, and poverty,” Nixon said in a statement. “The Office of Community Engagement will be responsible for facilitating meaningful communication about these issues that will yield concrete results.”

The governor’s press release stated that the Office of Community Engagement would be housed under the Office of Administration. Among other things, it would be responsible for:

  • Engaging communities, public and private sector leaders, clergy and citizens across the state in communication “regarding critical issues affecting Missouri communities.”
  • Developing  “policies and strategies to foster greater prosperity and opportunity for all Missourians.”
  • Making recommendations to the Department of Economic Development, Missouri Community Service Commission, Missouri Housing Development Commission and other boards, commissions and agencies “that administer programs designed to assist low-income individuals, urban neighborhoods, community redevelopment and similar activities.”
  • Recommending individuals to the administration for appointment to boards, commissions and agencies of the state.

But on  September 19th,  the day following Ms. Coleman's appointment, Messenger admitted there had been an ongoing public discussion of a commission.

Three times now, this editorial page has suggested a thorough, independent, broad-based and timely study of how and why the Ferguson tragedy occurred and the police response to it. This would not be a legal investigation; parallel state and federal inquiries already are underway. Rather the “Ferguson Commission” would get into the root causes of the economic and racial divisions in St. Louis and make recommendations for remedial action.

So the charge that the appointment of Ms. Coleman was merely a short term political fix is a false one. Ms. Coleman's appointment shows that, finally, Governor Nixon has come to understand that the only solutions that will ever be passed into law are those that benefit all Missourians. 

The appointment of Ms. Coleman showed that, before the election, Governor Nixon had finally come to understand why "progressives" who think like Messenger have been losing more and more elections in Missouri.

Kevin Drum summed up Messenger's faults in these few paragraphs following the November losses:

So who does the WWC take out its anger on? Largely, the answer is the poor. In particular, the undeserving poor. Liberals may hate this distinction, but it doesn't matter if we hate it. Lots of ordinary people make this distinction as a matter of simple common sense, and the WWC makes it more than any. That's because they're closer to it. For them, the poor aren't merely a set of statistics or a cause to be championed. They're the folks next door who don't do a lick of work but somehow keep getting government checks paid for by their tax dollars. For a lot of members of the WWC, this is personal in a way it just isn't for the kind of people who read this blog.

And who is it that's responsible for this infuriating flow of government money to the shiftless? Democrats. We fight to save food stamps. We fight for WIC. We fight for Medicaid expansion. We fight for Obamacare. We fight to move poor families into nearby housing.

This is a big problem because these are all things that benefit the poor but barely touch the working class. Does it matter that the working class barely pays for most of these programs in the first place, since their federal income taxes tend to be pretty low? Nope. They're still paying taxes, and it seems like they never get anything for it. It's always someone else.

It's pointless to argue that this perception is wrong. Maybe it is, maybe it's not. But it's there. And although it's bound up with plenty of other grievances—many of them frankly racial, but also cultural, religious, and geographic—at its core you have a group of people who are struggling and need help, but instead feel like they simply get taxed and taxed for the benefit of someone else. Always someone else. If this were you, you wouldn't vote for Democrats either.

I hate to end this with the usual cliche that I don't know what to do about it, but I don't. Helping the poor is one of the great causes of liberalism, and we forfeit our souls if we give up on it. And yet, as a whole bunch of people have acknowledged lately, the Democratic Party simply doesn't do much for either the working or middle classes these days. Republicans, by contrast, offer both the concrete—tax cuts—and the emotional—an inchoate but still intense rage against a government that seems not to care about them.

So sure: full-throated economic populism? That might work, though everyone seems to have a different idea of what it means. But here's one thing it better mean: policies that are aimed at the working and middle classes and that actually appeal to them. That is, policies that are simple, concrete, and offer benefits which are clear and compelling.

Mr. Messenger, Ms. Coleman is not redundant. To the contrary, her appointment is the fulcrum point of today's political battles. Her charge is to develop policies that help all our low income residents, state wide, including the white working class.

Friday, January 30, 2015

No. 000088 Why Exclusivity Means the Ram's (and NFL's) Business Model is Flawed and Hence the need for a public subsidy for a #STLNFL Stadium

The human drama of people watching athletic competitions:

Not to an economist who sees what you do not see. This is stunning evidence of the contradiction that lies at the heart of the NFL's flawed business model and which compels it to seek public subsidies.
What you see is that the NFL wants to sell exclusivity, an experience that you are special, to the .5% that can network among themselves in their exclusive "box, just like the owners."
What you may feel uncomfortable about discussing is that, due to the psychology of human misjudgment, the rest of us, the lower 99.5% are involved in watching the .5% in their exclusivity. Think not. Why does every TV telecast feature the obligatory cutaway to the owner's box, with or without notable visitors?
Consider Chris Christie. If he could buy a ticket to give the hug, what would he be willing to pay? A lot.

Due to the desire for status, exclusivity has immense value. Saint Louis blessed the World by giving it two extraordinary observers of life and the human personality, Jack Buck and Yoggi Berra. Here is Mr. Berra explaining the conundrum facing NFL owners.

"Nobody goes there anymore. It's too crowded."
There is the rub. The average fan in the seats would pay dearly to rub shoulders with the elite in the sky boxes but the elite in the sky boxes are not about to rub shoulders with the average fan.
Thus, simply put, the owners cannot capture the value that would be created if Average Joe would network with an elite of his or her choice.
And so we have had public financing of stadiums for thousands of years for, as Harry Truman always reminded us, "The only thing new in the World is history you don't know," because human nature never changes.
The Average Joe want's to tell his co-workers, I was at the game yesterday for exactly same reasons the elite want to tell their co-workers, I was in the company box yesterday.
This is but the open marketing of purchased status, of Saint Louis being an "NFL City."
Rome has, today, a magnificent Colosseum only because Emperors Vespasian and Titus didn't have to ask the Roman Senate to issue bonds.
This leads to my last observation. Why were all our regional politicians so fast to support the new stadium. Having lived the miserable life of searching for campaign cash they truly know the value of both access to those boxes and the ego boast evidenced by the Chris Christie hug.
Why the Missouri GOP is psychology hell bent against an NFL stadium is for another day.

Thursday, January 29, 2015

Tony Messenger, Journalist Malpractice, Whitewashing the Crazy No. 000087

Paul Krugman asks:

How does one report on politics when a significant wing of the political spectrum is, not to put too fine a point on it, stark raving mad? I appreciate that it’s hard to do without attracting accusations of bias; on the other hand, there’s a temptation to soft-pedal the crazy, to make it seem as if politicians were less out there than they really are.

But here is Tony Messenger whitewashing two Missouri crazies who are stark raving advocates of massive tax cuts and an end to state income taxes, one financed by Sam Brownback's principal backer

 

 

How often is this stupidity---"smart and thoughtful" going to be repeated in the next election cycle?

Do smart thoughtful people lead the charge in the race to the bottom?

 

 

Tuesday, January 27, 2015

Is the Way Tony Messenger thinks about Non-Profits and Charities Wrong? No. 000085

Editor Messenger and the Post think about Non Profit Hospital and other Charities the way the GOP thinks about Government. He is a cheapskate.

Consider:

Dan Pallotta The way we think about charity is dead wrong

Activist and fundraiser Dan Pallotta calls out the double standard that drives our broken relationship to charities. Too many nonprofits, he says, are rewarded for how little they spend — not for what they get done. Instead of equating frugality with morality, he asks us to start rewarding charities for their big goals and big accomplishments (even if that comes with big expenses). In this bold talk, he says: Let's change the way we think about changing the world. 

 

Sunday, January 25, 2015

Like Tony Messenger and the Post Dispatch Didn't Know that Tim Jones would Misuse the Post No. 000084

This evening took a moment to glance through the #MOleg hashtag on Twitter.  No Surprise. Speaker Jones is attacking Steven Lipstein for being a multi-millionaire CEO, this personal assault set up and made possible by the journalistic malpractice of Tony Messenger.

Progressives, with friends like Messenger, who needs enemies.

Playing #Hardball with the NFL Using Missouri's Power to Tax to #Brushback the Kansas City Chiefs, the Rams, and the NFL into building a new Saint Louis Stadium No. 000083

Tony Robbins

At 7:35:

"the defining factor is not resources it is resourcefulness"

We are still a week away from the SuperBowl but I have grown completely bored with the #STLNFL and the #NFL. I am especially bored with our Governor and local politicians who are trying to sneak one past the tax paying public by talking about paying the public portion of any stadium by extending current taxes.

Why bored? Because once again Missouri leads the nation in lack of resourcefulness.

If our politicians of either stripe were resourceful it would seem to me that they would be thinking as follows:

  1. The Roberts Supreme Court is an era of Renaissance for State's Rights.
  2. Surely there is a reservoir of a State's Rights over the NFL to prevent coercion in a stadium location, if the Federal Government lacks the power to coerce states into expanding Medicaid.

Simply put, when it comes to stadium location, the NFL is a conspiracy, which the NFL has argued is sanctioned by the United States under its anti-trust laws. Cf. City of San Jose v. Office of Commissioner of Baseball, No. 14-15139 (9th Cir. Jan. 15, 2015)Los Angeles Memorial Coliseum Com'n v. NFL, 726 F.2d 1381 (9th Cir. 1984).

That begs a question not considered before. By means of the anti-trust laws, can Congress coerce the States.

National Federation of Independent Business teaches, "No," Justice Roberts writing:

Coercing States to accept conditions risks the destruction of the "unique role of the States in our system." Davis, supra, at 685, 57 S.Ct. 883 (Kennedy, J., dissenting). "[T]he Constitution has never been understood to confer upon Congress the ability to require the States to govern according to Congress' instructions." New York, 505 U.S., at 162, 112 S.Ct. 2408. Congress may not "simply commandeer the legislative processes of the States by directly compelling them to enact and enforce a federal regulatory program." Id., at 161, 112 S.Ct. 2408 (internal quotation marks and brackets omitted).

Sum of it all.

The point, if we had a resourceful Governor and Legislature they would be actively looking at legislative solutions to the Saint Louis stadium situation. May I suggest thought be given to any of all of the following approaches for raising the funds necessary, either to renovate the Edward Jones Stadium or to construct a new stadium.

1) Enact a wealth tax, targeted toward the owners of the Chiefs and Rams, to tax away their ill gotten gains arising out of the squeeze put on the State of Missouri and its political subdivisions through the NFL's franchise location rules.

2) Enact an income tax or gross receipts tax, targeted toward the owners of the Chiefs and Rams, for the same reasons.

3) Enact a gross receipts tax on advertising revenue paid by advertisers for broadcasts of NFL games into the State of Missouri.

4) Enact a gross receipts tax on revenues received by either the NFL or its teams from broadcasters who televise or broadcast NFL games in Missouri.

Instead of #Ballgate, how about #Hardball with a few #Brushback pitches of our own.

More Reasons Why Progressives Should Not Trust Tony Messenger and the Saint Louis Post Dispatch No. 000082

To have a better understanding of why Tony Messenger should not be trusted one needs to consider how Mr. Messenger handles letters to the Editor with the editorial section of the Post Dispatch.  Yesterday provides a good insight.

Mr. Messenger is well aware the Bullshit Asymmetry Principle:

Accordingly, when it suits his purpose he selects letters to the editor that heap bullshit on those he disfavors.

On Saturday he directed the bullshit of newly elected State Senator Robert Onder against BJC Healthcare and its Chief Executive Officer, Steven Lipstein, by publishing a letter to the editor.

The Post offer's no reason or justification for publishing the letter which contains a myriad of false charges of which we shall mention two.

First, Onder asserts that expansion will strain our existing Medicaid program but that is false. Expansion replaces the current program and Missouri's match is less so it does exactly the opposite---it would put Missouri's budget in a better position.

Second, Onder asserts that we borrow the funding from expansion from China but that is not true. China exports billions of dollars of goods to us every month---at present over $40 billion a month---for which we are not paying. Instead, for its own reasons, China is willing to accept US government debt in lieu of payment for the goods it is selling us. This is why China is a creditor of the U.S. Government. China's acceptance of our debt in payment for goods sold and imported is not paying for Medicare expansion.

Given that the letter is bullshit regarding the ACA, why was the letter published.

To understand one must recall that Mr. Messenger believes that money grows on trees. He somehow thinks that BJC should be providing more free medical care. He may also be part of the chorus that objects to the non-profit status of BJC, albeit the sole source of funding to pay taxes would have to come from either reduced patient care or higher charges to paying customers, or some combination. Thus, he permits Onder to make the false, bullshit charge "that provision of care to the poor is why federal, state and local governments consider BJC and most other hospitals to be nonprofits and exempt them from taxes."

What non-sense.

Hospitals are non-profits, and appropriately so, because they tend to the spirital and emotional needs of their patients, patient families, and even the care givers and staff, in times of great pain, loss, suffering, fear, uncertainty, and doubt.

No great hospital, and BJC is a great hospital, is a mere for profit or commercial endeavor. It matters not a wit about whether BJC provides care to the poor whether it should be a non-profit.

Do we consider Senator Onder's church to be for profit when it ministers to his spirital needs?

Do we consider universities or private high schools for profit when they educate our wealthiest?

Why, Mr. Messenger, is this editorial malpractice being presented?

Was the letter printed because Mr. Messenger is jealous and envious of what Mr. Eipstein is paid and Odner's letter provides him a vehicle for attacking his salary. BJC, which operates 12 hospitals, has 27,000 employees and annual revenues of more than $4 billion, ranking it within the Fortune 500 in terms of sales. There are only 975 companies in the United States with more than 10,000 employees. To print such an ad hominen tells all.

Two closing observations.

Odner closes his letter with the false charge that Illinois "teeters on the edge of bankruptcy," more bullshit. Illinois has an unbalanced budget because, like Kansas, it cut taxes. In comparison to its total state gross domestic product and assets, Illinois is actually in better shape than Missouri. It only needs to raise taxes to balance its spending and outlays.

Last, Odner asserts that Arkansas is going to undue Medicaid expansion in 2015 but the Republican governor has called for the state to the expansion in place.

The sum of all this is that, merely to appear fair and balanced, a newspaper does not print bullshit, especially bullshit which personally attacks as does Senator Odner's letter.

 

Why Progressives Should Not Trust Tony Messenger and the Saint Louis Post Dispatch No. 000081

Most days when I read a Saint Louis Post Dispatch Editorial I put down the paper shaking my head with the thought, with friends like this, who needs enemies. Wannabe Celebrity Editor Tony Messenger, @tonymess, with only 8,784 Twitter followers, is the best thing going in Missouri for the reactionaries and neo-reactionaries of the Missouri GOP.

Why such a difference with Mr. Messenger?

First, he lacks the skill, ability, and insight to invert a problem. Further, he and all the most post writers see but they do not observe. How do these lacks of skills work together?

 

  • Open Enrollment

Let's consider K-12 education in the Saint Louis Region, the City, West County, North County, and Francis Howell School District in Saint Charles.

The facts are these. The schools in the City, in North County, and in Francis Howell are failed or are failing, all due to a lack of money. Taking the last first:

ST. CHARLES COUNTY, Mo. (KMOV.com) – The Francis Howell School District has a projected budget shortfall of $22 million dollars which may force the district to cut 80 jobs, half of which would be teaching positions.

 

“Where it gets tricky is you have, as an example, a first grade teacher retire, but you need to trim high school math,” said Dr. Steven Griggs, Human Resources Officer for the school district. “Sometimes the attrition and where you need to trim don’t match.”

 

Francis Howell has more than 17,000 students, 1300 teachers, 900 district employees, and a projected budget of $203 million dollars. Griggs says he expects most of the job cuts could be handled through employees taking jobs elsewhere or retiring.

 

One resident, Randy Watson, is critical of district’s decision and says they brought this predicament on themselves. “Our average teacher makes about $58,200. Next is Fort Zumwalt and that average teacher makes about $52,000. I’m not against teachers getting raises, but we don’t have the funds to pay for them.”

 

 

Read more: http://www.kmov.com/news/st-charles-county-news/Budget-problems-may-force-Francis-Howell-School-District-to-cut-teaching-jobs-286400071.html#ixzz3PrMS8Ril

Mr. Messenger's non-solution for this problem is two fold.  First, he proposes that the successful schools in West County be forced through Open Enrollment to accept more students without any increases in revenue or funding. If he inverted or observed he would know that solution would not work for fundamental reasons.

First, when you invert a school district and look from the bottom up and not the top down you will see that its primary mission is not education. The primary mission of every school district, when inverted, is to provide free public transportation of students to school. Inverting allows one to see that the secondary mission is providing education during the period of time when students wait to be transported home in the evening, again for free. Advocates for open schools are, in effect, advocating for abandonment of the primary mission of schools. Since open enrollment plans never include transportation, and the taxes necessary for transporting students greater distances, they are never talking about reality.

Second, open enrollment advocates never observe the market or supply of teachers. Presumably, those who support open enrollment believe that teachers in West County schools are better teachers than those available elsewhere. If true, then open enrollment cannot work unless one also increases the supply of entirely new teachers. What is accomplished by transferring an lower skilled teacher from the City to Clayton to teach the same students?

Thus, for open enrollment to work, teacher salaries must go up to attract new or better teachers. Professor Brad Delong here (Proposal 2) explains current teacher compensation in the United States where we presently use non-cash compensation, in the form of tenure and job security, to hire teachers at below market salaries. 

Again, Mr. Messenger disregards these facts. While he proposes open enrollment he never talks about from where the money will come to pay the higher teacher salaries necessary to make such a program work.

Last, Mr. Messenger never inverts and asks, How will voters in the West County districts react to open enrollment. The West County districts which Mr. Messenger wants to force open are not closed now. They are open to anyone who wants to move into the district and pay the local taxes that fund these districts, which "self fund." This means that they fund by local real property taxes instead of relying upon Missouri's School Foundation Formula.

By advocating for open enrollment Mr. Messenger is advocating for the kind of mooching and free riding that makes Missouri famous. A family could choose to live in a low tax district---and use Hancock to resist increases in their taxes by voting against such---and send their students to Clayton.

Under such a system Clayton voters will soon loose their appetite for funding their schools.

 

  • Fully Funding the Foundation Formula to the tune of $400 Millions

Mr. Messenger also frequently writes advocating fully funding the Foundation Formula. The Foundation Formula is Missouri's plan to kill the Goose, St. Louis and Kansas City, that lays the golden egg by taxing these two regions and spending the money out-state in lieu of imposing adequate taxes on farmland. The lack of adequate funding for out-state schools is assured by our State Constitution and Law's discriminate in the favor of agricultural and horticultural property.

If effect, under Missouri's current system of school funding, taxpayers in Saint Louis and Kansas City, living in self-funding school districts, via state sales and income taxes, are paying the principal amounts spent to educate children in out-state Missouri. 

When Mr. Messenger advocates for fully funding the Foundation Formula he does not mention that this will not increase (significantly) the funding for schools in Saint Louis.

Further, he fails to reason through whether this new funding could result in an increase in education quality.

It is an unfortunate reality that merely raising an employee's compensation does not get you a better and more productive employee. Raising funding for schools works, but only if you do one or both of two things:

First, you use the money to train current teachers or to provide a more effective learning environment or better teaching tools or for similar improvements.

Second, you use the money to hire new teachers with higher skills.

Republicans distrust raising the Foundation Formula because they believe that school districts will merely us the new funds to raise current teacher salaries without any increase in education quality.

As Professor Delong explains:

Teachers will fight attempts to disrupt security of employment unless they have confidence that the grand bargain by which they trade security for higher salaries will be kept — which they do not have. Fiscal conservatives will fight teacher-salary increases unless they are confident that the Democratic Party-public sector union complex will then disarm itself of its weapons — which they are not.

This is where the tone of the Post Dispatch, set by Mr. Messenger, is of no help whatsoever. 

Under Governor Nixon a grand bargain was available over Education over the last six years.

If the Post Dispatch had focused on the unfairness of St. Louis and Kansas City paying more taxes for higher teacher salaries in out-state during years in which farmers were enjoying record and near record incomes and farmland prices, the stage could have been set for an agreement on raising out-state taxes and assuring that new monies merely did not go to higher salaries for existing teachers.

Mr. Messenger goes not think and advocate in these terms because a solution is in conflict with his base motive which is to become a celebrity pundit of the Left.

 

 

Lesson No. 1 for the Missouri Democratic Party, Trade Craft: Making Powerful Use of the Hashtag #Moleg--Anonymous Blogs and Tweets No. 000080

  • Fears, Doubts, and Uncertainties prevail in Jefferson City

Wednesday's Senate Hearing on Senate Bill 12---Obamacare for Dairy Farmers---gave me a day long opportunity to observe what is left of Truman's proud Democratic Party after it has been thoroughly worked over and thrown under the bus by the Shadow Presidency of Valeria Jarrett. 

My expedition was for the purpose of evaluating whether, since the election, the Party had been able to OODA---observe, orient, decide, and act---in accord with the results of the post November election.  My expectations were not high.  My working hypothesis of what is wrong with the Missouri Democratic Party comes straight from Kevin Drum: that it is no longer the party of working class white voters.

But when the economy stagnates and life gets harder, people get meaner. That's just human nature. And the economy has been stagnating for the working class for well over a decade—and then practically collapsing ever since 2008.

So who does the WWC take out its anger on? Largely, the answer is the poor. In particular, the undeserving poor. Liberals may hate this distinction, but it doesn't matter if we hate it. Lots of ordinary people make this distinction as a matter of simple common sense, and the WWC makes it more than any. That's because they're closer to it. For them, the poor aren't merely a set of statistics or a cause to be championed. They're the folks next door who don't do a lick of work but somehow keep getting government checks paid for by their tax dollars. For a lot of members of the WWC, this is personal in a way it just isn't for the kind of people who read this blog.

And who is it that's responsible for this infuriating flow of government money to the shiftless? Democrats. We fight to save food stamps. We fight for WIC. We fight for Medicaid expansion. We fight for Obamacare. We fight to move poor families into nearby housing.

This is a big problem because these are all things that benefit the poor but barely touch the working class. Does it matter that the working class barely pays for most of these programs in the first place, since their federal income taxes tend to be pretty low? Nope. They're still paying taxes, and it seems like they never get anything for it. It's always someone else.

It's pointless to argue that this perception is wrong. Maybe it is, maybe it's not. But it's there. And although it's bound up with plenty of other grievances—many of them frankly racial, but also cultural, religious, and geographic—at its core you have a group of people who are struggling and need help, but instead feel like they simply get taxed and taxed for the benefit of someone else.

The post election actions of Governor Nixon show or tend to show that this is his working hypothesis. In the face of inadequate state revenue his State of the State speech proposed no new taxes even though the state is $4 billions under the Hancock Cap. He ordered the Missouri Department of Transportation to do a study on financing the rebuilding of I-70 with tolls. He instructed the his NFL stadium advisors not to propose new taxes (albeit continuation of current taxes was ok).

Further, when Governor Nixon talks about the ACA his principal selling point is that it saves money over the current program, at least until Missouri has to belly up and pay its 10%.

  • Fear has replaced the ability to Observe and Orient.

Walking the halls, sitting in the offices, seeing Senate Democratic members leave hearings and the opportunity to ask tough questions about GOP crony capitalism openly displayed, taking in the body language of members and staff, it was apparent that Democrats have come to understand that "the Democratic Party simply doesn't do much for either the working or middle classes these days."

For example, last year House and Senate Democrat supported a sales tax increase to pay for highway construction, carrying the coals for its construction union supporters. Talk about a tax on working class voters for the benefit of others. Governor Jay Nixon was never on board and Senate and House Democrats should have taken a cue.

More recently, some are proposing an increase in gasoline taxes---the most direct tax possible on the WWC---to pay for highways and I-70. Common sense seems to be prevailing.

This realization, however, has not been translated into anything tangible because, fearing the charge of class warfare, Missouri Democrats are unwilling to talk about progressive taxation.

For example, no Democrat has spoken in favor of a land tax to pay for highways and yet that would be the fairest and most simple way. Better roads will increase land values so taxing that increase in value would make the most sense.

Further, Democrats refuse to offer a fair progressive income tax law. Because the income brackets are so low, Missouri's current income tax law is really not a progressive income tax in effect. For several decades Missouri Democrats have missed the opportunity to work for Missouri's working class by failing to propose more progressive taxation. In conjunction with the need for higher revenues for education and transportation, now would be the ideal time for such proposals.

But, because of fear of talking about tax increases, Democrats are unable to observe, orient, decide, and act on a plan for progressive income tax increases for Missouri.

  • Anonymity, using the Internet, as a solution.

Tony Robins likes to say, our problems are "not a lack of resources, they are a lack of resourcefulness." When one walks into any Democratic member's office the head fakes being pulled off are amazing. There are computers, laptops, notebooks, and smart phones every where, being put to no apparent use.

Twitter, for example, has this wonderful powerful feature, the hashtag: #Moleg.

With #Moleg one can anonymously communicate with the World via Twitter account or a link to a blog, easily written, with the latest events and developments in he Capital or elsewhere.

It takes only a few moments to set up a blog, a Twitter account, and using the Google Chrome Browser,. and ScribeFire within 10 minutes any one can be informing the World about what is taking place in Missouri.

For example, it should be often and in depth explained that in the House this year there will be no Democratic amendments permitted and no meaningful floor debates.

We all know the bills that are coming. Right now, using Blogger and a Google Drive account, House Democrats could be offering to the World the amendments that would be offered to House Bills, if debate and amendment were freely and openly permitted.

  • The Very Honorable History of Anonymity

Some make ask, is it right, ok, lawful to communicate anonymous. Absolutely!. Our Founding Fathers, Hamilton and Jefferson among them, did so regularly and with gusto.  

  • Do I expect anyone to Act? No

If Progressives view our President as weak, unskilled, and lacking in leadership---Why didn't we hear the SOTUS last summer?---be prepared to be really disappointed with our current crop of Democratic Legislators. Consider our sole announced state wide office candidate No-Bill No-Voice Sifton.

Here is the strong progressive set of bills he has put forth for 2015:

Two weeks into the Session he hasn't appeared on the floor in any meaningful way and is certain to do anything possible to avoid a substantive debate with GOP Attorney General Candidate Senator Kurt Schaefer.

Democrats are urged to express your frustration early and often, easily done on twitter at @ScottSifton.

Senator, a Missouri state wide candidate with only 923 followers is in serious trouble.