Thursday, June 30, 2011

Oriental Town Commissioners and Management

Some Oriental Town Commissioners seem to have great difficulty grasping the proper role of the board of commissioners. Let's try again.

The Town of Oriental has a council-manager form of government. That means the board of commissioners exercises a legislative role by providing general direction and control over town government, adopting general personnel rules, regulations, policies or ordinances and providing oversight over the Town Manager's activities.

The Town Manager is the chief administrator of the town. He is responsible to the board of commissioners for all municipal affairs. His powers and duties are spelled out in North Carolina General Statutes.

The manager supervises and directs all departments of Town Government, including appointing, suspending or removing ALL city officers and employees not elected by the people (subject in some cases to other provisions of the law).

In brief, the town board gets to hire the town manager. The board has NO statutory authority to hire or fire any employee subordinate to the manager. To be sure, the board can establish general personnel rules, regulations and policies.

Commissioners have NO operational role in the town's administration. No supervisory role and no authority over employees. No individual commissioner has any administrative or disciplinary authority over the manager or any other employee. Neither does the mayor.

We saw at today's agenda meeting the sort of problem that can arise when an individual commissioner takes on the task of obtaining cost estimates, "bids," making design decisions, and attempting to move forward with a project instead of asking the entire board to task the manager with the project. In this case, the project that seems unnecessarily muddled is the pier at the end of South Avenue.

There have been other matters unnecessarily muddled by commissioner meddling in the past year and a half.

The board needs to address this. It is a procedural issue.

Wednesday, June 29, 2011

Town of Oriental Personnel Procedures: Due for Amendment?

This morning at their 11:15 special meeting, the town board of commissioners passed a motion to offer Dwaine Moore, who is a corrections officer at the prison in Pamlico County. Moore, a resident of Oriental, has been working for months as an unpaid auxiliary officer for the Town of Oriental. The board also offered an unpaid position as auxiliary police officer to Bob Lyons, a marine patrol officer for the state.

From the subsequent discussion, it was unclear to me whether the board would decide to conduct a formal search for a permanent Chief of Police to replace the retiring Chief Casasa.

After the meeting, I decided to reread what North Carolina General Statutes have to say about hiring personnel. Here is what I found:

"Section 160A-148. Powers and Duties of Manager.
The manager shall be the chief administrator of the city. He shall be responsible to the council for administering all municipal affairs placed in his charge by them, and shall have the following powers and duties:
(1) He shall appoint and suspend or remove all city officers and employees not elected by the people, and whose appointment or removal is not otherwise provided for by law, except the city attorney, in accordance with such general personnel rules, regulations, policies or ordinances as the council may adopt.
(2) He shall direct and supervise the administration of all departments, offices, and agencies of the city, subject to the general direction and control of the council, except as otherwise provided by law.
(3) etc."

Among the officers who may be appointed by a city, presumably in this case by the manager, is the chief of police and other police officers (NCGS 160A-281.)

Another interesting provision of NCGS is the following:

"Section 160A-165. Personnel board.
The council may establish a personnel board with authority to administer tests designed to determine the merit and fitness of candidates for appointment or promotion, to conduct hearings on the appeal of employees who have been suspended, demoted or discharged, and hear employee grievances."

In other words, it appears that under NCGS, the board appoints the manager and the manager makes all other personnel decisions, possibly as supported by a personnel board if one is established.

And by the way, town commissioners have no legal authority to provide any degree of supervision or direction over any town employees.

Maybe it's time to review how the town does business.

Baby Boomers Strike Again and Stay Put

It's no news that there have been few recent real estate closings in Oriental and elsewhere in Pamlico County.

The question is "why?" and "will this be a long term trend?"

Yesterday's Washington Post provided an explanation: retiring baby boomers are staying put and not moving to Florida, Nevada, and other sandy locations further south. Will this trend affect North Carolina and Pamlico County? I wouldn't bet against it.

So maybe we need to get busy with an economic development plan that recruits younger workers with families instead of more affluent retired folks who don't seem to be moving here any more anyhow.

Sunday, June 26, 2011

What to do in Hard Times

If we need to know what to do in times of prosperity and times of famine, we could do worse than to consult the Bible. The story of Joseph and the Pharoah makes the concept clear:

Genesis 41:
17 Then Pharaoh said to Joseph, “In my dream I was standing on the bank of the Nile, 18 when out of the river there came up seven cows, fat and sleek, and they grazed among the reeds. 19 After them, seven other cows came up—scrawny and very ugly and lean. I had never seen such ugly cows in all the land of Egypt. 20 The lean, ugly cows ate up the seven fat cows that came up first. 21 But even after they ate them, no one could tell that they had done so; they looked just as ugly as before. Then I woke up.

22 “In my dream I saw seven heads of grain, full and good, growing on a single stalk. 23 After them, seven other heads sprouted—withered and thin and scorched by the east wind. 24 The thin heads of grain swallowed up the seven good heads. I told this to the magicians, but none of them could explain it to me.”

25 Then Joseph said to Pharaoh, “The dreams of Pharaoh are one and the same. God has revealed to Pharaoh what he is about to do. 26 The seven good cows are seven years, and the seven good heads of grain are seven years; it is one and the same dream. 27 The seven lean, ugly cows that came up afterward are seven years, and so are the seven worthless heads of grain scorched by the east wind: They are seven years of famine.

28 “It is just as I said to Pharaoh: God has shown Pharaoh what he is about to do. 29 Seven years of great abundance are coming throughout the land of Egypt, 30 but seven years of famine will follow them. Then all the abundance in Egypt will be forgotten, and the famine will ravage the land. 31 The abundance in the land will not be remembered, because the famine that follows it will be so severe. 32 The reason the dream was given to Pharaoh in two forms is that the matter has been firmly decided by God, and God will do it soon.

33 “And now let Pharaoh look for a discerning and wise man and put him in charge of the land of Egypt. 34 Let Pharaoh appoint commissioners over the land to take a fifth of the harvest of Egypt during the seven years of abundance. 35 They should collect all the food of these good years that are coming and store up the grain under the authority of Pharaoh, to be kept in the cities for food. 36 This food should be held in reserve for the country, to be used during the seven years of famine that will come upon Egypt, so that the country may not be ruined by the famine.”

Now we are not dealing with famine, and we have a monetary economy in place of a barter economy, but the principle is the same: store up surpluses in good times and use those surpluses in bad times. The technical term for this is a counter cyclical policy.

The problem is, we did not store up surpluses in good times. In truth, every US president from Truman through Nixon left office with reduced debt as a percentage of gross domestic product. So did Presidents Carter and Clinton. Presidents Ford, Reagan, G.H.W. Bush and G.W. Bush did not. In fact, they quadrupled our existing debt.

Now if we want to put people and other resources back to work, we need to borrow the resources to do so, which we can do at very low interest rates.

Here is Mark Thoma's plan for how to make such financial policy automatic. Good luck getting it adopted.Link

Orwellian Political Economy

I am not an economist, though I once stayed at a Holiday Inn Express.

Joking aside, I did study International Economics as a part of my studies in International Law and Diplomacy in the late 1960's. But the core of my academic background was political science and history.

It was a time when public disputes centered around issues of war and peace, civil rights, women's rights, not about economics. Among academic economists there were some eccentric scholars calling for a return to the gold standard and some calling for flexible exchange rates. But in general, there was a widespread Keynesian consensus.

At that time, we had fixed exchange rates under the international payments system established at Bretton Woods near the end of World War II and designed (by Keynes) mainly to ensure economic recovery of both winners and losers of that conflict. Internationally, we had a gold-exchange standard and issues of "balance of payments" were described in terms of gold flow among nations.

It was a period of economic prosperity for both management and labor, with CEO's earning about 30 to 40 times the wages of the lowest paid employees. Pension benefits were fixed. Workers were responsible for doing their jobs and management took care of pensions and other benefits.

That all changed in the 1970's. Nixon abolished the gold exchange standard and the US adopted flexible exchange rates. Companies switched to "defined contribution" pensions rather than "defined benefit" pensions. After Nixon, the Federal Government began stripping away the financial controls that had maintained financial stability for more than three decades.

I recently decided to read up on current economic thinking. In the days of the internet, there is no better way to follow the discourse than to read economist's blogs.

I have had to learn or relearn such things as liquidity preference, propensity to consume, propensity to save, the problems of the zero bound, and IS and LM curves.

I also have learned the difference between "saltwater economists" [a school to which I adhere] and "freshwater economists." And it has become clear that when communicating with each other, economists can be a very sarcastic bunch of scholars.

Mark Thoma, a professor of economics at University of Oregon, recently started a thread on his blog dealing with Investment Saving/Liquidity preference Money supply issues. The discussion veered into the issue of "confidence" and the lack of clarity as to what the term means.

One participant, identified as "stunney," contributed the following:

I think that among not just billionaires, but multimillionaires in general, confidence is pretty high right now. In particular, they're confident that the financial crisis will be borne by the lower echelons, and that capitalism is being made safer and safer for unbridled rapacity.

They're also confident a large reserve army of unemployed labor will persist for a long time, ensuring that downward pressure on wages will not be relieved by any silly jobs program or other needed public investment

Their confidence that the massive military/industrial/national security expenditures of recent decades will continue is high.

Plutocratic confidence that trade agreements will be focused on making it as easy as possible to ruthlessly exploit cheap labor oversees without having to worry about workplace safety or environmental nonsense, while cracking down on foreign competitors via enforcement of intellectual property claims, whining about state subsidies, or whining about competitors' non-compliance with US regulatory standards.

Finally, they're confident that the socialistic insanity of Social Security, Medicare, and other forms of coddling US citizens will be progressively dismantled so that the richest can slave-drive the rest with utter abandon and, indeed, get them to vote for ever more savage forms of their own enslavement, abasement, degradation, and pauperization.

"Always, at every moment, there will be the thrill of victory, the sensation of trampling on an enemy who is helpless. If you want a picture of the future...


Reply Sunday, June 19, 2011 at 11:36 A

The reference, of course, is to George Orwell's novel 1984.

Saturday, June 25, 2011

Coastal Economics [Wal(rus) Street at Work]

The Walrus and The Carpenter

Lewis Carroll

(from Through the Looking-Glass and What Alice Found There, 1872)

The sun was shining on the sea,
Shining with all his might:
He did his very best to make
The billows smooth and bright--
And this was odd, because it was
The middle of the night.

The moon was shining sulkily,
Because she thought the sun
Had got no business to be there
After the day was done--
"It's very rude of him," she said,
"To come and spoil the fun!"

The sea was wet as wet could be,
The sands were dry as dry.
You could not see a cloud, because
No cloud was in the sky:
No birds were flying overhead--
There were no birds to fly.

The Walrus and the Carpenter
Were walking close at hand;
They wept like anything to see
Such quantities of sand:
"If this were only cleared away,"
They said, "it would be grand!"

"If seven maids with seven mops
Swept it for half a year.
Do you suppose," the Walrus said,
"That they could get it clear?"
"I doubt it," said the Carpenter,
And shed a bitter tear.

"O Oysters, come and walk with us!"
The Walrus did beseech.
"A pleasant walk, a pleasant talk,
Along the briny beach:
We cannot do with more than four,
To give a hand to each."

The eldest Oyster looked at him,
But never a word he said:
The eldest Oyster winked his eye,
And shook his heavy head--
Meaning to say he did not choose
To leave the oyster-bed.

But four young Oysters hurried up,
All eager for the treat:
Their coats were brushed, their faces washed,
Their shoes were clean and neat--
And this was odd, because, you know,
They hadn't any feet.

Four other Oysters followed them,
And yet another four;
And thick and fast they came at last,
And more, and more, and more--
All hopping through the frothy waves,
And scrambling to the shore.

The Walrus and the Carpenter
Walked on a mile or so,
And then they rested on a rock
Conveniently low:
And all the little Oysters stood
And waited in a row.

"The time has come," the Walrus said,
"To talk of many things:
Of shoes--and ships--and sealing-wax--
Of cabbages--and kings--
And why the sea is boiling hot--
And whether pigs have wings."

"But wait a bit," the Oysters cried,
"Before we have our chat;
For some of us are out of breath,
And all of us are fat!"
"No hurry!" said the Carpenter.
They thanked him much for that.

"A loaf of bread," the Walrus said,
"Is what we chiefly need:
Pepper and vinegar besides
Are very good indeed--
Now if you're ready, Oysters dear,
We can begin to feed."

"But not on us!" the Oysters cried,
Turning a little blue.
"After such kindness, that would be
A dismal thing to do!"
"The night is fine," the Walrus said.
"Do you admire the view?

"It was so kind of you to come!
And you are very nice!"
The Carpenter said nothing but
"Cut us another slice:
I wish you were not quite so deaf--
I've had to ask you twice!"

"It seems a shame," the Walrus said,
"To play them such a trick,
After we've brought them out so far,
And made them trot so quick!"
The Carpenter said nothing but
"The butter's spread too thick!"

"I weep for you," the Walrus said:
"I deeply sympathize."
With sobs and tears he sorted out
Those of the largest size,
Holding his pocket-handkerchief
Before his streaming eyes.

"O Oysters," said the Carpenter,
"You've had a pleasant run!
Shall we be trotting home again?'
But answer came there none--
And this was scarcely odd, because
They'd eaten every one.

Return to Lewis Carroll
Return to Jabberwocky

Friday, June 24, 2011

Election Law Pot-Pourri

As I previously posted, Governor Perdue has vetoed the legislature's bill to require photo ID for voting.

That is by no means the only important election law issue.

In this session, there were about forty-one bills introduced, with the goal of extensively modifying North Carolina election law.

As an aside,your Pamlico County Board of Elections will enforce whatever changes become law. I have informed both Representative Sanderson and Senator Preston of my concerns about the effect of one of the proposed amendments, and had a useful discussion with Senator Preston's staff. The bill is not yet ratified, but has been ordered engrossed.

That being said, as I have previously noted, North Carolina election law as it presently exists is highly regarded in other states and at the US Department of Justice. I hope we retain that positive reputation.

Of the forty-one bills, Senate Bill 47 began life under the title "Restore Partisan Judicial Elections." The conservative Civitas Institute advocated partisan judicial elections because "including a party affiliation would give them some information about the candidates, and could lead to greater participation by the voters." As we will see, this logic wasn't necessarily applied to other election legislation.

Senate Bill 47 has now been retitled "An Act to Make Various Amendments to the Election Administration Laws, and Other Conforming Changes." In other words, it has become a legislative pot-pourri, incorporating measures from most of the forty-one bills concerning election law. As Churchill might have observed, "this bill has no theme." So we can only list the changes it makes.

Here they are:

1. Special elections can only be held on the same day as general and primary elections;

2. Establishes a term of office for chair of the State Board of Elections, with a two- term limit;

3. Repeals same day registration and voting (many first time voters used this in 2008);

4. Prohibits paying any person to assist or encourage voters to fill out registration forms, including payment per application completed;

5. Repeals right of a person who becomes eligible to vote after registration deadline but before election day to vote on election day - a provision that allows newly-naturalized citizens sworn in just before election to vote;

6. Repeals the mandated voter registration and preregistration drives at high schools and statewide registration drives; and even repeals the authorization for school boards to participate in such drives;

7. Introduces more stringent candidate treasurer requirements;

8. Makes candidates personally liable for civil penalties against campaigns;

9. Eliminates non-partisan judicial elections;

10. Removes requirement that provisional ballots not be marked to identify the voter;

11. Requires rotation of order of parties on ballots every four years (in apparent contradiction to requirement in same section that parties be in alphabetical order);

12. Eliminates straight party voting;

13. Provides elaborate details to insure "faithful presidential electors," limiting appointments to a single alternate for each elector (did not amend section 163-1 which requires first and second alternates);

14. Reduces period of one-stop early voting by one-third (two-thirds of Pamlico County voters voted during one-stop in 2008);

15. Repeals present requirement that only a near relative can request an absentee ballot for another person, and repeals provision for requester with handicap or illiteracy to receive assistance from an individual of requester's choice;

16. Permits compelling testimony from witness while subjecting witness to penalty and forfeiture for acts testified to;

17. Repeals instant runoff voting;

18. Repeals Voter Owned Election Act and associated funding of candidates;

19. Severely limits political contributions by State Vendors;

20. Under the guise of limiting allowed contributions to political parties, allows parties to receive contributions of up to $250,000 from any individual, political committee (other than a candidate committee), referendum committee, person or other entity in any election;

21. Applies balances in Voter Owned Election Fund to pay for voter ID equipment mandated by the Voter ID Act that Governor Perdue has already vetoed.

Those are the important ingredients in the pot-pourri.

More Debt Can Solve a Debt Problem, After All

The public keeps hearing confident assertions that "debt can't solve debt." As it turns out, it can.

Here is the clearest explanation that I know of how it would work. Furthermore, the new debt would be very cheap: interest rate not much above zero percent or in some cases less than zero.

Paul Krugman:

June 8, 2011, 11:22 am

Sam, Janet, and Debt

In the discussion of Richard Koo, I’m seeing a number of people asserting (a) debt can’t be the solution to debt (b) inflation can’t possibly be helpful. I guess that’s the problem with blogging: even if you explain your position clearly, after a few months people enter the discussion without knowing about or having forgotten the earlier discussion.

So let me repost in its entirety my take on the balance-sheet recession issue. There’s a more formal treatment of the ideas, plus a bunch of further results, in my work with Gauti Eggertsson.

The original post:

Sam, Janet, and Fiscal Policy

One of the common arguments against fiscal policy in the current situation – one that sounds sensible – is that debt is the problem, so how can debt be the solution? Households borrowed too much; now you want the government to borrow even more?

What’s wrong with that argument? It assumes, implicitly, that debt is debt – that it doesn’t matter who owes the money. Yet that can’t be right; if it were, we wouldn’t have a problem in the first place. After all, to a first approximation debt is money we owe to ourselves – yes, the US has debt to China etc., but that’s not at the heart of the problem. Ignoring the foreign component, or looking at the world as a whole, the overall level of debt makes no difference to aggregate net worth – one person’s liability is another person’s asset.

It follows that the level of debt matters only if the distribution of net worth matters, if highly indebted players face different constraints from players with low debt. And this means that all debt isn’t created equal – which is why borrowing by some actors now can help cure problems created by excess borrowing by other actors in the past.

To see my point, imagine first a world in which there are only two kinds of people: Spendthrift Sams and Judicious Janets. (Sam and Janet who? If you’d grown up in my place and time, you’d know the answer: Sam and Janet evening / You will see a stranger … But actually, I’m thinking of the two kinds of agent in the Kiyotaki-Moore model.)

In this world, we’ll assume that no real investment is possible, so that loans are made only to finance consumption in excess of income. Specifically, in the past the Sams have borrowed from the Janets to pay for consumption. But now something has happened – say, the collapse of a land bubble – that has forced the Sams to stop borrowing, and indeed to pay down their debt.

For the Sams to do this, of course, the Janets must be prepared to dissave, to run down their assets. What would give them an incentive to do this? The answer is a fall in interest rates. So the normal way the economy would cope with the balance sheet problems of the Sams is through a period of low rates.

But – you probably guessed where I’m going – what if even a zero rate isn’t low enough; that is, low enough to induce enough dissaving on the part of the Janets to match the savings of the Sams? Then we have a problem. I haven’t specified the underlying macroeconomic model, but it seems safe to say that we’d be looking at a depressed real economy and deflationary pressures. And this will be destructive; not only will output be below potential, but depressed incomes and deflation will make it harder for the Sams to pay down their debt.

What can be done? One answer is inflation, if you can get it, which will do two things: it will make it possible to have a negative real interest rate, and it will in itself erode the debt of the Sams. Yes, that will in a way be rewarding their past excesses – but economics is not a morality play.

Oh, and just to go back for a moment to my point about debt not being all the same: yes, inflation erodes the assets of the Janets at the same time, and by the same amount, as it erodes the debt of the Sams. But the Sams are balance-sheet constrained, while the Janets aren’t, so this is a net positive for aggregate demand.

But what if inflation can’t or won’t be delivered?

Well, suppose a third character can come in: Government Gus. Suppose that he can borrow for a while, using the borrowed money to buy useful things like rail tunnels under the Hudson. The true social cost of these things will be very low, because he’ll be putting resources that would otherwise be unemployed to work. And he’ll also make it easier for the Sams to pay down their debt; if he keeps it up long enough, he can bring them to the point where they’re no longer so severely balance-sheet constrained, and further deficit spending is no longer required to achieve full employment.

Yes, private debt will in part have been replaced by public debt – but the point is that debt will have been shifted away from severely balance-sheet-constrained players, so that the economy’s problems will have been reduced even if the overall level of debt hasn’t fallen.

The bottom line, then, is that the plausible-sounding argument that debt can’t cure debt is just wrong. On the contrary, it can – and the alternative is a prolonged period of economic weakness that actually makes the debt problem harder to resolve.

L'etat, C'est Nous

So, what are elections about, anyhow?

To Louis XIV of France, elections and parliaments were irrelevant. "L'etat, c'est moi," he declared.

We started our nation with a different idea.

"We hold these truths to be self-evident," we declared, "that all men are created equal, that they are endowed by their Creator with certain unalienable rights, that among these are life, liberty and the pursuit of happiness. That to secure these rights, governments are instituted among men, deriving their just powers from the consent of the governed."

In this country, that is what elections are about: to grant or withhold the consent of the governed. That is, in today's America, the consent of all its citizens, each of whom has the right to vote.

Or, to put it another way, "l'etat, c'est nous."

Voter ID Bill

Thursday afternoon, Governor Perdue vetoed the voter ID bill passed by the Republican state legislature.

I have commented previously on the purpose of voter ID laws, as revealed by a Republican Party official in Texas.

I am reviewing Senate Bill 47, which incorporates a wide range of election law modifications. I expect to have an informational post up by noon.Link

Thursday, June 23, 2011

Municipal Elections

I still hear grumbling about Oriental town government.

Just a reminder: candidate filing for municipal office opens at the Pamlico County Board of Elections office in Bayboro at noon, Friday, July 1, 2011. Candidate filing ends at noon, July 15, 2011.

Now is the time to start organizing for your campaign.

Wednesday, June 22, 2011

Do We Need a Third Party?

Columnist Thomas Friedman, in today's New York Times, called for a third party to enter the 2012 presidential election campaign.

His reason? Our political system has evolved to the condition that makes it impossible for any president to accomplish anything except during the initial 100 days of the administration.

Friedman makes a lot of good points. He also admits that there is no chance that a third party candidate would actually win. He doesn't mention it, but the only time in our history that a third party affected the outcome of an election was in 1912, when Teddy Roosevelt ran as the "Bull Moose" party (Progressive Party) candidate and won more votes than incumbent President Taft. That put Woodrow Wilson in the White House.

Republicans hoped for a repeat in 1948 when two third parties (Henry Wallace's Progressive Party and Strom Thurmond's States Rights Party) split from the Democratic Party. Despite that, Harry Truman won the election.

The Pew Research Center for People and the Press finds eight or nine groupings of political thought. Each of these groupings could form the basis of a political party, except for one thing: our elections are held on a "winner-take-all" basis. This system, unlike countries with proportional representation, can sustain no more than two parties.

If Friedman really advocates third parties, they have a better chance of success at the state level and in congressional elections than they do for presidential elections.

I am not at all persuaded by Friedman's article, but it is worth reading. Even more interesting are readers' comments.

Tuesday, June 21, 2011

Can Americans Make Anything Besides Deals?

Interesting column by Harold Meyerson in last week's Washington Post.

The question Meyerson addresses is whether the United States can learn from the example of others - in this case, Germany. The first part of the question is whether there is anything to be learned from other countries. Clearly there is.

The second part of the question is whether we are capable of learning from the successes of other countries. That's an open question.

Meyerson comments on the German model: "German manufacturers, particularly the midsize and small-scale ones that often dominate global markets in specialized products, don’t seek funding from capital markets (there’s a local banking sector that handles their needs) and don’t answer to shareholders. They make things, while we make deals, or trades, or swaps."

David Leonhardt, the New York Times economics columnist, wrote last week that Germany owed its edge in global competitiveness to a range of policies that could not be more different than ours: limiting home ownership, improving education (including vocational and technical education) and keeping unions strong — which is why “middle-class pay,” he noted, “has risen at roughly the same rate as top incomes.”

The German model differs from the laissez-faire approach to globalization that has dominated U.S. policy and discourse for decades, dooming many American workers to penury. Meyerson's article emphasizes the crucial distinctions between Germany’s stakeholder capitalism, which benefits the many, and our shareholder capitalism, which increasingly benefits only the few.

Can we learn from others? Let's give it a try.Link


Wisdom is a deep understanding and realizing of people, things, events or situations, resulting in the ability to choose or act or inspire to consistently produce the optimum results with a minimum of time, energy or thought. It is the ability to optimally (effectively and efficiently) apply perceptions and knowledge and so produce the desired results. Wisdom is also the comprehension of what is true or right coupled with optimum judgment as to action. Synonyms include: sagacity, discernment, or insight. Wisdom often requires control of one's emotional reactions (the "passions") so that one's principles, reason and knowledge prevail to determine one's actions.


The opposite of wisdom is folly. The opposite of a wise man is a fool.

Pamlico County Budget

Last night Pamlico County's Board of Commissioners held a public hearing on the budget for FY 2011 - 2012. The national (and worldwide) economic downturn, which was none of the county's doing, is now harming its citizens.

During the hearing on the budget, members of the county's soil and water conservation board asked the commissioners to reconsider the decision to reduce work hours for two of their employees. This point was taken up by Commissioners Delamar and Ollison before the vote on the budget. They emphasized the services provided by the board to all of the county's citizens.

The county GOP Director of Communications complimented the commissioners on a good budget and then made the predictable observation that we need tax cuts, smaller government and more individual responsibility. He also cited the county's median income as $47,000 per capita (that's more likely the figure for family income, not individual income), 15% below the poverty line and the fact that taxes constitute 56% of the county's revenue. He did not mention that the county has a functional illiteracy rate of 14% and that 24% of the county's citizens have a disability of some kind.

The challenge facing the county was to deal with reduction in funds received from the state, forcing the county to reduce its contribution to both the Community College and the Public Schools at the same time those institutions received reduced resources from the state. The surprise resignation by Dr. James Coon, county school superintendent, represented his contribution to the reduction of central staff in an effort to hold down expenses. Even so, there will be staff reductions, increase in class size, and a likely adverse effect on the quality of education in the county.

The county commissioners have done the best they could under difficult circumstances.

This is a case of stuff flowing down hill. The economic crisis didn't start here and can't be fixed here. It started on Wall Street. It can be fixed by Washington. It won't be fixed until our leaders recognize that what is needed is a substantial fiscal stimulus.

I have written about this before. I won't go into it again, at least not now.

But the only people benefiting from the current situation and the refusal of the national government to take effective stimulus measures are the top 1% of our economy, who own fifty percent of the nation's assets. The next 9% are doing OK. The bottom 90% are hurting. And it's all so unnecessary.

Monday, June 20, 2011


There are two novels that can change a bookish fourteen-year old's life: The Lord of the Rings and Atlas Shrugged.
One is a childish fantasy that often engenders a lifelong obsession
with its unbelievable heroes, leading to an emotionally stunted,
socially crippled adulthood, unable to deal with the real world. The
other, of course, involves orcs.

John Rogers

Race and the Past

William Faulkner once observed that the past isn't dead - it isn't even past.

Not that there aren't people who try to bury it.

Today's New York Times has an article about the race riot 90 years ago in Tulsa, Oklahoma. When I was growing up in Tulsa, I never heard about the riot. It was typical of riots by whites against blacks in the late 19th and early 20th centuries. In this case, spurred by untrue rumors of a black on white sexual assault, armed white citizens attacked the prosperous black area of town known as Greenwood, killed perhaps 300 residents and burned the area to the ground.

My grandparents, who lived in Tulsa at the time, never told me about it. After they died, I found an old photograph of a distant Tulsa neighborhood engulfed in flames.

No wonder my grandparents never told me. My maternal grandfather was a member of the Klan. Both he and my paternal grandfather were among the armed rioters on that day.

It wasn't a glorious day in my family's history.

Or that of my home town.


Thursday, June 16, 2011

Singing from the Wrong Sheet of Music

Last Saturday, we attended a baccalaureate ceremony for our graduating grandson.

There was lovely music, sung by the college choir. Early in the ceremony, the choir sang a spirited rendition of "America the Beautiful."

Unlike the unsingable drinking song with Francis Scott Key's lyrics that we chose as our national anthem in 1931 under President Hoover, "America the Beautiful" isn't bombastic.

I wonder how much of our national readiness to go off firing rockets comes from "bombs bursting in air" and prideful assertions that we are "the land of the free" and the "home of the brave."

Maybe if we had a less bombastic anthem, we could pay more attention to the arts of agriculture and industry, the challenges of diplomacy and the creation and celebration of beauty and a bounteous plenty. Who knows what heights such an anthem might inspire us to achieve.

"America the Beautiful" is just such an anthem.

Delicious Seed Corn

The Governor vetoed the NC legislature's budget which reduced our education spending to the level of Mississippi.

All over a penny sales tax.

Are the citizens of NC so cheap we would withhold a penny from our schools? I don't think so.

But all of the Republican members of the general assembly and five Democrats made it clear they don't give a fig for our children. Or our college students. Or the economic future of the state.

I know something about Mississippi. I started school there in 1943. I graduated from Ole Miss in 1958.

If you really want to, it isn't hard to win a race to the bottom.

We don't want to go there.

But as I warned before, we are eating our seed corn. I hope we enjoy it.


I see our military actions in Libya are drawing fire.

I am agnostic about the wisdom of what NATO is doing there. But I believe the president's actions are legal.

Have we forgotten "the shores of Tripoli" in the Marine Corps Hymn? That refers to a war we waged against the so-called Barbary Pirates from 1801 to 1805 under President Thomas Jefferson. We didn't declare war.

Throughout our history, the Navy and Marine Corps fought in foreign conflicts, including our "Quasi War" with France under President Adams, without a declaration of war. Our founders were quite suspicious of a standing army, but harbored no similar prejudices against the Navy and its associated Marines. The Constitution, for example, prohibits appropriations for the army longer than two years, but has no similar limitation for naval appropriations.

This historical and legal foundation became muddled by the creation of the Department of Defense in 1947.

Why we felt the need for DOD is a mystery. We had just triumphed in the greatest military conflict in history, with our original structure of a Department of the Navy and a War Department (the army). Unification was a solution in search of a problem.

There's nothing we are doing in Libya right now that can't be handled by what we used to call the "Navy/Marine Corps Team."

Keep the army in their garrisons until we need them and then call up the militia and declare war. It worked well for a long time. And put the Air Force back in the Army, where it belongs.

Tuesday, June 14, 2011


Cambridge MA, Tuesday, June 14, 2011

I understand from a recently published list of media that cover Pamlico County that mine is a "rambling blog."

I prefer the term "eclectic."

I don't object to "rambling." I certainly never promised to limit my thoughts to certain subjects or to Oriental and Pamlico County.

I hope my readers don't mind.

This week, we're rambling in Massachusetts.

Monday, June 13, 2011

Afghanistan, Bananastan

I was glad to see in Pamlico Today that Congressman Walter B. Jones, Jr. has come out publicly for a withdrawal from Afghanistan.

Senator Aiken of Vermont once observed during the Vietnam War that the US could well declare victory and bring the troops home, leaving the conflict to be resolved politically.

Not a bad idea for Afghanistan today. We need to get over the illusion that we can remake the world by force of arms. We may have better success by using the force of ideas. Or example.

New England

We got out of New Hampshire just in time to miss the debate.

Still cold here in the Boston area. Visited Winchester, MA today, where I lived while studying international relations, including courses in international economics. Lovely place. While it's a bit chilly today, it becomes really chilly in midwinter.

The house we lived in still looks over the street as it always did.

Much has changed, but much is the same.

Sunday, June 12, 2011

Graduation Day

Hanover, NH Sunday, June 12, 2011. The Dartmouth class of 2011 graduated this morning. It was cold and rainy, but both funny and exciting.

The commencement address was delivered by Conan O'Brian.

There were two valedictorians - both were young women. Forty years ago, no women were admitted. Now, about half the student body are women. And most of the honors graduates.

The same number of graduates were named Wang as were named Smith.

It was a diverse student body. Many of color, including Native Americans, African Americans, Hispanic Americans, Oriental Americans, South Asians and Africans. They are America's new elite.

Today we saw the future in Hanover, NH. And the future is good.

Saturday, June 11, 2011

It's Cold Up Here

If you plan on going to New Hampshire from Oriental anytime soon, remember it gets cold and rainy. Be prepared. I wasn't.

Thursday, June 9, 2011

Traveling North

Just a word to the wise: when traveling north on I-95, if you can avoid Delaware, do so. Big delays from construction.

Wednesday, June 8, 2011

On Outgrowing Earth

Today's article in the New York Times by Thomas Friedman should be alarming.

But don't worry. Oriental's member of Pamlico County's Board of Commissioners reported at the last Board meeting that she and others have successfully blocked an effort by NC planners to push restrictions on construction based on predicted sea rise. The objection: the plan was based on computer modeling. Presumably, we are supposed to wait until the water actually rises. That would be scientific.


We'll be on the road for a couple of weeks. Posts will be sporadic at best.

Tuesday, June 7, 2011

Religious Exception to Zoning

I was pleased to learn this evening that the Oriental Town Board had decided to postpone the public hearing on the five amendments to the Growth Management Ordinance proposed by the town's planning board. There was a recognition that maybe the public notice hadn't been as clear as it might have been.

The board decided this evening to schedule public hearings on all five proposed amendments at the July meeting. I would have been happier if they had decided to act first on the proposed amendment on how to amend the ordinance, but that's ok.

In the meantime, we should all be thinking about the proposal to exempt "religious institutions," including buildings owned by such institutions, even if they otherwise resemble ordinary houses, from some of the dimensional regulations affecting other structures in the zone.Link
A point to remember is that, just because a religious institution owns a building today doesn't mean it will own that building tomorrow, next year or ten years from now. In the meantime, an allowed deviation from dimensional restrictions could have significantly changed the look of the neighborhood and affected the housing value of neighbors.

Nobel Laureate Not Good Enough for Republicans

Two days ago, Peter Diamond, a Nobel Laureate in economics, appointed by President Obama to a vacant seat on the Federal Reserve Board, withdrew his nomination. His statement explained why. In a nutshell, Republicans don't want someone on the FED who is expert in the economics of employment.

Why does the president want an expert in employment economics on the FED? Because one of the statutory responsibilities of the FED is to take measures promoting full employment. No economist is better qualified to figure out how best to do that than Peter Diamond.

Senator Shelby of Alabama has been Diamond's main obstacle. Senator Shelby is not unintelligent. He is, it seems, intelligent enough to know which side of his bread the butter is on and who is buttering it. And it isn't unemployed citizens of Alabama or anywhere else in America.

Time Magazine's Michael Grunwald has a pertinent observation here.

Monday, June 6, 2011

Goals of the Wealthy and Powerful

I've been trying to make rational sense of the adamant Republican opposition to any measures that might actually ameliorate the economic distress of ordinary people. I've been looking for an explanation other than their contempt for people who work for a living.

Even a political party whose central organizing principal seems to be the welfare of the top 1% of the economic strata might be expected to worry about the economy as a whole, but that doesn't seem to be the case. I have had a dark suspicion that it is all about partisan manipulation: wreck the economy and blame the democrats.

Maybe not.

Here is a much simpler explanation, and one with deep roots in history.

Check it out.Link

Paul Krugman: Day of Days

I just couldn't resist linking to one of today's posts by Paul Krugman.

Interminable War

The war, it seems, went on forever.

It lasted half my lifetime. At least it had when it finally ended. In 1945.

When the Japanese attacked Pearl Harbor, December 7, 1941, I was a little over four and a half years old. When the Japanese surrendered in Tokyo Bay, September 2, 1945, I was eight years and five months old.

War movies had already been going on for nearly four years. And they are still going on.

I even occasionally come across a war movie I don't remember having seen before.

It's no wonder that younger generations can't place the war in any particular half century. It was ancient, wasn't it? Nineteenth century? Just after the Spanish American War? Or was it before?

It's also no wonder the younger generations find it unsurprising that a war in a foreign land could have been going on for a decade. It's like seeing WWII movies. Especially if you don't have a father or an older brother in the fight. Life goes on as usual.

That isn't the way it was in 1942. Or 1943 or 44 or 45. We were all in it together, even if all we did was deliver carefully smashed tin cans and bundles of paper and magazines to the scrap drive. Or sweetened our tea with saccharine instead of sugar and our mothers saved up ration cards for months to be able to bake a birthday cake.

Is this trip necessary? The patriotic posters asked in the train station.

Good question.

D-Day Conundrum

Sixty-seven years ago today, allied forces crossed the English Channel by air and sea, conducting the largest amphibious invasion in history.

The forces landed on the coast of Normandy, not far from Bayeux, from where the Norman forces under William the Conqueror had left in 1066 to defeat the forces of King Harold and conquer England.

By far the two best movies depicting the landings in Normandy are The Longest Day and Saving Private Ryan. Neither movie, however, depicts the most significant technical innovations of Operation Overlord - the Conundrum, Pluto, Bambi, Dumbo and the Mulberries.

As early as 1941, British military and naval planners recognized that the harbors in the pas de Calais would be heavily defended and that amphibious assault would probably not succeed. The solution: artificial harbors constructed using enormous concrete caissons towed across the channel and sunk to form artificial breakwaters. Inside the breakwaters, cargo was to be offloaded onto floating piers.

The greatest challenge, though, was how to provide enough fuel to the forces once they landed. The answer was to invent, manufacture and test an underwater pipeline system, known as PLUTO (Pipe Line Under The Ocean). The pipeline was to be laid by using enormous spools of line (called Conundrum). Once in place, the pipeline would be serviced by camouflaged pumping stations built in great secrecy under the code names Bambi and Dumbo.

Here is a good summary of PLUTO.

Sunday, June 5, 2011

Let's Make Voting Harder

Good article in today's New York Times explains what's really going on with voting law in North Carolina and in other states.

I had an earlier post on the issue of one-stop (early voting) in North Carolina.

Make White Water!

When a US Navy destroyer goes from one place to another at high speed, it stirs the water up and leaves a big rooster tail and wake.

One day in 1964, I was at the conn of USS Higbee (DD-806) when the commodore decided to exercise the destroyer squadron at tactical maneuvers. At one point, we were in a circular formation centered on the flagship, when he ordered us to rotate the formation axis. I checked the maneuvering board solution and realized we could simply alter course a bit, slow to about ten knots, and slide into the new station. Smooth.

Commodore Healy had different ideas. He called us on the radio. "Higbee," he said, "this is ComDesRon Three. Make White Water!"

In other words, he wanted us to speed up, turn in a tight circle, stirring up the water, and hurry into the new station. I ordered left full rudder, all ahead full, and did as he wished.

I learned from that experience that sometimes visible action is more important than subtlety.

As I look at the state of the economy and assess the recent jobs information, I see that we aren't creating jobs fast enough to keep pace with our growing population. We need to kick up a rooster tail and make white water!

Is anyone in Washington listening?

Debt Problem?

Suppose you could borrow money for ten years at a real interest rate of less than one percent? Even better, suppose you could borrow money for five years at an interest rate of less than zero? In other words, someone will pay you for you to borrow their money?

You'd probably think about borrowing that money and investing it in measures to improve your future wealth.

Strange as it seems, the US Treasury's real interest rate paid on inflation-protected securities is less than one percent for ten years and less than zero percent for five years. So why not borrow more at those rates and use the funds to stimulate jobs and reinvigorate the economy?

Ask the Republicans.

Is this what they mean by running the government like a business?

Saturday, June 4, 2011

What is Economics?

I've been following recent disputes among academic economists in the blogosphere. Very interesting.

I think macroeconomist Brad DeLong has put his finger on one of the essential differences in approach that feeds economic disputes, as well as political disputes.

Commenting on a presentation by Robert Lucas, Jr., a noted economist of the Chicago School, who cites taxes, unions, financial regulation and the expanding welfare state as causes of the persistent depression, DeLong has this to say:

"[A]s Gavyn Davies [another economist blogger] drily notes, Lucas "seems to have ruled...out [alternate explanations] by a priori conviction, rather than any detailed empirical work."... Lucas seems to be discarding the very idea that economics, like the natural sciences, should be based on the evidence. He appears to believe that the state of the world can be ascertained by deductive logic, without ever looking out the window. That's fine, I suppose, if you believe that economics is a branch of philosophy rather than a branch of science. But it does not seem to be an approach that is likely to enable many practical improvements in the lives of human beings."

Reminds me a bit of the Queen of Hearts in Alice in Wonderland: "Sentence first - verdict afterwards." And perhaps then a bit of evidence, if ever we get around to it.

But I'm afraid too many in Congress treat economics as a branch of philosophy rather than science.

Friday, June 3, 2011

Milk Jug Protests

Remember the local protests against President Obama's health care reform proposal at the Oriental post office last year? The protesters, mostly Republicans, said they didn't want any government interference in health care, though most of them were users of Medicare, VA and other US Government health care programs. Some seemed to fear that health care reform would take these away.

We now know that it is the Republicans who want to replace Medicare with a voucher system, thus turning it into something entirely different from the present system. But they get upset if anyone points out that Congressman Ryan's plan is a voucher system (which it is) and will end Medicare as it now exists (which it will).

Paul Krugman points out quite clearly in his blog why Medicare is sustainable in its present form, but is susceptible to improvement. If you are interested in his explanations, look here. For even more information, once on his blog, keep clicking on the "previous post" button. Eventually, you will come to an explanation of liquidity preference and an informative graph.

Personally, I think a better health reform would have been to adopt a system like VA. For various reasons, in any event, doctors are increasingly withdrawing from their own private practices and going on salary. This brings many benefits to them as well as to their patients. I, for one, would be more comfortable knowing that the physician isn't recommending a procedure because it improves his own personal income.

Jobs, Jobs, Jobs

Today's employment news isn't good.

Unemployment is up to 9.1%.

I hate to be a pessimist, but I'm not surprised. The stimulus plan (ARRA) wasn't big enough, and included too many tax reductions in lieu of direct government expenditures.

To understand why, you need to be familiar with three concepts:
A. Liquidity trap. That is when our national monetary authority reduced short term interest to zero, but banks aren't lending and companies aren't borrowing. We are in a liquidity trap. There are many reasons for this - companies, for example, aren't investing because they have no expectation that new customers will suddenly appear. Another reason is:
B. Liquidity preference. In uncertain economic times, companies prefer to hold liquid assets (that can be readily converted to money, like bonds) rather than illiquid assets, like real estate and other commodities;
C. Aggregate Demand. Classical economists have believed for nearly two centuries that there will never be an overall shortage of aggregate demand. Time and again they are proven wrong, but the belief persists. Our aggregate demand is way down because we have the lowest percentage of the population employed since the great depression.

The reason our recovery is stalled is that, in a liquidity trap only government expenditures have a realistic chance of overcoming liquidity preference, improving aggregate demand for goods and services, and therefore stimulating businesses to hire workers and invest in increasing productive capacity.

Businesses aren't refusing to invest because Democrats have hurt their feelings, as some seem to suggest.

Thursday, June 2, 2011

Modern Anarchism

Government isn't the solution - government is the problem!

Did you ever hear that? If you really believe it, you are an anarchist.

Tea Party adherents say they believe it.

Until the pot holes on the way to work don't get fixed. Or they lose their job. Or their house catches fire.

Wednesday, June 1, 2011

Rich Man's War - Poor Man's Fight

I just finished reading an interesting book about the Civil War in Mississippi: The State of Jones.

I had long known that something happened during the war in Jones County, Mississippi. The county became a refuge for deserters and supporters of the Union. The central figure was Newton Knight, a yeoman farmer who opposed the planter class. He not only organized and led a force of Unionists who opposed the Confederacy, he established an interracial community in the county.

I don't know if it was these farmers who invented the phrase, "it's a rich man's war and a poor man's fight," but it might well have been.

Bitter as Newton Knight's fight was during the war, the struggle afterwards was even more challenging as the planter class reestablished control of the state after the war through a reign of terror. They even succeeded to a great extent in reestablishing white dominion over black laborers. How Knight survived the assassination attempts and the violence of the Klan to die in his old age is in itself a remarkable story.

I have also been reading the New York Times' Disunion series of articles. I'm learning a lot about the Civil War I never knew. A complicated tale.