Prediction and Governing

Last May I posted the observation that governing is prediction.

Various studies have concluded that, in general, liberals are better prognosticators than conservatives, especially if they have no law degree.

Now David Frum of the Wall Street Journal has joined the chorus.

"Imagine, if you will," Frum asks, "someone who read only the Wall Street Journal editorial page between 2000 and 2011, and someone in the same period who read only the collected columns of Paul Krugman. Which reader would have been better informed about the realities of the current economic crisis? The answer, I think, should give us pause. Can it be that our enemies were right?"

The main problem I see with Frum's observation is the assumption that someone whose research and analysis of facts and trends differs from one's own is thereby an "enemy." We should all be seekers of truth, not seekers of vindication. The proof of the pudding is in the accuracy of resulting predictions.

Krugman's predictions are accurate. Wall Street Journal's are not.

Curmudgeon Status

I've been warned.

A couple of days ago during the morning status report at The Bean, one of my colleagues spoke up:

"Unless your blog posts become more emotional," he warned, "we're not gonna let you renew your curmudgeon's license."

I tried to think of a response. Finally I mumbled: "I yam what I yam."

It was a weak riposte.

August Oriental Town Board Meeting

There were some positive developments in the way last night's town board meeting was conducted.

Mayor Bill Sage reported that he has been reading Robert's Rules of Order and learning a lot from it. That is good.

Town Manager Bob Maxbauer reported on the status of planning for a new town dock at the end of South Avenue. He will submit a proposal for a grant under the federal Boating Infrastructure Grant (BIG) program, thus leveraging the money the town has set aside for the project. The area will be dredged to a depth of eight feet before installing a pier planned to be six feet wide and 120 to 130 feet long. It will be designed to BIG standards, expected to last for at least twenty years. The BIG program targets non-trailerable transient vessels at least 26 feet long and requires a depth of at least six feet alongside.

Maxbauer also explained the recent purchase, using funds from last year's budget, of a John Deer Alligator vehicle, which will provide new capabilities to public works with more economy than the existing pickup trucks.

The meetings still take too long. I will have some suggestions about that.

Gandalf

Gandalf frees the GOP from Grover Wormquist.

http://youtu.be/w65menUWLIY

Where Is The Stock Market Rally?

Today is the eighth straight day the market is down. No rally yesterday after the vote in the House. No rally today after the vote in the Senate.

Does the Market know something Washington doesn't?

Maybe they see this as a victory for the Tea Party but a loss for America. I do.

This deal, with its reduction in government spending, will be a drag on the economy. The consequences:

1. More jobs lost;
2. Reduction in the Gross Domestic Product (GDP);
3. More deterioration in the nation's roads, highways, bridges, railroads, harbors and other infrastructure (the quality of our infrastructure now ranks 23rd in the world);
4. Reduction in basic research;
5. Reduction in education;
6. Reduced ability to compete with the rest of the world;
7. More wealth diverted to the wealthy and powerful;
8. More blame to the blameless,
9. Reductions in Medicare and Social Security.

The Tea Party has now killed their half of the dog.

Cutting government expenditures in an economic downturn really worked out for Herbert Hoover in 1929, didn't it? Just remember - it was the Tea party this time.

Debt Limit Explanation

I have tried to explain what is going on, but today economist Jared Bernstein has a more clear explanation:

"While waiting to go on Larry Kudlow’s show last night, I heard Sen Mitch McConnell say:

“What we have done, Larry, also is set a new template. In the future, any president, this one or another one, when they request us to raise the debt ceiling it will not be clean anymore. This is just the first step. This, we anticipate, will take us into 2013. Whoever the new president is, is probably going to be asking us to raise the debt ceiling again. Then we will go through the process again and see what we can continue to achieve in connection with these debt ceiling requests of presidents to get our financial house in order.”

This morning, on Squawk on the Street (CNBC) I debated former Sen Judd Gregg who wholeheartedly endorsed this process, calling it the best way to impose budget discipline.

Predictable, I guess, but let’s think about this for a sec. These politicians are essentially saying the following:

“We in Congress cannot be counted upon to come up with budgets that pay for the spending we authorize. Therefore, we will have to borrow to make up the difference. But if that borrowing hits the cap, we will not raise the cap to cover the appropriations on which we already signed off, unless we get the spending cuts we want.”

To understand how nonsensical Sens McConnell’s and Gregg’s position is, you have to appreciate that Congress knows when they pass their budget whether it will breach the debt ceiling or not, just like you know when you order your lunch whether you’ll be able to pay for it. They’re saying, I’m going to keep ordering lunches I can’t pay for and when the cashier hands me the check, I’ll hand it right back and tell her it’s her problem.

The budget process is when you square the ledger. Or not—there will be budgets, especially in recession, that add to the deficit and breach the ceiling. In such cases, Congress must borrow to make up the difference, and sometimes that will mean raising the ceiling, as we’ve done without incident since 1917.

But Sens McConnell and Gregg would rather pass budgets they knowingly refuse to pay for, and then threaten default. You can call that budget discipline if you want. But I’m telling you, this is not the way of great nations.

On the plus side, while I was waiting to go on Lawrence O’Donnell’s show, I heard Barney Frank, who, while even more disheveled than usual, made a whole ton of sense on the debt ceiling debate (he was a ‘no’ vote in the House)."

Job Losses

Oriental Town Charter - Proposed Amendment

A couple of interesting items on tomorrow night's agenda for the meeting of the Oriental Town Board of Commissioners:

1. Under "new business" - Approve subdivision of property at 204 High Street. This is a continuation of a longstanding controversy in that neighborhood. There has been high public interest in the issue in the past.

2. Set public hearing for proposed amendment to Article VI of the GMO. I'm sure it's just a typo, because required notice of a public hearing has not been made - but the proposed amendment in the commissioners' briefing package says "adopted this 2nd day of August, 2011."

3. Similarly, the resolution of intent to adopt a charter amendment changing terms of office for mayor and council members from two to four years calls for a public hearing August 2, 2011. This is obviously in error.

For the information of citizens, NCGS 160A-102 sets out the procedure to be followed:

"The resolution of intent shall describe the proposed charter amendments briefly but completely and with reference to the pertinent provisions of G.S. 160A‑101, but it need not contain the precise text of the charter amendments necessary to implement the proposed changes. At the same time that a resolution of intent is adopted, the council shall also call a public hearing on the proposed charter amendments, the date of the hearing to be not more than 45 days after adoption of the resolution. A notice of the hearing shall be published at least once not less than 10 days prior to the date fixed for the public hearing, and shall contain a summary of the proposed amendments. Following the public hearing, but not earlier than the next regular meeting of the council and not later than 60 days from the date of the hearing, the council may adopt an ordinance amending the charter to implement the amendments proposed in the resolution of intent.

The council may, but shall not be required to unless a referendum petition is received pursuant to G.S. 160A‑103, make any ordinance adopted pursuant to this section effective only if approved by a vote of the people, and may by resolution adopted at the same time call a special election for the purpose of submitting the ordinance to a vote. The date fixed for the special election shall be not more than 90 days after adoption of the ordinance.

Within 10 days after an ordinance is adopted under this section, the council shall publish a notice stating that an ordinance amending the charter has been adopted and summarizing its contents and effect. If the ordinance is made effective subject to a vote of the people, the council shall publish a notice of the election in accordance with G.S. 163‑287, and need not publish a separate notice of adoption of the ordinance."

NCGS 160A-103 Stipulates: "An ordinance adopted under G.S. 160A‑102 that is not made effective upon approval by a vote of the people shall be subject to a referendum petition. Upon receipt of a referendum petition bearing the signatures and residence addresses of a number of qualified voters of the city equal to at least 10 percent of the whole number of voters who are registered to vote in city elections according to the most recent figures certified by the State Board of Elections or 5,000, whichever is less, the council shall submit an ordinance adopted under G.S. 160A‑102 to a vote of the people."