Poverty is Bad For Business

Someone who gets it. From a business writer no less and about the dozenth one I've seen by a business writer in the last month or two.

On Poverty, Maybe We're All Wrong

Most years, what passes for the national debate about poverty is confined to the 24 hours after the government releases its annual report on household incomes, as it did yesterday.

The left expresses moral outrage -- in the richest country the world has ever known, one in every eight residents still lives in poverty -- and calls for government to do something about it.

The right, to the degree that it pays any attention to the issue at all, notes that while the poverty rate goes up and down with the economic cycle, it has remained relatively stable over the past 35 years and, in any case, represents a failure of government meddling, not a mandate for more of it.

That there is a germ of truth to both views does not excuse the fact that the debate has become stale and unproductive, based on misleading data and outdated assumptions.

Much better, conservatives say, to do away with all those patronizing and inefficient social welfare schemes that create perverse incentives and "empower" the poor to act in their own best interest using the same traditional market mechanisms as everyone else.

The best refutation of this argument that I've seen in a long time is contained in a new book, "The Persistence of Poverty," by a friend of mine, Charles "Buddy" Karelis, a professor at George Washington University. Karelis isn't an economist or social welfare expert but a philosopher by profession with wide-ranging curiosity, a dry wit and a weakness for unconventional wisdom. And after doing lots of reading and giving it extensive thought, Karelis concluded that the reason some people are perpetually poor is that they don't have enough money.

Ya think? That would seem obvious if we were at all rational creatures but it's fairly well documented that we are not. Pearlstein goes on to explain why it isn't as obvious as it seems at first glance but not wanting to rip off his entire article, I leave you to go read it. It's a refreshing change from Cowboy Bush who apparently believes the poor all gambled their money away at a Reno casino.

The Case For Not Keeping Up With the Joneses

You can count me as one homeowner/investor who is not terribly upset about the drop in real estate prices. Everyone has already weighed in on the downsides to this development but I really can see an upside here.

For starters, I'll be the first to admit I really don't care if it's perceived as a "conservative" viewpoint....I believe in home ownership. I see it as being nearly as important as food and medical care. Yup, that important.

Where I differ from the "conservatives" is in believing that it's important for everyone, not just those of us lucky enough to have decent incomes and sterling credit. People need their own space that is truly their own and not some set of rooms they are allowed to inhabit at "the pleasure of" a landlord or an anonymous property management company or even some well-intentioned governmental agency.

It's really a no-brainer...people who do not own their homes, no matter how expensive or inexpensive, do not have a vested interest in their communities. We can't even begin to address social and economic inequities in this country when nearly half of our citizens don't have a prayer of ever owning their own space.

Thanks to various governmental programs and the boom in "creative" financing the latest figures indicate home ownership in the US is at record levels. I'll leave that alone though in truth I'd dispute that figure. The trouble is we got there not by having available, affordable housing but by creating unrealistic terms and conditions which rather than providing a "leg up" to the most vulnerable buyers instead provided a cash cow to speculative buyers.

Real estate is an investment but we've done what we always do, we got greedy. We stopped living in our homes and started viewing them as ATM machines and temporary quarters to inhabit until we could double our investment and move on to the next better thing, always counting on the people behind us to continue pushing prices higher. So we've finally hit the wall and there is no longer anyone behind us. It was bound to happen and anyone surprised at this turn of events has been living in a state of extreme denial.

What part of a nation filled to overflowing with service sector employees making barely above an already substandard and unrealistic minimum wage cannot afford to purchase even a $150k home are we not getting? Particularly not going to happen in the very communities that most need the labor and services provided by those same workers where their sheer numbers have pushed the cost of rentals through the roof.

So now prices are dropping. GOOD. They need to drop, I doubt they will drop anywhere close to where they need to and most likely the cycle will continue. Hopefully, much as I was able to in the California housing crash of the '80's, some people will be able to take advantage of the situation. Unfortunately it won't help those on the very bottom of the wage scale. They'd still have to give up little things like eating, medical care and child care to be able to save enough to make a down payment...even assuming they could afford the monthly payment on the simplest of homes.

As much as I'd like to sell and relocate I would really be far more pleased if home prices dropped to half or less than what they currently are because it would put nearly everyone into a home of their own and put the investor classes straight out of the real estate market, as they should be. Homes are an investment but not just in a dollars and cents kind of way. They're an investment in people and communities in ways far more important to us as a nation than people like me being able to "flip" and make bank.

For the record, yes, I've put my money where my mouth is and sold (to people I hand-picked, not random lucky investors) twice for prices that convinced everyone I was psychotic. Maybe I am but hey, I'm doing just fine, not missing any meals and I feel no guilt whatsoever, I'm officially NOT a part of the problem. Besides, if I believe in anything it's that "what goes around, comes around" if for no other reason than the way you live your life will determine the results you get. Just something to consider when deciding whether to go for the big profit or instead to take an opportunity to walk the walk and possibly do your bit to make a difference just because you can.

Nevada's Traditional Values

Myrna the Minx at Reno and It's Discontents on the State of Nevada:

Nevada ranks first nationally in the percentage of our population that is homeless (D.C. isn’t a state). Its finally great to be first for a change isn’t it? The comments degenerate into the usual blame the immigrants and lazy people, and there is also ignorant speculation that a drop in housing prices will help the situation. Since all homeless people own homes and 41 percent of homeless people in the US are living in families , that makes perfect sense. Couple our high homeless population with our other worst ranking, meth use, add in our 44th ranking in k-12 education and you have a recipe for low taxes. You get what you pay for. And you’re an idiot if you can’t see that a high rate of homelessness, excessive drug use, and a lackluster K-12 education system aren’t related.

The lady speaks the truth. Ask any 10 Nevadans, chances are at least 6 or 7 of them will tell you "it's the illegals". Yeah, the illegals. Not the majority of Nevadans who squeal like pigs when asked to pay a penny in taxes for useless stuff like education, law enforcement, or mental health care.

We like to stick to important issues here in Nevada. Like making sure we don't have to register our guns. You never know when you might need to shoot one of those pesky homeless people or an illegal.

Those same 6 or 7 people would probably also tell you how 9/11 happened because of the democrats. We are losing in Iraq because of the democrats too. Democrats are also likely to blame for everything from crime to global warming. Bets on whether or not we killed Kennedy just to try and make republicans look bad.

So what is the difference between the Reds and the Blues, aside from Blues clearly being the the root of all evil? Myrna has this interesting little bit on The Difference Between Liberals and Conservatives. Great advice for parents wanting to insure their children grow up to share their traditional values: be sure your kids are easily victimized, easily offended, indecisive, fearful, rigid, inhibited, and vulnerable at age 3.

Easy enough. Just whup 'em around a little bit with the butt end of your shotgun next time you're robbed and have a mental breakdown, lose your job and become homeless and don't forget to pull 'em out of school as soon as they are old enough to get one of those minimum wage jobs. That'll teach 'em.

Stupid, Greedy Fucks

I've been thinking about Lloyd Blankfein, CEO of Goldman Sachs and his $53.4 million dollar Christmas bonus for two days.

Yes boys and girls, that's 53.4 million. For one man who essentially does nothing but manage people who manage other people who move money around. That's it, he doesn't save lives, doesn't invent or produce anything, does not in fact contribute one single thing that could unarguably be held up as being of any real benefit to the world in general but he is rewarded in sums that would have made the pharaohs blush.

I like money as much as the next person does, I do believe hard work and innovation deserve to be rewarded, I understand that "everyone having the same" is not realistic nor will it ever produce great results, there have to be incentives for achievement.

I also believe there have to be some fucking limits. We passed those limits long ago here in the USA. We fiddled while much of the world starved and reaped more profits from their misery. Now we are reaping the results of our operating philosophy, we've turned it on ourselves.

We have working Americans living in cars and vans because they don't make enough money working their minimum wage jobs to pay rent in the cities they work in. Heaven help them if they get sick because medical care is something they can only dream about. We have entire schools filled with American born children who've never even considered the idea of going on to college, they've learned very early in life to have no dreams, it only gets you hurt. We have god-only-knows how many Americans who will live their entire lives never knowing the security of having their own home.

It's easy to just call them lazy or stupid isn't it? Absolves us of any responsibility, why should we have to give up any of our hard earned money or benefits for people who were too lazy or stupid to get their own.

I'll tell you why. Because you got where you are on their backs. You enjoy the lives you have because of them. They clean your houses, mow your lawns, babysit your offspring, wash your clothes, and work at all the little jobs that you need to keep your wheels oiled. They package your food, wait on you in stores and clean the bathrooms you piss in. Think about it the next time you feel like whining about losers wanting your money you puking fucks.

I leave you with Jamie Kilstein, enjoy.