Saturday, March 28, 2009

A memory

Our family was coming back from Japan on the SS Sultan. My dad, a Marine, had served an accompanied tour over there, and now we were coming home.

On the last day of the voyage, we got up early to pack up the last of our stuff, then went out onto the deck. The foghorn was blowing, the ship plowing through a calm sea, barely rolling. Fog made it white in every direction.

Then the sun, a great disk, rose, hanging in the sky like an enormous glowing orange, at least twice as big as a sun should be.

The foghorn blew, the gulls cried. We tasted the salty fog, lost in a vast world of black and silver sea, white fog, and a huge orange sun.

Then, out of nothing, a giant bridge appeared, orange like the sun: the Golden Gate.

It was such a perfect moment. I have never forgotten it: the orange sun and the great bridge, the salt tang in the air, the hoots of the foghorn, the screams of the gulls, the vibration and slight sway of the ship.

Whenever I see anything beautiful, I compare it with that.

Wednesday, March 25, 2009

The "new frugality" of the rich

1. What are they being frugal for? Have they suddenly realized that their spending habits were compromising their future? Have they piled up too much debt and want to pay it down? Have their sources of income decreased (very likely if it was based in part on investments)? Have they decided to establish a savings program in order to pursue some important goal (for instance, retirement if their 401ks and other current plans have decreased)?

If so, then their frugality is useful to the economy in the long run, although it may be harmful in the short term.

If it is solely a response to current social pressures, it is harmful in the short run (by depriving the people they hire or patronize of income), and in the long run. Instead of creating savings to invest, when the current downturn is over, they will simply return to their old ways, and spend any surplus they may have accumulated on other luxuries in a time when there will be no shortage of spending on luxuries.

2. This issue illustrates one of the problems of basing any major part of the economy on the behavior of the rich. It varies so wildly and is so unpredictable. Places that have based a large part of their civic growth on the spending of the rich flourish mightily in good times, and suffer mightily in bad times.

A small, select coterie of purveyors of extreme luxury goods will continue to do well; people who patronize them will not change their lifestyle because instead of a billion and a half dollars, they are now only worth a billion. But the stores, shops, and services whose customers were the "middle rich," such as brokers or traders in Lehman Brothers or AIG, are suddenly finding their stores, restaurants, and shops empty and their phones silent. Of course, they will come back after the economy turns around, but only AFTER, not AS it turns around.

3. This brings up again the question of what kind of economy do we want to have:
--one that is built on the economic power of the few rich, or one based on the economic power of the many middle and working class?
--one based on full time work with appropriate benefits, or one based on part-time work with the social safety net entirely provided by the government?
--one that is based on the idea that every adult must work, no matter what their family responsibilities, or one where a single wage earner can support a family in reasonable security?

Sunday, March 22, 2009


My town is essentially a big-box store town. 2 Wal-Marts, 2 Lowes, a Home Depot, a Target, a Barnes and Noble (mall store), a Belk's (mall store), a Sears (mall store), a Penney's (mall store), a Books-A-Million, 2 K-marts.

We also have a few of the older stand-alone clothing stores, hardware stores, and variety stores.

Our downtown (Court Street) is dead, but it wasn't killed off by Wal-Mart or the mall; it was killed off by the growth pattern of the city. Most of the new houses were not convenient to downtown. Now Old Jacksonville has the lowest population density of any of the wards of the city. Retailers don't locate there because there is not a large enough customer base, unless the business caters to the lawyers and others that work around the court house. It is significant that the restaurants in the downtown area are open for breakfast and lunch, but not for dinner; there are simply too few people in the area after the court closes for the day.

Wal-Mart is blamed for ruining downtown and killing off the locally-owned (Mom and Pop) stores. But that is blaming the symptom for the disease. Sam Walton was not a visionary who invented something that never would have been though of if he had not thought of it. He was a visionary because he thought of something that inevitably was going to happen first. If it hadn't been Wal-Mart, it would have been Smith-Mart, or Jones-Mart, or Someonelse-Mart. Whoever thought of the idea, and had the energy and skill to push to push it through, could have done what Sam did.

Globalization is real, and among its effects we must count the increasing effectiveness of large-scale retailers in taking advantages of it. Wal-Mart and Target and Best Buy can can afford to hire people to scour the world for the best prices and the cheapest shipping, to bring things to the US from China, India, Indonesia, and the other industrializing countries.

But that may be changing.

As the Internet becomes more pervasive, and as businesses become more adept at using it, smaller retailers may discover that they can do the things Wal-Mart does. While Pop tends the counter, Mom may be on the net negotiating with a factory in Shanghai. Because they cannot buy in the bulk of a Wal-Mart, they may not get quite the price of the big boxes, but they can get close enough that their advantage in a closer, less crowded location, better service, and a willingness to cater to the needs of individual customers will give them a secure customer base.

Finally, not everyone shops at Wal-Mart for price alone. The only time I shop at Wal-Mart, almost everything else is closed. When I need something at the last minute for a trip that starts at 5:00 a.m., I buy it from Wal-Mart or, too often, I can't get it at all. I go to Wal-Mart faute de mieux--for the lack of a better alternative.

Monday, March 16, 2009

Happy St. Urho's Day

St. Urho was a hermit who lived in Finland in the Dark Ages. When a plague of locusts threatened the grape crops of Finland, and the destruction of Finnish wine production. The saint was appealed to by the Finnish vintners, and he went to the top of a mountain looking down on the main area of viniculture. There he prayed day and night, then took a pitchfork and went down to the valley, chanting his holy chant, "Heinäsirkka, heinäsirkka, mene täältä hiiteen," loosely translated as "Locusts, locusts, go to h3ll." A strong wind suddenly came up and blew the whole swarm out into the Gulf of Bothnia.

Ever since then, March 16 has been St. Urho Day. People drink Finnish wine and sing Finnish songs. They wear purple and green to remind themselves of the grapes and the vines saved by the holy hermit. If they can't find Finnish wine, they drink beer with purple food coloring in it.

Of course, there are certain problems . . .

Grape vines have never thrived in Finland.

There have never been swarms of locusts in Finland.

Since there were no grape vines, there could have been no vintners.

And finally, there is no record of St. Urho in any Finnish manuscripts of the time.

In fact, the earliest mention of this saint was in northern Minnesota, by a learned loremaster named Richard Mattson, who was also a manager of Kotala's Department Store in Virginia, MN, who used this historical personage as an excuse for a sale and a party.

So if you want to start celebrating St. Patrick's Day a little early, here is a great excuse.

All together now:
"Heinäsirkka, heinäsirkka, mene täältä hiiteen"
"Heinäsirkka, heinäsirkka, mene täältä hiiteen"
"Heinäsirkka, heinäsirkka, mene täältä hiiteen"

Thursday, March 12, 2009


I have been having trouble maintaining my blood sugar on certain days. When I go to Lions Club, they have great food, and peanuts. I eat too much and my glucose gets all messed up.

When I can ride my bike, I can usually keep my glucose down, but when the weather is bad, I often find that I don't take the time to go to the gym and work out on the stationary bikes or elliptical trainers there.

Just a sulky rant.

Tuesday, March 3, 2009

What are we leaving our children?

A lot has been said and written about the massive debts we are running up in an effort to stem the economic crisis. The constant complaint is that these debts will be a burden to our grandchildren.

What I think is being overlooked is what we will be leaving our grandchildren if we don't deal with this economic crisis effectively.

In the late 80's and early 90's, Japan went through the same kind of property bubble we have gone through. The Japanese government, afraid of debt, did not move strongly enough. They started a few, very large stimulus projects and propped up the banks, but did not reform them. They did this over and over, putting patch on top of patch, but never dealing with the fundamental weaknesses of their structure. The result has been a period of no growth, followed by very slow growth. As a result, the children of the generation in charge when the bubble burst have inherited a massive debt and inflexible, ineffective system that no longer has the power to respond strongly to the current situation. They dribbled out unused airports and unnecessary bridges, spending slowly what might have worked if they had spent it all at once. They kept zombie banks operating, sucking money from the economy and not passing it on in the forms of loans.

Back in the Second World War II, our government created a massive (for the time and the value of the dollar) national debt. But we won the war; the problem the money was spent on was solved. As a result, we could leave it behind and turn our attention to building our country and the world. So massive debts will not harm our grandchildren provided we solve the problem we ran up the debts to deal with.

That is so important I will say it again: massive debts will not harm our grandchildren provided we solve the problem we ran up the debts to deal with.

As I see it, whe have these choices:

1. Intervene massively and solve the problem, leaving our children free to turn their attention and effort to growth and innovation.

2. Intervene ineffectively and fail to solve the problem, letting it grow until it paralyzes the economy, locking our children into a paralyzed, ineffective system.

3. Do nothing and hope that the invisible hand of the markets will cause everything to work out--without regard to how long it may take for the invisible hand to do its work or how much people may suffer in the interim. And I am not talking about inconvenience in the interim; I am talking about real suffering--hunger, homelessness, and a permanent underclass lacking the very basics to benefit from whatever good outcome the invisible hand may, possibly, produce. Along with the high possibility that the Keynesians are right in this: the invisible hand will not work at all in this case, because when we finish our fall, it will have nothing to work with.


About Me

Jacksonville, N.C., United States
Retired teacher, motorcyclist, member of the Patriot Guard Riders, the Christian Motorcyclists Association, and the Moto Guzzi National Owners Club.