Box Free Thinking

Taxes are rising - How to Prepare

2012-10-26T15:36:58Z

As we approach the end of 2012, regardless of who wins the election, our tax personal outlay will be increasing. This is not a "Tax Increase" but rather a removal of a tax decrease. On January 1, 2013 your Social Security Taxes will go back to normal (did you know that they are currently lower). That is roughly $80 per month out of your take-home pay.

So how to prepare for this?

Well most people have a monthly budget. For the Months of November and December take $100 out of your budget. Take the cash and put it in a jar / a savings account / etc. That way it will be out of your budget BUT still available to you far a holiday expense or if you need it.

Remember that in January that money will be gone, so why not get used to this back to the future dilemma while you can.

Why did Rick Santorum do so well???

2012-02-20T21:17:29Z

The answer is simple..... You know where he stands.

It is an age of American politics where you have some folk changing their views over succumbing to the establishment time (aka Mitt Romney) or angry and/or bombastic (read Newt Gingrich) or absolutely unrealistic or ridiculous (Ron Paul / Tea Party / Harry Reid / Mitch McConnell). Then you have others (like President Obama) who might be sticking to his convictions but no one is sure what those convictions are.

Then you have Rick Santorum. There is a reason, as a Pennsylvanian recently reminded, why he lost and lost big in his last Senate race. He views are really really really hard to swallow in 21st century America. But you know what those views are. Further he is so strong in his very obvious views that should he make a deal to get a bill passed you would have no doubt that he made the decision because he believed the betterment of society and the country (if not the world) were at stake in getting a piece of legislation passed. Also, he looks like he wants to be president as opposed to expecting it. Scarily he has the same look President Obama had 4 years ago.

While voting for Mr. Santorum in the general election is a non-starter, better President Obama for four more years, but Mr. Santorum might be better as president than the other current Republican options.

But there is still hope for Bloomberg ... isn't there???

BFT Believes Huntsman vs Obama is Best

2011-11-24T20:09:49Z

For the 2008 Presidential election, Box Free Thinking was wise enough to have picked and endorsed both John McCain and Barak Obama. This choice was made mainly through direct observation of the campaigns in New Hampshire four years ago. Of course, on the part of Senator McCain the decision also included a long-term admiration of his "maverick" ways and his policy goals.

Now four-years later, we are back at the Presidential election cycle and it is time for Box Free Thinking to pick its choices. On the Democratic Front, President Obama is the only candidate.

On the Republican Side our choice is Governor Jon Huntsman. Why Governor Huntsman? While, his social views may be little more conservative than BFT advocates, his explanations of his views are well thought out and articulate. His economic policies are more reasonable and thought out than the rest of the field. But it is his foreign policy experience and his having managed a state, an embassy, and having worked directly with what has become our biggest rival, China, that makes him stand out.

Four years ago at this time (November), John McCain's poll numbers were about the same at Jon Huntsman's... So we know he can win.
-He dares to have his own ideas... So we know he is a creative thinker.
-While economies go up or down statesmanship lasts a lot longer... Huntsman is a statesman.
-The U.S. Constitution gives two powers to the president. Leadership and Statesmanship. Huntsman has both and we hope he wins the Republican Nomination and we know he will be a great Republican representative in the fall.

If Gov. Huntsman is chosen to face Pres. Obama we can maybe have that intellectual and honest campaign the majority of Americans desire.

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Of course if we really had our dream come true our ultimate election would be Obama / Huntsman / Bloomberg. But that is only a dream... or is it?

4 Simple Ideas to Move Economy Forward

2011-08-23T15:43:34Z

As an applied economist, I have come to the conclusion that the best way to move this economy forward is to change everyone's mentality from half-empty to half-full. Yes, this is a cliché (and an obvious one at that), but the average person in the U.S. has no idea what a debt ceiling, Greek debt crisis, S&P, etc means. All they hear is negativity and want to know how their life is improving.

A lot of talk on job creation and infrastructure has been floating around. While I agree infrastructure, especially really high profile projects (e.g. Hoover Dam, space race, or Erie Canal) would get people forward focused, I see some ideas and projects that could move immediately and maybe get the whole country excited.

1- $50 million grant towards the building of a new school in each of the 437 congressional districts (435 seats plus one for DC and one for territories). (total = $21.85 billion) There would be limited criteria:

• Grant must be for construction of a new or finishing out a currently facility and that the grants ONLY go towards construction materials, labor, and made-in-the-USA finishings within that academic facility.
• Each member of the House of Representatives would choose ONLY ONE project within his/her district.
• Project must be designated by November 1, 2011 and monies must be spent by December 31, 2012.

This will bring a project to each congressional district; would be an open competition with each congressional member determining the best project; would immediately finance or speed-up 437 construction projects throughout the country; and would go towards education which will have a long-term positive.

2- $1 billion flat grant award to the first car manufacturer producing, at a US facility, 50,000 gasoline powered family cars with an mpg of 50. Straight up capitalism here. First to the finish line gets $1 billion

3- $1 billion flat grant award to the first car manufacturer producing, at a US facility, 50,000 full size pick-up trucks with an average of 30 mpg. Straight up capitalism here. First to the finish line gets $1 billion

4- Finance one of three railroad projects.
A- The second rail tunnel under the Hudson. Yes this is northeastern centric and will take years to complete. But it is ready to go, it is a BIG long-term project that we all can point to, and when finished it will directly affect a large portion of our country offering better rail service from Maine to Florida.

B- A NJ Transit rail link from Stewart International Airport (Newburg, NY) to the main NJ Transit corridor into Manhattan. Stewart International is underutilized and better access would help increase flights and reduce congestion at the other NY area airports reducing cancelations and delays throughout the country.

C- The LoneStar Rail Line in Texas. While this would have limited impact outside of Texas, it can be done very quickly and have a huge affect on one of the fastest growing regions in the country. It would help speed commerce from Mexico and the coastal ports; and would have a peripheral positive effect on Amtrak.

These suggestions positively affect all congressional districts. They are short and long-term. Offers a tangible project the public can watch today and be proud of 50 years from now. These programs would be positive, tangible, and easy to understand. I hope things start turning around and wish you and your economic team all the best.

A Humiliating Win is a Loss for All

2011-01-26T17:34:53Z

Recently, it was reported that another high school basketball team won a game by over 100 points against an uncompetitive opponent. The report stated that the losing team was not forcing the game or pressing and the winning coach stated something to the effect "I had no choice, what was I supposed to do." Coach I just want to say... "There is NO REASON to crush/humiliate a team by over 100 points; Never, no reason, none.

A good coach would have taken this as an opportunity to teach/coach/lead.

As a coach who has been on both sides of an uncompetitive game, it is a terrible place to be. If you are the lesser team you try to keep your team motivated, try to find little battles to win, try your best to keep things under control. As a coach on the winning side, you are trying to keep things in check, keep your focus, fight the urge of the fans chanting for more blood, and make sure you get the win. But there comes a point where a good coach will know the game is at hand and should try to add class to the game. "There is NO REASON to crush/humiliate a team by over 100 points; Never, no reason, none."

Oh I have heard the excuses...

"What were we supposed to do slow it down?" - YES! - There is no shot clock, take your time bringing the ball up. Set up your offensive set. If you miss a shot, get it out and start again.

"We need to play our game... it's the players way." - NO! - You are the coach, so coach. Try out a new play set or a new defense. Pack it in tight. No fast breaks. Try new players at new positions.

"It is more humiliating to slow the ball down or play 4-corners than to run up the score."- WRONG! - No one wants to see a score differential of 100. Also no one said you have to play 4-corners. You can put your team on a 5/8/10 must-pass rule before they shoot; Take 10-15 seconds to bring the ball past mid court. Set up and move the ball. If you miss, start again.

"There is NO REASON to crush/humiliate a team by over 100 points; Never, no reason, none."

Now I will say this, it is also the responsibility of the losing coach to recognize when a superior team has called off the dogs. I was coaching the winning side of a lopsided game once where it was 30-0 with 15 seconds left in the 1^st half. And since we ran a slow offense it could have been a lot worse. We packed in tight, tried some new things, rotated players differently with a 5-must pass rule with a no fast break rule. We won the game 62-28. We won. After the game a parent from the other team came to me and said "I really appreciate you letting my daughter's team play. We drove a long way. We all know what you did and again it was appreciated." It was good to know that the coach and fans understood what our team did. It went a long way to building the character of the team.

So Coaches, letting the other team play makes for a better game, a better environment, and teaches all that winning a game is good but it should never be humiliating. Because, there is still absolutely no reason to crush/humiliate a team by over 100 points; Never, no reason, none.

Looking for a Benchmark on the Economy... Try the New Ford Taurus

2009-07-24T15:37:15Z

Recently a friend asked where the economy was heading over the next six months or if maybe there was a benchmark or barometer she could follow?

After thinking for a minute I blurted out "watch the new Ford Taurus."

She was quite surprised by my comment and quite frankly I even surprised myself a bit. The more I thought about it though, the more convinced I am. "If you are looking for a benchmark on the economy, watch the new Ford Taurus!"

Why? When Alan Mulally was brought in to lead Ford in 2006, apparently he saw nothing new in the pipeline and even though his "people" believed otherwise, he insisted on something new and quickly. Remember this was before the collapse of the system and the economic nightmare we are seeing at the moment. Also remember Ford has not taken any bailout money and has not filed for bankruptcy. Mr. Mulally insisted on a new Taurus and insisted on it fast.

So, in August of this year, the new Taurus will be on showroom floors. It is a new design and basically a new product. It has the heart and soul of Ford's upper management in it. It has been designed and rolled-out faster than any previous Ford and utilizing new methods.

What to watch for and why it is a barometer...- Does the Taurus catch the attention of the public and create a positive buzz? America needs some good news and to feel good again. We are a car society and even though some may argue otherwise, a car can turn our heads and a really nice car can put a smile on our faces.
- Does it pass the quality test? For used "state of the art" design techniques to bring out the Taurus faster. These techniques are the backbone of the "new" Chrysler and GM. Does quality suffer? If the Taurus is of quality it offers hope for other car manufacturers.
- Does the Taurus sell? Recently we read about the Chevy Camaro selling well. But this is a muscle car with a cult following and people putting money down way ahead of time. A Taurus is targeted at a different market. Families, corporations, fleet owners. If the Taurus sells, does this mean that people are back in the spending mood? Does this mean that credit to the heart of America is available again?

If the Ford Taurus does not sell, does not create a buzz, does not pass the quality test, and does not solicit smiles and good feelings.... What will? If the Taurus does fail and Ford sees bleak days, the one star that everyone pointed to in this dismal economy will have been extinguished.

While pinning an economic barometer on the success of a new car may not seem the best of bets, the Ford Taurus will at least give us a sense of the mood of consumers, credit availability, spending habits and a glimpse of the viability of the auto industry. Sorry Mr. Mulally, but a benchmark on whether the economy will be better soon or are we in for a bleak fall has been palced on your shoulders and the success of your Taurus

Hockey?!?! Who Would'a Thought?

2009-06-13T19:06:41Z

If you spent some time watching the Stanley Cup Finals this past week, you witnessed what was possibly the most exciting minutes in sports. The action of the 6th and 7th games where every move made a difference and every hit could be a game changer was spectacular.

The Detroit Red Wings and Pittsburg Penguins participated in a set of games that I know I will be talking about for a while. In game 6, the last minute of the game had Detroit taking shot after shot after shot only to be followed by save after save after phenomenal save. I was awestruck. But game 7, the level went up even higher. I was on the edge of my seat as the Pittsburg goalie literally saved the game by diving across the net to block a shot taken with 2 seconds left in the game.

Granted hockey on TV can be a tough sell. It is hard to see the puck and with few time-outs hard to refill your cup or get another bag of chips. However for this series, kudos go out to NBC for a great broadcast. The announcers took time to explain situations during dead time but called the game with intensity and hockey sense... not dumbing down the broadcast made it more exciting and intensified the pace. NBC also provided plenty of camera angles and replays on important plays and goals (and saves).

Now I know this site is for creative thinking and thought provocation, so on that note... While Hockey may not be "Americas Game" or "Our Nation's Pasttime," maybe we could open our eyes and maybe, just maybe there might be a new sport and set of athletes to appreciate. Well, at least during the Stanley Cup Finals.

A Question for the Wind Energy Industry...

2009-05-21T23:31:31Z

A Question for the Wind Industry and our governmental agencies focused on renewable energy sources.

A good friend works for the wind energy industry. He was asked about the viability of wind power and why costs might prove so high as compared to alternatives. He then explained all the difficulties he encounters in his job (hard to get to locations, harsh weather conditions, heights). Then he discussed the fact that the electric grid is not set up to carry electricity from these obscure locations (where little electricity is used) to the big cities.

An economic question was posed to him. "How much do land payments (to farmers, ranchers, etc) as well as transmission lines add to the cost?" He was not quite sure and asked why the question was posed.

So here is the question....

Couldn't wind turbines were placed along Interstate and similar highways where there are large medians or setbacks? The NY State Thruway in upstate NY, Rte 130 near Austin, I-90 in central Massachusetts and so on, all have wide grassy areas ideal for wind turbines. And the electricity could be used for the lights, rest stops, and local towns needs. Yes admittedly this would be a small dent in our electrical needs, but wouldn't it make sense? If the argument is that the grid is not set up for the obscure wind farms, couldn't a few wind turbines on this government owned property help alleviate this situation? Also, wouldn't this allow renewable clean energy to be produced closer to areas that need cleaner air?

If there was free land available that is considerably closer to cities; if this land is open and easy to get to and does not pose a visibility risk or a noise problem and birds and such already have hazards to deal with, wouldn't it make sense to place wind turbines there?

Can someone in the industry take a shot at answering these questions?

Another rebate check? President Obama, say it isn't so.

2009-01-30T19:01:41Z

There is an old saying "Give a man a fish; you have fed him for today. Teach a man to fish; and you have fed him for a lifetime"

Basically, with the proposed issuance of rebate checks, the Federal Government is giving us a fish. Sure Wal-mart will be happy as people buy knick-knacks and such. But the last two rebate checks (2002, 2008) have shown that these checks have little if no coat tails and will not create jobs. The rebate checks we received in 2008 are said to have simply slowed down the spiral. What we need is tangible and big. Don't give us a fish, teach us to fish.

Now do not get me wrong here. $500 would be nice to have. I can use $500. But I know it will not help me past the week I receive that check.

With the US Airways flight landing safely in the Hudson and President Obama's inauguration has illustrated is that Americans want some good news. Hearing that a neighbor, a friend or a relative landed a good job or a new sparkling building was built or even seeing new grass on the Washington Mall will have a bigger impact than a quick $500.

Previously I have advocated buying trucks and vans for schools (Creative Suggestions for the Stimulus Package). That is 100,000 vehicles off lots without need of financing, 100,000 commission checks, 100,000 vehicles that will need repairs, 100,000 vehicles produced by American workers, cash directly to manufacturers to restructure and regroup. And instead of 5 million families getting $500, we ALL benefit. (Full Article: Helping Detroit Automakers Can Benefit Us All, Here's How)

It is said the root of air travel problems is in the skies over New York City. For years there has been talk about building a direct rail line from the Newburgh NY airport to Northern NJ and New York City. For the unfamiliar the Newburgh airport is a former military base with huge runways and tremendous over capacity. Instead of rebate checks, build the rail link. The jobs created in the initial survey, the construction, the long-term operation, the hours saved in travel, the new opportunities created. It could be fast-tracked and completed rather quickly. This would be better than any rebate check.

There is talk about how wind turbines and such are the new manufacturing. If overhead is part of the overall cost, maybe the stimulus could include buying one of these closed auto factories in Michigan and paying for the retooling in exchange for a manufacturer building wind turbines or such. That is jobs and products at a lower price which means cleaner air, etc.

Hey Congress... Let's get creative here. A rebate check is a cop-out and easy cover. It is like taking some Advil for a broken leg. OK the pain might be reduced but you still have a broken leg.

(This article was written and posted by BFT's Chief Economist - TJ Costello)

Creative Suggestions for the Stimulus Package

2009-01-03T16:37:28Z

Dear President Obama:

The stimulus package your economic team is preparing is quite impressive. However before it is introduced, here are some out-of-the-box suggestions for your consideration. These suggestions are not very costly (in relative terms) but would make an impact on not only the economy but the psyche of America.

Vouchers to schools for new vehicles: As written here previously ("Helping Detroit Automakers Can Benefit Us All, Here's How."), offering a voucher for a new vehicle to every school district in America would take over 100,000 new cars off dealers lots, get monies to troubled car manufacturers, assist all school-tax payers, and secondarily assist school children. Total cost = appx: $2.5 billion.

Law enforcement: We recently read that the FBI is looking to add thousands of new employees. We have also read time and again that the FBI does not have the manpower to investigate the white collar criminals who perpetrated the latest scandals on our society as well as focus on terrorism and such. We suggest $1 billion for law enforcement efforts to investigate and apprehend white collar criminals associated with the current financial crisis. $500 million would go directly to the Department of Justice and $500 million would be in the form of grants to state and local law enforcement and administered by the Department of Justice. This money would be used for new employees and equipment. This money would create jobs, allow for the purchase of high tech products and allow all of us to know that IF there were illegalities causing this crisis, someone might be held accountable. Cost = $1 billion.

Fully fund the National Parks System for 2009: Time and again we are told the National Parks System is in a shambles. No money for repairs. No money for summer interns or rangers. Not being sure of the exact needs, an estimate of $2 billion for immediate construction and employees would be reasonable. This would create construction jobs. Create summer jobs. Help Americans with local vacationing during these tough times. Cost = $2 billion.

Add to local and national park land by buying foreclosed property: Put aside $2 billion (split by 438; each congressional district, DC, territories, US Parks) for grants to purchase foreclosed property adjacent to existing park land or to be used as a new park. Each congressperson could determine if there was such property available and which proposals would be best. This would help take some foreclosed properties off the market. Would create more parkland or open space for all of us. Cost = $2 billion

These proposals add up to $7.5 billion. A mere 1% of the proposed Stimulus Package. If one looks really deep at these ideas it is obvious they will create jobs, create growth, and increase our spirits.

If something more substantial is sought, a last more expensive idea is $40 billion for a new school in each congressional district (437; each congressional district, DC, territories). Again each congressperson could best determine based on speed, jobs, district need, etc. This would create construction jobs; potentially help strapped districts; and better many children in our country.

It would be a pleasure to help flush out these ideas further. Good luck to you and your team.

(This article was written and posted by BFT's Chief Economist - TJ Costello)

Helping Detroit Automakers Can Benefit Us All, Here's How.

2008-11-19T22:13:44Z

With all the debate about the Austin Industry Bailout / Loan / Assistance / Giveaway, I wanted to throw in my two-cents. I believe I have a way that would not only assist the automakers, but in a small way all of us too.

PROPOSAL:

The Federal Government would give every school district (with at least 50 students) and/or every public high school (through its school district) a voucher good for $25,000 towards an AMERICAN MADE truck, van, mini-van, or SUV purchased through a local dealership of its choosing.

Arguement

Basically, the argument is should Detroit automakers be given a loan to assist them through the winter or should they be left to weather the "free market" like other businesses with old and outdated business models. YES, Detroit automakers are a lynchpin in the overall economy of this country. But also; YES, just a few short years ago Detroit automakers were raking in huge profits on the backs of oversized, fuel inefficient vehicles. Automakers at the time said "the market demands big vehicles." So if they played the market then, why shouldn't they play it now?

In the end, like the banks, something needs to be done. My proposal is to help the Detroit automakers through the "free market" and do so in a way that benefits all Americans.

Assumptions:

In the end, something will need to be done for the Detroit automakers.

One of the root causes of the automaker crisis is the glut of fuel inefficient vehicles on dealer's lots. Basically no sales.

A basic truck, van, minivan, SUV can be purchased for $25,000

Every American pays for public education in some way shape or form.

Every School District owns a fleet of vehicles for transport or maintenance.

School Districts are a well defined easily determined number as are the number of public high schools in the United States.

Implementation:

The Federal Government would send each School District one voucher worth $25,000 for itself and for each senior high school within its borders. To qualify, a district must have over 50 registered and active students. (This definition is used because some school districts do not have high schools and some districts do not really have any students.)
The dealership network would be used to allow for the "free market" to be utilized. A district should be able to choose the best U.S. made vehicle, the best manufacturer, and the best dealership based on market forces (supply, demand, service, etc).

Utilizing local dealerships would allow for more relief along the entire supply chain in the auto/truck industry.

Cost and benefits:

Assuming 100,000 school districts and/or high schools in the United States and its territories, and $25,000 for each would amount to $2.5 billion in federal tax payer monies.

Assuming that amount would be spent at some point by school districts means that the monies would be now available for other school related needs or maybe even the maintaining of a tax rate. Also, it is possible that a district may be able to sell a used vehicle sooner and use that windfall as well.

Assuming what automakers say is true "there is a glut of vehicles," this would alleviate this problem. Take stress off the system. Allow for an influx of revenue (rather than a loan). Allow the entire auto/truck network to be positively affected. Allow all Americans, at least peripherally to benefit.

This voucher proposal would directly and immediately benefit all U.S. manufacturers, especially the Detroit based firms. This proposal would do so in a manner utilizing "free market" principles thus appeasing its advocates. Finally this proposal would positively affect all Americans.

(Full disclosure, this idea was submitted for consideration via phone on 11/17-19 to: Reps McCaul; Doggett; Lowey, Senators Cornyn; Kyl; Dodd. Attempted: Reps Pelosi and Sen. Hutchinson).
(This article was written and posted by BFT's Chief Economist - TJ Costello)

Economic Reality 2 - Quicker Action by Congress???

2008-10-01T19:55:42Z

So the U.S. Congress is taking its sweet time on the "Bailout" bill. Obviously members and staff have not read my last post: "The Economic Reality of Today's Uncertainty."

Yes, they should not give a blank check to Paulson. Yes, deliberation many times creates a better bill (it also amazingly creates opportunities for unneeded add-ons). But imagine what would have happened if two weeks ago Congressional leaders had said...,

"Mr. Paulson, we are the U.S. Congress. We take our sweet time deciding everything let alone a $700 billion request. What we will do is give you $100 billion immediately so you can try out your theory. In the meantime we will debate and deliberate the remaining requested dollars as to how we (the financial branch of our government) deem, based on your request, it best for our constituents and the country."

If Congress had authorized a quick, say, $100 billion immediately, the Treasury could have tested their theory, stabilized the market, immediately been able to see inside the motivations and dealings of these mortgage derivatives, and provided solid information for the deliberation that followed.

Wow, the decisiveness, the understanding of the market situation. A good deal of uncertainty might have been avoided as would have many a 401K. But alas it did not happen that way. While Congress may have forgotten how to work in a bi-partisan manner on important issues, time will tell whether the posturing we have seen this week will prove beneficial to us all.

The Economic Reality of Today's Uncertainty

2008-09-12T23:50:53Z

This article was just about to be posted when the Lehman Brothers and AIG fiascos were announced. After rereading, even with the major troubles on Wall Street, I still believe that uncertainty is the main driver behind today's economic problems.

In 1992, President George H.W. Bush kept insisting the economy of the United States was fundamentally fine and was actually poised for a huge spurt. Well, in hindsight he was right: the 1990s offered quite a nice economic bonanza. But, at that time, the economy was sputtering in places, including some very visible places like Wall Street, legal services, and the arts. When President Bush (41) refused to acknowledge the dynamic behind the economy at the time, he was labeled as out of touch and in the end may have cost himself the election.

Recently, former Senator Phil Gramm basically implied that the U.S. economy is fundamentally fine and that America is made up with a bunch of "whiners" when it comes to economic issues. In some ways (I admit uncomfortably) Senator Gramm is accurate. There are several industries and areas of the economy where life is good. Rail, export-focused industries, certain service arenas, oil workers, and political consultants are all doing quite well, thank you. While the typical American scratches his/her head, tightens the ol' wallet, or cuts back on a family trip, my friends in the oil industry in Midland, Texas, or on an oil rig off the Louisiana coast are doing just fine. Don't think so? Go to Midland or Exxon, or ask NBC about selling 85% of its available SuperBowl advertising being sold five months before the game.

The reality is, just like in 1992, a large and visible part of the economy is hurting. Obviously the auto (i.e., truck) and construction industries are struggling. For others there is an uncertainty - an economic future that is unknown. An economic uncertainty that affects what is so near and dear (our homes, our money, our desire to plan for the future, and our general understanding of things). This economic uncertainty is a real and tangible issue.

I have argued that seeing gas prices climb and drop and climb and climb again and then drop again has left Americans uneasy and unsure. Out of nowhere families have been forced to increase a single budget item (gasoline and home-heating costs) by 25%. Further complicating the matter is the fact many blame speculators for the price jump, which simply confuses the average American. Heck, I'm still not quite sure how the whole pricing thing works--it sure isn't a result of pure supply and demand. If the price is based solely on supply and demand, how the heck did demand jump so far so fast without anyone noticing it?

As we have recently seen, the housing crisis is even more complicated. Anyone with a brain should have seen this coming. Zero-percent down mortgages with three-year ballooning interest rates? Please - there's no recipe for disaster here! Anyone who sold or knowingly took out and understood the dynamics around a creative mortgage or participated in the repackaging of these high-risk loans gets no sympathy and should get no bailout. BUT that does not change the fact that many people were bamboozled into one of these loans (and sorry to say many in the minority community were targeted). Or that a smart friend (who thought he could outflank the system) lost his home. Or how in some communities foreclosed homes have become a blight. What about the couple being transferred for work who cannot buy a new or even sell an old home? It's real. Just ask Lehman Brothers.

When I think about today's economy, for some reason I am always drawn to the "Gas Tax Holiday" presented this spring by Senators Hillary Clinton and John McCain. As an economist, I at first thought this was folly. But upon reflection and analysis, I have come to the conclusion that not only was the idea an inspired one at the time, but it might have set a positive tone. Yes, it is likely we would never have seen anything close to the full savings in our gas prices. However what we would have gained (besides a few bucks) is a knowing that our government was/is looking out for all of us with something we can understand and see. Some uncertainty would have been diminished.

Similar direct across-the-board assistance could be implemented as well. Instead of a low-interest loan to car manufacturers, why not a credit to each municipality or school district that buys a new truck. Instead of a new stimulus check to an anointed few, why not put the construction industry to work and refurbish and rebuild federally owned homes and hospitals or offer to build 51 new state-of-the-art schools? Instead of pointing fingers at who has a new focus on regulation, why not help individual homeowners pay any fees keeping them from restructuring or selling a home they should never have purchased in the first place? While, yes, long-term retraining and technological shifts are required, short-term across-the-board tangible stimuli are needed now.

Academically speaking: the American economy is doing OK. But the average American cutting back on travel, seeing friends lose their homes, watching neighborhoods deteriorate in value, reading headlines about 158-year-old businesses collapsing, freaking out every time a barrel of oil goes up a dime isn't whining--he or she is worried and unsure what the future might hold. Today's economic reality is uncertainty. A focus on anything that would reduce that uncertainty and calm our fears is the prescription for economic recovery.

BFT's Sequal - Economic Reality 2 - Quicker Action by Congress???

(BFT is 2 for 2) Compelling VP Choices part II

2008-08-29T15:46:17Z

Not to pat myself on the back or anything, but I think I can do so when the two choices for Vice President were on my publicized short list of hopefuls.

"Compelling Choices for Vice President" July 21, 2008

OK, some of my short list were not really going out on a limb. But find others who thought publicly that Joe Biden and Sarah Palin would be chosen and we would be in a very small group.

Now you are asking why Palin and Biden.

Governor SARAH PALIN:
As I stated in the above mentioned posting....

"Governor Palin's reputation is quite unique. She is a reformist Republican Governor in a male dominated state. She knows a bit about the environment and energy exploration (pretty much what Alaska is). She adds a youthful vigor, is attractive, and (from what has been read) she can throw on a pair of boots and hang with the guys anywhere; anytime. While Alaska is not large in electoral votes, and there are no immediate coattails, Governor Palin solidifies Senator McCain's environmental and energy stands and offers a youthful and down home contrast."

Back in January when I was volunteering in NH for the McCain campaign I asked a colleague about vice presidential choices. He asked me to go first. I said I think he needed a woman or an unconventional choice. Being from the NYC area I thought of Jody Rell. He said "Nice but I think Sarah Palin from Alaska is better. She would be fantastic"

My curiosity sparked, I did my research and I had to agree Governor Palin was/is a quite intriguing choice. For all the reasons I mentioned above and more. She answers all the questions that have followed Senator McCain and she adds a new spark and a luster to what is already a pretty dynamic campaign. Since that time she has always been on my short list and I think she is the ultimate compliment to Senator John McCain.

Senator Joseph Biden:
As I stated in the above mentioned article:

"We have seen much of Senator Biden on the Sunday morning talk shows and in Senate hearings where he is tough and partisan. We have also seen him speak at neutral locations (like the LBJ Library) where he was much more thought provoking and intuitive. At the LBJ Library his arguments were well thought out and convincing. It is this out of Washington-Biden that makes him so compelling. This Joe Biden would solidify an Obama candidacy."

Honestly, I was never really a fan of Senator Biden's from watching him on the Sunday morning talk shows and such. But when he came to the LBJ Presidential Library in 2006, I got to see a different Joe Biden; the one we all saw at the Democratic Convention. He was challenging and he was thought inspiring. He was just good..
I took away three quotes from his talk...
1 - "[America] is good at projecting power; we are not so good at staying power."
2 - "The American people have never let their country down when faced with adversity... What has been asked of us [during this 'war on terror']?"
3 - "To tell me what you value; show me your budget."

So Senator Barak Obama and Senator John McCain, now that you have evened out your tickets, lets make this a heck of a campaign. Now maybe "A Presidential Election that Could Have Been" might just be. Glad I was able to pick your VP's now if you need help on anything else....

A Presidential Election that Could Have Been... and Still Could Be... Maybe?

2008-08-18T20:57:01Z

This past April, I had the opportunity to talk one-on-one with former Senator Bill Bradley. I asked Senator Bradley if he remembered a quote from his 2000 presidential campaign where he was reported as saying, "If John McCain and I get nominated by our respectful parties, I could see us riding around the country on a bus and stopping at various locations for a debate on relevant issues. Just drive around and discuss policy and take questions."

He said he remembered that possibility. I asked him if he thought we might actually ever see such an election. Senator Bradley looked at me and said, "If Barack Obama wins [the nomination], I could see him and Senator McCain doing just that."

"Wow, wouldn't that be nice," I said to him

During the week leading up to this past New Hampshire primary, I had the pleasure of leading a group of volunteers for the McCain 2008 campaign in Concord, New Hampshire. Every morning starting at 6:45, our little group occupied two corners of a major intersection in downtown Concord. About thirty minutes later our friends from the Obama campaign occupied the other two corners. It was good fun with excellent camaraderie for what we thought a worthy cause. Both candidates were underdogs and both groups of volunteers genuinely enjoyed our mornings shouting at cars and trying to get truck drivers to blow their horns. The Obama people would chant "Fired up," and the McCain people would yell back, "John McCain."

The citizens of Concord must have thought we were crazy as we stood there waving signs every morning at 6:45 in sub-zero temperatures. Each morning, once our toes went numb, the McCain and Obama volunteers would end up intermingling and discussing the upcoming primary and the presidential race in general. Discussing politics actually became a way to stay warm.

"Wouldn't it be great if both our candidates won the whole thing?" I asked my contemporary from the Obama group.

He observed and I concurred that by far the McCain and Obama volunteers seemed to be the only campaigners actually having fun. "Talk about a clean and fun campaign," he replied.

I said to him, "Maybe McCain and Obama would actually do what Bradley and McCain said they would do in 2000."

"Wow, wouldn't that be nice." He shivered back.

This spring Senator Obama indicated he believed the 2008 presidential campaign would be about two contemporaries from different generations with different ideals just talking about the issues.

This past June, Senator McCain suggested a series of ten Town Hall meetings to do just that. This was quickly followed by an invitation from the Reagan and Johnson Presidential Libraries offering their facilities for Town Hall meetings during July.

Being very familiar with the LBJ Library, I could close my eyes and see one hundred Austinites on the tenth floor of the LBJ Library surrounded by TV cameras and reporters. In walks Governor Perry, followed by James Steinberg (Dean of the LBJ School) and the Director of the Library Dr. Betty Sue Flowers. I could see Lynda (Johnson) Robb introduce Senators McCain and Obama; hand each a microphone; and watch the questions and answers fly.

Well, if only. It is now August. The Olympics are going strong. Both candidates are preparing for their party's convention.

Last week I mentioned my time in New Hampshire to a friend who happens to be an Obama supporter. We kind of talked out loud about the presidential race and the twists and turns it has taken and what the fall will bring. I then described my conversation with Bill Bradley and his belief, back in April, that this election could be different.

"Wow, wouldn't that have been nice," she said.

Well, it still could be... couldn't it?

TJ Costello
Austin Texas