Sleepless in Midland

Overheard in a pawn shop

With all the pawn shop reality shows landing on our TV screens one suspects that pawn shops are seeing a lot of new customers wanting to haggle. Overheard in a pawn shop the other day --

Customer trying to sell/pawn some digging implements responding to an offer from the clerk:

"Hey, that's a bad ass shovel! That's a bad ass pick!"

Clerk, (with a smile):

Putting "bad ass" in front of it doesn't make it worth any more.

We miss you Margaret Thatcher

"Thatcher Thatcher the milk snatcher!"

The "milk snatcher" label came from opponents of her proposal as Education Secretary in 1971 to redirect education funds by eliminating the program left over from WWII that paid for free milk for students over seven. See BBC. Lefties tried to demean Margaret Thatcher over her entire political career, but she held firm, and Britain and the world were better for it.

Sometimes you don't miss someone until they are gone. And as we learned this morning that Margaret Thatcher died, it reminds us that socialism isn't defeated in one battle.  It's a lifelong struggle. She fought the good fight and won during her time. And that's a legacy anyone would be proud to pass on to the next generation.

The goal of a politician is to get power over people, and socialism is bait they use to sucker people into giving them power. That brings to mind Thatcher's famous quote: "The trouble with socialism is that you eventually run out of other people's money." Snopes tells us the real quote was in 1996 about the Labour Party as follows:

I think they've made the biggest financial mess that any government's ever made in this country for a very long time, and Socialist governments traditionally do make a financial mess. They always run out of other people's money.

Close enough.

The U.S. appears to be headed toward the type socialism that can turn a great nation into a mediocre nation. It will take resolve to fight it -- the kind of resolve the Iron Lady had. If only we can be so strong. Let Margaret Thatcher be our guide, and maybe someday our country can show other nations how economic and individual freedom is the way to greatness.

Paul Ryan's budget makes tiny tiny cut to farm subsidies

With many fiscal conservatives suffering anxiety attacks about the federal debt and a government's inability to do anything about it, the House passed Paul Ryan's budget proposal -- House Concurrent Resolution 25.

The part about farm subsidies is a little disappointing.

Instructions.--
(1) Committee on agriculture.--The Committee on Agriculture shall submit changes in laws within its jurisdiction sufficient to reduce the deficit by at least $1,000,000,000 for the period of fiscal years 2013 through 2023.

That's $1 billion over eleven years. Agriculture payments totaled $10.4 billion in 2011, and that was the lowest amount since 1997. (Source: UDSA, "Value of total direct government payments, by State, 1949-2011" spreadsheet.)

So, based on the 2011 payments, a $1 billion cut in spending over eleven years comes to a reduction of about 1% of the total. But the Resolution doesn't say they'll cut spending by $1 billion, it says they'll cut the deficit by that amount. No one really knows what they'll do with that. And since every Republican in the House voted YEA, it couldn't have worried them too much.

It's a start. And I suppose we should be grateful for that. But the solution is right under their noses: Free trade. Bryan Riley explains it very clearly in The Best Plan for Farmers and Ranchers: Free Trade. Simply end the subsidies, and the free market will produce winners all around. Farmers make money, taxpayers save money, and the hungry of the world get fed.  It's win, win, win.

Texas -- We're number 14

On Wednesday the Mercatus Center at George Mason University announced the publication of an interactive map which gives each state a personal and economic freedom ranking as of 2011. The #1 ranking puts a state at the top as the most free, and that spot was earned by North Dakota. Not surprisingly, the states with the highest numbers, i.e. least free, are California at #49 and New York at #50.

Texas ranked #14 this time. That's worse than than the #8 spot it held in 2009 but better than the #17 spot it earned in 2007. High local debt was an impediment. Here are the first two paragraphs of their Texas analysis.

Texas prides itself on being a freedom-loving state, and at 14th in rank its citizens have something to be proud of. However, its policies are sometimes not as consistent with individual liberty as the rhetoric of its officials and citizens would suggest. Like many southern states, Texas performs better on economic freedom than personal freedom. Yet despite its reputation as a low-regulation state, it is only average for regulatory policy—while it is above average for fiscal policy.

exas enjoys one of the lowest tax burdens in the country. It also does better than average on state spending, fiscal decentralization, and government employment relative to the private sector. However, state and local debt is high (with most of the problem arising at the local level).

Emphasis added. Texas residents have certainly seen the local debts rising. Good economic times cause a fever that induces amnesia about the bad times.

A new use for pennies -- floor covering

Most people who see a penny in the parking lot won't bother benging over to pick it up. But a creative tattoo artist in Garfield, Pennsylvania, had an idea -- use them for floor covering.

There was plenty of bending over for that project, but with a lot of help -- 300 man hours worth -- she covered the 800 square feet of her store floor with around 250,000 pennies.

Watch a video here.

Apparently, it is cheaper to pave the floor with money than to buy tile. Ben Bernanke must be proud.

Even the Chi-Coms saw a problem with over taxing the rich

Richard W. Fulmer, in a blog post titled Whipping the Fast Ox pulls an item from Commanding Heights, the battle for the world economy. He notes that after Mao's death there were some within the Chinese Communist Party who recognized a problem with putting a heavy tax burden on the most successful.

"Whipping the fast ox" was the analogy they used, and what a great one that is. If the most productive are punished then there would be no incentive to excel. It's really that simple.

AEI's video prize winners

The American Enterprise Institute announced the prize winners for its contest for videos making the moral case for free enterprise in under two minutes. And today they announced the winners.

Here are the direct links to them on YouTube: First place, The Moral Paper Route; second place Freedom's Price and third place Joke of the Day.

They all make the point. But my favorite is the third place winner, Joke of the Day because it provides the message in a light hearted way sans the soap commercial theatrics.

Economic models explained in a simple yet satirical manner

This has been around a while but it's still good. There are 21 models on the list, but the first six are particularly noteworthy. As follows:

SOCIALISM
You have 2 cows.
You give one to your neighbour.

COMMUNISM
You have 2 cows.
The State takes both and gives you some milk.

FASCISM
You have 2 cows.
The State takes both and sells you some milk.

NAZISM
You have 2 cows.
The State takes both and shoots you.

BUREAUCRATISM
You have 2 cows.
The State takes both, shoots one, milks the other, and then throws the milk away.

TRADITIONAL CAPITALISM
You have two cows.
You sell one and buy a bull.
Your herd multiplies, and the economy grows.
You sell them and retire on the income.

See the whole list at OrganizationsAndMarkets.com.

But we can't leave without contributing one of our own:

OBAMANISM:
You have two cows which makes you a one percenter.
You sell one to pay your "fair share" of taxes.
You sell the other to pay methane pollution fines.
You can't get a job.
You collect unemployment insurance and food stamps.

Entrepreneurial spirit still lives -- teen builds mobile shower for ND oil field workers

The spark: "The recent high school graduate [Evan Jensen] got a whiff of himself and his 21-year-old brother, Justin. The two had been sleeping in a pickup while looking for work in the oil fields of western North Dakota. 'We smelled,' he said. 'Bad.' "

The idea: A mobile shower where oil field workers can take a shower and clean up for a small price thus saving them a long drive to a motel or truck stop.

The seed money: He used $15,000 he earned from trapping muskrats over the past two years plus money invested by relatives.

The product: They built a 53-foot semitrailer with a five-stall shower, an office, and laundry facilities. A 6,000-gallon tanker provides fresh water and collects the discharge.

The price: They charge $10 for a shower and $1 for a towel and washcloth. Soap is free.

He built that.

Via Carpe Diem.

Most hated industries

The oil and gas industry shares a spot on a list with the movie industry. Gallop says people hate them.

Here are the top ten:

1. Oil and Gas - negative rating = 61%

2. Banking - negative rating = 53%

3. Health care - negative rating = 42%

4. Real estate - negative rating = 41%

5. Pharmaceutical - negative rating = 38%

6. Utilities - negative rating = 38%

7. Legal - negative rating = 37%

8. TV & radio - negative rating = 36%

9. Movie - negative rating = 35%

10. Advertising and PR - negative rating = 35%

Ironically, it is movie makers who work as hard as anyone at villainizing industry.

Talk of more gun control forces Remington to consider leaving NY

New York Gov. Andrew M. Cuomo's recent threats for more gun control scares the fire out of the folks at the 1,000 employee Remington factory in Ilion, NY. Story at CNBC.com:

But now residents of Ilion, a community whose history and economy are indelibly linked to one of America’s more celebrated gunmakers, are starting to worry about Remington’s future. The recent mass shootings at a screening of “The Dark Knight Rises” in Colorado and at a Sikh temple in Wisconsin have galvanized advocates of tougher gun laws in Albany, and Remington has made it clear that such laws could prompt it to leave New York for a more sympathetic state.

Note to Remington: There are plenty of low tax Red states that would love to have the factory there. In fact, many jurisdictions will give you all sorts of concessions to get you to move. (I would like to suggest Midland, Texas, but the board in charge of development grants prefer betting on the hare over the tortoise.)

Unintended consequences of plastic bag ban -- shoppers went elsewhere

Municipalities all across the country have either considered or enacted a plastic bag ban. In some places they are paying deference to the environmental movement. But in others it's a simple matter of trying to eliminate the eyesores on vacant lots where the windblown bags drape wild shrubbery.

But there are always unintended consequences. The National Center for Policy Analysis has published a paper titled A Survey on the Economic Effects of Los Angeles County’s Plastic Bag Ban in which they tell us that business in the stores within the jurisdiction in which plastic bags were banned lost business, and businesses outside the ban area gained business. Here's an excerpt from the executive summary:

The purpose of the survey was to determine the effects of the ban on sales and employment at the stores affected by the ban. The study also sought to determine if consumers changed their shopping behavior by increasing purchases at stores that could still offer plastic bags. The survey found that following full implementation of the ban, sales increased at stores in incorporated cities compared with stores in unincorporated areas. Of these respondents to the survey affected by the ban:

• Over a one-year period (pre- and post-bag ban), 60 percent of stores in incorporated areas reported an increase in sales averaging 9 percent.

• Fourth-fifths of the stores in the unincorporated areas reported a decrease in sales averaging, –5.7 percent.

Examining the overall change in sales of all the stores that responded among the two groups (incorporated versus unincorporated):

• Incorporated stores experienced an increase in sales of 3.4 percent.

• However, unincorporated stores reported a decline in sales of –3.3 percent.

Should this have been foreseeable by the rule makers? If it wasn't before, it is now.

Via.

Who builds business? Not the government.

President Barack Hussein Obama:

If you’ve got a business -- you didn’t build that. Somebody else made that happen.

The best economies are ones that developed in spite of rather than because of the government. The old Soviet Union provided ample evidence that central planning commissions don't do a very good job. And President Obama was rightly excoriated for pandering to people who want something for nothing with his irrational claim that a successful business wasn't built by the entrepreneur who actually built it.

But it's extremely difficult to get the government to keep its hands off of business. An example of this is going on right now in Midland, Texas, where the local government wants tight control over development of a short stretch of highway between Odessa and Midland. It has a connector road to the airport, and that's what has the government exited. The F-Troop insecurity that affects many people out here in the boonies makes them want to put on their freshest face when the out-of-town bosses arrive by air and get chauffeured to town along that stretch of highway. Better that they see raw desert than a business that doesn't meet the highest standard of governmental aesthetics.

To some of us, a thriving business is a thing of beauty, and the best government is one that stays out of the way rather than meddle. (See the results of the eminent domain case the Supreme Court handed down in Kelo vs. City of New London. That land taken from the citizens for government approved economic development eventually became a dump.)

So is it possible to have it all? Great beauty and thriving businesses?

The government is only concerned with the surface. So here's a compromise. In a previous post about this I suggested tall fences between the roadway and the businesses painted with murals to look like the solemn desert that drivers see now. But here's another alternative.

Go ahead and let the landowners build whatever buildings they want, then take voluntary donations from those who are dissatisfied with the aesthetics and use the money to build a facade and hire the artists to paint murals. The artists at at Dashart.com.ua could put up some very interesting images.

Their work has a fairy tale look to it. So maybe for Texas a theme focusing on the legends of the wild west might be appropriate. Pecos Bill meets Yosemite Sam. Throw in caricatures of Elfego Baca for good measure.

Or better yet, who better to do the art work than Midland's own Rubi Sosa?

Having it all, a thriving economy behind a thing of beauty. Everybody's happy.

License to work -- paying your state in order to do your job

The Institute for Justice asks “Should You Need the Government’s Permission to Work?”

They've compiled searchable lists of states and jobs which require a license. Some of them make sense. For example, a license for an electrician might insure a minimum level of competence. But for other jobs, like barbers and cosmetologists, one has to question the necessity of a license. For some jobs a requirement for a license is merely a technique that limits competition and protects established businesses.

The IJ site for Texas shows a long list of jobs that require licenses, but their list is questionable as it lists Travel Guide as a job requiring a license. It would be fun to make fun of that one -- the state has to make sure the guide knows the difference between the Alamo and Alamo Beer. However, my own search didn't uncover any Texas state license requirement for a travel guide. However, there are plenty of other jobs that do require licenses.

Take a look at the State of Texas license search page and click the arrow below "Inquire by License Type" to get a list of the jobs requiring a license. That's actually a fun site for the casually curious. [User note: the search site might require acceptance of cookies.] For example, you can learn that there are 51 Combative Sports Timekeepers licensed in Texas. Those would be the bell ringers at boxing matches. They need a license to watch a clock? Who knew?

Among other professions that require a license is Identity Recovery Service Contract Provider of which there is a grand total of one currently licensed in Texas.

The records show there are fewer than 15,000 barbers but over 200,000 cosmetologists licensed in Texas. Maybe that's why Texas women are so beautiful.

There are 257 polygraph examiners. And get this, 66 booting company/operators. What's a booting company/operator? That's someone who puts a boot on the tire of a car they think is illegally parked.

The state is pretty hard on those who don't follow their rules, and browsing though the punishment section is equally instructive. Again, click on a profession then "search" to find administrative actions such as a fine of $550 when, "Respondent leased space in a salon to an individual who engaged in the practice of cosmetology with an expired cosmetology license," or a fine of $350 for an Air Conditioning/Refrigeration Contractor who failed to submit his change of business affiliation within 30 days, or a fine of $375 for a talent agent who "failed to state the registration number of the talent agency on a publication or advertisement."

It must be tough being in a licensed profession in Texas. The state agency might do a better job of demonstrating the need for licensing if they didn't use their regs like a club. However, you might be glad to know the Combative Sports Timekeepers didn't incur any fines. Now there's one profession that knows that its business.

Quote of the day -- Milton Friedman

Timothy P. Carney made the observation today that the Left may be shifting its focus a little bit from a goal of big government as a check on the pursuit of profit to the goal of big government as a partner with business. See An expanding partnership between business and government.

So maybe this is a good time to bring out the late Milton Friedman, articulate and understandable, with his observations about government and business. Watch him here as he explains it to Phil Donahue. Here's the quote at about the 1:20 mark.

Friedman: So that the record of history is absolutely crystal clear, that there is no alternative way so far discovered of improving the lot of the ordinary people that can hold a candle to the productive activities that are unleashed by the free enterprise system.

Runner up quote of the day, same clip near the end -- To Donahue's argument that free enterprise doesn't reward virtue as much as it does the ability to manipulate the system, Friedman politely explains that government is not motivated by virtue, and ...

Friedman: Is it really true that political self interest is nobler somehow than economic self interest? ... Tell me where in the world do you find these angels who are going to organize society for you?
Donahue: Well ...
Friedman: I don't even trust you to do that.

He's right, of course. Government as a partner with business will simply reward those businesses that, to borrow Donahue's words, can manipulate the system at the expense of their competitors. We've got that already.

Mark Steyn the prophet of doom

Mark Steyn is such an entertaining writer that it's conflicting when he delivers bad news. He always makes a good point, though. And Twilight of the West is one such article.

Most of us can see the problems the country faces. And many of hope, perhaps naively, that a change in presidential administrations will at least provide some help. But Steyn thinks the problem is systemic. Excerpt:

That’s to say, the unsustainable “bubble” is not student debt or subprime mortgages or anything else. The bubble is us, and the assumptions of entitlement. Too many citizens of advanced Western democracies live a life they have not earned, and are not willing to earn. Indeed, much of our present fiscal woe derives from two phases of human existence that are entirely the invention of the modern world. Once upon a time, you were a kid till you were 13 or so; then you worked; then you died. That bit between childhood and death has been chewed away at both ends. We invented something called “adolescence” that now extends not merely through the teenage years but through a desultory half decade of Whatever Studies at Complacency U up till you’re 26 and no longer eligible for coverage on your parents’ health-insurance policy. At the other end of the spectrum, we introduced something called “retirement” that, in the space of two generations, has led to the presumption that able-bodied citizens are entitled to spend the last couple of decades, or one-third of their adult lives, as a long holiday weekend.

It's the sense of entitlement that too many people have. If their votes will keep the money flowing then that's they way they will vote. And the politicians who pander to them will be the ones who get elected. That theory has been around for a long time, and maybe it's going to play out.

But on the other side are the people who believe that the U.S. really isn't just a failed 200 year experiment in the long history of human endeavors but that the U.S. doesn't just symbolize but embraces individuals' freedom to pursue their livelihood with minimal government interference. It's no more possible to predict the long term future than to predict the weather in the long term. But this faction of the population is in resurgence at the moment. And with perseverance they'll prevail.

Applying economics to peak oil

There was a Woody Allen movie (one of the old, funny ones) in which he flashed back to his neurotic childhood, and he was being counseled by a rabbi about his irrational fear that the earth will one day perish as it hurtled toward the sun. That the event would occur many millennia in the future didn't matter.

Those who fear peak oil seem to fall into that same category. According to this Wicki-nition, peak oil is the point at which the maximum rate of petroleum production is reached, followed by a decline. Another way to put it is the point at which the total of earth's producible petroleum supply is half gone.

The technology of oil exploration and production is continually advancing, and maybe Moore's law applies in that field as well as in semi-conductors. The result is that more petroleum is being found and produced, but much of that has to do with the price of oil.

This brings us to Tim Worstall's article Can we please just declare the end of 'peak oil' and start worrying about something important?. Quote:

There is no such thing as "supply" or "demand". There is only either of them at a price. So, if there really is a limit on how fast we can pump the stuff up, the price will rise.

Like it is at the moment. There's a lot more demand for $50-a-barrel oil than there is supply of it, which is why the price is $100 a barrel. It's true that if we really do reach some production plateau, then it's likely that the price will rise.

But more importantly:

Even if we accept the geological conventional wisdom, then there's still no cause for panic. Prices will rise, yes, so people will go off and do other things. Either use something else instead of oil (that ever cheaper shale gas for example) or simply doing things that require less energy. That's what a price system is for, after all, providing the signals that a certain resource is in scarce supply.

When the price rises, there will be more effort in finding and developing petroleum by the producers. And he sums this next part up quite nicely: if the price gets too high, customers will seek alternatives.

Whether we are half full or half empty, it doesn't much matter.

Worstell article found at Carpe Diem.

Lubbock Lemonade Day

From time to time we hear those outrageous stories about a child's lemonade stand getting shut down by some meddling government bureaucrat. Not so in Lubbock, Texas, where they believe kids experiencing entrepreneurship and learning how to sell is a good thing.

Last Saturday (5/6/12) they held Lubbock Lemonade Day during which kids were encouraged to set up stands and sell lemonade. Lubbockonline.com says 3,000 children participated. Same at MyFoxLubbock.com.

Take that, bureaucrats.

Secret Service guy shoulda just paid the woman

Common sense suggests that the fee for prostitution should be negotiated before, not after, the service is performed since the service can't be undone. I don't know any of this first hand, mind you, but it being the oldest profession, it seems the participants should have that part of the transaction down by now.

Therefore, this whole business about the secret service and the hooker raises a lot of practical questions. Apparently, some secret service agents were involved in dalliances with hookers in Cartagena. A dispute over the price broke out, and the cops were called -- for the dispute, not the prostitution since that was legal.

So let's put on our detective hats and surmise what must have gone down. Three scenarios emerge:

First, the agent was dissatisfied with the service and refused to pay.

Second, the parties did not negotiate in advance. The hooker mistakenly relied on the agent's sense of fairness, but the agent mistook her attention for infatuation, love, or maybe a gesture of international good will. His sense of importance put him in denial, and he refused to believe she wanted his money more than his manhood.

Third, the hooker quoted a price with which the agent agreed. But after the tryst, the hooker claimed to be owed a higher price. The agent refused to pay, and the hooker caused a scene.

Which was it? They were speaking different languages, but the language of love needs no translator. However, the first scenario can't be possible because there would have been no guarantee to enforce. The second scenario isn't possible because, as tempting as it might be to think it, no secret service agent could possibly be that stupid.

That leaves the third scenario. That one has to prevail because the hooker knew she had the upper hand with the local authorities -- mordida bought it -- and therefore the policia will always support a local business against a foreigner in a tourist hotel.

It's elementary, dear Watson.

Peter Funt the 99 percenter

The market place functions when there's a meeting of the minds of the buyer and seller based on their perception of the supply and demand. When their minds meet the buyer and seller each walk away from the transaction with something they value more than what they gave up.

Today's Wall Street Journal contains a rant from Peter Funt about a proposal in California to allow drivers to pay a premium to use the car pool lanes while driving solo. His complaint is expressed in the title: "How Government Coddles the 1%, There's class warfare in America, all right." The filthy rich have it so much better, you know.

But he's right about one aspect if he could only acknowledge it. It's a monopoly situation with the government controlling the monopoly. They could privatize the roads and let the owner make them toll road where everyone pays, rich and poor alike. Instead, the proposal provides a fast lane option for paying customers. Seems like a way for the rich to pay their fair share -- if that's a phrase Mr. Funt would like -- and get something in return.

California's problem isn't that they are trying unorthodox ways to increase revenue, it's that they need so much revenue to begin with. There's where Mr. Funk's argument goes into the ditch. Californians have for far too long tolerated the government that led them to this situation. And now parts of the government are corrupted by the thirst for revenue. And, according to some reports, police in many California communities are not there to serve and protect but to ticket and collect.

Reminds me of the gasoline shortage and the long lines at the gas stations a few decades ago. I was living in Houston at the time, and one enterprising station owner there experimented with the concept of a higher price for those who were willing to pay more to avoid the lines. That was the market place at work. But no. The populists were up in arms at the very idea that some people could have an easier go of it simply because they were willing and able to pay for it. There was such a public outcry that the station owner canceled the program and shrunk back into obscurity. There's the 99% at work.

Here's the link to Peter Funt's article. Oh damn. It's behind the pay wall. Wouldn't you know? You have to pay to read it.

Love those entrepreneurs

There are fewer stories more exhilarating than ones about the entrepreneurial spirit. There's a site out that's full of small entrepreneurs called fiverr.com.  It will connect customers with someone who will perform some specialized service for $5.

For example, Bethan will produce a short video of herself in a banana suit promoting your product or shouting anything else the customer wants. Here's a recent sample. Note: bad weather has brought her indoors.

And Han_da_man will photoshop a picture for a five spot.

But it's not all for fun. This one looks like real work. He will will read your insurance policy and answer three questions about it for his five clams.

All in all, it's a remarkable market place where customers and suppliers can get together and make a deal. Check it out to see what all is available.

Via Carpe Diem.

[Hey boss. Maybe you should hire the guy who will proofread your blog post for grammar and spelling errors. Ha ha - Robo-ed. Yeah, not a bad idea given how bad you are at it - GJ]

Cheers for Sears

The good news for Sears is that it plans to close a bunch of unprofitable stores, and hopefully that action will help the bottom line enough to allow it to cut prices and compete with Best Buy, Walmart, and online competitors.

But what must really hurt is the highly public announcement that CIT Group Inc. would quit extending credit to Sear's vendors. See Sears Supplier Loans Are Said to Be Halted by CIT Starting Today. Therefore, Sears would have to pay those vendors up front for orders. That sounds bad, but the report says merchandise financed by CIT accounts for only 5% of Sears' inventory. So unless other creditors follow suit, it shouldn't hurt that much.

I've got a soft spot for Sears. I admit it. The stores have always been a reliable place to buy tools, car batteries, tires, and plenty of other stuff. At one time wrenches and other non-electric tools bought at Sears carried a lifetime warranty. But times change, and that was back in the day when a tool would last a lifetime.

Hang in there Sears. Your fans are rooting for you, even those of us who sought out the cheaper prices elsewhere. If the store closures can bring down those prices, then the game is still on.

Making it political

The Sears store closings will inevitably result in employee layoffs and put those people out there looking for new jobs. The political issue of the day is Mitt Romney's work for a restructuring company that took over failing businesses and -- gasp -- laid off employees. So basically Sears is doing on its own what countless other businesses have done. That's the way the market place works. And thankfully no one is asking for a Sears bailout or some other form of government intervention.

Also, there's this nagging question. Lefties have left no doubt how much they hate Walmart. So would they cheer if Walmart was hurting? What about if Walmart decided to close a bunch of stores, would lefties continue to cheer big employee lay off? Just wondering how that all works together.

Car2go -- innovating car rental concept in Austin

Residents in Austin, Texas, have access to a neat transportation concept. It's Car2go, a car rental that let's the renter find a car on his/her smart phone parked somewhere within the operating area, pick up an itty bitty Daimler smart fortwo car, use it for a while, and leave it at another parking spot near the renter's destination.

The cost is $35 to register then $0.35 per minute of use up to a max of $12.99 per hour or $65.99 per day. Plus tax. And there's a charge of $0.45 for each mile driven over 150.

From their website:

Our network includes more than 300 of the coolest cars on the road, the innovative smart fortwo. At 41 miles-per-gallon hwy, these amazing vehicles are the most fuel-efficient non-hybrid or electric vehicles in the United States and the 3rd most fuel-efficient vehicle in the United States. You'll see plenty of these blue and white vehicles all over Austin, handy and waiting for members to access and drive away.

Drive where you want for as long as you want. Afterwards, simply park the car in any legal parking place in our operating area, or one of the many car2go parking spots in Austin, no need to return the car to the original pick-up location.

It being Austin, a natural assumption would be that taxpayer money is subsidizing the operation, but surprisingly, a word search for "car2go" in the Austin 2010 budget didn't produce any results. So maybe taxpayers aren't kicking in. Not bad.

More Jersey Shore unbranding

We talked about this phenomenon before -- reverse advertising or unbranding -- in regard to Snooki of "Jersey Shore" fame whereby owners of famous brands sent her clothes with competitors' labels so people would associate her with someone else's brand.

That's a rather ignoble way to make money, being bribed not to be associated with a product. But it's the marketplace at work.

And now we learn that another one of those show stars is getting the bum's payoff. Newslite.tv:

A spokesperson for Abercrombie and Fitch said: "We are deeply concerned that Mr. Sorrentino's association with our brand could cause significant damage to our image." ...

"We have therefore offered a substantial payment to Michael 'The Situation' Sorrentino and the producers of MTV's The Jersey Shore to have the character wear an alternate brand.

"We have also extended this offer to other members of the cast, and are urgently waiting a response."

Seems like there's room for extortion in there somewhere. "Nice set of sneakers you're selling. It would be a shame if everyone saw me wearing them."

Is it hard to get a loan these days?

I'm not in the market for a loan, but I found this chart to be quite interesting. It's the M1 Multiplier from the St. Louis Fed.

The multiplier is a ratio derived from a formula based on the proposition that a bank will accept a deposit but can lend most of it out, keeping only a required percentage in reserve. The person who borrows that money can then deposit what he borrowed into his own bank. That new bank makes a loan based on that deposit while retaining the required reserve. So the actual spending power of that original deposit is multiplied by the fact that banks can lend it out.

The chart shows the multiplier has been declining since about 1986. But it made a drastic drop below 1 in 2008. It bounced a bit and looked like it was about to reach 1 again. But now it's at around 0.75.

So it looks like banks aren't lending. Why the ratio has been declining for 25 years is a mystery the economists should explain. But at least one blogger speculates that the drop in 2008 was caused at least partly because that's when the Fed began paying banks interest on their reserves. If that theory is correct, bankers have decided a guaranteed payment from the Fed is a better bet than lending money to borrowers.

In any event. Now may not a good time to be in the market for a loan.

Our Central Planning Committee at work

The morning newspaper contained an editorial lauding the concept of government control of economic development along a 30 year old highway newly annexed into the city limits. It's Texas State Highway 191 an 18 mile road used by commuters to travel between Midland and Odessa, Texas.

The other road connecting the two cities is former U.S. 80, now Business 20, and it's teaming with vibrant businesses. Some of those businesses may not be deemed as aesthetically pleasing to the style conscious critic as the open empty desert spaces one currently sees while transiting 191. And that's probably what has the government wanting to exercise power over development.

"Ugliness is so grim," Lady Bird Johnson said as her Highway Beautification project performed a facelift along the U.S. roadways a half century ago, and together with her husband, Lyndon Johnson, they built the Great Society we live in today.

"Lady Bird doesn't want you to see what's behind this wall," teased some junk yard owners on the walls they were forced to put up to hide their businesses from sensitive passersby.

So maybe that's what our central planning committee can do -- allow owners to do with their property as they wish, and thereby satisfy those owners who like to think they, not the government, own their land. But then require those owners to put up facades painted to mimic the parched desert landscape commuters now see. Of course, in the interest of free speech, they could also put up signs poking fun at the central planners, and that's when a boring commute would get interesting.

[Image is from Illustrated Road to Serfdom.]

Michael Moore and capitalism

While browsing the close-out sale at a Blockbusters store a 99 cent sales display jumped out. See photo on the right and note the movie on the far left of the display.

It's Michael Moore's Capitalism: A Love Story. I didn't buy it -- let his fans give up their own money. But that's the essence of capitalism. Let people do with their money what they want to do with their money, and an economy will flourish. And the price will reflect the value customers place on it. The fact that Moore's movie languishes at discounted prices tells us that maybe the price is still too high.

Judging from the IMDB.com plot summaries the movie is a diatribe against capitalism. Samples:

What is the price that America pays for its love of capitalism? Families pay the price with their jobs, their homes and their savings. ...

However capitalism as seen the United States today, which truly took hold in the Reagan era, is more about the want of the wealthy to get wealthier at the expense of all others. ...

Michael Moore himself seems have done OK by capitalism. Maybe Moore could have demonstrated his concern for those who haven't made out as well by bailing out Blockbuster, a store chain which probably contributed mightily to Mr. Moore's considerable wealth.

For a better read on capitalism, let's seek out some smarter people:

Milton Friedman:
The problem of social organization is how to set up an arrangement under which greed will do the least harm, capitalism is that kind of a system.

Larry Elder:
America traditionally represents the greatest possibility of someone's going from nothing to something. Why? In theory, if not practice, the government stays out of the way and lets individuals take risks and reap rewards or accept the consequences of failure. We call this capitalism - or, at least, we used to.

Warren Buffett:
I think the most important factor in getting out of the recession actually is just the regenerative capacity of - of American capitalism.

Ron Paul:
Capitalism should not be condemned, since we haven't had capitalism.

Ralph Waldo Emerson:
Doing well is the result of doing good. That's what capitalism is all about.

Terry McAuliffe:
I invested in many companies, and I'm happy this one worked. This is capitalism. You invest in stock, it goes up, it goes down. You know, if you don't like capitalism, you don't like making money with stock, move to Cuba or China.

Fidel Castro:
Capitalism is using its money; we socialists throw it away.

Parking meters for collecting change for panhandlers -- Orlando

It's a big city plague -- panhandlers badgering people for spare change, usually downtown, and often near a public facility like a courthouse or library. Minimal eye contact, a stern look, and a shake of the head used to be enough to deter them, but now, who knows?

Most kind hearts will feel some compassion the first time or two and hand fork over some currency. But they soon learn an important lesson: rewarding behavior increases said behavior. And regardless of how generous a person is, handing out money can become tedious, not to mention expensive.

Back when I was a big city dweller I experimented with lots of things from standing in line and buying some sympathetic beggar a Big Mac to telling them to bug off. Some of those characters were quite sympathetic, too. But as we all know, story tellers gets better with practice, and there's no way of knowing how much effort went into crafting those stories into moneymakers.

So it's interesting to read about this experiment in Orlando, found at Carpe Diem.

They are planning to put up parking meters, called "homeless meters," which are set off from the street and painted some color to distinguish them from real parking meters. Anyone with spare change can deposit it into the meters giving them a ready made excuse to deliver to any panhandler. "I gave at the meter."

But here's where it gets complicated. The money is collected by the city then turned over to a non-profit group which is supposed to use it to help the homeless. So there are basically two middlemen, and presumably the last one determines where to spend the money.

At least it gives the people with spare change another choice in the matter, give directly to the panhandler or give to a middleman. Then again, deterrence is always an option. Give them that stern look, a head shake and a "bug off." Your wording may vary.  But the object is to let them know they are dealing with a first class A-hole.

Post Script: Some hobo history at Overheard in New York:

"Ladies and gentlemen, I have spent all my money on alcohol and marijuana and drugs... But now, I have learned my lesson. I want to spend all your money on alcohol and marijuana and drugs... and viagra."

Judge strikes down anti-prostitution laws in Ontario

The judge based the ruling on the safety issue. The law made the prostitutes vulnerable to violent crimes because it forced them to hide from the police. Judge: "I find that the danger faced by prostitutes greatly outweighs any harm which may be faced by the public." Makes sense. Link.

A higher court will probably have the last word on this, but should it hold, this will be a good test of the free market principle that fewer regulations result in lower prices.