Sunday, May 31, 2009

Caution: Do not honk...

At old ladies in crosswalks.

Discuss.
The remorseless market...

The fact the organic milk market is faltering is not particularly surprising to me, but it is one of the sharper downturns in the otherwise dismal dairy industry.

 
[More]

(We are seeing too many of these cliff-diving charts for my comfort)

Painful too are the stories of shattered dreams for the mostly small producers who invested to make the switch.  The combination of feed prices and the reality of hard-to-prove organic "benefits" have consumers substituting "down" to regular, cheaper milk, while expenses obliterate margins.
But soon the price of organic feed shot up. Then the recession hit, and families looking to save on groceries found organic milk easy to do without. Ultimately the conglomerate, with a glut of product, said it would not renew his contract next month, leaving him with nowhere to sell his milk, a victim of trends that are crippling many organic dairy farmers from coast to coast.
For those farmers, the promises of going organic — a steady paycheck and salvation for small family farms — have collapsed in the last six months. As the trend toward organic food consumption slows after years of explosive growth, no sector is in direr shape than the $1.3 billion organic milk industry. Farmers nationwide have been told to cut milk production by as much as 20 percent, and many are talking of shutting down.
Certainly their own byzantine regulated milk pricing system (hardly an efficient market) isn't helping.  Nor is the ability of enormous dairies to produce milk very cheaply. But this final round of consolidation is even uglier than the hog or cattle consolidation due to the strong consumer attachment for cows.

Doubtless corn prices are one powerful factor in this grim picture, and despite glib assurances that corn farmers have ample productivity to supply the ethanol plants and our old customers like the dairy industry. What we are actually hoping is this supply is sold at much higher prices, regardless of the downstream consequences.
Feed accounts for 50 percent to 60 percent of the cost of producing milk. Escalating feed costs, fueled by the growing demand for corn to make ethanol, have eroded potential profits. [More]
Probably we can mandate more replacement corn markets as the meat industry shrinks, and arguably this could be a good thing for our diet. But the livestock industry is not fooled, and justifiably is feeling increasingly betrayed by legislators who took the corn farmer side for whatever political reason.

Grain producers are facing similar future, I think. And not many in the rest of agriculture will be sympathetic.

Saturday, May 30, 2009

I blush with modesty...

I got 100%.

And your score was...?

[Thanks, James]
Another brief window...

Our planting season has been a series of 48-hour windows where we scramble at full speed around the clock.  Having just missed (by a quarter-mile) a "30%" downpour last night, we are going to finish our corn today or expire trying.

Posting simply has to wait.
A big piece of the puzzle...

Understanding our care health care issues perhaps begins with the health care providers. Houston, there may be a real problem existing and perhaps growing there.

In a fantastic article being widely linked around the blogosphere, The New Yorker's Atul Gawande carefully outlines how business models for physicians are changing, and how one huge hurdle is simply overutilization of health resources.

There is no insurance system that will make the two aims match perfectly. But having a system that does so much to misalign them has proved disastrous. As economists have often pointed out, we pay doctors for quantity, not quality. As they point out less often, we also pay them as individuals, rather than as members of a team working together for their patients. Both practices have made for serious problems.
Providing health care is like building a house. The task requires experts, expensive equipment and materials, and a huge amount of coördination. Imagine that, instead of paying a contractor to pull a team together and keep them on track, you paid an electrician for every outlet he recommends, a plumber for every faucet, and a carpenter for every cabinet. Would you be surprised if you got a house with a thousand outlets, faucets, and cabinets, at three times the cost you expected, and the whole thing fell apart a couple of years later? Getting the country’s best electrician on the job (he trained at Harvard, somebody tells you) isn’t going to solve this problem. Nor will changing the person who writes him the check.
This last point is vital. Activists and policymakers spend an inordinate amount of time arguing about whether the solution to high medical costs is to have government or private insurance companies write the checks. Here’s how this whole debate goes. Advocates of a public option say government financing would save the most money by having leaner administrative costs and forcing doctors and hospitals to take lower payments than they get from private insurance. Opponents say doctors would skimp, quit, or game the system, and make us wait in line for our care; they maintain that private insurers are better at policing doctors. No, the skeptics say: all insurance companies do is reject applicants who need health care and stall on paying their bills. Then we have the economists who say that the people who should pay the doctors are the ones who use them. Have consumers pay with their own dollars, make sure that they have some “skin in the game,” and then they’ll get the care they deserve. These arguments miss the main issue. When it comes to making care better and cheaper, changing who pays the doctor will make no more difference than changing who pays the electrician. The lesson of the high-quality, low-cost communities is that someone has to be accountable for the totality of care. Otherwise, you get a system that has no brakes. You get McAllen.
One afternoon in McAllen, I rode down McColl Road with Lester Dyke, the cardiac surgeon, and we passed a series of office plazas that seemed to be nothing but home-health agencies, imaging centers, and medical-equipment stores.
“Medicine has become a pig trough here,” he muttered.
Dyke is among the few vocal critics of what’s happened in McAllen. “We took a wrong turn when doctors stopped being doctors and became businessmen,” he said. [More - almost mandatory reading for understanding this problem]
[Update - link repaired]

I do not fault doctors to acting like market participants, but as the comparison between the Mayo and McAllen results show, there are some profound economic aberrations that make the health care market unrepsonsive to the usual counteracting forces of a market place.

One is third-party payers like insurance or government.  The other is a product for which there is unlimited demand, especially as we age. Throw in complications like malpractice abuse - although as the article describes some states seem to have a handle on that issue - and the health care economic system defies easy economic analysis.

There is growing evidence that other ways of approaching this problem are more successful. More and more detailed comparisons are pointing out  the inefficiency and extravagance of delivering too much care too to few arbitrarily chosen consumers.
Inevitably, perhaps, that means Americans are looking to European models, hailed by some, dismissed as socialized medicine by others. In truth, European health care is neither the nirvana of Michael Moore's imagination, nor the publicly funded money pits that so scare conservatives. For one thing, Europeans spend less — about $4,000 a person less, in some cases — than Americans on health care annually, and often with better outcomes. The good news is that without reassembling its entire health-care system, there are many relatively simple measures that could help the U.S. get a handle on soaring costs — and keep its population healthier, too. [More helpful suggestions]

Just as America can to appreciate the quality of Japanese cars, I think we will shed our prejudice against all health care ideas that don't have a "made in America" sticker on them in the face of obvious advantages.

It's simply a matter of of more of us being shifted to the losing side in the health care lottery and the costs growing to consume our economic future.

Wednesday, May 27, 2009

OMG, Canada...

I've always held the Canucks in great respect for their ability to thrive in - let's face it - an remarkably challenging corner of the globe.  But it seems Brits can match their wilderness toughness.

The Queen’s representative in Canada has delighted locals and outraged campaigners by eating a chunk of raw seal heart cut freshly from a victim of the annual hunt.
Michaëlle Jean, the Governor General of Canada, helped gut the mammal in front of television cameras before slipping a slice of heart into her mouth and announcing that it tasted like raw fish.
As she wiped the blood from her fingers, she said that it was delicious. “It’s like sushi,” she said. “And it’s very rich in protein.” [More]

I'm guessing Hillary is cancelling any trips north of the border for a while.

BTW: from other reports: "It doesn't taste like chicken"
Maybe in a few years...

The USDA will step up and add their participation to the new media.  I know, let those progressive rascals at NASS take the lead!

This is how government improves the contact with the governed.  We need more of this.

(And faster, affordable, total coverage broadband, as well]

[Thanks, James]
I wonder if he does machine sheds?...

Especially if you live along a busy highway, wouldn't something like this be cool?

  [Click to embiggen]
At first glance, it looks as if some natural disaster has shaken away the walls of these buildings to reveal architecture hidden for thousands of years.

And at second and third glance, it looks like that too.

But these spectacular images are not the unexpected result of an earthquake. [More]
[via presurfer]

Tuesday, May 26, 2009

Meanwhile, back at the [chicken] ranch...

For corn growers who have forgotten old customers, this message:
It’s well documented that chicken producer margins have suffered during the past 18 months or so which has caused them to cut production. Chicken production for the better part of 2009 has been trending 5% plus below year ago levels. 2009 will almost certainly mark only the fourth chicken output decline since 1961 and by far the steepest. A decrease of around 1.5 billion pounds is anticipated this year which is roughly 6 times more than any other decline since 1961. In short, an historic slowdown in chicken production is occurring. When will chicken output turn around? Probably not anytime soon. Yes chicken breast and leg quarters have risen as of late, but so have feed prices hurting producer profitability. The 2009/10 crop corn and soybean planting remains behind and supplies for both products are anticipated to remain historically tight for the foreseeable future. [More]

 This is my contention with ethanol-worshipers - we have enlisted our government to help us screw reliable buyers of our production.  Heck, we'd starve our entire livestock industry if we could get a 50% blend mandate.

The market, not K street lobbyists should allocate corn supplies. There is responsibility chain that parallels the production chain. All of us are free to finagle what we can from our political process, but the short-sightedness of pushing our livestock industry to the brink just because we can seems wrong to me.

All we have accomplished, I think, is raise our input prices and fixed costs.  In fact, corn farmers have slipped into a role as little more than a conduit between corn buyers and input suppliers - who are remarkably more market savvy than we. Between seed and fertilizer vendors, landowners who can read the media, and competition who can see the bigger picture, producers have built their own future though government fiat without asking if they were capable of being a part of it.
We are now officially tools.
Works for me...

I have spoken about the need for health insurance/health care reform, but have struggled to offer any alternatives to a system I think is broken for too many.  

Please, I understand many of you already have wonderful coverage and your first concern is losing a good deal.  (A good deal in this case is where you are getting more health care than your premiums cost).  The problem with this parochial approach is the group of folks in this happy situation is steadily shrinking.  Remember the rule for good health insurance: don't lose your job.  Or don't be surprised when the board of directors of your company has an emergency board meeting.

But this system is not quite as wonderful as the lucky/healthy think.  And it appears to be staggering under the load of health care demand.  The big slam on the Canadian system is the long waiting times for services, for instance.  Maybe you just haven't been sick lately.

Okay, so much for the bad side of US health care: high costs and mediocre-to-poor average results. But what about the benefits that the "market-driven" US system provides? Sure, the argument goes, the US health care system has some shortcomings - but at least it doesn't involve long waiting lists for elective procedures, as is the case with countries that have primarily government-run health care.

It turns out that this is largely a myth.

Let me leave aside the point that waiting lists exist in abundance in the US for elective procedures - it's just that when people are waiting in the US, they are waiting for a miraculous windfall of money to be able to afford the procedure, rather than waiting a few months until their number is called. No, right now I want to focus on the myth that government-financed health care necessarily entails waiting lists for elective procedures.

The data shows that many countries with "nationalized" health care systems have little or no waits for elective medical procedures. A 2003 OECD working paper entitled "Explaining Waiting Times Variations for Elective Surgery across OECD Countries" by Luigi Siciliani and Jeremy Hurst provides some survey evidence of actual waiting times in various OECD countries. [More good info]

For farmers, it is the crumbling of the individual health insurance market that does the greatest damage, I think, either by forcing off-farm employment or by skyrocketing policy costs.
But what could a better system look like?  Here is an idea I like, because it retains a strong market connection and individual responsibilities, and still allows government authority to make sure coverage is not limited to sure bets for the insurance industry.

The ideal policy for promoting both flexibility and coverage in health care would involve two reforms. The first is a refundable tax credit that would be available only if the taxpayer provided the policy number for a qualified health insurance plan that included catastrophic coverage. The coverage would have to extend to all children for whom the couple is responsible. Since the credit would only be available if an individual purchased insurance, every adult would have a strong incentive to do so even absent a government mandate. Making the full amount of the tax credit refundable even if the actual policy costs much less would ensure that taxpayers treat the money as their own. This would cause them to use the same type of cost-benefit test that they apply to spending in other parts of their lives. This change would be strongly progressive since it would effectively pay uncovered people, many of whom are poor, to obtain coverage, while holding harmless most of the people who benefit from the current tax exclusion for employer-provided insurance.
An important part of this reform would be the elimination of the income exclusion for employer-paid benefits, including health care. Employers would have to list the cost of each employee’s health care on his W-2 form. This amount would be included as income in the employee’s tax return. Employers should also be required to allow each employee to opt out of care, taking the employer’s payment share in return. This would give employees the ability to shop for other plans and increase the size of the individual insurance market.
The second major reform would be to allow much greater freedom for individuals and groups to band into insurance pools. The resistance from some quarters to allowing small businesses and groups to get together to purchase insurance for their members makes no economic sense. Similarly, the efforts of groups like AARP and many labor unions to offer insurance plans to their membership and others should be encouraged. Finally, the government should open up the Federal Employee Health Benefits Plan to all individuals. Under the federal plan, the government uses its size to negotiate terms with a wide range of health care plans. Employees can then choose whichever plan is best for them. In each pool, insurers should be required to offer the same terms to all individuals, regardless of prior history, with one exception: Insurers should be allowed to vary their price by the age and sex of the individual. This reform would keep premiums low for young people, encouraging them to participate in the pool, rather than purchase individual coverage. It would also create a better match between health care premiums and income over one’s career. (If desired, the size of the refundable tax credit could also vary by age in order to create a better match with expenses.) [More of a very helpful summary and analysis of health care problems and reform - well worth reading]

I favor means-adjusted deductibles as well.  In other words, for high-earners, the first say $5000-10,000 of medical expenses are out of pocket.  For low income consumers, this number would be much smaller, but not zero, except for the very poorest or children.  It is imperative to make every health care decision a cost-benefit calculation. Trust me, you can put a price on good health, and we are doing it every day.

There will be no answer that does not require us to include a system to ration health care.  We now do it quietly, since the term is incendiary.  But the truth is we cannot continue to afford to spend enormous sums on end-of-life procedures simply because oldsters have universal coverage (Medicare).  Meanwhile, much greater benefits measured in person-years of quality life could be bought for substantially less if treatments were affordable at childhood or early adulthood.

Until we admit we cannot afford to give everyone all the care they want, we will not prevent our system from benefiting fewer each year.  And costing our economy more.
Better sell now...

To me, that is.  An ag media tempest accompanied the Federal Reserve announcement that [brace yourself] farmland prices had declined in the first quarter!!!
The value of good agricultural land in its district on April 1 was 6% lower than it was on Jan. 1, the Chicago Fed said Thursday. The quarterly decline is the sharpest since 1985, when the farm belt was mired in a wrenching debt crisis.
Any drop in land prices has a chilling effect on the agricultural sector because real estate is the largest source of collateral for farmers; their borrowing power is dropping along with the value of their land. The seventh district, which is at the center of America's most productive farmland, includes all or parts of Illinois, Indiana, Iowa, Michigan and Wisconsin.
The report didn't offer actual land prices, but percentage changes. Prices of farmland across the district began dropping late last year on a quarterly basis after climbing higher for a decade. On an annual basis, the price of farmland on April 1 was just 2% higher than the same 2008 date in the Chicago Fed survey. Farmland prices were climbing at double-digit rates across much of the Midwest on an annual basis until last fall, when the gathering recession took at lot of steam out of commodity prices. [More]
[Wait - did I read a 2% increase for the year?]

Ahem.  Now note this deceptive graph from the normally righteous Calculated Risk.

[Click to enlarge]
[More]

My beef is the first quarter of 2009 is graphed as the entire year.  It could be we will have a y-o-y (year-on-year) decline of 6%, but to display it as a done deal  - even though labeled - is duplicitous.
The correct depiction would be to have the decline only one-quarter the (x-axis) length as the other annual figures.  Moreover, what if prices bounce in Q2-4? That could make the 2009 figure flat or even up for the year.


Bad economists - no biscuit!

The intense scrutiny on agriculture waiting for the first indication our "bubble" is bursting is understandable.  But my bet is any dip in land prices is primarily a result of ethanol uncertainty in Iowa.
Farmland values in Iowa doubled from 2001 through the first half of last year, mostly on strength of demand for corn from ethanol and for both corn and soybean exports. The market softened with a 50 percent drop in the prices of corn and soybeans since mid-2008.

"Most people think that we've lost the gains of the last 12 months, but overall the market is flat," Iowa State University economist Mike Duffy said. [More]
Meanwhile, IA has corn growing and prices rising thanks to ECB growers like me who can't get into the fields, as well as impressive export demand.  Regardless, I see this as a buying opportunity, and I'll bet I'm not alone.

Monday, May 25, 2009

Ah, yes - the serenade...


[More]

Why glee club guys do not get the babes.  DAMHIKT
The good life...

Note the lack of capitals in the lede.  I've never bought into the concept of a definitive "Good Life" description, but have noticed many folks seem to live good lives.  What exactly that entailed danced around the edges of my comprehension, but this amazing longitudinal study seems to shed some light:

What allows people to work, and love, as they grow old? By the time the Grant Study men had entered retirement, Vaillant, who had then been following them for a quarter century, had identified seven major factors that predict healthy aging, both physically and psychologically.
Employing mature adaptations was one. The others were education, stable marriage, not smoking, not abusing alcohol, some exercise, and healthy weight. Of the 106 Harvard men who had five or six of these factors in their favor at age 50, half ended up at 80 as what Vaillant called “happy-well” and only 7.5 percent as “sad-sick.” Meanwhile, of the men who had three or fewer of the health factors at age 50, none ended up “happy-well” at 80. Even if they had been in adequate physical shape at 50, the men who had three or fewer protective factors were three times as likely to be dead at 80 as those with four or more factors.
What factors don’t matter? Vaillant identified some surprises. Cholesterol levels at age 50 have nothing to do with health in old age. While social ease correlates highly with good psychosocial adjustment in college and early adulthood, its significance diminishes over time. The predictive importance of childhood temperament also diminishes over time: shy, anxious kids tend to do poorly in young adulthood, but by age 70, are just as likely as the outgoing kids to be “happy-well.” Vaillant sums up: “If you follow lives long enough, the risk factors for healthy life adjustment change. There is an age to watch your cholesterol and an age to ignore it.”
The study has yielded some additional subtle surprises. Regular exercise in college predicted late-life mental health better than it did physical health. And depression turned out to be a major drain on physical health: of the men who were diagnosed with depression by age 50, more than 70 percent had died or were chronically ill by 63. More broadly, pessimists seemed to suffer physically in comparison with optimists, perhaps because they’re less likely to connect with others or care for themselves. [More]

There are all kind of qualifiers that immediately spring to mind.  For one, the history of the times these men lived through pertains, as Gladwell suggests in Outliers.  The fact that the subjects are all men.  The list begins immediately in our heads and proceeds to exempt us from comparison.

This is the adaptation of age mentioned in the excerpt.  Our brains are remarkably subtle and efficient about remodeling our memories and adjusting our emotional responses in the face of reality.  The closing paragraphs of the article struck me on this melancholy not-planting Memorial Day.

Here's wishing helpful memories and good living attend your holiday.

Sunday, May 24, 2009

The affordability flim-flam...

I suspect we may be in for another adroit about-face by the commodity lobbyists who loudly and proudly claim credit for our food affordability.  The use of this measurement is sheer genius, since it carefully substitutes the issue of actual food costs for percent of income.

As I have pointed out, even the ERS at the USDA carefully notes that affordability is largely due to faster growth in average income compared the growth in food expenditures.  This happy circumstance  has masked the fact that food expenditures have exceeded inflation consistently for years.

In other words, our food costs more, and often more than other countries, but our average income is high and growing which makes the ratio (affordability) look like a bargain.

But the average income is a troubling and largely unused demographic measure.  Indeed, in my posts on inequality of income, I have noted the increasing spread between mean (average) and media (middle-of-the-pack) income.  Note how much higher the affordability number would be if we used median income, instead.
Another common measurement of personal income is the mean household income. Unlike the median household income, which divides all households in two halves, the mean income is the average income earned by American households. In the case of mean income, the income of all households is divided by the number of all households.[59] The mean income is usually more affected by the relatively unequal distribution of income which tilts towards the top.[55] As a result, the mean tends to be higher than the median income, with the top earning households boosting it. Overall, the mean household income in the United States, according to the US Census Bureau 2004 Economic Survey, was $60,528, or $17,210 (39.73%) higher than the median household income.[60] [More]


 [Click to enlarge.  Note the numbers at the bottom] [More]

In fact, the distribution is so skewed that the "average" American earns more than 60% of all Americans. Consequently more the three in five pay more than the widely touted figure for their food.  In fact, our affordability for median wage earners is similar to folks earning the same in places like Mexico.

Since so much of the growth in income was accruing to a few at the very top, the average income continued to zoom, while median income barely budged.  This phenomenon could be reversing as high-earners have been hit hard by the recesssion, thus lowering the average closer to the median.

Suddenly the brisk rise of food prices (which looks set to resume) cannot be masked by faster income growth - indeed the a decline in average income is not unthinkable.  That ratio could jump to the point the we would be something other than the "most affordable". One caveat: shoppers are changing food consumption patterns, so food expenditures could fall as fast as income. This is especially true as less away-from-home and meat purchases become the norm.

The spinmeisters such as Larry Combest will undoubtedly rise to the occasion.  My guess is they will blame it on falling upper-tier incomes.  This would be the most honest approach they have used to date. But I doubt they will point out that income has always been the important actor in this useless measurement.

Oddly, along with the food-fuel argument that separated corn prices from food prices, this will be another flat admission that what farmers are paid does not have much bearing on food costs.  Hardly an effective subsidy slogan, as I have pointed out before.

More to the point, families who actually buy food know what is happening to their budget these days. If nothing else, being reminded of "affordability" rings hollow (and begs the question "For whom?") for most Americans in the checkout line.  It remains to be seen whether this pseudo-statistic will endure a possible reversal as consumption cutbacks race falling average income.

Saturday, May 23, 2009

Not from thin air...

Leonard Nimoy on the Vulcan salute.



[More]
 

Live long and prosper.

It makes you wonder how many deeply revered symbols and gestures that arose in similar casual fashion, despite the reverence we accord them today.

[via sullivan]

Friday, May 22, 2009

Not that you would...

But here's a great way to cheat on crossword puzzles.
[Update: link corrected - Thanks, Bill]

[via presurfer]
A real timesaver...

I know you are all busy planting or getting ready for the weekend, and you're thinking, "How am I ever going to get my classic poetry reading done?"

I'm here to help.  Famous poems reduced to limericks.  First some Robert Frost

Stopping by the Woods on a Snowy Evening

There once was a horse-riding chap
Who took a trip in a cold snap
He stopped in the snow
But he soon had to go:
He was miles away from a nap. 
 Now some Wiliam Wordsworth.

I Wandered Lonely As a Cloud

There once was a poet named Will
Who tramped his way over a hill
And was speechless for hours
Over some stupid flowers
This was years before TV, but still. 
[More]
 I feel deeper already.

Thursday, May 21, 2009

Short Brief crop report...

We're able to work about everywhere on our farm today.  Funny how 85°and 20 mph winds change soil moisture.  But the interesting (OK, it was interesting for me) bit was traveling to South Bend this afternoon.

The rotary hoes outnumbered the planters 3.2 to 1.  

So, I counted - it's what engineers do.

Anyhoo, there may be some divergence between "planted" and "emerged" in future Crop Progress Reports.
You talkin' to me?...

'Fraid so.  One of the likely implications of the new credit card law is freeloaders like me are coming to the end of a wonderful joyride.
Credit cards have long been a very good deal for people who pay their bills on time and in full. Even as card companies imposed punitive fees and penalties on those late with their payments, the best customers racked up cash-back rewards, frequent-flier miles and other perks in recent years.

Now Congress is moving to limit the penalties on riskier borrowers, who have become a prime source of billions of dollars in fee revenue for the industry. And to make up for lost income, the card companies are going after those people with sterling credit.

Banks are expected to look at reviving annual fees, curtailing cash-back and other rewards programs and charging interest immediately on a purchase instead of allowing a grace period of weeks, according to bank officials and trade groups. [More] [My emphasis]

This is harshing my buzz, dudes.  I looked up the new rules, and no mention is made of a mandatory grace period.

Like other irresponsible citizens, the only time I ever paid any interest was when I was a day late paying the statement.  Since I signed up for inter venous withdrawal from my checking account, even that meager of source of income from me eluded those poor schmucks at Citicorp.

Meanwhile, they were handing me free frequent flier miles.  In fairness, I do pay $75 per year for this card, but it's still a big bargain in my book.


I'm a deadweight bad person.

But here's the deal.  I've gotten hooked on using credit cards instead of checks/cash.  Plus it helps me keep track of exactly how I squandered my dough. It always reminds of the sci-fi future when nobody uses money, only "creds" or something.

But if every swipe starts the interest counter going, how will our economy survive?  We can't go back to cash - all the bills are in Russia and Mexico.  And nobody can make change anymore.

I'm not the only one calling their bluff.
They say limits on fees and interest charges will mean the end of bonus rewards programs and low interest rates, as well as the return of annual fees for customers in good standing.
Scherer said he fears card companies could start charging interest from the day of a purchase, rather than after the traditional 30-day grace period.
“If they start charging interest from the day of purchase, I’ll just pay cash for everything,” he said. “It’s no big deal to me at all.”
In fact, experts said, that would be the response from many consumers, making the elimination of all incentives and the grace period doubtful.
“Companies would lose a lot of business,” said Scott Laughlin, client service manager at Consumer Credit Counseling of Buffalo. “These good customers are the ones with the bargaining power. Nothing is keeping them with a credit card company that has nothing to offer them.”
Cristian Tiu, assistant professor of finance and managerial economics at the University at Buffalo School of Management, agreed that clamping down completely would be difficult. While interest rates might increase at first and bonuses such as frequent flier miles could disappear, they probably would kick back in eventually, he said.
“Somebody has to drop first because of competition. Somebody will want to snatch that customer and will offer incentives to do it,” Tiu said. “I wouldn’t be too worried that those benefits would go away forever.”
In addition, credit card companies collect merchant fees on each purchase. That revenue would disappear if consumers switch back to cash, giving credit companies another reason not to penalize good customers. [More]
Besides, I've almost got enough miles to get to Australia.

Wednesday, May 20, 2009

Is it real?...

You don't get many economic graphs that present this kind of straight line phenomenon.

[More]

This could perversely be kinda good news.  We have to work off a huge oversupply of new housing and one way to do that is to stop building more.

Reminds me of corn economics.

Tuesday, May 19, 2009

Bonus question...

For twenty zillion points and the vacation in Aruba:
What magazine has the largest circulation IN THE WORLD?

("Jeopardy" music)

Answer.
Two-week warning...

I tried to work this afternoon and to my surprise the thousands of dollars spent for tiling our swampy land may pay off this year.  We're rolling and the planter will start early tomorrow.

Thanks for all the great comments lately.  What a time to be alive, and what a country to be alive in! I appreciate your reading and feedback.  I'll do the best I can to have new stuff daily.
Pondering the average...

Have you checked your county's average cash rent*?  How close to accurate do you think it is?
The data will be based on information NASS gathered from 700,000 agricultural producers nationwide during the 2008 end-of-year surveys: the biannual cattle survey, the biannual sheep and goats survey, the quarterly crops/stocks survey, the annual acreage and production survey, and the first-ever county-level cash rents survey. [More]
 I think several cautions should be considered when utilizing this data.

First, it is self-reported.  While I do not question respondents' honesty, there is an inherent conflict of interest in putting out your highest rents for public knowledge.

Second, there is significant inertia in cash rents.  Some multi-year rents are still stuck on below market rates and won't show up for 3+ years, for example.

Third, some cash rents are simply tenants taking advantage of clueless owners and operating on figures from years ago.  I know this, since like many farmers who have rented new ground, I have seen the astonishment and subsequent irritation when I offered my bid.

Fourth, I think smart operators are working to find ways to make their rents non-comparable to avoid constantly chasing some reported figure. One reason for variable rents is to do just this.  If a tenant is tiling or improving the ground, building storage, clearing trees, etc. the rent could be altered by the value of that work.

Fifth, these are county averages.  What would really add some value is to have the standard deviation.
 
Still, these numbers will be what folks work with to explain the plight/good fortune of farmers.  Remember, with low reported average rents more of us look like we're making a killing our here.

* Some driving hints:
  • select one filter at a time starting from the upper left
  • you can skip selecting a county to see a list of all counties
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Monday, May 18, 2009

Only a third?

So - are you happy now?
Really good news...

I think. The staggering ineffectiveness of Indian government is partially due to the standard curse of its parliamentary system and the lack of a single party majority to enable action.  As a result, the world's largest democracy makes single-party rule in China look like a brilliant idea in comparison. 

But the election recently concluded handed the Congress Party a sweeping victory and hopes India might begin to reach toward its potential are rising.  The election certainly was welcome news on Wall Street.  One reason is a glimmer of hope for freer trade.

Other good news out there: The communists were put to rout in the Indian elections. This suggests that India will take new steps to liberalize its economy, including foreign investment, free trade, privatization, and tax cuts. This is a big plus for global economic recovery. And the Indian elections may well have triggered the stock rally right from the opening bell this morning. [More]

But along with a more accommodating approach to trade, the bigger economic impact for farmers here will be efforts to encourage industrial development and emancipate some of the 600 million subsistence farmers.

In Singh’s first term, Communist resistance stalled a bill to raise the foreign investment ceiling for insurers to 49 percent from 26 percent. He also failed to pass a bill aimed at removing a 10 percent cap on the voting rights of foreign investors in non-state banks. His plan to permit global retailers into India also foundered.
Kamal Nath, a Congress lawmaker and India’s trade and industry minister, said in an interview last week that the government will continue its focus on “stimulating the rural economy” as a means to spur growth. More than three-fifths of Indians live in the countryside.
Congress has introduced a rural jobs program, written off farmers’ loans, and created economic zones, many of them located in the countryside, to create employment, boost consumer demand and win popularity. [More]
We often look at rural poor in other countries as cheap-labor competitors.  Too often our response is to prod the US government for protection or subsidies from low-priced commodities they produce, such as cotton and sugar.  What might be a better strategy is to encourage and even support efforts to raise per capita income to the point where the vast majority of citizens can add more protein to their diet.
Another qualitative aspect of food production has been India's efforts to identify, evolve, and propagate food-grain varieties with more-than-average nutrient content. Protein and lysine have received special attention. High protein/high lysine lines of cereals and millets have been identified, but have often been found not to breed true, for reasons not fully understood. Improving protein content and quality of staples was conceived as a method of improving the quality of diets, at a time when habitual Indian diets were considered to be protein-deficient. This concept has changed and the primary bottleneck is now believed to be energy. Cereal-pulse based diets have been found to be capable of meeting protein needs, when consumed in amounts that satisfy energy needs. The relevance of efforts to improve protein quality, therefore, needs re-evaluation.
At the national level, food production appears to be adequate to meet demands, provided there is equitable distribution. In actual practice many households do not get enough food because of poor purchasing power Among families whose daily per capita income is below Rs 3/-, over one half consumes an energy-deficient diet. A proportion of such households do not get enough protein either - a finding that explains the widespread childhood energy-protein ma/nutrition. The impressive buffer stocks of food grains held in recent years is a reflection of this low consumption. They would disappear should the purchasing capacity improve. Current levels of production under such circumstances would not be enough to build reserves.
Due to increased agricultural production, food-grain import has, normally, all but stopped. What has been achieved in the Indian agricultural situation has been the prevention of serious famines, which occurred in earlier years. But it does not appear to have made much impact on the widespread chronic malnutrition. To be able to reduce chronic malnutrition, increase in food production has to be of a magnitude larger than that seen at present. This alone will not suffice. Food grains have to be within the price range of the great majority. Also, national nutrition policy and national agricultural policy will have to be more compatible. [More]
Of course, this won't do us (grain farmers) much good if we allow our livestock industry to languish or even decay by focusing solely on ethanol. With opportunities like India on the horizon, rethinking our obsession with corn prices and the expense of demand might be in our best interests.
So that's what Fred did...

In a cautionary tale of throwing away more than a health insurance liability when you lay off older workers, this disconcerting little note from our nation's nuclear weapons industry.
In 2007, as the government began overhauling the nation's stockpile of W76 warheads—the variety often carried by Ohio-class submarines—officials at the National Nuclear Security Administration realized they couldn't produce an essential material known as "Fogbank." What purpose this substance actually serves is classified, but outside experts have suggested that it's a sort of exploding foam that sits between the fission and fusion portions of hydrogen bombs. The Government Accountability Office reported in March that NNSA's effort to recover its Fogbank-making ability had resulted in a yearlong, $69 million delay in the refurbishment project. And a government official with knowledge of the situation tells Mother Jones that further Fogbank-related delays are imminent.
The US government's Fogbank snafu has stunned nuclear policy experts. "What the story ought to tell people is that the institutions that we've built to oversee development and maintenance of our nuclear weapons are incompetent," says Jeffrey Lewis, the director of the nuclear strategy and nonproliferation initiative at the New America Foundation, who has written about the episode.
So how did America's three nuclear weapons design laboratories and four nuclear weapons manufacturing plants—the institutions collectively known as the nuclear weapons complex—simply forget how to make a crucial component of one of the military's most important warheads? "It seems like it was a case of ten-year-itis," says Phil Coyle, a former assistant secretary of defense who worked in the nuclear weapons complex for 33 years. "Ten years go by and people forget things that they used to know how to do."
"You have to keep people who know how to do these things and when people get too old or they retire you have to train new people to take their place," adds Coyle, now a senior adviser to the Center for Defense Information, a Washington think tank. But NNSA failed to do so, according to the GAO. The agency "kept few records of the process when [Fogbank] was made in the 1980s and almost all staff with expertise on production had retired or left the agency" by the 2000s. [More]

But wait, there may be a saner approach buried in the new federal budget.
Anti-nuclear weapons advocates warmly welcomed President Barack Obama’s 2010 budget as it has eliminated funding for research and development of a new-generation nuclear warhead called the Reliable Replacement Warhead.
"Development work on the Reliable Replacement Warhead will cease, while continued work to improve the nuclear stockpile's safety, security, and reliability is enhanced with more expansive life extension programs," the budget document said. [More]

Maybe some knowledge should be forgotten.
Several thousand were to me...

Lest you think government can't get anything right, this encouraging news.
A federal judge has issued two temporary restraining orders designed to stop what officials describe as a wave of deceptive "robo-calls" warning people their auto warranties are expiring and offering to sell them new service plans.
"Today the FTC has disconnected the people responsible for so many of these annoying calls," Federal Trade Commission Chairman Jon Leibowitz said Friday.
"We expect to see a dramatic decrease in the number of deceptive auto warranty calls, but we are still on high alert," Leibowitz said in a statement posted on the agency's Web site.
The FTC filed suit against two companies and their executives on Thursday, asking a federal court in Chicago to halt a wave of as many as 1 billion automated, random, prerecorded calls and freeze the assets of the companies.
Officials say the calls have targeted consumers regardless of whether they have warranties or even own cars and ignore the Do Not Call registry. They say telemarketers have misrepresented service agreements consumers have to buy for warranties that come with the price of the car. [More]

More interestingly, in this era of deabte over the role of government, how would limited-government backers approach this problem?  Or would they consider it a problem?  Is it free enterprise, and simply a cost of owning a phone?

Sunday, May 17, 2009

Not that I could hit a fastball, either...

A very cool and plausible visual explanation of the illusion and action of a curveball.  Even better discussion of how this affects the game here.
In baseball, a curveball creates a physical effect and a perceptual puzzle. The physical effect (the curve) arises because the ball’s rotation leads to a deflection in the ball’s path. The perceptual puzzle arises because the deflection is actually gradual but is often perceived as an abrupt change in direction (the break). Our illusions suggest that the perceived “break” may be caused by the transition from the central visual system to the peripheral visual system. Like a curveball, the spinning disks in the illusions appear to abruptly change direction when an observer switches from foveal to peripheral viewing.
[You have to see it to appreciate it.]
Bad Intertubes...

From Friday evening to this morning, my Internet (hughes.net) barely worked.  I think dialup would have been faster. I'll try to post some today after church.  This may be more common that I thought, although we've had a pretty good stretch lately.

Status: still very wet - the last 1.5" on Friday (much more elsewhere in IL) really killed us as it had nowhere to go.  Forecast finally looks good, though.

Friday, May 15, 2009

Those wacky Brits...



[More]

Here in the US, we just build our subs CLOSE TO THE OCEAN.

[via growabrain]

Thursday, May 14, 2009

I had this read wrong...

I figured small car dealerships would be the first off the cliff, but perhaps not.

GM's 2,700 rural dealership locations are relatively safe, even if they have lower sales volumes than some of the dealerships that will be cut. GM's turnaround plans released in February anticipated few cuts in the rural dealers in the near term.
But GM has since announced plans to cut much deeper into its overall dealership network. That earlier version of the turnaround plan called for it to cut its network to 4,100 dealerships by 2014. Now it expects to get that number down to 3,600 by next year, with most of them being eliminated this year. [More]

I hope your dealership is a lucky one.
Cap and trade for beginners, Part I...

I have been working to get a handle on how cap and trade works at the fundamental level, because, as I have discovered in conversations with farmers, while some of us think we know, we really don't.

So slog along with me as I try to grasp how this massive undertaking could function and what it means for my farm.

One good start is here:
There are three basic ways to reduce our GHG emissions. First, we can reduce our use of carbon-emitting technologies and devices. For example, buying energy efficient products reduces the need for utilities to burn fossil fuels to create your electricity, and therefore reduces total world carbon emissions. Second, we can improve the technologies we use by reducing the emissions they create. Third, we can develop projects that actively reduce atmospheric GHG. These projects are varied, from planting trees   (PDF) to recovering methane from landfills  , but they all serve the ultimate purpose of capturing greenhouse gases rather than letting them be released into the atmosphere.
Cap-and-trade schemes   (PDF) are an attempt to incorporate all three of these methods in the most economically efficient way. Under a cap-and-trade system, an overall cap is set on total emissions. The goal of the system is to reduce emissions below that level. Each participant in the cap-and-trade scheme either buys or is given so-called “allowances.” These are amounts (generally expressed in metric tonnes CO2 equivalent) of greenhouse gases that they are allowed to emit. The total number of allowances adds up to the cap. [More]

Let's proceed with this helpful (albeit somewhat dated) introduction to cap and trade:


[More]

Sort out whatever persuasion is embedded, and I think you can learn some helpful facts.  But one is most important: controlling emissions will cost YOU money - no matter how it is done.

This is because we use so much energy which is derived from buring carbon-rich fossil fuels.  So whether it's electricity from coal/oil/NG or gasoline, we are the reason carbon dioxide gets released into the air, for the most part.  It's about our burning habits.

The permits will be an added cost, which can only be recaptured from the consumer - and we're the folks with the electric toothbrushes, remember?

But the economics of how this cost lands in whose lap has other wrinkles to be ironed out.
Will there be offsets — and if so, how many, and what kind?
In addition to buying emissions permits from the government, companies might be able to get extra permits by investing in a wide variety of carbon-offset projects, from planting trees to burning the potent greenhouse gases released by landfills and factory farms.

Environmentalists have mixed feelings about this. Carbon offsets have been scoffed at in the press and compared to papal indulgences. Although some offsets are clearly better than others, it's tough to measure how much carbon they really reduce. And since each kind of offset comes with its own complicated accounting system, cap and trade would be much simpler without them.
But on the other hand, offsets give skeptical farmers and financiers a reason to get on board the green bandwagon. After all, there's money to be made by selling them.
Who gets the money?
Think of cap and trade as a giant Monopoly game about to get underway, with the government holding a stack of carbon permits instead of Monopoly money. To get the permits into the market, the government has a choice: it can either give them away for free, or force companies to buy them at auction. An auction could raise money for tax cuts, which would help ease the burden on ordinary Americans. But power companies want free permits, and they're lobbying fiercely for them. This debate is so hot, the recent ACES bill — the current front-runner among the cap-and-trade bills that have been filed in Congress (see "Generation Green") — wouldn't even touch it. Obama wants 100 percent auctioning, but he's got a fight on his hands. [More]
Which brings us to offsets, which you probably glommed onto in the paragraph above.  Farmers think they should have a piece of this action.

Stay tuned.
Worth the Trek...

The last movie I had seen before yesterday was Lord of the Rings III, I think.  So my impressions of the new Star Trek arise from someone who is essentially a movie dropout. Just a caveat.

That said, I enjoyed the movie and recommend it.  However, I'm pretty certain I wasn't the target audience, nor should I have been. Some specifics:
  • The camera work - I realize the rage is for extreme closeups and quick, eye-dazzling cuts of 2-3 seconds, but I cannot get into this style. The lack of stability to comprehend a scene or even make out what the heck is happening, let alone add timing and pace to the action was jarring.  Just like we now have to look at the nostril hair of the guy shooting a free throw, you get to see every whisker and blemish while struggling to figure out perspective and even sizes.  And why we need shoulder-camera jerkiness in a sci-fi flick is beyond me.  Do they want us to think it was a reality show?
  • The actors did a remarkable job creating younger versions of their counterparts. McCoy was the best, I think, but all captured many of the quirks and mannerisms of the guys I knew.  Kirk was over the top, IMHO.
  • The time-travel paradoxes lost me completely.  Look, I know it's science fiction, but the premises were shaky and the exposition baffling.  Veterans like myself may spend too much time reacting to obvious inconsistencies.
  • I still have no idea what the bad guy was up to or really why.  Or how you make starship captain two weeks out of the Academy.
  • Lordy, they love hand-to-hand violence. The sheer unreality of modern personal combat common in all action films reminds me of how often in Westerns guys would get knocked unconscious with a gun butt.  I grew up thinking you could really casually temporarily render someone inert with few problems or consequences.  Obviously today we have raised the bar, and the video game aspect of the action is cartoonish to me.
I'm glad I saw it, but it wasn't one I would add to the collection.  It's a new Trek for new fans with much less humanity and plot and point.  And being a prequel, it doesn't even have the chance to embody a dream about the future.

Maybe I'll go see another movie in a few years.
When it rains...

Not only am I looking at flooded fields, we have a computer down (Jan's). 

It is amazing how big a deal that is now for us.

Later, after I get it together I'll post my review of Star Trek.

Wednesday, May 13, 2009

I'd kill for that spacing...

In my corn rows.


powerlinerflyers from wes johnson on Vimeo.
Assuming I could get in the field to plant, of course.
Hold the phone...

Or sell it.  It seems Verizon is tired of not fixing all those pedestals I have run over mowing roadsides during my farming career.  They have sold my phone business.

continued their move to exit the rural local exchange business with the announcement today of the of Stamford, Connecticut. It’s a bold move by , almost tripling them in size and catapulting them to one of, if not the largest, service provider focused on rural markets in the U.S. Frontier will have over 7 million combined access lines after the acquisition. The new Frontier and the combined CenturyTel-Embarq will be extremely close in size and either could qualify as the largest U.S. rural service provider, depending on the choice of measurement. The operations Frontier will acquire include all of Verizon's local wireline operating territories in Arizona, Idaho, Illinois, Indiana, Michigan, Nevada, North Carolina, Ohio, Oregon, South Carolina, Washington, West Virginia and Wisconsin. In addition, the transaction will include a small number of Verizon's exchanges in California, including those bordering Arizona, Nevada and Oregon. [More]

Now, of course, my heart leapt with anticipation of true high-speed broadband (>3 Meg for me), but who am I kidding?  Anyhoo, one of my neighbors has 5 Meg!! at his farm (wireless), and I'm going to duplicate his setup if I can.
Some background for reading "Incoming"...

In order to maximize your reading experience here, some understanding of both the author and the nature of existence is helpful.  Therefore a brief refresher course in the Basic Laws of Human Stupidity.
The first basic law of human stupidity asserts without ambiguity that:

Always and inevitably everyone underestimates the number of stupid individuals in circulation.

At first, the statement sounds trivial, vague and horribly ungenerous. Closer scrutiny will however reveal its realistic veracity. No matter how high are one's estimates of human stupidity, one is repeatedly and recurrently startled by the fact that:

a) people whom one had once judged rational and intelligent turn out to be unashamedly stupid.

b) day after day, with unceasing monotony, one is harassed in one's activities by stupid individuals who appear suddenly and unexpectedly in the most inconvenient places and at the most improbable moments.

The First Basic Law prevents me from attributing a specific numerical value to the fraction of stupid people within the total population: any numerical estimate would turn out to be an underestimate. 
This rigorously academic inquiry into the world of stupidity is worth reading through, if for no other reason that the powerful logic which supports the Fourth Law:
Non-stupid people always underestimate the damaging power of stupid individuals. In particular non-stupid people constantly forget that at all times and places and under any circumstances to deal and/or associate with stupid people always turns out to be a costly mistake.
Finally, the unification offered by the Fifth Law would serve us all well, as we try to cope with the stupidity around (and within) us. Ergo: I am a dangerous man.
 
Too many dishes...

Back in the day, most of us watched Ed Sullivan on Sunday night.  One of the more popular acts was  - and this sounds bizarre to describe now - a guy spinning plates on top of sticks.



Whoa - I'll pause to let you recover.

Anyway, let's suppose each plate (bowl, egg, whatever) is a subsidy directly or indirectly for corn growers. You now have a metaphor for the life of a farm lobbyist.

The problem is we have, I believe, exceeded our spinning talents, and I think the floor is getting slicker.

Consider the headwind for the HFCS plate.
In any case, this whole thing is ridiculous. The issue here is highly caloric sweeteners, not soda per se. In other words, high fructose corn syrup, which is what virtually everyone uses to sweeten their drinks these days. So why on earth would we tax Pepsi at a penny an ounce at the same time that we massively subsidize HFCS? And even if we got rid of the subsidies, which would be a fine idea in any case, why tax soda? If this is the direction we want to go, why not just tax sugar and HFCS directly, regardless of what it goes into? [More]
Now consider the delicately nuanced and artfully phrased slam against crop insurance for corn and other crops, by Bruce Babcock, The Bravest Ag Economist in Iowa.

Because the cost of risk is a real production cost, risk management subsidies are essentially a cost-of-production subsidy. It follows that the main effect of the subsidies is to increase the production of the crops that receive the subsidized risk management. The crops and regions that have the largest reduction in risk will have the largest increase in production. High-risk crops and regions include dryland cotton in Texas, wheat in arid regions of the Great Plains, and corn and soybeans in parts of the Dakotas and the Southeast. The production of low-risk crops in low-risk regions would be largely unaffected by elimination of risk management subsidies because the percentage of reduction in production costs would be small.
Why might taxpayers benefit from expanded production of select crops in high-risk, largely low-productive regions? If expanded production in high-risk regions is large enough to significantly affect U.S. and world aggregate production, then risk management subsidies will lower market prices for the subsidized commodities. Any such decrease in commodity prices will benefit consumers somewhat.
But the prospect of slightly lower commodity prices cannot justify the billions of annual risk management subsidies. Furthermore, a large proportion of the subsidies do not even flow to farmers but rather go to the crop insurance industry. Instead of looking at taxpayer benefits of expanded production in high-risk areas, it is more instructive to look at the political benefits of this expanded production, and at the lobbies that guard against changes in risk management policy. [More]

This plate could be the first to shatter as the deficits soon overtake all other fiscal problems.

And it may be that the ethanol platter is slowing the most drastically.
According to a Duke University-led study, "Converting set-aside [land] to corn-ethanol production is an inefficient and expensive greenhouse gas mitigation policy that should not be encouraged until ethanol-production technologies improve."
This is another in a long list of studies that dent the credibility of corn based ethanol as a viable source of environmentally or economically sound energy. In early February, a University of Minnesota study said that corn based ethanol is worse for the environment than gasoline. [More]
[Wait - that report came from Minnesota??]

If you are a corn grower, it is important that you realize it is far more important to keep these plates going than get the Illinois crop in the ground this year. We could disappear enough demand overnight that all our skills and pride in growing corn would be devalued like a Las Vegas bungalow - along with our land and equity.

Thanks to our confidence in our plate-spinning abilities, this is what our industry now faces: a future in political theater.  We have happily structured our business model on an ever increasing amount and number of subsidies, without pausing to reflect on how many we can keep twirling. I know we didn't intend this, but the signs of our growing dependence were there all along.

It could be a pretty rugged subsidy-withdrawal program is ahead.

Tuesday, May 12, 2009

More pie?

I seem to be on a pie chart theme lately.  This one I found interesting.

Where our words come from.

 
The French, of course derives from the Norman influence in England.  The Germanic from frisky Viking tourists during the Middle Ages, and the Latin from Roman invaders and the Church.

[Unhelpful link]
Another unhelpful fact...

Ethanol proponents have gone to considerable trouble to make sure I know the proper talking points about how ethanol has replaced foreign oil.  OK, let's assume they are truthful - I'm feeling generous.

Then 'splain this to me, Lucy:


OK, that should explain oil in the $30 -$50 range. I expected to see oil bounce between $30 and $50 in a cob-web function as oil settled in on a new equilibrium price.

That analysis worked for a while, but now Oil has broken out to the upside. Why?

Maybe marginal demand is stronger than generally thought.

For years I have watched real oil imports as a measure of US marginal demand for oil and US demand for OPEC oil. Early this year, after several years of stagnation real oil imports surged very strongly. That was a real surprise. With oil demand falling and oil stocks unusually high, why should oil imports surge? It does not make sense to me. [More]
[Update:  I forgot to make my point shown on the graph.  Note the big ramp-up in ethanol production coincides with the right edge of the graph, where imports are taking off again.]

I will concede ethanol replaces oil demand from somewhere, but there NO, as in ZERO, proof it replaces MidEast oil, or improves our national security.  In the first place, since our largest oil supplier is Canada, it may be we are displacing high-cost tar-sand oil.  It could also be replacing high-cost domestic oil as well.

At any rate, as imports continue their surge, the flag-wrapping for ethanol will look more and more transparently manipulative.

Monday, May 11, 2009

Homework...

New, actually useful math for our times.



[More]
Pooling our ignorance...

At first I began to emit hoots of derision over the fact that surprisingly few Americans even know what cap-and-trade is basically about.

[Source]
Given a choice of three options, just 24% of voters can correctly identify the cap-and-trade proposal as something that deals with environmental issues. A slightly higher number (29%) believe the proposal has something to do with regulating Wall Street while 17% think the term applies to health care reform. A plurality (30%) have no idea. More]

But maybe we're missing the implications here. To begin with, public polling under these conditions means diddly squat.  It's like asking third-graders about accelerated depreciation. Public discussion could be little more than totally crossed wires, and absent a massive and problematic education campaign, could remain so indefinitely.

Under conditions like this, won't many voters simply follow the most trustworthy-seeming voice?  Or even more powerfully, their intuition?

To be more precise: "For each three degrees that local temperature rises above normal, Americans become one percentage point more likely to agree that there is 'solid evidence' that the earth is getting warmer." Maybe this explains why national surveys that ask people whether they believe in global warming tend to fluctuate fairly significantly, even over a few short months' time.
Bonus finding: This local-weather effect is strongest on people who aren't particularly partisan, and it's pretty much non-existent for people who identify strongly with one party or the other. Committed Republicans tuning into Rush aren't likely to believe in man-made climate change no matter how sweaty it gets, while ardent Democrats won't stop listening to Al Gore just because there's a cold snap the day he's testifying before Congress. But for many people, this stuff appears to have a fair-sized impact, however scientifically iffy it might be. [More]
So what I'm thinking is if the crucial vote on cap-and-trade comes about mid-July, the combination of summer temps and Obama's approval ratings will be enough to make pollsters report a poorly informed approval for such regulation.

Nor do we have the kind of independent leadership in Congress to not follow the polls.

We could be looking at a whole mess of "change", simply because so many of us don't understand what is going on. 
Maybe there are more of us...

Than I thought.  The idea of a different health care system is not all that unpalatable to many CEO's.

Plenty of CEOs continue to support the status quo, of course, despite the drawbacks. "A lot of businesses take the approach that 'this is a lousy system, but we're good at it,' " says Joseph J. Minarik, research director for the Committee for Economic Development, a Washington think tank. "I interpret this as, 'I've got the best stateroom on the Titanic, and I'm not moving.' "
Democratic senators are calling for a new, federally funded insurer that would expand coverage by competing with private health insurers. Although insurance companies hate the idea, opposition from other businesses has been muted, even though this "public option" is characterized by Republican lawmakers as the first step toward a government-run system. "CEOs are focused on the bottom line," says Len Nichols, director of health policy at the New America Foundation, another think tank. "They know high health-care costs put U.S. companies at a competitive disadvantage."
James Hagedorn, CEO of Scotts Miracle-Gro (SMG), describes himself as a conservative. Nevertheless, he sees much to like in the national health systems of Europe. "If someone said to me, 'you can pay the same amount [for health care] and we will redeploy to a national system,' I'm fine," he says. "Why would I argue with that?" [More]

This attitude could gain even more momentum as health insurance premiums zoom upwardsHave you gotten your bill this year? 

Ours was up 18%.