Archive
November - December 2007

Monday, November 5, 2007

   No Recession in 2008 - This past week, I had the pleasure of participating in a half-day seminar, in Flagstaff (AZ), devoted to the condition of the economy - local, state and national.  I gave a presentation on national conditions, highlighting interest rates and inflation.  While one of my colleagues opined that there was a 50% chance of a recession next year, I told the audience that there was a zero percent chance.  That is probably not correct, but once you get down into low numbers, why not just go all the way?  The single best data set that confirms this view is the Chicago Fed's National Activity Index - see the 3 month moving average chart in their September news release.  Except for 1974-76, this index is an excellent leading indicator of recessions.  And, there is no sign, as of now, that we are headed that way.  Thus, we probably have, at least, another year of solid economic growth.

     For the enjoyment of the local crowd, my presentation included a more humorous look at why we can expect growth to continue for the next year:

Some notes of context:
10. Our local transit line, based on my casual observation, is mostly just an exercise in driving large, empty, boxes around town.  It is not convenient, of course, and is subsidized by taxpayers, both from here and elsewhere.  A manager of the transit "company" was in attendance and, I heard second-hand, unhappy with my remark.  I guess he must believe that riding buses is a morally superior transit option.
9. The key to continued growth is continued spending; lots more spending left in this "industry."
8. If you believe global warming models, then you must believe that economic growth will continue, uninterrupted, for the next hundred years.  Ah, if only it would be so ...
7. I don't know if presidential candidate Edwards is still doing this, but, hey, it's still funny.  Well, and sad.
6. Yep, four more to go, including Arizona, in 2008.
5. I needed a Republican counterweight to the Edwards comment.  I was wondering if, when he takes his candidacy to a third party, might he pick RuPaul as his running mate?
4. The city hired the former director of the Friends of Flagstaff's Future, a notorious anti-business group, to be a business retention specialist!  I am thinking of starting a "Don't San Francisco Flagstaff" movement.
3. It is always nice to see the young people back at work.
2. If the trains keep me up all night (blaring their horns so that I am aware that they are at a crossing a couple of miles away from where I live), economic activity must be robust.
1. Well, the Nobel in economics isn't a political prize yet.

Wednesday, November 7, 2007

   D.C. Summit - In early October, we got to travel to Washington D.C. for the Defending the American Dream Summit (follow the link to see video highlights), sponsored by the Americans for Prosperity.  They are an interesting group.  While technically non-partisan, their support of lower taxes and limited government doesn't really appeal to liberals, of course.  The event was the first for this relatively young group.  They decked out the main hall (at the Mayflower Hotel, in the heart of D.C.) in the style of a political convention, which, I think, was meant to help stimulate the passions of the folks in attendance.  And, to further that atmosphere, the program was chock-a-block full of presidential candidates - all Republicans, as the Dems, naturally, declined to take advantage of a chance to speak to people that want less government.  Cara Lynn and I were joined for this day-long event by my brother-in-law, Bob, and his nephew, Andrew (recently having returned from a tour of duty in Iraq).

     The morning session, which lasted some three hours, was kicked off by Rudy Giuliani.  I was impressed.  He did not back off of a conservative fiscal agenda.  He swayed me - I think he can win over the conservatives in the GOP**, to win the nomination, and can trounce Hillary in the general.  He got a large chunk of time and used it well.  Some of the memorable phrases (which probably populate his stump speeches) were, "Freedom works," "Tax cuts work," and "Bad socialist ideas never die."

     We, then, heard from some of the second tier candidates - Ron Paul, Sam Brownback (who has since dropped out) and Mike Huckabee.  I thought all did a good job with the limited amount of time they had.  Paul had a good line as a reply to whether he was for a flat tax or the fair tax - "I'm for the low tax."  He did dis NAFTA, which I think is a mistake, and was a bit too cavalier about cutting taxes, which I think works against his candidacy.  He most certainly will run as a third party candidate, which I think is a huge mistake; better to stay in the party and try to create meaningful changes.  We'll see.  Brownback brought along the tax code, and waved it in the air.  He argued for taxpayers having the option to pay a flat tax versus the current tax . . . hmmm.  Interesting way to begin to engineer a change to our current system.  Huckabee argued for a consumption tax, i.e., a sales tax, as a replacement for "all taxes on productive activity."  I'm not sure - seems like we are always being asked to raise our sales taxes, here in Flagstaff, by very small amounts (like, .001%) to fund increased spending, and people just don't oppose it.  He also made a pitch for "energy independence in ten years."  So, I'll never vote for him - how stupid can anyone be about that?

     We also heard from Michael Steele, former Maryland Lt. Governor, and John Stossel.  Both gave good talks that were well-received by the crowd.  I have heard Stossel before, and use his videos in my classes, so it was very familiar ground to me.  I liked his theme of "markets work in unexpected ways" to show how problems get solved when we allow for flexible responses to arise, which we wouldn't otherwise be able to plan in advance.  Government, he said, just doesn't work.  Right on.

     The morning session ended with an appearance by Fred Thompson.  He hadn't been an official candidate for very long, and this was just the kind of venue that was suited for him.  But, he was awful.  He was unprepared.  He stuttered and stammered a lot - quite unexpected for an actor!  His message was chaotic and uninspiring ("I will do the things that work.").  Too bad.  My sense was that this crowd was ready to jump on the Thompson bandwagon, but he lost us and he lost an opportunity to be a meaningful player in this race.  I suspect he'll drop out early, after poor showings in the first few primaries . . . probably on February 6th.

Click on any photo to see a larger image.
We were treated to presidential candidates Rudy Giuliani, Ron Paul, Sam Brownback, Mike Huckabee and Fred Thompson, and, maybe . . . future presidential candidate . . . keep your fingers crossed, Michael Steele.
Cara Lynn, Andrew, Bob and Dennis enjoy coffee and Danish at the Mayflower Hotel, site of the DADS.		Does nobody like diet soda? So it seems, as they gather together at lunch's end.		John Stossel signs book for Cara Lynn.  Economist Tyler Cowan, to the left, also signed his book for her.

     There were some competing afternoon sessions, but still lots of great speakers.  We continued to catch the speakers in the main ballroom.  We heard from John Fund, Art Laffer and Steve Moore.  We saw Moore at the local Arizona Federation of Taxpayers luncheon last year.  He is a member of the Wall Street Journal Editorial Board and doesn't pull his punches.  He mentioned that some conservative groups were starting up ATF parties - do some target shooting in the morning and enjoy the afternoon (somewhere else) smoking and drinking.  What a hoot.  I have also seen Laffer before - speaking to a luncheon sponsored by the Goldwater Institute.  Fund was a bit of a surprise.  I have seen him on TV before, and read his excellent book about voting.  He usually comes across as rather reserved, but not on this day - he was quite animated and passionate in speaking to this crowd.

     Later in the afternoon, we heard from Ann McElhenney, who co-produced and co-directed a recent film titled Mine Your Own Business.  Fantastic speaker.  She really riled up the crowd, and enjoyed a standing ovation for her comments lambasting environmental nutjobs, including Al Gore.  She talked about being in Madagascar, which is a major portion of the film, and how not a single white person they spoke to cared about the miserable conditions of the local populace, but would speak volumes about saving the lemurs.

     In the evening, the keynote speaker was Mitt Romney (none of my photos turned out very well).  He did a good job and was well-received.  The theme for the evening was A Tribute to Ronald Reagan.  In that vein, we heard from Jim Miller, Reagan's OMB director, and Dinesh D'Souza, who interned in the Reagan White House and had a lot of good Reagan quips.  My favorite was from a visit Reagan made to his alma mater in Eureka, California.  It is an average college and he got average grades, which was the fodder of many of the president's critics.  To the assembled crowd, he reflected, "Even now I wonder what I might have accomplished if I had studied harder."  Touché.

** Update - This morning, Pat Robertson, conservative religious right figure, endorsed Giuliani.

Sunday, November 11, 2007

   All Quiet on the Western Front - In late October, we drove up to the Grand Canyon to attend the second annual Grand Canyon Hikers Symposium, sponsored by the Grand Canyon Hikers & Backpackers Association.  Great stories all day long.  On our way out of town, the sun was setting behind the helipad, in Tusayan.  We stopped and I was able to snag this great shot of the helicopters at rest. 

Tuesday, November 27, 2007

   Your (Tax) Money is for Nothin' - This morning's Daily Sun has expended much carbon to further warn us about the impending doom we all face from our profligate lifestyles, which, apparently, is the leading cause of global warming.  No, ... I think it is the only cause of global warming.  In fact, it may well be that if we just think about global warming, we may be causing global warming.  In any event, the drumbeat on this issue has become incessant.

     The kicker, at least today, is an article about how Northern Arizona University officials are trying to achieve the goal of becoming "carbon neutral by 2020."  In pursuing this goal, the dean of the engineering college has said that she is "looking to buy carbon credits to offset faculty jet trips..."  If I had more time, I could probably think of a bigger waste of money.  Maybe.

     Let me see if I have this right.  Taxpayers in Arizona should have to pay for faculty salaries, when they travel to far-flung conferences, pay for the travel expense for those conferences, and, now, pay for a carbon offset for this travel?  I guess it would be too tacky to ask the traveling faculty member to cough up some of his/her salary for this noble cause (or, is it Nobel?).  Of course, that assumes that they actually agree with NAU's goal of neutrality.  And, never mind that college faculty earn about double the median wage in this country.  The bottom line is - if it is a good idea, someone else should pay for it.

Related items in the on-going global warming hysteria:

Claim the $125,000 prize.  If you can prove that humans cause "increases in global surface and tropospheric temperatures along with associated stratospheric cooling" and that the costs of global warming, through the year 2100, exceed the benefits, you can win this prize, offered by junkscience.com in their Ultimate Global Warming Challenge.  No takers yet for this money.

The debate is over.  Really?  Of course not.  But, the proponents of catastrophic man-made global warming are singularly reluctant to debate this issue.  The folks at demanddebate.com have a reasonable agenda of what they would like to see in this regard.  

Proponents lose in a debate.  National Public Radio, not known as being especially unbiased in this regard, organized a debate in May of 2007.  Following the debate, the audience was polled and, by a 46% to 42% margin, accepted the proposition, "Global warming is not a crisis."  

Thursday, December 20, 2007

   There They Go Again - Those who read the local paper regularly may often get the feeling of deja vu.  Sometimes it is because they literally run the same story twice, usually separated by a day or two.  Indeed, one time, I actually saw the same story three times - all exactly the same - in the same week.  Still, my comment today is on the newspaper's editorial recycling.  They don't run exactly the same editorial more than once.  At least, not to my knowledge.  But, they do recycle editorial content, usually without any additional insight nor acknowledgement of new data.  And, so it goes with their editorial, "Rebalancing Canyon access and natural experience critical," run in the Wednesday, December 12th paper.  Once again we are treated to the moans and groans of how crowded it is at the canyon and how cars should be banned from the park.  Aaargh!  To wit, I wrote a reply, printed in the paper on Tuesday, December 18:

Well, I tried to keep it short and to the point.  I have commented before on logical fallacies, and may make it one of my missions in letter writing.  The 'non sequitur' has always been a favorite of mine, and it just amazes me how easily people will connect up two disparate notions just because they are juxtaposed together.  And, so it was here.  More galling was their contempt for the fact that the park service is actually addressing these issues.  The editors may not like what the park is doing, but then they should tailor the editorial appropriately.  Lazy.  A few more observations:

Why is visitation flat?  The editors suggest that, "annual park visitation has been flat for nearly a decade, in part because of its reputation for summer overcrowding."  How do they know this?  Well, they don't.  The mere act of writing (or, speaking) it will make it true.  After all, how can you survey non-visitors?  Certainly, some potential visitors may be off put by stories of the canyon's congestion.  But, most visitors are first time (i.e., only time) visitors.  I don't think the canyon's "congestion" is likely to be a deciding factor.  Inability to get a room reservation, on the other hand, may well be a deciding factor.  Still, it begs the question of why visitation is flat.  I would suggest that potential visitors are faced with lots of interesting choices for how to spend their time.  And, most "attractions" market themselves pretty effectively.  But, the Grand Canyon doesn't really do this.  It is not a destination.  And, yet, it could be.  But, the people that run the park service hate the idea that anyone would come to the Grand Canyon for any reason other than to genuflect upon the rim.  So, they have resisted each and every idea that would help carve out the Grand Canyon as a singularly spectacular visit.  The Hualapai Tribe is doing a better job (but, they have a long way to go) with their new Skywalk at the so-called Grand Canyon West.  

No, it isn't at all like Disneyland.  The editorial contends that "Grand Canyon Village is a mass tourism model no different than Disneyland, which has long shuttled visitors from giant, outlying parking lots by bus and tram to its entry gates."  First of all, the parking lot at Disneyland (the original one) was right in front of the gate to the park!!  Their transit options only developed over time.  Secondly, the draw of the Grand Canyon is . . . drumroll, please . . . the GRAND CANYON!!!  It isn't the village.  Visitors have no reason to wander around the village area.  The Grand Canyon is huge - practically the size of Delaware.  And what visitors want is access to the rim.  There is no reason why the village has to be so small, or so constrained to its current miniscule footprint.  It is an artificial scarcity that prompts wide-eyed urban planners into conniptions of buses and trams for visitor access when it is totally unneeded.
     One more salient fact, unmentioned in the editorial - Disneyland has parking for over 15,000 vehicles while the South Rim area has but 2400 spaces, and the "need" for about 600 more!

For those not in the know, the title for this essay is inspired by Ronald Reagan's famous retort to Jimmy Carter.

dfoster@kaibabjournal.com