Thank God For Great-Grandchildren

In this year of so many unpleasant surprises, I have made at least one wonderful discovery.

If one marries young and has children quickly, great-grand parenthood can happen to anyone.

Children are a joy, as are grandchildren!

Beware! Do not try to give too much child rearing advice to your children because they are likely to be hyperaware of what they see as your mistakes in raising them.  Of course, no one is perfect, but we all do our best.

When your grandchildren’s children arrive, they are heaven sent. They are the cutest, bestest etc.

(But beware of ever-growing tuitions!)

Here is the DISCOVERY:  Your grandchildren will welcome ALL your advice because they do not hold YOU responsible for what they see as their parents’ mistakes.

In such dark times, we need to take our joy from unexpected corners.

Trust me on this. The future is promising!


The Best Defense Is A Good Offence

The 2017 tax bill may be the worst and most dangerous piece of legislation since the 1930 Smoot Hawley protectionist legislation that shrank international trade in the following three years by almost half and led directly in the 1930s to the horrors of the worst depression this country has ever experienced.

Among the similarities was the fact that 1000s of the leading economist –of all political stripes—then and now –have written and warned the country at large of the likely adverse consequences.

The only materiel distinction is that Smoot Hawley immediately led to retaliatory trade restrictions and this tax bill will lead to a rapid rush to inflation everywhere in the world which will radiate into depressed economies worldwide through shrinking investment.

There is one other distinction which is crucial, and if we move aggressively in the right ways, just might dampen the adverse effects of this new tax bill.

The trade protectionist legislation in 1930 took effect IMMEDIATELY and was responded to immediately.

Significant parts of the new tax bill take effect over several years.

Thus IF the other world economies see wise and serious counter measures being planned by the Democratic leadership for post the 2018 midterm elections, the radiating consequences might be successfully restrained, if the world reads the political tea leaves as do most Americans today.

THEREFORE, a vital and immediate task for the current Congressional leadership will be to convene a task force from both the Senate and the House to map out the outlines of an appropriate tax reform plan to immediately replace today’s treacherous bill.

If the US and global market places see what is likely to happen  in early 2019, hopefully they will adapt better to what is otherwise in store for us today.

Yes, either Trump or Pence just might still be President. But, remember that there were quite a few Republican House and Senate members who went along with the flawed tax bill under duress. Hopefully, the political climate then may be sufficiently different for the then Democratic leadership to lure enough Republicans to create a veto proof majority to get the country back on track.

SURE! This is a long shot. BUT it cannot hurt anything to show the country and the world what a Democratic tax reform plan would look like? AND SOON!!!

People Are Like Camels

The biggest question that surrounds us today is why and how so few people, who we all live among, are concerned enough with what is going on in Washington to think much about it and/or do anything about it.

There is an inertia that envelops most people which is something like ‘I cannot do anything about it, therefore I do not want to worry about it and therefore I am going to go on about my own business and simply HOPE for the best’. That obviously on the surface seems to make perfectly good sense. BUT, that state of mind is what probably dooms all of us from doing anything to remedy the overall situation in time to minimize the damage.

Our political process has taken on a life of its own which makes it VERY difficult to correct even obvious mistakes. In some strangely perverse ways, over long periods of time, that may be a good thing because it overall creates political stability.

The flip side of that, of course, is that it takes virtually a political revolution or a major legal problem to effect any change, which is where we ought to be at the moment.

Certain animals have their own ways of dealing with situations like this. In vicious sandstorms camels simply stop where they are and put their head in the sand and hunker down and wait for the storm to blow over, which such storms always do at some point, and then they take their heads out of the sand and continue on their way.

Other than a few new sand dunes on the horizon, when the storms end, the world around them otherwise remains the same.

The real world in which we all live today is very different. When and if, our political mistakes get corrected, it is already clear the world likely will be quite different. We will have quite different Federal courts, we will have a tax system which creates MORE inequality and deficits, and we will have a global instability brought on by a selfish America First doctrine of protectionism.

Perhaps a Pearl Harbor type of event of shocking proportions would help. That could happen if North Korea gets out of hand. But, the costs in human lives would be ‘inhuman’. Do we have to hope for that?

Instead, it seems to me that the recent Alabama senate election is a very helpful signal of public disgust with current events and suggests that by the midterm elections in 2018 we may get the revolutionary turnover essential to correcting the mistakes of 2016.

In the meanwhile if our human camels could pull their heads out of the sand for long enough to look around and engage in an unending series of public, but peaceful, displays of displeasure with the Republican controlled Congress and Trump’s shocking Presidential misbehavior, the whole country likely would become aroused. The polls are already without precedent – support for Trump and his Congress are well below 40% and falling. Such a campaign would likely take that number below 30%.

A healthy majority is the only basis for a Democracy to work properly.

Wake up Americans and DO SOMETHING besides simply privately hoping!

Bitcoin – Madness or the Future

In today’s amazing world you may have missed this or misunderstood it. It has had me mystified until recently.

Bitcoin is the brain child of several unknown Japanese computer geniuses who use the pseudonym “Satoshi Nakamoto”. Bitcoin employs block-chain software (a recent invention) and allows for private, cheap (free), and invisible transfers of “money”. Bitcoins are unregulated. The theoretical maximum number of bitcoins is 21 million, and there are believed to be 16.4 million in circulation now. It is also believed that they are primarily used to evade taxes of various sorts and to buy illegal goods. They are found by “mining” which requires a bitcoin “wallet” and a very powerful computer.

If that does not confuse you what follows will.

Bitcoins are now selling for in excess of $15,000, up from under $100 just months ago.

To the best available reports bitcoins do NOT convey to any owner of coins any interest in the possibly valuable underlying software that enables it.

Many of the leading financial minds in the US—like Buffett, Dimon, Bogle and Greenspan—have dismissed bitcoin because it was created out of nothing and has no real value—other than that given by an artificial a shortage of  notional coins that have been promoted cleverly to attract innocent sheep as buyers.

The block-chain software may yet have some utility in financial transactions but must be seen as completely separate and distinct from bitcoins.

Currencies like the dollar, yen, and euro exist in essentially unlimited numbers thanks to the banking systems that regulate their use. Their fluctuating values relate to comparisons to other currencies and rare things like gold and silver. Their real value—if it is real?—is purely notional and ultimately based on confidence in the national issuers and their countries’ economies.

Consequently, bitcoins are simply nothing but a clever scam and the only winners will be those who sell theirs before the price ultimately and surely falls.

Bitcoins will be remembered in history the way the name Ponzi is remembered.

But block-chain technology may yet develop into something worth remembering.


North Korea – The Solution?

Recently, I had the privilege of hearing General Vincent Brooks, whose name may someday be remembered alongside Grant and Eisenhower in the pantheon of great generals. When we remember General Brooks, however, we will likely praise how he kept us OUT of a war.

General Brooks is the commander of United States Forces in Korea. He appears to know the situation in great detail, including the names and profiles of all the North Korean officers facing the South.

He is persuaded that NEITHER side can back down from the present spitball game between our two national leaders.

Accordingly, his view appears to be that we have to rely on a serious, long- term diplomacy to manage the North Korean threat. We have worked in such a way with Russia since 1945 and China more recently.

The frequent objection to this approach is that long term accommodation is a very risky cop out. But, how different is it really than what we have been doing vs Russia in Europe so far?

Brooks did not say outright that there was no military solution and he was not asked that question. But his sophisticated and knowledgeable analysis left this observer with the view that we all had better grow up and get used to the permanent reality of a nuclear North Korea.

It takes the very best of any General’s thinking to be open and honest enough to know when to avoid shooting!

Another Titanic Tragedy

In 1912 the British launched an “unsinkable” passenger ship. On its maiden voyage, the Titanic hit an iceberg and sank in about two hours. About half of the people on board perished in the frigid water. If you did not see James Cameron’s cinematic depiction of the disaster, it is currently back in movie houses thanks to a new Dolby version. See it. It is amazing.


Whether we know it or not, we are all sailing on an older TITANIC called the United States of America. For two centuries, we have been an unsinkable democracy.


But, as the ship Titanic proved, nothing is truly unsinkable.


The world has been living with a threat of a possible rogue nuclear power since 1945. We are now living on the brink of uncertainty of whether North Korea can be contained. One North Korean bomb could unleash a devastating nuclear war, the full consequences of which are almost impossible to predict.


More recently, the United States has been living with a rogue and accidental President who has neither a rational policy for dealing with North Korea nor any idea how to manage the United States and its economy.


Meanwhile, the Republican leadership in the US Senate and House of Representatives is rushing towards a budget and tax reform bill that virtually all independent and knowledgeable economists warn is a major threat to the US economy.


The last time our leaders ignored such a large number of economists was in 1930, when the Congress passed the disastrous Smoot-Hawley Tariff Act, which led directly to the worst economic depression our country has ever seen.


Despite the numbers and expertise of their opposition, Congressional Republicans evidently want to ram their tax bill through before Trump implodes, believing that may help them in coming elections.


Like the ship Titanic the United States does NOT have enough life boats. Our national ship has sailed and none of us can get off. The combination of the threat of nuclear war with a serious threat to the whole American economy looms as a giant iceberg in our path forward.


But we can still scream and yell loudly before the Congress finally votes on the reconciled tax bill and we can argue that Trump’s incoherent foreign policy is in itself grounds for removing him from office.


We must take to the streets ASAP and yell REMEMBER THE TITANIC!!!

Do Not Despair on the Tax Bill – Yet!

The tax bill that passed Friday night may be the most dangerous piece of legislation ever. The scoring by bipartisan experts and virtually all first-class economists agree. Remember the disastrous Smoot Haley trade protectionist legislation in 1933? It was opposed by thousands of economists but passed anyway, leading to the worst depression EVER!


The idea of passing a 500-page bill before it is even completely printed is in itself beyond comprehension and ought to be illegal. The Constitution is silent on that front. But IF they had addressed such a need, the Founders would surely have required enough time for members to see AND KNOW what they were voting on. A detail yes, BUT may turn out to be important.


One thing that possibly could excuse the rush is that everyone knew that this was NOT the LAST vote. That will come after the bill goes through the House and Senate conference committee reconciliation process.


That is where the last hope lies.


Congress operates in its own bizarre ways and there is a lot of “tap dancing” to get from here to there. Remember: members’ FIRST and last thought before voting will be “How does this affect my reelection?”


Take for example Susan Collins of Maine. She had been thinking straight and spoke against the bill based on broad sound deficit reasoning. Suddenly, she asked for relief for the first $10,000 of real estate taxes. When she got her wish, they got her vote. BUT AFTER the reconciliation process, she will hopefully change her mind back to NO. Her constituents will appreciate her even more for her help with their real estate taxes, etc. Her Republican colleagues surely will appreciate her “help”.  AND, when the final reconciled bill loses with her NO (along with McCain, Johnson, Flake and Corker) those constituents will realize their tax position remains protected under current law and at the same time she will have helped saved us all from an economic disaster much worse than the loss of a tax deduction.


I do not know the McCain, Flake, Johnson and Corker stories well enough to walk you through their possible fancy dancing. But I have no doubt there are similarities.


To make all this even more upsetting, the Senate’s rushed vote came on the same day that Trump’s tenure surely started seriously downhill. Now Flynn’s plea opens up Trump to a clear and convincing charge of obstruction of justice. The end of his Presidency just might be coming faster than most expected. As such, the Republican Congressional leadership is RUSHING to get their long dreamed of tax goodies before their whole political world blows up.


We should redouble all efforts to kill this bill (which incidentally I believe will in fact reduce my taxes) because I am more concerned with a sound economy than lower taxes for myself or any other well off taxpayers.


Therefore do not despair yet but keep up the fight!