In a similar vein to my earlier post this morning Josh Barro hones in on why state and local governments are laying off employees. According to San Jose’s Democratic Mayor Chuck Reed, San Jose faces a budget problems because it has been:
1. Giving out raises faster than revenues were growing.
2. Giving out raises and increasing benefits when revenues were falling.
3. Giving out raises and benefits retroactively.
4. Allowing employees to cash out unlimited amounts of sick leave when they retire.
5. Providing lifetime health care for retirees.
Transfusion may be necessary emergency medicine but it doesn’t solve the underlying problems. In the case of state and local government unconditional cash transfusions also remove the incentives for addressing their underlying problems.
“Josh Barro hones in on…” should read “Josh Barro homes in on….”
hone1
n
1. (Engineering / Tools) a fine whetstone, esp for sharpening razors
2. (Engineering / Tools) a tool consisting of a number of fine abrasive slips held in a machine head, rotated and reciprocated to impart a smooth finish to cylinder bores, etc.
vb
(Engineering / Mechanical Engineering) (tr) to sharpen or polish with or as if with a hone
[Old English hÄn stone; related to Old Norse hein]
Usage: Hone is sometimes wrongly used where home is meant: this device makes it easier to home in on (not hone in on) the target.
I sometimes wonder if conservatives have a better grasp on individual human nature. I think liberals tend to accept that if more resources are needed we should give them, and then everything else will work itself out. They (we) rarely seem to consider that if a person can cheat to their own advantage with minimal risk, they’ll use those resources to line their pockets.
At the same liberals seem very cognizant of this happening in the private sector, while conservatives when discussing business often deny cheating exists.
Maybe we’re all hypocrites.
Merriam-Webster: hone in. It’s accepted usage.
Jimbino
C’mon, man.
Dave
Correctomundo
Ben
some conservatives, but probably no more than liberals convinced that anyone down on their luck is deserving “through no fault of their own.”. It’s an equal opportunity faulty worldview. BTW. IMHO you knocked the cover off the ball on the very first comment about wealth destruction over at OTB. Tired of JP yet?
Ben
In case I wasn’t clear, i was commenting on the cheating thing. Trust me, I know. But as a window into my worldview, I’ll bet liberals cheat vs conservatives at a 60-40 ratio. (that’ll get me in trouble). But look at charitable giving and Al Gore or Joe Biden. Liberal to the core……….with OPM.
I doubt that cheating has an ideological bias. I think there are two reasons not to cheat: internalized and externalized.
I don’t cheat because it would be dishonorable to do so. We don’t do it. I would feel guilty. These are internalized reasons.
Some people don’t cheat because they’re afraid they’ll get caught. Or condemned to eternal damnation. Those are externalized reasons.
If you’re bound neither by internalized nor externalized reasons, you cheat. When elites, regardless of ideology, are not governed by noblesse oblige or conscience or sense of honor or some other internal governing mechanism they cheat because they know they will either not get caught or, if caught, they will not be punished.
Here you go, Drew:
http://www.guardian.co.uk/science/2012/feb/27/upper-class-people-behave-selfishly
Apparently the problem isn’t liberal or conservative, but a rich folk thing.
As I said, no internal controls, don’t believe they’ll be caught or punished.
@Drew
We all live in our own little bubbles to some extent, but JP sometimes seems in an alternate universe. The claim that value and price are always the same thing was REALLY bizarre. The whole point of sound investing is to target opportunities with good value because they have solid fundamentals. Ponzi finance is about targeting price in the hope it will spike so you can check out ahead of the other suckers.
Maybe you should take him around to the manufacturers you work with and let him see the difference.
I have to confess, Michael, that I didn’t even read the link. Junk “science” etc is junk. I know you will dismiss this as “anecdotal” but I know of and observe more people who claim to cheat on their taxes, not tip the waiters or waitresses, not give to charity, attempt to get on disability, file phony insurance claims and on and on……….who have a leftist bent than a conservative bent.
And also unfortunately, some are my relatives.
Asinine “studies” don’t impress me. I’m too old, observant and worldly to fall for obviously planted crap.
Ben
You may have not been around long enough. “John Personna” was formerly “odograph.”. Back when I just came to pick a fight for sport I used to joust with “odograph.”. Then odograph disappeared. But along came “John Personna” and curiously, the writing style and points seemed very familiar. I once quipped that JP was odo. Our very own favorite blogger Dave, having inside info, confirmed this suspicion. I confronted “John Personna” with this for about three weeks before he realized his continual denials were to no use.
The point? JP lies like a dog. Squirms, lies, contorts ………..and has not one honest bone in his body. Worthless.
I guess I should note. Dave didn’t need to confirm it, it was as obvious as the back of your hand.
We all live in our own little bubbles to some extent, but JP sometimes seems in an alternate universe.
Yes, and it looks exactly like Denmark.
I might buy into michael’s link with the exception that the poor/needy lie like hell about money when they can’t pay their obligations. The check is in the mail. I loaned the car to some guy; I don’t know his last name, but now its missing. I didn’t sign any mortgage on this house; I don’t remember how I paid for it. Its shameful and embarrassing, but at least its motivated by wanting to reconcile with society’s expectations.
When someone of means lies about the check being in the mail, its a blacker lie.
Drew:
Yes, you’re right: whatever you pull out of your ass to “prove” a point is much better than “junk science” you didn’t bother to look at. Once again, you demonstrate your open-mindedness and capacity for objectivity.
“I don’t cheat because it would be dishonorable to do so. We don’t do it. I would feel guilty. These are internalized reasons.”
I need people who not only dont cheat, but dont cut corners in the wrong way. People need to have enough integrity and commitment to do the right thing. It may cost time or maybe you make less money, but it is a necessity for in the long run outcomes are much worse. In my trade, I dont see this as being ideologically linked. Avowed conservatives and liberals seem to have these positive traits just as frequently. What I have noticed is that entrepreneur-crooks are most likely very vocal conservatives, but I think that is mostly because I live in a pretty conservative area.
Drew- Observational bias. That is why we need studies.
Dave- Just FTR, this is out of control government. In particular, I really dont understand lifetime health care benefits. I can understand how the sick leave thing can be beneficial. The raises outpacing revenues is not sustainable. If you are not willing to raise the taxes, or the people are not willing to pay them, you have to cut pay or services.
Steve
“Yes, you’re right: whatever you pull out of your ass to “prove†a point is much better than “junk science†you didn’t bother to look at. Once again, you demonstrate your open-mindedness and capacity for objectivity.”
I knew this would be your view, and your response. Michael, I just don’t care. I’ve made a fortune disregarding conventional wisdom in my business. There are fundamentals, then there is experience, then there is wisdom and talent. As my father always said “I keep my own counsel.”. I know from the title of a “study” what its going to say. I wasnt born yesterday.
And I’m going to go out on a limb, because I think I know you well enough. I bet you don’t listen to people, or “studies” when it comes to your writing. You have a real talent. It is fairly unique. What are you going to do, read a study and base your next book on it? No need to answer, I know the answer.
So spare me the lecture. I’ve been around too much, done too much and seen too much to waste my time on obviously agenda based “studies.”
Steve
Your postings are becoming bizarre. Is everything ok?
Well, I’m personally skeptical of studies, particularly in the so-called social sciences, as well anecdote whether it comes from experience or not. There are, frankly, a lot of bad studies out there and the problems with confirmation bias are obvious.
On the topic of this post, this issue is a big reason why I draw a pretty big line between public and private unions. I think private sector unions (or at least the threat of unions) are a necessary evil, but public sector unions are, imo, pure rent-seeking.
I’ve made a fortune disregarding conventional wisdom in my business.
I thought you were claiming you weren’t rich.
Ben
” The whole point of sound investing is to target opportunities with good value because they have solid fundamentals. Ponzi finance is about targeting price in the hope it will spike so you can check out ahead of the other suckers.”
I should have responded to this earlier but didn’t. I apologize. This is exactly correct. I would only add that our formula is to take those sound fundamentals and add our expertise so that a company “can be all it can be.”. It’s one of the most rewarding things in my lifetime to see underperforming businesses under family ownership unleashed, with managers cut in on the equity gain in a major way for the first time, and maximizing what the company can do. Everybody makes money, everybody who is worthy has a good career, everybody feels good about what was accomplished, people get employed……. It really is the American Dream.
Anyone wonder now why I can’t stand Obozo?
Ice pick
C’mon, that’s cheap. A couple tens of millions ain’t rich. Sorry to disappoint. Movie stars making ten million a flick are rich. Kennedy trust fund kids are rich. bill Clinton at what, eighty mill, is rich. Rock stars and rappers and second rate third basemen are rich. Labron James is rich.
I ain’t rich. No planes. I don’t live on the North Shore. And I’ve only got one vacation house. I ain’t rich. I’m just a farm boy from Indiana.
A couple tens of millions ain’t rich.
Bullshit.
And I’ve only got one vacation house. I ain’t rich.
Boo-fucking-hoo.
To be more expansive, “a couple tens of millions” represents approximately 279 times that median household wealth. Flip that fraction around and the median household is only worth about 0.39% of your networth. And you bitch about only owning one vacation home that is no doubt worth a good percentage more than most families own.
So again, bullshit and boo-fucking-hoo.
Typo alert: that should have been 259 times median household wealth.
Actually I’ve put considerable effort and even a bit of capital into trying to get better data in publishing. We know nothing about our end users and I find it troubling. I’d love some accurate data. And I listen to input on writing. When people make valid criticisms I listen and try to fix. I once threw out 200 pages and rewrote it – painfully difficult and complicated – because an editor had a valid point. I didn’t have to, at this point I can ignore editors if I want, I did it because he was right.
I always want more data, not less. I won’t say that I always adjust my opinions to fit the facts, but that’s my goal, and I try hard to stay honest.
I’m grateful when people teach me something new. On different occasions here I’ve thanked Icepick and Dave and Steve Verdon and Ben Wolf and others, and probably you for making points I had not thought of. I’ll take truth from satan and be grateful. (No, I’m not calling you satan.) Why do you think I push back so hard on ideas? I’m not trying to prove I’m smart — I’ve seen my IQ tests. I’m trying to test ideas to see whether they should get absorbed or not. I don’t want bullshit in my brain.
We all have to find what we give a f*ck about in this life. It can be love or beauty or humor or whatever. For me it’s the capital ‘T’ Truth, so no, you don’t get me at all.
“Anyone wonder now why I can’t stand Obozo?”
I was sure his “private sector doing fine” remark would have been the last straw for supposed progressive friends of the working man, but instead they doubled down on defending him. It’s appalling how many at OTB think the argument that things aren’t getting bad as quickly is a legitimate reason to vote for Obama.
Ben
Yes
Ice pick
You are of course entitled to your opinions. Your have no clue what
“”rich” really means. It’s a different world.
Michael
Satan, here. (snicker) look, I love you man, I really do. I’m the resident engineer. I’ve been trained – data, theory, data = theory? Yes no and so it goes. Im the ultimate analysst. Cold fucking blooded analyst. But…….
I just know that if you want to “break out” and become more than a robot, you rely on experience and instinct. Raw talent,. I’ll be damned if you do anything different. You deny me, Balls, I say.
Micheal, we are two peas in the pod. We don’t agree on jack shit. And probably never will. But the things that have made us what we are are probably closer than either one of us wants to admit. We have sordid pasts. Ugly. Really ugly. Really, really ugly. At least my past is. But those events have formed us. We survived and prospered.
However, escape is sweet. And, to quote the great Led Zep, I ask no quarter. I’ll make my way.
Your have no clue what â€rich†really means. It’s a different world.
I understand that twenty million dollars is far more than most people will make in a lifetime, much less be worth. I understand that when you want to be the BSD you talk about the “fortune” you have made. I understand that no matter how dire a person’s circumstances in life, you will (a) tell them they deserve every bit of it and (b) that YOU are the one with the truly rough lot in life. Guy gets his face chewed off by some Haitian zombie in Miami? The dumb fuck should have been a private equity douche bag, then he would have never had to asociate with the riff-raff, he could have been golfing at the Doral instead. Someone is out of work for years in the worst employment market in a lifetime? Fuck them, you once had a well paying job that you trained for but didn’t like. Poor miserable Drew.
We have sordid pasts.
Yes, Michael was homeless, and you once had to work as an engineer in a steel mill. They’re EXACTLY THE SAME!
Ice pick
You are in your self pity mode again. Please stop. If you are what you say you are you can go do anything you want. People do it all the time.
Do you get the irony of noting Michaels past while telling yourself your situation is hopeless?
By the way, you have no idea some of the issues in my past. They are none of your business, and I suspect your problems pale in comparison. Stop bitching like an old woman and make something of yourself. This is like the scene from the Godfather when Brando tells “johnny Fontaine” to act like a man. Well, Icepick, act like a man.
PS
I’m no BSD, although the ladies never seem to tire of me. Heh.
You are in your self pity mode again. Please stop. If you are what you say you are you can go do anything you want. People do it all the time.
Self-pity? My life is okay at the moment. I can’t get work, but neither can most of the people I know who are unemployed. My house sucks and my neighborhood is awful, but the house is paid for and the roof is decent. My wife has a decent job and for the moment I can be a full-time parent. Life isn’t grand, but it is better than it has been in years.
However, this crap that anyone can do anything they want is utter tripe. If that were so why aren’t you working on winning your 25th grand slam tournament at golf this weekend instead of trying to get your jollies making fun of unemployed people?
(And I’ll note again that you complain about how tough Obama is making it for poor little rich boys like yourself to loot the country while stating that the only reason anyone is unemployed is that they’re either lazy, thieving or malingering. Amazing how the bad economy of Obama & Co. ONLY has a negative impact on self-pitying capitalist assholes.)
The economy is in the toilet. Even the optimists I know have finally given in, and they now admit that it is almost impossible for an unemployed professional to get any kind of job after they turn fifty. The ones that are a little less optimistic now think that anyone out of work for six months and over age forty is completely hosed too. Hellfire, there was an article on CNN about three weeks ago with someone claiming that IT and CS people that are over 35 and lose their jobs are done, because that’s just the way the industry is going.
I’m actually getting a little depressed at the networking events not because things stink, but because I hate to see some of these eternal optimist types getting completely worn down by the relentlessness of the current bad economy. Last weekend I actually had to buck someone else up, someone that is usually always upbeat.
We’re starting to see people just completely give up trying because after so many years of being unable to even land an interview… well, you won’t understand because you’re a sociopath, but most would understand that it completely discouraging. The reason SSDI usage is up is because people are desperate to keep body and soul together. I don’t blame most of the people conning the system, even though it is going to be a detriment to two of my friends the NEED SSDI, because I can’t blame people for trying to keep food on the table.
The economy hit bottom in early 2009 and it HAS NOT GOTTEN BETTER. It is the worst economy since the Great Depression, and it some ways* it seems to be even worse than that one. Namely, it is harder to find work once you’ve been out of a job for six months – one can’t just pick up and head for California because they’re deeper in the toilet than almost every place else.
I understand that given your total narcisism you can’t understand that being out of work now is different than you not liking a job once when you were in your 20s. But the reality is that you have no fucking clue what it is like to find employment right now, none whatsoever. The fact that you keep telling me that you do just indicates either total stupidity on your part or that you enjoy tormenting others. Given that you love to talk about how you love to start fights, I assume you are simply a sadist. And that pisses me off because needless cruelty is about the third on my list of things I hate, after only condescension and chronic dishonesty.
* Hard to be certain because of lack of good data from the way back. Of course the modern data is mostly dictated by the White House so as to attempt hiding how badly they’ve fucked up, so it’s probably a wash on which era has worse recorded data.
Well, I think most of the planet would disagree with you.
“For me it’s the capital ‘T’ Truth, so no, you don’t get me at all.”
Oh yes I do, I’m sorry if that disturbs you.
Andy
It’s all relative. It’s a state of mind. Analytically, I don’t consider myself rich, I don’t live rich, it’s just numbers in financial accounts. Yeah, I have a few toys. And I live comfortably.. But that’s all.
I help my family, I help others through Tough times. I even have a college tuition program that I can’t discuss publicly. (and that should be an indication of just how effed up our society is right now)
Our daughter is getting to the age that she understands money. She had a friend who’s father had a Lamborghini with a license plate “success.”. We don’t do that crap. That’s just “look at me” crappola.
So perhaps here is an insight into me. I often quip, and use this line when dealing with business owners, who consider us Big Time New York Private Equity guys. “I’m just a farm boy from Indiana.”. It goes over well. Well guess what, I’m just a farm boy from Indiana. Yeah, my father was a doctor, but we were never moneyed. In fact, we lived outside of Indianapolis in a farm community called Greenfield.
It’s true. I’m just a farm boy from Indiana. One of my best friends here in the community I live in now is CEO of a major company. His background? He grew up as a pig farmer in southern Illinois. A fucking pig farmer. Are you kidding me? A pig farmer. He’s a tremendous guy. Huge success. Smart. Hard working. Savvy.
You can learn a lot coming from humble roots. You don’t take yourself too seriously, but you also understand what it takes to get ahead. And it ain’t the government. It’s all you.
So to put a bow on it, I can’t stand the Barack Obamas of the world. Smooth talkin sons of bitches who went to this or that school but never really did anything in their lives………..except figure out how to promise candy to everyone on someone else’s dime. Yet we laud them. Insanity.
@Drew- My family centered around Greenwood, which used to be all farm land, and Trafalgar.
Steve
Icepick
For the last time. Please dear God, stop with the excuses and self pity. If you are the talent you say you are, go use it. But if I listened to you in an interview, I’d hire a monkey before an excuse machine like you.
I read your posts. I think you are a bright and good guy. I think you have an attitude problem. (go ahead, tell me I’m an arrogant son of a bitch; get it out of your system, call it cleansing) Get rid of the attitude, and go do it. Just go do it. Please.
Drew, you are just plain willfully ignorant. LTUEs don’t even GET TO THE INTERVIEW STAGE. Our resumes get pitched first thing because HR people do not want to bother with us. I haven’t been to an interview, or even had a phone interview, since early 2009. I presume my resume and cover letters suggest I’m a malinger? Is that it?
OTOH, I did recently get an offer to go to work. Someone was trying to sell me on being a seller of financial services – a 100% commission based job. All I’ve got to do is convince people to spend money on services that I myself wouldn’t buy if I had the money. That’s what it’s down to now. Do I do the immoral thing and try to sell people products that I believe are useless and bound to fail, or do I just keep bouncing along as before? Tough call.
Not to mention, you presume to know an awful lot about me from BLOG COMMENTS. Can I assume then that you start every business meeting by starting a fight with your partners and potential clients? I’m guessing not, though you normally start comments here by telling everyone that doesn’t agree with you rthat they are stupid, evil or incompetent. I doubt you do that in meetings.
It’s all relative. It’s a state of mind. Analytically, I don’t consider myself rich, I don’t live rich, it’s just numbers in financial accounts. Yeah, I have a few toys. And I live comfortably.. But that’s all.
The idiocy just keeps coming. By your account Sam Walton wasn’t rich when he died, because he was still driving an ancient pick-up truck. Not to mention Warren Buffett, who just got a private jet a few years back. Up to that point he took airlines. So I guess he wasn’t rich until then, right?
So did you grow up the son of a farmer, Drew, or working on a farm? Because being the son of a country doctor ain’t the same thing at all as being a farm boy. For one thing doctors have social and intellectual cachet that most don’t. That’s a big damned difference that being the son of a fucking pig farmer. (Assuming it wasn’t a big agribusiness concern, and was an actual small-time pig farming operation.)
Drew,
Yes it is and, relative to almost all the people on this planet, you’re rich. If you are worth “a couple tens of millions” (I’m assuming here you’re talking about net worth and not income or something else) then you are well within the top 1% with regard to wealth in this country. Just because you’re a self-made farm boy from Indiana doesn’t mean you’re not rich – it just means you’re a rich farm boy from Indiana. You may believe you are not rich, but by any objective measure you are – at least based on what you’ve told us here.
“I’m just a farm boy from Indiana.â€
I knew this sounded familiar.
Steve
My brother lives in Greenwood to this day.
Icepick
I give up. Yes, you are a loser.
Andy
When you have lived on the east coast for years, places like New Canaan, New York or Greenwich,you realize what rich really is. Sorry, I ain’t rich. Take the statistics you cited, and add a zero, or two. That’s rich. .
So people aren’t rich until they’re worth $200,000,000 or even $2,000,000,000 in your book? And you called me self-pitying for telling you you are full of shit for poor-mouthing it with your paltry $20,000,000 “fortune” (your word, not mine)? Damn, you are funny. As in strange, not “ha-ha”.
As for calling me a loser, if you are trying to hurt my feelings then try again. I’ve had a $50,000,000,000,000 economy telling me to go kill myself for four years now. Words from some self-proclaimed poor-little-rich-boy jack-hole whose wealth isn’t even within several orders of magnitude of that sum calling me names doesn’t really register!
Not to mention that the main reason you call me a loser is because I dare to disagree with you and point out when you are being a jackass, a sadist and an inconsistent so-and-so. You claim to have made a fortune, but say you are not rich, You love flaunting your wealth here in words, but claim to be humble. You love being a bully but claim to be a nice guy. You claim that you can judge everyone else SOLELY by whether or not they are sycophantic regarding your comments on someone else’s blog, but claim that you are entirely not like the jackass persona you project here at any other time in your life.
Get some consistency.
This is a factor I’ve mentioned before: “rich” is usually reserved for somebody at the rung on the income ladder a step above where you’re standing. For those earning $1 million a year it’s the “ultra-rich”, those making ten times that much. For those earning $350,000 but less than $1 million, it’s those earning a million. For those in the lowest income quintile the CPS teachers who are demanding substantial pay increases are rich.
Each group has a reasonable argument why they’re not rich but the other group is. What we’re forgetting is that, except for a few people living on Indian reservations or maybe in the rural South, by world standards all Americans, even those who see themselves as poor and just barely getting by, are rich.
Icepick
Look, I should and do apologize to you. Calling someone a loser isn’t productive or helpful. You simply frustrate me. You sound somewhat like Obama, it’s all everyone else’s fault. I just don’t think that way.
I’m a golfer. The old saying is “just show up with your sticks, some balls, and a wooden peg to put in the ground.”. No excuses, no tears. Just tee it up and lets go. It’s a mindset that I can’t escape. Have you ever heard an interview with Jack Nicklaus? He will look you straight in the eye and tell you he wins with his sticks, not the other guys. No weather, wind, etc issues. No complaining about the world or competition. Either you beat him, or he beats you- straight up. And he made sure he won most of the time, through talent and hard work. sounds Darwinan, but that’s how the world really works.
I do understand your plight, and I of course wish you the best. I’ll probably get a dose of invective, but you really do need to think about your attitude. It’s an issue.
Dave
I think that is a very good pont, and pretty much a view I’ve held for years. But it cuts both ways. We are constantly told by politicians that we have to have more taxes and new programs to help “the poor.”. Even though “the US poor” are not poor by other standards. They have food, tvs, cell phones, take vacations, and so on. Tney are poor only in a relative sense. Hence my view that this is just vote buying.
As for what’s rich. Of course it’s also perception. And I’ve obviously manged to piss some people off here. (its a talent.) But really, I think you would find most people in my situation to describe themselves as comfortably well off. I’ve seen real wealth. I mean real wealth. I’m not even in the same ballpark.
I know it’s sounds a bit smarmy. It’s not intended to be so. But really, I’m just a farm boy from Indiana who has made his way. It was really, really, really hard. Lots of sacrifice. Lots of risk taking. Lots of people telling me I would never do it. That just made me buckle down harder. Many no sleep nights repeating FU, watch me, to my detractors.
@Icepick
So people aren’t rich until they’re worth $200,000,000 or even $2,000,000,000 in your book? …
The only people without financial worries are the ultra-rich. These would be the folks whose wealth will take several generations to piss away. For the rich, their financial worries are proportional to those with less money, and the proportion may be greater for the rich guys.
As I tell my step-son, everybody has financial problems, but greater wealth allows you to worry in more comfort. It is all relative including living paycheck to paycheck, but there is an inverse relationship between paycheck size and loss of that paycheck.
“Life is like a shit sandwich. The more bread you have, the less shit you have to eat.”
-Unknown
“For the Snark was a Boojum, you see.”