Warren Buffet Can Fix Debt Ceiling...

Warren Buffet has a great idea on partially repairing our nation's economy.  Warren knows a thing or two about finances.  Unfortunately, Warren's plan won't work unless and until people get involved.  Most of us are rationally apathetic, knowing that our voice will not matter unless united with those of many, many others.   See what you think about Warren's plan, laid out below.


Warren Buffett, in a recent interview with CNBC, offers one of the best quotes about the debt ceiling:

"I could end the deficit in 5 minutes," he told CNBC. "You just pass a law that says that anytime there is a deficit of more than 3% of...GDP, all sitting members of Congress are ineligible for re-election.

The 26th amendment (granting the right to vote for 18 year-olds) took only 3 months & 8 days to be ratified! Why? Simple! The people demanded it. That was in 1971 - before computers, e-mail, cell phones, etc.

Of the 27 amendments to the Constitution, seven (7) took one (1) year or less to become the law of the land - all because of public pressure.

Warren Buffet is asking each addressee to forward this email to a minimum of twenty people on their address list; in turn ask each of those to do likewise.

In three days, most people in The United States of America will have the message. This is one idea that really should be passed around.

Congressional Reform Act of 2012

1. No Tenure / No Pension.

A Congressman/woman collects a salary while in office and receives no pay when they're out of office.

2. Congress (past, present & future) participates in Social Security.

All funds in the Congressional retirement fund move to the Social Security system immediately. All future funds flow into the Social Security system, and Congress participates with the American people. It may not be used for any other purpose.

3. Congress can purchase their own retirement plan, just as all Americans do.

4. Congress will no longer vote themselves a pay raise. Congressional pay will rise by the lower of CPI or 3%.

5. Congress loses their current health care system and participates in the same health care system as the American people.

6. Congress must equally abide by all laws they impose on the American people.

7. All contracts with past and present Congressmen/women are void effective 12/1/12. The American people did not make this contract with Congressmen/women.

Congress made all these contracts for themselves. Serving in Congress is an honor, not a career. The Founding Fathers envisioned citizen legislators, so ours should serve their term(s), then go home and back to work.

If each person contacts a minimum of twenty people then it will only take three days for most people (in the U.S.) to receive the message. Don't you think it's time?

THIS IS HOW YOU FIX CONGRESS!

Dialogue: Job Security

Austin: Hey Larry, looks like you'e making a mess in there.

Larry (the janitor): Sometimes you've got to make a mess to clean a mess.

Austin:  That's what they call job security.

Pick #314

Sammy Kershaw - "She Don't Know She's Beautiful" (cover of a Dave Mason song)

Bad News About Honduran Private City

Looks like the dream is dead.  A slightly watered down version of this city might be realized, but I don't like what I've learned about adaptations to the original idea.  Paul Romer answers some questions on Marginal Revolution.

Private City in Honduras

I got pretty excited when I heard about a private city that is being built in Honduras.  The details are not all worked out yet, but I expect them to have open immigration policies like the good 'ol USA used to.  The only tax will be a property tax.  No income tax, no capital gains tax, no estate tax, no sales tax, etc.  I'm not sure how the tax structure will be designed, but I imagine a straight ad valorem setup where you pay about 5% of the value of your property each year...that way the government has an incentive to provide an area where people want to live.

Since there are not going to be many taxes, there won't be many public services.  I imagine that the garbage collectors will contract with each apartment building or office building or private residence.  Power will be generated by private companies and sold to individual customers.  It will be very easy to start a business.  There will not be a large police force, but I understand that the city can employ legitimate use of force from Honduras.  As an effort to provide stability, a 2/3 majority will be needed to change laws in the city.

The only "catch" that makes this place not "completely free" is one tiny little regulation that I personally have no problem with.  Each business will have to employ a minimum percentage of native Hondurans in order that a portion of the prosperity generated by this city benefits Hondurans.  I don't forsee this being a problem because the best and brightest ones will be hired and I anticipate that there will be an excess supply of highly qualified Honduran workers for at least a few years.

If this city fails like some haters think it might, then the only people who lose are the investors.  If the city performs well, it could transform that part of Honduras in much the same way that Hong Kong was transformed from a rocky island into a booming economy.

If this place turns out to be a success, maybe I can end up teaching at a university in this city...

Pick #313

David Cook - "Lie" from David Cook

TreT, the Parkour DOG!

Some of My Research on SSRN

I have submitted some research to Social Science Quarterly and it is under review.  I was informed that it is fine to also post that research online at a site like Social Science Research Network.  Here's a link to my paper coauthored with Dr. Charles Barrilleaux and Dr. Daniel Scheller.

Atlas Shrugged Part I

I watched Atlas Shrugged Part I with the econ club tonight.  If you don't read the book before watching the movie, there are tons of characters heaped on you in this first installment of the trilogy.  It's tough to draw the connections between everyone without a background of how the story will unfold.  The movie times the presentation of information to the audience differently than the text.

It's true that there are some bad sets and terrible CGI, but I feel like this first movie was just a setup for an awesome Part II.  I hope they can trim the speech in Part III or else it's doomed to be boring.  Overall, the actors did a good job of portraying the characters.  I was an especially big fan of Taylor Schilling who plays Dagny Taggart.  She showed the confidence and determination that I imagined while reading the book.

Watching the movie now makes this book feels particularly prescient.  At one point, I seriously thought I heard Obama's voice from one of the government types who was basically talking about spreading the wealth around.  Spreading the wealth is a nice concept until one stops to consider where that wealth comes from before it is spread or who is in charge of the spreading or what sorts of incentives that creates for everyone.  In response to these incentives, Ellis Wyatt sets his own very valuable oil field on fire.  This is where Part I of the movie ends.  It is not unreasonable to think that non-fictional characters faced with the same incentives could do the same thing.

I am glad that I got to watch this movie with the right audience.  I don't think it would have been as good on my own or without a discussion afterward.

Groovy and Rad

The words groovy and rad seem to be used by people in certain cultures but are almost unambiguously good things.  I don't think I've ever heard them used sarcastically.  People might say "well that's cool" to mean that it's not cool.  Some people say "have a nice day" to mean F you.

I have heard alternate uses for groovy.  It can be a synonym for granola (the adjective, not the noun).  If you can recall a time you heard either groovy or rad used in a bad way, please let me know in the comments.

This post partially inspired by Millencolin's song "Fox."

Pick #312

Orleans - "Still the One"

Do Phones Ring Anymore?

On the way to my office, I heard a phone vibrate and thought it was mine.  Wrong.  Turns out that most phone vibrations sound the same.  Ringtones are sometimes the same, but it's easier to have a unique ring than a unique vibe.  I think kids these days (and older people too) leave their phones on vibrate.  Sometimes I think they're on silent because I see people pick up their phone all of a sudden and answer it.  I definitely hear less ringing from phones than I used to.  I wonder what's caused that shift away from an audible (ok, I guess you can hear a vibration) notification.

A Penitent Driver

On my way to school this morning, I was almost right-hooked by a motorist who was presumably in a hurry. The speed limit was 25 and I'd be surprised if I was going any slower than 23.  I was in the bike lane when this girl came from right behind me (like most cars do) and turned right all of a sudden.  I can't remember clearly, but I think I saw her blinker and so jammed on my brakes.  I was able to avoid running into her.

Since I had a bit of time before I needed to teach, I followed the car into the parking lot (against the advice of law enforcement and some bloggers).  I finally got her to stop and roll down her window.  I asked her how valuable her time was.  She was nearly in tears.  She said that she saw me after the turn and felt terrible and she was convincing.  I told her that she only saved about 3 seconds by passing me and making the turn and that I could have been seriously hurt.  At that point I think she might have shed a tear.  I told her that everything's fine...I'm not hurt, she's ok, but to please please watch out for cyclists.  Not everyone rides as aware as I do.  And I thanked her for using her blinker (if that really did happen).

I can only hope that she changes her habits and tells her friends to watch out for cyclists too.

OSLC Welcome Statement

I got an email from my church "back home."  See excerpt below.  I've always felt that the church had this sort of philosophy, but it was nice to see it in writing.  When I was young and naive, I thought that all churches had an outlook like this.  I was very surprised to learn that some churches teach that God hates certain groups of people or used the pulpit for political purposes.



We welcome you to Our Savior Lutheran Church.  We extend a special welcome to those who are single, married, divorced, gay, filthy rich, dirt poor, black, brown or white.  We extend a special welcome to those who are crying newborns, squirming children, and frazzled moms and dads.  We welcome you if you can sing like Andrea Bocelli or like some of us, who can't carry a note in a bucket.  You're welcome here if you're "just browsing", just woke up or just got out of jail.  We don't care if you're more Lutheran than Martin Luther, or haven't been in church since little Joey's Baptism.  We extend a special welcome to those who are over 60 but not grown up yet, and to teenagers who are growing up too fast.  We welcome starving artists, tree-huggers, latte-sippers, vegetarians and junk-food eaters.  We welcome those who are in recovery or still addicted.  We welcome you if you're having problems or you're down in the the dumps or if you don't like "organized religion", we've been there too.  We offer a special welcome to those who are left-wing, right-wing, or middle of the road.  If you are only here because you are visiting grandma and she wanted you to go to church with her, we welcome you.  We welcome those who are inked, pierced or both.  We welcome those in flip flops or three piece suits.  We offer a special welcome to those who could use a prayer right now.  We welcome vacationers, snow-birds, year-rounders, seekers, doubters....and you!  We welcome you to Our Savior Lutheran Church, because we are a place of saints and sinners of all kinds who are here by the grace of God.

Pick #311

311 - "Don't Let Me Down" from 311

Democrats: Let's Ban Profits

This is one of the scariest videos I've seen in a while.  I'm not trying to bash Democrats...I would be just as appalled if this were Republicans.  I have no party affiliation.  People really don't understand the source of profits.  See comments after video:




Profit is value created for society.  In order to make a profit, corporations have to sell the product for more money than it costs to produce.  Firms must pay their inputs their respective opportunity costs in production. That's economist talk for "you have to pay people to work for you and you have to buy your materials."  The people will not work for you if you do not pay them as much as they could earn elsewhere.  Nobody will sell you material if you won't pay as high a price as some other person.  Therefore, the inputs are valued by society at the price that corporations pay for them.  The finished product is valued by society at its sale price (or more).  Therefore, profits are a MINIMUM amount of value created for society.

When Traffic Lights Lose Power: Spontaneous Order

This site has an interesting case study on the spontaneous order of traffic in New Zealand.  It involves filming traffic one day when the lights were out and then again the next day at the same time.  I haven't counted the number of cars in each video...I assume they're supposed to line up approximately.

I must say that I've been in areas where the traffic lights are out and traffic did not flow as smoothly over here stateside.  Perhaps it's due to the rule that you're supposed to treat the blank lights as a stop sign.  That rule impedes the spontaneous order.  In case you didn't click the link, I'm posting the video below.

Good Timing on Facebook Wall

No joke, this was perfect timing for Dillon and Erin.  View full size for funnies.

Pick #310

Marcel Marcel - "Pony and Moody" from Schlemiel EP

I could see this being used in a commercial...probably for a car