I typically avoid large crowds. And the idea of being on my feet all day with visually obstructed views of a stage over a quarter mile away doesn’t sound like a recipe for a good time. But that’s not why I went. For me, attending this event was more about the experience of being there than having the best seat in the house. I wanted to be there in person to feel the energy of the crowd and to be a part of a message – even though it was never really made clear what the message was supposed to be.

The energy on the Mall was eerily calm. It was like something you would have hoped for but never expected from a crowd that exceeded 200,000. Everyone was nice to each other. No pushing or shoving. No yelling or cursing. I’ve never seen so many calm and happy people gathered in once place. It was as if everyone subscribed to the message from “Bill and Ted’s Excellent Adventure,” which was to “be excellent to each other.” (I saw at least two signs with that message but didn’t get a picture.)

For the few weeks before the rally, the main message from The Daily Show for attendees was “don’t be a douche.” Who knew so many people would comply? It was great to be there to experience it. As for the message…

Aside from the name of the rally, Jon Stewart (and Stephen Colbert) offered few details about any message they wanted to convey or what the show was to include. First and foremost, these guys are comedians and entertainers. However, Jon does have a reputation as a political satirist and I don’t think there is any question as to which way he leans politically. So, by having a rally on the National Mall near the heart of American politics, he must have had a message to convey. Anybody happen to catch what the message was?

The show itself focused more on musical guests than political commentary. In fact, there was practically no political commentary at all. There was no message for or against Republicans or Democrats. There was no call to action for or against any cause or hot political issue. To hear them explain it, their only goal was to entertain by putting on a good show. Jon did take a few minutes for some heartfelt thoughts near the end, but they were more observations than political statements. If there was an actual message I would say that it was a desire for the media and our politicians to be more constructive and less focused on sound bites and name calling. A desire for a little more… sanity.

As Jon himself pointed out, people came from across the county “even if none of us are really quite sure why.” For some attendees, the goal was simply to help create a bigger crowd than some guy named Glen Beck was able to draw last August. And those people should be proud of themselves, because by all accounts this event drew more than double what Beck got. (Estimates of 215,000 for Stewart/Colbert vs. 87,000 for Beck.) But this rally wasn’t just about trying to one-up a misguided cable pundit.

I’ve heard silly statistics that suggest that 10% of Americans get their news from Jon Stewart. Silly because Stewart is a comedian, not a journalist, and because it would be difficult to understand many of the jokes unless you were somewhat informed through more traditional sources. However, his show can be insightful in the sense that his satire can often bring home a point that many journalist miss or choose not to share. Whether it is about a community center in New York, patriotic homosexuals, or any other hot political topic, he very often finds a way to add value to existing news and a viewpoint that is often shared by many.

Mr. Stewart may not have had a specific purpose for the rally other than to provide entertainment, but the message from the attendees is that we applaud his efforts and the work that he does. Not just one day on the National Mall, but on his show every week.

A commentator on one of last Sunday’s news shows suggested that the size of the crowd was more a testament to Jon Stewart’s star power than any message, but that just tells me that he didn’t get the message. For me that message was this:

We are here, hundreds of thousands of us. We are not loud and we don’t even agree on everything, but we represent millions of Americans who would like to see a bit more common sense and a bit more sanity from our media and our politicians. Stewart and Colbert are entertainers, but mixed in with the comedy is a lot of truth. Pay attention sometime and you might learn something.

Even if that message has mostly fallen on deaf ears, it was good to get it out there and I was proud to be a part of it.

Check out some pictures I took at the rally by clicking this link: http://chrisozcpa.shutterfly.com/

Thank you to my friend Matthew for providing a weekend of ground transportation, rally companionship, and some nice Chianti. And special thanks to him and his wife for their hospitality, which included some awesome croissants on Saturday morning.

A small business owner is interviewing candidates to be his new tax advisor. He asks each accountant one simple question: What is the answer if you add two plus two?

The first candidate answers “four.” The second accountant pauses, thinking that it might be a trick question, but then answers “four?” The third interviewee, a CPA, leans back in his chair and asks “What do you want the answer to be?”

We CPAs may not be very good at simple math, but we are often very good tax advisors.

I’m not a Nobel winning economist and I haven’t studied all the data and models used by the Congressional Budget Office for projecting things like the effects of specific tax law changes or the effects of retiring baby boomers on the national budget. I’ll do my best to start with actual facts, but some of you may not like my math. (Story of my life… people only like my math when they get the answer they want.) Even if you don’t like my math I hope that most of you will acknowledge that I make some valid points.

Let’s start with some good news and happy thoughts before we address the potential post-election pain that may be on the horizon.

TARP

So many people freaked out when the government passed the TARP (Troubled Asset Relief Program). OMG!… $700 billion? It will bankrupt the country!

What most people didn’t understand was that this was an investment, not an expense. Even at the time it was passed, the actual cost of the program was expected to be about half of that amount – on the high side. At the time, I wasn’t concerned as much about TARP as I was about the effects on our economy if the government had done nothing. Financial institutions would have started falling like dominos. Bear Stearns and Lehman Brothers were already down. Even George Bailey wouldn’t have been able to stave off the run on the banks, which would have led to disaster at the FDIC and the collapse of our economy as commerce came to a screeching halt.

Still, people want to blame someone for pissing away a lot of money. It’s all people are focused on these days (perhaps rightly). So who do we blame? TARP was passed before Obama became president. Ah… but some of the money got doled out while he WAS president. Fine, let’s blame him for half. Half of what it will actually cost.

A lot of the “mistakes” that happened with TARP happened in the early days as money was thrown at banks without restrictions. Eventually, TARP money started getting “invested” with strings attached, such as equity ownership and board of directors seats. Essentially, TARP put the government in the position of being a venture capitalist. Guess what… sometimes venture capitalists make money.

As of earlier this month, the projected total cost of TARP is now expected to be less than $30 billion. On top of the money being paid back, interest and profits are offsetting a lot of the losses that occurred because not all of the “investments” worked out. We won’t know for several years, but that number could be modified down further. It may even turn a profit! It wouldn’t be the first time that a government bailout turned into profit. (Thank you Lee Iacocca.)

Clearly some errors in judgment occurred during the execution of TARP investments. (Several regarding AIG.) What did you expect? They are politicians, not ACTUAL venture capitalists. In the end, a program that probably prevented the entire collapse of our economy for the low, low price of maybe $0 doesn’t sound that bad.

So good job: George W., Republicans, Democrats, Barack, some guy named Ben, and probably a few other people.

Two final thoughts on TARP:
• There are those out there who have said “Let them fail – the banks, the insurance companies, the auto companies… They are all broken – it’s time to hit the reset button.” I can’t say I disagree with the thought in general. I for one hope that we, the taxpayers, are done bailing out the likes of Chrysler. However, our country was already in the depths of the worst recession since the great depression. I don’t even want to think about where we’d be had they done nothing.
• “Oh sure… banks are paying us back with interest – by getting it from taxpayers in the form of higher fees!” Yes, fees are higher because banks now have to operate as businesses by charging fees for the services they provide instead of gambling on derivatives to make money. Would you feel better about the higher fees if all the banks were owned by the Chinese or the Saudis?

Stimulus

OMG!… $787 billion? It will bankrupt the country!

Obama probably wasn’t even unpacked in February of 2009 when Congress sent him the American Recovery and Reinvestment Act, AKA – The Stimulus Plan. The Democratic White House/House/Senate combo hit the ground running and the first substantial act was an effort to get the economy on track with a shot to the arm. Umm… yea… We’re not getting that money back.

It’s odd to me that “stimulus” has become a bad word. For all the talk about how it didn’t do what they said it would do, it’s not like the money was all pissed away. Only some of it! (Oh come on… where are my “glass half full” people?) We’re only about two thirds of the way into the stimulus plan (it’s a three year program) and it’s already hard to find an economist who doesn’t think its working. The “jobs saved” and promise of lower unemployment was bad marketing. It set the expectation too high. What it really did was reverse the trend of monthly job losses and it has helped people who were already unemployed tread water for a bit longer.

Without the stimulus, unemployment would have gotten and would likely still be significantly higher. Was it worth $787 billion? I think it’s more important to look at how it was spent and determine if it was spent wisely. Here are a few thoughts:

• Infrastructure.  We were going to spend the money anyway, so why not do it now? Roads, bridges, public transit, electric grid, rail transportation… I’m not talking about bridges to nowhere. I’m talking about fixing stuff that we have that is crumbling and building stuff that we need to facilitate commerce. Well, maybe a bridge to nowhere or a stupid fence got snuck in, but most of the stuff was/is needed. I get frustrated when less important projects get done and desperately needed ones don’t, but in general it seems that infrastructure spending is well spent. The biggest beef seems to be that these dollars haven’t gone out fast enough.
• Aid to states.  With high unemployment and lower property values our states were not getting the revenues they expected. Sure they need to cut back. But some help for police, fire, education, and other programs seemed wise.
• Unemployment benefit extensions.  I’m not sharing an opinion on this one, except to say it probably would have been passed as a separate bill anyway. Just like the other unemployment extensions.
• Hey – how about cutting taxes and letting taxpayers decide how to stimulate the economy? What a great idea! Ahem… Over a third of the stimulus package was tax cuts for individuals and small businesses. What, you didn’t get your check? Sneaky how the government trickled it out a few bucks at a time so that you’d spend it (to stimulate the economy) instead of using it to pay down debt or save for retirement. Such as?
  • The biggest line item of the stimulus package, over $116 billion, was for the Work Opportunity Tax Credit. It’s as if Obama was pretending to be Oprah. “You get $400 and you get $400 and you…” You know that payroll tax holiday that Republicans are always saying we should have? Most of you got one. Check with your tax preparer, or me, to see where you got it or find out why you didn’t.
  • It seems like every year Congress puts a patch on the tax code to reduce the effects of the dreaded Alternative Minimum Tax. Last year’s patch was nearly $70 billion. Maybe someday they will fix the problem instead of burying patches for tens of billion of dollars into other bills. (I can dream, can’t I?)
  • Child tax credits, earned income credits, homebuyer credits, residential energy credits, bonus depreciation for businesses, NOL carrybacks for small businesses…

So, glass half-full people… forget that it was a huge price tag for one bill. Let’s think of it as an example of government efficiency. Some of it is crap, but most of this money was going to get spent anyway. Most of it we needed. Instead of dozens of small bills for things like infrastructure, tax breaks, tax fixes, unemployment benefit extensions and more – they did it all with one bill. Does $202 billion sound better? Only $202 billion was for the fiscal year that ended last year. $353 billion was for the year that just ended. The rest goes in the budget for the year ending September 30, 2011. Hey… how’s that budget looking?

2011 United States Budget

Funny thing… the United States is currently operating without a budget. I know that’s probably normal for most people – I don’t have a budget these days. I just hope enough comes in each month to cover what needs to go out. But this isn’t normal for the US Government. It is the first time since 1974 that we haven’t had a budget in place by the beginning of a fiscal year. Congress was kind enough to pass a “continuing resolution” on the last day of the fiscal year, September 30, so that government wouldn’t shut down until after the election. Without an approved budget or another continuing resolution we shut down on December 4. So what’s the holdup?

For starters, I’m guessing that no one in Congress wanted to put their name on a budget that projects a $1.3 trillion dollar deficit before the election. After the election I suspect we may have a similar problem. (Did you feel that cool shadow of doom start to creep into this blog post? I was so upbeat about TARP and Stimulus.)

In my mind, the two biggest problems are tax cuts and old people. (Who says I don’t know how to make friends?) Let’s look at some of that budget.

First the income side. Total income is project to be about $2.6 trillion, almost all of which comes from income taxes and payroll taxes. This figure assumes the extension of the Bush tax cuts for individuals with income under $200,000 and families under $250,000. I’m guessing it also includes some increases based on economic growth which is yet to be seen. If Republicans get their way, the Bush tax cuts would be extended for everyone. The price tag for that is an additional $700 billion over ten years. I’ll round off a little and suggest that if Republicans got their way it would drop the revenue side to about $2 trillion for fiscal 2011. But total expenses are expected to be $3.8 trillion – more tax cuts just made the problem worse. How do we fix that? Cut expenses!

Anyone else notice that all the politicians are talking about cutting expenses but none of them will be specific about where?

• Old people. I don’t know if we have final audited numbers for the fiscal year that just ended, but I think we spent about $1.2 trillion on Social Security payments and Medicare. Even if I’m off a hundred million, the number for this year will be a lot higher and it gets worse for the next several years as baby boomers flood into retirement. I’m the first to admit we need to start looking at some changes here, but find me a politician willing to cut payments to grandpa and a bunch of little old ladies. Death panels starting to look good? Hey, I saw a movie called Logan’s Run that had some ideas we could use. However I think we should assume that none of the politicians have the testicular fortitude to touch this hot potato and estimate $1.3 trillion for 2011. Where else can we cut?
• Defense and homeland security. Let’s call it $900 billion. (I was tempted to round up to a trillion, but that’s just rude.) I get it, we’re at war. But let’s play a little game. Let’s end the war, identify billions in other savings and cut the overall defense budget to say $500 billion. Hey that was fun – I think I just got the deficit under a trillion. Unless we extend Bush tax cuts to everyone.
• Everything else. Let’s see… Total expenses of $3.8 trillion, but let’s take out $200 billion for that stimulus bullshit and I saved $400 billion on defense a minute ago, so call it $3.2 trillion. Subtract $1.3 trillion for old people and $500 billion for the newer leaner defense budget because we miraculously and instantaneously ended the war. Probably need $200 billion or so for interest on the debt and some money for the VA since we take care of our troops. That leaves $1.2 trillion for everything else. Cut everything else in half and we still have… a nearly half trillion dollar deficit. Dammit!

Forget the silly math. My point is this: Extending the Bush tax cuts for everyone cuts projected revenue to about $2 trillion a year. We spend that much on Social Security payments, Medicare and defense. Even with planned defense spending decreases we still have increasing SS and Medicare costs because of an aging population. The $2 trillion isn’t going to get cheaper. Where does the money come from to pay for everything else?

Put everyone back to work and grow the economy as much as you want. Let’s say that increases government income by 40%, which I believe to be unlikely if you extend all the Bush tax cuts. You’d still need to cut the cost of EVERYTHING beyond SS/Medicare/defense by over half to balance a budget. No matter what you think about government waste, I submit that this would be impossible.

When Clinton left office we had balanced budgets and an economy that was working even if taxes were a little too high. Bush cut taxes too much and by the end of his presidency we were headed for trillion dollar deficits. I submit that tax rates belong somewhere in the middle. Not too high, not too low. Something Goldilocks would be comfortable with.

We need to cut government spending. A LOT. But taxes still need to go up and not just for the top 2% of taxpayers. We can’t hit them for the whole bill.  It’s simple math!

Don’t like that math answer?  Good thing  I’m a CPA.  Stay tuned after the election for some tax law coverage, including my 3-point plan to increase federal revenues without creating a new tax or raising rates beyond the Bush tax cuts.  I know I just said that it can’t be done, but I’m just that good.  Here’s a hint, Obama is actively working on two of them and I alluded to one of those in part 2 of this series.  Another teaser:  Some of you will prefer higher tax rates.

We still have some doom to talk about.

The Election and Extension of the Bush Tax Cuts

So here we are, days away from the election. We don’t have an approved budget, we have a government limping along with the help of continuing resolutions, and so far the Bush tax cuts are still set to expire on December 31. Any guesses on what will happen between next Tuesday and the end of the year?

Let’s say the Democrats keep the House and the Senate. (Bear with me.) Hurray – they won! The House passes tax cuts for individuals under $200k and families under $250k and sticks a huge tab to the top 2% of taxpayers just as Obama wants. Senate Republicans filibuster because they want all the cuts extended, nothing gets passed, they run out of time and we are looking at obnoxious tax hikes January 1. Hmmm…

Let’s say Republican’s take the House. (Pretty likely.) Hurray – they won! Bush tax cuts for everyone! Except the Republican’s don’t take control until January. We have a lame duck session of Congress to deal with. Fine… tax cuts for 98% of the people – Everyone wants that, right? Wrong. Republicans will fight it because they don’t want the Democrats to get credit for a tax cut when they will get control in a few weeks. Democrats theoretically might have enough votes, but a lot of those guys just got pink slips and won’t be motivated to vote. Let the new guys deal with this mess in January.

Run the scenario a half dozen ways and I see the large possibility that we don’t have tax law extensions until well into the new year. Scared yet?

If Congress can’t agree on the budget or tax law extensions then how about that continuing resolution to keep the doors open? Several of the conservative Republican candidates have flat out suggested that the government should shut down. No one to process tax refunds when people start filing tax returns. No one to process payments to government vendors. All national parks are closed. Certain construction projects stop. Do I need to go on?

Final Thought

No matter who wins next week I think we have a couple of scary months coming. However, at some point I believe that a modicum of sanity will be restored and our fresh batch of elected leaders will find a way to… not completely f*ck us over. It’s the optimist in me.
This concludes my three part series, but (as noted) I’ll be back with more commentary after the election. I welcome your comments, but I may not get back to you for a day or so. I’m headed to Washington D.C. for the Rally to Restore Sanity (and/or Fear). Tune in to Comedy Central on October 30 and watch for me in the crowd.

Please vote.

Politicians continue to lie on and on about what is and isn’t in the healthcare reform that passed earlier this year. Security along both sides of the Tigris River as it weaves through Iraq is now the responsibility of Iraqis. Threadbare rules on Wall Street that led to the near collapse of our financial system are being rewoven. A lot of things have happened over the last 21 months. Some of it is bad. But some isn’t as bad as detractors would lead you to believe.

Healthcare Reform

Several presidents have tried to tackle health care reform and failed. Health care was a cornerstone of Obama’s platform during the election and, to his credit, he got a comprehensive package passed. We must have wanted it or we wouldn’t have elected him. The status quo of double digit increases in health insurance costs and a growing class of uninsured (and uninsurable) had to be stopped, or at least slowed down. Even many Republicans acknowledged that, although half-heartedly.

From the beginning all options were on the table as far as Obama was concerned, even if his own party disagreed. He preferred a government option but didn’t require one. Tort reform, mandates, taxes, and more were all open for discussion. Obama, concerned with other matters as president, delegated the details and law writing to Congress. In retrospect, he probably should have been more hands on from the beginning. Who knew that the members of Congress would act like a bunch of school kids who don’t like each other?

About 2,400 pages later, we have healthcare, errr… health insurance reform.

Broad strokes, as confusing as it is, it does accomplish a lot of good things. A lot more people will be insured, costs go up but not as fast, and there is a lot of help for low/middle class taxpayers AND small businesses. Republicans didn’t get the tort reform they wanted but you would think they’d be happy that the meat of the law doesn’t include a public option and that it does have the mandate – which was their idea.

Confused? Stop listening to revisionist history and you’ll find that Nixon was a proponent of mandates. Oh, and most of the Republican party during the Clinton administration. Free market providers with tax related mandates were their ideas to fight against Hillary’s failed attempt to reform healthcare during the 1990’s. Too far back for you? Current millennium – Mitt Romney, with Scott Brown’s help, passed similar laws for Massachusetts.

Be careful what you wish for? Now that Republicans got what they wanted (without their actual help) they don’t want it anymore. Instead of trying to fix the flaws in the health insurance reform they perpetuate lies about what is in the law and talk about repealing it in its entirety. A few random thoughts:

• Tort reform.   It’s not too late. It has come up separately from healthcare reform many times. Pass some.
• Socialized medicine.  As passed, the law is far from it. And it won’t lead to the U.S. turning into a communist country. Am I the only one who was confused by the old farts who protested against a single payer system (which we didn’t get) because they didn’t want socialized medicine… but then they said “don’t touch my Medicare,” which is a single payer system? (It should be illegal to make chocolate – but don’t take away my chocolate?)
• Reporting requirements.   Don’t be scared into believing that the reporting of your health insurance costs on your W-2 is bad. It’s just a reporting item – it isn’t taxed and it shouldn’t be a burden for employers. What IS a reporting burden is the new requirement (starting 2012) that businesses issue 1099s to all payees of $600 or more. I get why it’s in the law, but there are other ways to accomplish some of the goals without being such a burden on small business. PLEASE FIX!
• Abortions.  Without getting into the whole pro-life/pro-choice debate, there is specific language in the law plus a presidential mandate that prevent government funding of abortions. If those aren’t good enough for the pro-lifers then maybe they should consider some additional restrictions. But don’t throw the baby, um… reform, out with the bathwater.
• Death panels.  Insurance provided counseling, which didn’t make it into the final bill, was denounced as “death panels” because of a perceived (erroneous) bias toward euthanizing the elderly. Some who continue to want a complete repeal still use this as a reason even though it didn’t pass. What cracks me up is the irony of it all. Insurance, by its very nature, is somewhat of a death panel in the sense that lines are being drawn at every level about what is and isn’t covered. If something isn’t covered and the person can’t afford to pay out of pocket for a treatment (that may or may not work) then the insurance company (panel) has sentenced them to death. “Sorry, not covered. Prepare to die. NEXT.”

Insurance can’t cover everything and in the end we all die. Preferably later than sooner. The whole idea of healthcare reform was to help provide a minimum standard of care available to everyone without regard to pre-existing conditions and without sending people into personal bankruptcy if they get sick. It’s not perfect, but I believe the health insurance reform has more good than bad. It’s unfortunate that it is so complicated and so misunderstood by the general public, but in time I think we’ll appreciate the benefits and legislative patches will mitigate some of the shortcomings.

And to those who would suggest that we “tear down those laws” I would say “Ney!” We passed these laws to help “promote the general welfare.” A Constitutional mandate long ignored.

War

What is the definition of “winning” these days? War, today, is not about taking over real estate and adding to our global footprint. It’s not about stopping Nazis from increasing theirs. It’s not about Borg-like assimilation of other cultures. And, post-Bush, I don’t think it’s about regime change. Isn’t it about security? Isn’t it about protecting the safety of our citizens? Not just in the United States, but British and French citizens on trains, people in Bali and India at hotels, and so many others. Christians, Jews, Hindus, Muslims, and even a few atheists… we are at war to create a safer world for all people.

So how do we win? How do you fight an enemy you can’t discern from the color of their skin, the clothes they wear or the religion they practice? This enemy doesn’t care about political borders or government or peace. We aren’t fighting the 1.5 billion Muslims on the planet, we are trying to protect ourselves from a few thousand (maybe less) radicals who claim to be Muslim but who are also willing to blow up other Muslims on a regular basis.

I don’t know the answer. But I hope, for the most part, that we are doing the right things at home, in Iraq, in Afghanistan and in other places around the world. A lot of people have criticized Obama for how he’s handled the war on terror. Shortly after taking office he more than doubled our troop levels in Afghanistan. In September of last year, after a botched Afghan election in August, the military recommended significant additional troop levels beyond what had already been sent. Because he didn’t quickly rubber stamp a report from a general he was accused of being a bad commander-in-chief who lacked the military experience necessary to understand what needed to be done. I think he knew more than the public realizes. For starters, he knew to ask more questions.

You can’t just call up the president of a sovereign country that you are trying to help and say “My generals tell me we need more boots on the ground. It’s for your own good. They are on the way.”

This war is unlike any other and no war is just about a military solution. There are many political and diplomatic factors in play – with allies and the leaders of the countries where the troops are to be deployed. It took about two months for the White House to publicly acknowledge the additional troops for Afghanistan, but a lot of diplomacy and additional research went on during those two months. And the influx of additional troops was to be faster than originally outlined in September, so don’t tell me that the delay caused the whole plan to be pushed out to the detriment of the soldiers already there because I’m not buying it.

Working to eliminate safe havens for terrorists to take root and multiply is our best option to increase safety. This includes military actions, diplomacy and (like it or not) some level of nation building. In the end, can we ever really “win”? There will always be some terrorists out there. Some Muslim, some Christian, and some just plain whack-a-doo. Reducing their numbers and their ability to inflict damage is all we can do.

A Mosque in New York

Unbelievable. Some politicians and conservative pundits have overtly created a negative campaign against all people of a specific faith. Even an old Jew from Jersey knows that we aren’t at war with all Muslim. The “Ground Zero Mosque” is a myth created to scare people into hating Muslims – apparently for political gain. A “myth” because a) it isn’t at ground zero and b) it’s actually a community center open to all faiths with a portion designated as a prayer room for Muslims. Is there a “no churches allowed in Oklahoma City” rule because McVeigh was a Roman Catholic?

On this same topic, if you haven’t seen the clip from The Daily Show about how the funding for the Community Center near Ground Zero can be traced back to Fox News then you should. Here’s the link:

http://www.thedailyshow.com/watch/mon-august-23-2010/the-parent-company-trap

Financial Reform

After years of hacking away at protections put into place after the great depression to reduce the risk of financial catastrophes we got… a financial catastrophe. Go figure.

In theory, I still believe in free-market capitalism, but we have two problems.
1) As we’ve moved toward a global economy, capitalism only works if everyone plays. Chinese flat-screens and tennis shoes are cheaper because they don’t play by the rules. This is just one example of why TRUE capitalism is probably dead.
2) Greed and stupidity. (Maybe that is two problems, making a total of three?) The last dozen years have proven that you can’t have unchecked capitalism. Enron, Worldcom, financial institutions leveraged 50 to one and lending 110% loan-to-value, some guy named Bernie…

A couple months ago we finally got some long overdue financial reform. I’m of the opinion that the reforms don’t go far enough to protect borrowers and investors, but they should curb some of the stupidity that turns financial thunderstorms into hurricanes.

John McCain still hasn’t learned from his involvement in the S&L scandal of the late 1980s and the rest of the Republicans haven’t learned from the more recent financial meltdown that you have to have regulations. These mouth pieces for Wall Street bankers continue to thwart attempts to create a stable financial structure by sticking to their theme of deregulation in the name of free-market capitalism. Maybe they don’t watch the news.

I think I can learn to live with the watered-down version of capitalism that we are ending up with. Promote business, innovation and success – but regulate for health and financial safety. Would a capitalist put seatbelts in every car? Hell no, they’re expensive. But we do it. Do we shun lead in out toys and paint? Yes (China will learn eventually). Do we require more transparency of derivative investment products? Hmm… still not enough.

 
So many more topics I wanted to cover with this article. Maybe I should have started earlier in the month and chopped this into a 5-part series instead of three. 
Gitmo – Still open? Don’t-ask-don’t-tell – Still not repealed?
Immigration reform, global warming, and math/science scores that are dropping in relation to other countries. So many hot topics, so little time.

Stay tuned for the third part of this October 2010 series, which should be out on Friday.
I’ll be attempting some math – not an easy task for a licensed CPA.

Comments or criticisms? Please share below or email your confidential thoughts to christopher@grasshutandcoconuts.com.
 

Over the last few months several people have asked me if I was still happy with my decision to vote for a Democrat in the last presidential election. And the question is often asked with a tone that suggests that I shouldn’t be. After all, with nearly 21 months in office he has failed to transform a country that was in the middle of the worst recession since the great depression into Utopia. Our streets are not paved with gold and there isn’t a unicorn in every pot. Indeed – How could I POSSIBLY be happy?

Admittedly, a few things haven’t gone as smoothly as hoped. But, unlike many, I think I had fairly realistic expectations when I voted for Barack Obama. Even before he was elected I accepted the fact that he is a mere mortal who would be taking over during troubled times. I also knew that there is only so much that one man, or even all of government, can do to turn things around. I expected setbacks and missteps. I hoped for a leader with a good message who could make tough decisions for the good of our country as a whole. I wanted things to get better.

And things have gotten better. Certainly not as fast or as well as many have hoped, but many key indicators are headed in the right direction. “Technically” the recession is over (if you believe the economists) and several stock indices are up over 30% since Obama took office. (Over 30% in 21 months – I wish I could do that EVERY 21 months.) Inventory levels, productivity, consumer debt… statistic after statistic we see things moving in the right direction.

But it doesn’t FEEL like things are getting better because the jobs aren’t coming back fast enough and that’s what everybody sees. Yet even with regard to jobs the statistics are at least headed in the right direction. We were losing about half a million jobs per month when Obama took office. It took a few months to stop the bleeding but we’ve seen private company payroll increases for 9 straight months – every month so far in this year. The gains have been minimal but it’s a start. Economists will tell you that employment statistics are lagging indicators – which is to say that they are some of the last to recover when recessions occur. They are certainly being proven right with regard to this recent recession.

While I don’t agree with all of the decisions coming out of Washington, I do think that White House policies have helped a recovery more than they have hindered. More importantly, some of the legislative accomplishments should have positive long-term effects. Stay tuned over the next few days for some specific thoughts on the following:

Part II: Obamacare, Financial Reform, War, and some miscellaneous random thoughts.

Part III: TARP, Stimulus, and extension of the Bush tax cuts.

With an election just over a week away, I’m not so naïve as to think that my ramblings on these topics will sway anyone from once side to the other. I just think it’s good to summarize some thoughts on the hot topics. Besides – no matter who wins next month and no matter which party controls the House and the Senate, we are in for more political stupidity from Washington. As for Obama…

After 21 months I see a president, not unlike many of his predecessors, who is discouraged by the lack of power to get certain things done. Apparently many things can’t get done without an act of Congress. Literally. And Congress, even if controlled by your own political party, isn’t always willing to play along.

I see a man who has stuck by his core messages and who has tried to govern from somewhere close to political center even when pundits try to characterize him as a liberal whack-job because of his political party affiliation. If you refrain from putting words in his mouth and pay attention you might notice that some of his ineffectiveness is attributable to the fact that his own party doesn’t think he’s liberal enough. In this political climate, there appears to be no room for compromise in the House or Senate because that is seen as fraternizing with the enemy. It doesn’t matter what is good or bad for the country. All that matters is pleasing your political base so that you can get votes and keep your job.

Some people like to blame the president for not bridging the gap, but the gap has never been this wide and I don’t think anyone sitting in the Oval Office could build a bridge big enough. Bring Reagan back from the dead and give him a ruler to slap wrists and you still wouldn’t be successful.

Speaking of Reagan, a final thought for today – When Ronald Reagan took office we were in a recession and he started with an approval rating somewhere around 60%. During his first two years in office the economy continued to struggle and his approval rating slid until it hit a low point around 40% early in his third year. About half way through his third year the economy and his approval rating began to recover. Anyone else see an eerie pattern starting to form?

Stay tuned for parts II and III of this series. I welcome comments and criticisms. Use the comment feature below or you can email your confidential thoughts to christopher@grasshutandcoconuts.com.

Round One – Choice of song performed earlier in the season

Lee – Black blazer and jeans with white tee shirt.  He came roaring into the ring like The Boxer… except a bit more subdued.  I thought he made a good choice and I agree with Ellen who said he performed the song better than when he did it the first time a few weeks ago.  But the rest of the judges were looking for more.

Crystal – She chose a look and a song that were representative of her style and skills then delivered one of her consistently good performances.  The judges, Me & Bobby McGee all liked it.  Without coming out and saying it, the judges all seemed to like her performance more than Lee’s.  Round One seems to go to Crystal, but I think it was closer than they made it sound.

Round Two – Executive Producer (Simon Fuller) Choice

Lee – Brown suede jacket.  I’m not so sure this was the best song for him, but Simon thought it was a brilliant song choice.  (Note to Simon… you don’t have to suck up to the producer anymore.  You’ve already resigned.)  Although he liked the song choice, Simon and all of the other judges were somewhat cool on the delivery.  For the second time tonight the judges were hoping for more than what they got from Lee.  I wouldn’t call it painful, but Everybody Hurts a little after that one.  Unless they are voting for Crystal.

Crystal – Black Velvet dress that was somewhat unflattering for her figure.  Ok, it wasn’t velvet.  It was more akin to a taffeta, but unflattering nonetheless.  Judges were falling all over themselves complimenting her on the performance, including Simon who doesn’t care for the song but thought she “nailed it.”  Seems to me she clearly won the second round.

Round Three – “First Single” if they win

Lee – This is where I thought Lee would lose because I expected them to have to sing some lame, unknown song from a contest winner like in previous years.  Fortunately, they’ve done away with that malarkey and Lee got to choose a better song.  UNfortunately I think he chose poorly.  It’s not a Beautiful Day for Lee.  It actually kinda sucked.  If I had money on him I think I’d be a little pissed right now.  As it turns out, I’ve got money on Crystal.  So I’m kinda happy he didn’t take my suggestion to sing a Creed song.

Crystal – If that’s the first single she’s going to put out then I’m not buying it.  In fact, it’s unlikely that I’ll be buying any of her music.  But the song showcased range, emotion, and above all – talent.  So that means votes.  She’s been “the one to beat” from very early on.  Lee showed some good effort to catch up near the end, but I don’t think it will be enough.  Crystal will be heading Up To The Mountain as this season’s American Idol.

Quick checklist of why Crystal will win
Reasonably talented (although less so than previous winners): Both
More “commercial” sound:  Lee
Last week:  Lee
Several of the previous weeks:  Crystal
This week:  Crystal – Crystal – Crystal
Consistency:  Crystal
Perceived judges’ expected winner:  Crystal
My prediction April 21:  Crystal

Are we clear? – Yes sir.
Are we clear? – Crystal

I have just one more question… If you gave an order that Santiago wasn’t to be touched, and your orders are always followed, then why would he be in danger, why would it be necessary to transfer him off the base?

YOU CAN’T HANDLE THE TRUTH.

Sorry.  This season is so anticlimactic I thought I’d throw in a few lines of riveting dialog from something with a better ending.

I’ll not bother with an “I told you so” follow up post once Crystal is crowned the winner.  I just don’t see the point.

Have a great summer.

– Christopher

Casey – Grey blazer, flowered shirt, jeans.  For me to say Ok, It’s Alright With Me would be an exaggeration.  It was a poor song choice, it was boring and it was underwhelming.  Judges pretty much all agreed that this is the time in the competition where you HAVE to step up.  And he didn’t.

Crystal – Black sleeveless top and jeans.  It was a good song choice and decent performance, but I wouldn’t say she had a moment.  She consistently has good vocals, but I wasn’t wowed.  Come To My Window and you’re unlikely to hear me playing this back over and over.  But it was good.

Lee – Grey leather jacket, black tee shirt and pants.  In a season with few outstanding performances worth listening to more than once, this performance stands out as good.  Good song choice, good vocals, good performance.  He may be a Simple Man but he stepped up his game this week.  Judges all agreed that this was the best performance of the three so far tonight.  As Simon put it, he crushed round one.

Casey – Randy and Kara chose this song for him and all the judges thought he did better than on his first song this week.  But let’s face it, this dude is going home.  Keep your Daughters from voting for this crap.

Crystal – Black outfit with thigh high black leather boots.  Baby I’m Amazed that Ellen chose this song for her to sing, but she did well with it.  It was a bit outside of her comfort zone, but the vocals were really good.  She’s been my choice to win this season, but were those vocals good enough?  For the first time all season she may be shaking in those boots, because…

Lee – Holy crap.  I’m second guessing my prediction that Crystal will win after this performance.  In fact after tonight’s performances in total.  Lee CLOBBERED the night (with a little help from Simon, who chose his second song).  He is in this to win this.  Outstanding.  Listen again.  And again.  Hallelujah.

So 3 contestants, 6 songs, 2 worth listening to several times – Both from Lee.  Crystal still has a chance, but Lee isn’t going to let her walk off with it.  Crystal is more consistent but Lee has the more commercial sound.  If this week showed anything it’s that song choice is critical.  CRITICAL!

I don’t know what they are singing next week.  I’m not sure they even know what they are singing next week.  But if, by any chance, Lee gets to sing Creed/Arms Wide Open I’ll bet against myself.

Either way, I now expect next week to be a lot closer than I thought it would be.  Kinda glad I don’t have a lot of lunches bet on this season’s winner.

– Christopher

Lee – Plaid shirt.  Decent vocals but no original spin on the song and it was pretty much a karaoke performance.  (Which Simon noted.)  Poor song choice but I don’t think he’ll get the Kiss From a Rose. Still my choice for runner up.

Mike – Black leather jacket.  Boring.  Judges weren’t feeling it.  Neither was I.  Will (He) Be There next week?  Could be close.

Lee/Crystal Duet – Judges loved it so I listened again to see if I missed something.  Decent vocals from both of them and they are my choices for the one and two spots, but I liked Kris Allen’s version from last season better.  They aren’t Falling Slowly, they are just limping along.

Casey – Turquoise leather jacket.  Third bad solo performance song choice of the night.  Out of three.  I don’t know if he was singing for Kara or Mrs. Robinson but I don’t think either one of them are throwing panties at the stage after that performance.  He’s fighting with Mike for the boot this week.

Crystal – Odd black dress showing too much pasty white leg between the hemline and the short black boots.  Best solo song of the night but still not what I would call a winning performance.  She’s lucky everyone else sucked.  (She’s) Alright.

Casey/Mike Duet – Judges liked this duet too.  I don’t know why.  I loved Ellen’s response to the question Have You Ever Loved a Woman. That’s good tv right there.

Two more weeks then Crystal will be crowned Season 9 American Idol.  After that she and the rest of this year’s ragtag group will drift off into entertainment oblivion.

– Christopher

Aaron – Thin tie, grey vest.  Judges way too nice, especially Randy and Ellen.  Not sure they were listening to the same performance they showed on tv.  Fly (Him) To The Moon.

Casey – Purple shirt and dark vest.  Marginally better than Aaron but still painful to listen and watch.  Judges lambasted him.  Probably gone this week.  He’ll have plenty of time for some Blue Skies.

Crystal – Black sleeveless mermaid dress.  To summarize the judges:  It was sleepy, indulgent, and she needs to loosen up.  I prefer the sound of the Summer Wind.

Mike – Judges all loved it.  I don’t know why.  Mike: I don’t care about the Way You Look Tonight.  Or the way you sound.  I guess he was better than the others.  Hard to say.

Lee – Black jacket and tie over untucked white shirt with Converse athletic shoes.  Judges pretty much called it the best of the night, which I’ll agree with.  But that ain’t sayin’ much.  That’s Life and that’s the pain of AI Season 9.

Siobhan’s exit last week was unexpected but not undeserved.  At the beginning of the season there was a lot of talk that the girls were better than the guys, so it’s surprising to see that there is only one girl in the top five.  Won’t be a surprise if she wins.

Sports fans:  Sorry about your week – and it’s only Tuesday.  Wings down 3-0 in the series with the Sharks.  That sucks.  And RIP Ernie Harwell.

Oh… and the stock market took a hit today.  Seriously, is there ANY good news out there?

WAIT – Anyone see House this week?  Great episode.  Writers deserve an Emmy for some great dialogue.  Maybe I’ll watch it again because everything else SUCKS this week.

Sorry to be a downer.  I’m sure my mood will turn when I hit that Mega Millions jackpot.

BUCK UP CAMPERS.  Next week will be better??

– Christopher

This week Shania mentored and contestants sang Shania songs.  Too bad I’m not a fan of the twang.  Here are a few thoughts:

Lee – Dark suit, white shirt, thin tie.  Lee, You’re Still the One to beat for that runner up spot.  I guess it was ok.

Mike – Black shirt and jeans.  Blah, blah, blah, heartfelt and connected with the song, blah, blah, boring.  It Only Hurts When I’m Breathing and when I have to listen to this crap.  Had I known this week was “Shania/Country” week I’d have downgraded him last week.  I predicted Aaron or Casey to depart this week, but now I really think Mike is in trouble.

Casey – Silk shirt with too much chest and jeans.  I’m not that hip the genre, be I guess that was pretty good.  Judges thought it was good.  I Don’t think he’ll go home this week.

Crystal – Brown dress and cowboy boots.  Judges were cool on her performance – especially Simon who didn’t seem to care for it.  No One Needs to Know why she chose that song.  Except her boyfriend apparently.  It was ok, not her best.  Still my choice to win this season.

Aaron – Ellen said it “will be tough” this week because “everybody is doing well”.  I think she’s been a good judge this season, but that may be an exaggeration.  Aaron, You Got a Way of dodging bullets.  Last week it was easy to pick Tim’s departure (finally), but I had Aaron on deck.  He may have saved himself for another week with that song choice and performance.  I’m not saying I liked it, but he did it right and the judges loved it.

Siobhan – Another odd outfit.  I guess it was ok.  Except for that scream near the end.  Judges loved it.  Any Man of (Hers) needs to vote for her this week.

So, to summarize, I’m modifying my predictions from last week to suggest that Mike might be taking cuts in the line to exit.

Not much else to say this week.

Did I mention that Shania is hot?

– Christopher

But here we are.  So I will continue my weekly bit until the end of the season no matter how painful.  I make no promises for next year.  I’m sure even my most loyal readers will understand if it’s time to move on.  Several of you don’t even watch the show anymore.  If the show survives I may consider abbreviated recaps once we hit the top 12, but only if I’m inspired.  It’s not looking good.

For now… a few thoughts about last week:

Andrew (GONE) – Can’t say I’m surprised.  I even pegged him for bottom three in my abbreviated post last week.  I can say I’m disappointed.  He doesn’t have what it takes to win American Idol but there was a quality in his voice I really liked.  If he does a mix of upbeat covers with original twists I’d consider picking up his CD.  I don’t expect it on the market any time soon.  So long Andrew.

Katie (GONE) – After last week’s performances and a few short hours before the results show I made my first friendly wager of the season.  Hard to believe someone would pick Katie as the possible winner, but it’s true.  And I’ll accept the low-end bottle of booze I’ve almost won when my choice (see below) gets crowned at the end of the season.  It would have been easy to take candy from this misguided viewer but I took pity and added a caveat – I only WIN if my choice WINS.  Half way home, baby – and not surprised!  As for Katie… I pegged her as “doomed” in my top 12 recap, so I wasn’t surprised to see her get the boot.  She actually wasn’t that bad last week, but that’s all relative when you’ve overstayed your welcome.

And the remaining seven:

Casey – Wedding singer performance, complete with tuxedo jacket over a v-neck undershirt. Karaoke hell that showed nothing special.  He sang Don’t Stop, but I say “no really… stop.”  Ellen summed it up by saying “You have to be great right now and it wasn’t great.”  Last week wasn’t much better and I expect next week to be about the same.  Yes… he’ll be here next week.  I HOPE he’s here next week.  Look for him in the bottom three but please-please-please let it be time for Tim to go home.

Lee – Brown shirt and black tie.  It was ok and it definitely had some originality to it.  I can’t say I loved it but I am promoting him to “best guy left in the competition.”  He’s got a good sound – very commercial.  He’s a few good song choices from being runner up.  He won’t win, but I now think he’ll make final four.  In the clearing stands a Boxer but he’ll end up on the mat eventually.

Tim – Words cannot express my frustration with the fact that he’s still in this competition.  Judges have been so hot and cold on him but this has to be the end – doesn’t it?!?  Even Ellen “didn’t like the soup.”  The show will see Better Days once he’s gone.  He single handedly messes with my predictions each week by staying.  Who of the remaining contestants can possibly go home before him now?  Except…

Aaron – Sigh… I guess Aaron could go home before Tim.  It would be frustrating that Tim is still on the show, but Aaron sucks too.  He may Believe (he) Can Fly, but he’s gonna run out of Archuletta votes soon.  Probably next week.

Siobhan – Almost normal purplish dress with butterflies on the shoulder.  Randy thought it was “just ok” and Simon didn’t like it.  I was more or less just bored.  I did listen to last week again and it was better than I remember it being.  Still not jumping up and down, but When You Believe Tim (and Aaron) have to go then everything else sounds a little better.  She’s clearly very talented.  Song choice and arrangement will be her downfall in the end.

Mike – I think I had to wipe drool off my chin.  It was so boring I think I fell asleep.  He is not my Hero and this seemed very karaoke to me.  I keep thinking he looks like the actor who played Marsellus Wallace in Pulp Fiction.  I don’t really want to see him with a red rubber ball strapped into his mouth, but it might have sounded better.  Sad truth about AI Season 9 – I still have him picked to make the final four.

Crystal – Elegant floor length black dress and NO instrument.  She got choked up and emotion at the end of her song, but hey… this is live TV.  And it was still the best performance of the night.  Week after week she is consistently good.  I’m not a huge fan of her musical style, but she is far and away the most talented contestant left this season.  People Get Ready to see her win this.  Because that’s were my money is.

And here ARE the predictions:

Bottom three this week:  Tim, Aaron, and probably Casey.  Hopefully they depart in that order:  Tim this week, Aaron next week, Casey the following.

In my Season 9 Top 12 post I predicted Michael, Siobhan and Crystal would make the final four.  I’m standing by that prediction.  I’m rounding out the group by adding Lee.

Mike, Siobhan and Lee have some fighting to do.  Not sure which order they fall, but fall they will.  Reality is that this season it seems clear who the winner will be.

Does anyone NOT think Crystal will win?

In 2008 I predicted David Cook would win the week it was down to 6.  In 2009 I predicted Kris Allen would win the first week of 7 remaining contestants (that week they used the save resulting in a second week of 7 remaining).  I should have made this season’s prediction last week but I was preoccupied with my day job.

Looking for lunch bets.  Anyone?  Anyone?

Bah… it’s not as much fun when I don’t get to beat a lunch out of anyone.  It’s also not as much fun when pretty much the show SUCKS.

Big “Idol Gives Back” show this week.  Yea, I don’t care either.

– Christopher

CRYSTAL – Backup singers were too loud.  But she was good.  Saved and safe.

ANDREW – I still like his vocals but I know I’m in a minority.  Judges Hound Dogged him and they are probably right.  Possibly bottom 3 again.

TIM – Judges must be smoking crack.  They all loved it.  “Zero to hero”?  Sucked.  Bottom 3.  I CAN Help Falling In Love.

LEE – Judges loved it.  Seriously… put down the pipe.  I want A Little Less Conversation. Jon Peter Lewis rocked this way better on AI in 2004.  YouTube it up.

AARON – Actually better that I expected, but my expectations were pretty low.  Judges were mixed.  In the end I don’t care about his Blue Suede Shoes.

SIOBHAN – Good but I didn’t love it.  Suspicious Minds want to know if it was good enough.  Probably.

MICHAEL – Started out really good but drifted off if you ask me.  Judges were falling all over themselves for saving him last week.  He wasn’t THAT good.  But he probably isn’t headed back to The Ghetto.

KATIE – One of my favorites for this week, which is surprising because I don’t usually like Katie.  I may change my tune when I watch closer this weekend.  Simon didn’t like it.  What Do You Want Me To Do?

CASEY – I didn’t really care for it, but I recognize that it was better than many of the others tonight.  Which just proves that I should have skipped the show and kept working.

Double burn this week – two contestants go home.  Poetic justice if Michael is one of them because of the save, but probably Tim and someone else.  Maybe Andrew or Aaron.

Quick shout out to my gal pal JG – I’m sorry.  Please don’t hate me.

— Christopher

Aaron – Some kind of black double breasted marching band jacket over a plaid shirt.  This guy is starting to annoy me almost as much as Tim.  Watch for him in the bottom three this week.  Ellen stole my line… “Felt like a Long and Winding Song.”  At least the judges weren’t as nice as they usually are for him.

Katie – Hot pink and a ponytail.  I’ve been hard on her the last few weeks, but it could have been worse.  She looked her age and it didn’t sound bad.  The judges loved it – LOVED IT.  Not sure it was as good as they made it sound but there was improvement.  I was still bored and she still might be in the bottom three, but Let it Be. Tim’s departure will save her?

Andrew – Charcoal suit and yellow sport shirt.  I’m still a fan of his vocals but it was kinda boring.  Randy nailed it – “solid performance but not jumping up and down.”  Can’t Buy Me Love, but he doesn’t need my love.  I’m sure he’s fine this week.

Michael – Kind of a Johnny Cash style all-black look.  Judges made some references to the TV show Glee.  If this performance was indicative of what you see on the show then I’m glad I don’t watch it.  BORING.  Even Eleanor Rigby would be bored.  He was an early favorite, but lately he keeps letting me down.

Crystal – Black wide collar top, jeans and boots.  It didn’t all Come Together, but at least it didn’t suck.  She had a guy playing a didgeridoo on stage with her which was more distracting than helpful for the performance.  Eh… at least she tried to sass things up.

Tim – Faded red longjohn’s top and a dorkie grey with white stripes jacket.  Why is he still on the show?!?  It sucked and it was boring, but I will give him one compliment – his vocals were better.  Not enough to keep him on the show mind you.  He doesn’t get All My Lovin’… in fact he gets none.

Casey – White blazer with black shirt and pants.  His guitar playing is better than his vocals, but he is turning out to be better than I expected.  I was a bit bored… and not because I’m a Jealous Guy. Simon thought it was the best of the night and I did get a text message from one of my loyal readers, Little Miss Sunshine, who agreed.  Eh… it was ok.  I actually thought he was better last week.

Siobhan – Lots of white lace and ruffles topped with a black leather biker vest.  Hair looked good, especially when you consider that the first few weeks she had bird’s nest hair.  A pinch boring and not my favorite Siobhan moment, but I did like it and it was one of the best performances this week.  She is a true artist and will probably get votes from Across the Universe. Maybe even from her home planet.

Lee – Black jacket and string bean tie with a white shirt.  Our final dose of Ambien for the night.  Call out Hey Jude and no one will answer because he’s asleep.  Simon didn’t like the bag pipes he fit in to the arrangement.  I actually thought the bag pipes were the best part.  He had a “moment” last week.  This week was just weak.

Anyone out there awake enough to comment?

– Christopher