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    October 28

    Something for Nothing Part II

     

    It’s not possible to summarize my long weekend going to a friend’s wedding. That because it was a significant trip not just for the bride and groom, but Rita and I. As a result, rather than try to condense the weighty feeling of going back to what you know just as you approach one of life’s milestones, my thoughts will probably get mixed into other posts.

    But for those of you that like my economic analysis, I couldn’t resist saying something about the trip there. Namely, Rita and I booked a one-stop flight to Oakland through Ontario. WE did it because it was cheaper than flying direct. However, the flight ended up being overbooked (this was a Friday). So they needed volunteers to be shifted to another flight. The irony was that this flight left only five minutes later and was also one-stop, going through LAX instead. And for the privilege, Southwest provided us not just with a voucher, but they also refunded our tickets for the original flight onto said voucher. A total value of around $500.

    Once aboard, we noticed that the plane was only about half full. Sitting in row twenty, there was no one behind Rita and I until we reached Los Angeles.

    One the way home, however, our flight was cancelled. Not because of a weather delay or mechanical problem, I learned but likely because it was too empty. Not only that, but it was Southwest policy to delay another flight to “fill it up” with passenger stranded by the cancellation. This is because unlike the old days when a “direct” flight on Southwest went through three cities or so, now it is more like five. Those worried that air travel has become the “Greyhound of the Skies”, take heart. This whole operation smelled more like Amtrak than anything else.

    It took some cajoling in Oakland, but we had them put on on another one-stop flight home that left a little bit early than the one they wanted to put us on. But the voucher, it’s still good for the next year. And hopefully, so will Southwest.

    October 21

    Something for Nothing

     

    A little bundle of joy landed on our doorstep recently, but it wasn’t delivered by the stork. No, FedEx left a package for us in broad daylight while we were out of the house on Saturday.

    You see, Rita’s favorite holiday by far is Christmas. So last week she wasted no time in taking advantage of Day-After-Thanksgiving Christmas shopping. What’s that you say, it’s only October? Well yeah…I guess it was more Day-After-Canadian Thanksgiving Christmas shopping…but hey…minor details, right?

    Among the great deals Rita found was none other than a Specialized Domestic Partner Homing Device (SDPHD) also known as a Blackberry. The reason? Neither she or I was on contract currently and Verizon was more than willing to give us the phone for free if we signed up for a new, expensive plan. Verizon has been marketing their SDPHDs quite aggressively all year, mainly because they always think the next model is going to the “iPhone killer”.

    We also found out subsequently that if we upgraded to a family plan (something I don’t particularly like) Rita could get her very own Specialized Domestic Partnership Homing Device (SDPHD) too. So we did. All for “free”.

    But here’s the kicker. On my old plan with Sprint, I had free incoming calls as a legacy customer with Nextel. So I never really worried about my minutes because I would have to initiate a call to incur minutes. Now, however it’s the opposite problem. We have ten numbers we can call for free, all Verizon numbers are free, and all text messages are Internet charges are included but I have to share minutes with you know who.

    So as you might guess I’m sudden a big fan of text messaging, which heretofore was not something I cared much for. But SDPHD of course, expedites that problem and can turn even the most mild-mannered person into a Crack-Berry addict.

    And I confess if nothing else, I have configured my SDPHD to broadcast different sounds based on what sort of communication I’m receiving, be a phone call, text message, email, IM, or Facebook update. You’d think it’d be horribly distracting I’m sure…but truth be told….I’m just not that popular.

    October 16

    Other People’s Money

     

    I finally think I understand the healthcare debate.

    It took a while, but my epiphany came courtesy of none other than Wendell Potter. The former public relations head for CIGNA, going rogue has appeared numerous times on television in the last year to incriminate his old line of work. It’s often like watching “Macbeth”: the insurers have no hope of being good because they are influence to do bad by others, namely Wall Street.

    And what do you know, the health care debate makes perfect sense from the standing outside 70 Pine Street in New York. Or 3555 Farnham Street in Omaha for that matter.

    The former is the world headquarter of AIG, the later Berkshire Hathaway. Both are giants in the world of insurance for decidedly different reasons. And both are crucial to the overall explanation.

    It’s no secret that big insurance companies (and by extension Warren Buffett and his firm Berkshire Hathaway) use insurance premiums as capital for investments. Then by the times those investments mature, the companies have not just enough money to pay claims, but also a healthy profit as well. This also means that insurance companies are reliable institutional investors, even more so than banks. Well brick-and-mortar banks at least.

    Therefore, a government mandate to buy insurance is always attractive to both Wall Street and insurance companies because it ensures a steady stream of income. But it’s also true that some type of insurance is more profitable than other, and even now, medical policies are not exactly money-makers. To compensate, you might expect, the insurers have to think of ways to be profitable including such methods as “rescission”.

    Moreover, it’s been pointed out repeatedly that most the uninsured in the US (who aren’t illegal aliens) are young people. Young people are a boon to healthcare companies (you’d think) because they don’t get sick very often. (Then again, this ignores the fact that today’s young people aren’t particularly healthy because of the lack of open space and our progressively deteriorating diet…but don’t tell CIGNA that…)

    The public option, as its been described, causes problems for this system because the government could offer at cost insurance (like Medicare) and take away much of the profits from the industry. But wait you say, the government issues other types of insurance for things like floods and there’s Medicare and Medicaid. Well this is no coincidence. You can’t make much money insuring against floods because the “100 year floodplains” can be hit more frequently than once every hundred years and because it’s really hard to say that something isn’t flood damage when it is. Plus, Medicare and Medicaid conveniently cover the part of the population who are the sickest, and therefore least profitable.

    But it is probably true much as the insurers fear the public option, it’s probably more destructive to Wall Street. Why you ask? Because most other big institutional investors like pension funds and university endowments are in decline. This is because both large companies and universities have passed on much of the cost to their operations to their employees and students over the last 60 years. Now, there’s precious left to privatize other than health care and ….Social Security….(awkward pause).

    The reason, however, I haven’t said much about “Obamacare” previously is that it won’t have that much of an impact. Premiums are going to rise regardless. And no matter what the “mandate” allow the insurers to charge, the money is not there. Most the wealth in this country is in the hands of people much older than the target demographic of the mandate. And the gap continues to grow. But don’t tell Wall Street that. They continue to think they cannot be victims of their own economic success, that there has to be billions of dollars still ripe for the taking. You know, just like during the housing boom when everyone became a millionaire…. How is that going again? I forgot.

    October 12

    Monkey Wrench

     

    Have you ever had bitchin’ plans for a long weekend only to see them torpedoed by something you do hours after you get off work? You know, like when you head to Vegas and shoot your whole wad the first night and wake up the next day hung over and unable to motivate yourself to go out again? Well that’s what happened this weekend to me….although I promise I’ve been nowhere close to Vegas.

    See, this week is fall break for Cougar Country Unified and Rita traditionally sends the kids to see her parents in San Diego. The plan is that we rendezvous with her folks deep in the Sonoran Delta, where they usually spend the night before. We come in, drop off the children, and then wait until the next day to go home.

    Throwing a big, giant monkey wrench into things was that Justin had his first flag football game Friday night. He was shall we say, excited about playing under the lights. (No I’m serious, he got excited that the game was played at night under artificial lights.) The way it works is that the city organizes the teams by the school they attend. (For the longest time we didn’t realize his team’s opponent was a Catholic school abbreviated to “OLPH”.) The school uniform crowd apparently didn’t respect Justin or his teammates much but they should have.

    Instead of pounding on Justin and company, OLPH was stymied all game. No points. Justin meanwhile saw little action either, with the quarterback rolling out plenty of times but not hitting many of his guys. It got to be the fourth quarter, and then the game really started heating up. First, OLPH tossed a bomb at the end zone trying to break the tie. Justin meanwhile, had none of that and picked it off. His school, the Cardinals, began to march down the field until they tossed a big one for a touchdown. But wait, there was an illegal motion penalty negating the play. And it was Justin who was guilty.

    D’oh.

    OLPH managed to hurl another one into the end zone as the seconds ticked down. But it sailed out the back, with the player unable to grab it. That meant overtime.

    At this point, the other kids were going home. The soccer leagues on other fields also were packing up their stuff. Rita and I had stopped sitting in our folding chairs long before the start of the over time. We asked the ref how it was supposed to work. It turns out it’s much like college, where the teams get a certain number of plays from a pre-determined started down near the end zone. The first over time yielded touchdowns on both sides but both failed on the extra point. (There is no kicking, just conversions.) In the second over time period, the down was moved up to essentially the two yard line….but both teams failed to score. The ref told us that starting with the third overtime, each team would get one play from the two yard line. However, out of nowhere, the recreation department supervisor came over (looking very much like a skinny version of your favorite’s sports commissioner with balding hair and thick glasses) and announced if the third over time ended in a tie that would be that.

    And then came the real controversy.

    OLPH called a run play and seemed to scamper into the end zone. But the referee called the flag down before the ball broke the plane of the goal line. Their coach became livid accusing the wrong official of making the call. The flag was obviously not in the end zone…but perhaps the ball might have come very close the breaking the plane as the play stretched his arms out. The coach continued to fight the call because the linesman continued to remain quiet.

    That gave Justin and his boys one last chance. The quarterback decided to make a run for it off tackle and scored. No one could believe it….the marathon game was over and somehow sanity prevailed.

    But you can imagine what happened next. The kids up past their bedtime were hard to wake up on Saturday. We got going late and kept Rita’s parents waiting. We turned on the UCLA game and ended up taking a nap. (Not a bad idea, apparently.) Woke up late Sunday, then again today.

    Justin has a bye this week, and then picks it up again in two weeks.

    October 09

    The National Parks

     

    Before heading into the mountains last week, I had been watching with great interest Ken Burns’ new documentary “The National Parks”. I didn’t grow up a Ken Burns fan…catching only pieces of his “The Civil War” in AP US History. But almost exactly two years ago I found myself in a Homestead Inn eating microwave lasagna in a new place called Alta Sonora ready to start my job. And surfing through the various options on TV (which were on a different time zone than California) I came across “The War” which was a harrowing look into the reality of World War II on various parts of American life.

    “Parks” pushes a much different vein…that American history is really about the limits to property rights. And predictably, people started to throw around the “S-word”: socialism. All because as you can imagine, Burns has reverence to the parks and casts the program in a positive light. (To be fair, the man’s political leanings aren’t much different.)

    But keep in mind, there’s another obvious reason Ken Burns chose to make this point talking about “Parks” and not say, railroads. (Who also played a decisively role in the West, and over property rights.) National Parks are iconic, and telegenic and make great TV. Dams, power plants, ehhh not so much.

    Of course if you want to take Burns’ thesis a little further you could argue that history is driven by the allocation of risk. And that people individually and collectively if acting rationally try to minimize their exposure to risk. But even when they do of course, we’re still wrong. But such a hypothesis usually gets most people uncomfortably close to game theory and an ultra-dynamic view of human nature and society. Something that belies that idea of institutions and rights set in stone.

    But that’s a topic for another day, for now I’m just glad my sense of smell is returning after this sinus infection.

    October 05

    Cabin Fever

     

    In the heat of the summer, Rita’s friend Jennifer suggested that her family and ours take a trip to the mountains. More specifically, a cabin owned by a friend of Jennifer’s husband Tom. Rita, immediately smitten by the thoughts of trees, cool air, and the sounds of nature was smitten. The only catch,:Jennifer told us to plan for the first week of October when the weather would be nice, but chilly at night.

    I was intrigued too, especially because the cabin was located at the very edge of the Sonoran Republic, a town that could not be mistaken for anything close to Cougar Country. As an example, the first night Rita and Jennifer asked Tom and I to run to the store. However, it being after 10pm the Safeway was closed and we were forced to make do at the Circle K. Upon checking out, I noticed the guy at the cash register had the same last name as the town. I asked him why, and he said his grandfather had settled the town years before. And that was just the first night.

    At first we thought that we were just lucky that Tom’s friend had a satellite dish, but then we realized that the entire town did…if they wanted reception that is. The neighboring town’s General Store sold camouflage-colored clothing…for children. Or that to do skeet shooting we were instructed to go down the highway and turn off where it read “Primitive Road, drive at your own risk” until reaching a turn out over an arid and rolling landscape.

    But the biggest irony was that it was hardly a long weekend in the woods. The town sat in a valley surrounded by pines to be sure, but the area was artificially green from irrigation sitting near the headwaters of America’s Blue Nile. Despite the high elevation (7000 ft) the neighborhood trees reminded more of Southern California than say, Minnesota. And the cabin was not carved from wood with the scent of sawdust, but a modern and comfortable mobile home style dwelling on a platform.

    Each night the four adults would play cards or drinking games and the children slumbered. And when the light broke, the children would let the adults sleep in as they played outside on a street with no traffic.

    Idyllic, perhaps, but the truth is that we left much of the area’s treasures to be explored. We never did manage to go hiking, fishing, or see some Indian ruins. But that’s okay, as it leaves the door open to further adventures.

    And while our time in the mountain is done…my own personal bout of cabin fever isn’t. That’s right, I woke up on Sunday thinking I was just really thirsty but by this morning it was confirmed…I’m sick. A small price to pay, I suppose, for the chance to get away.