Month: April 2009

The View From Your Recession

A reader writes:

I began working in the mortgage business in 2002. I started in an entry level position at a medium-large mortgage company not long after I dropped out of high school.

Back then I was a drifter who needed a job to help pay the rent for the new apartment my girlfriend and I just moved into. I was lucky enough to find an ad offering $15 per hour plus commissions with no experience necessary (I’m sure for many this speaks volumes about the current state of the mortgage market). It was a telemarketing job that I excelled at and soon worked my way out of and into a management role where I was to hire and train new recruits. After a couple years of that I was recruited by another company to be a mortgage broker and by 2005 I was making $90,000 per year at the age of 23.

Soon after came ‘the crash,’ where the lenders who mortgage brokers relied on began dropping like flies. By the end of 2007, business at our company was down by about 50%.

I was still making what I considered good money; I finished 2007 with a gross income of around 65k. I considered myself to be a very ethical, honest mortgage broker. Without attempting to sugar coat things, I worked with people who I knew were not ethical mortgage brokers. These other brokers were used to a far fancier lifestyle and needed to close loans to pay bills for their overly expensive habits. Some who, as the market deteriorated further, I could blatantly hear their pathetic desperation when they were too flustered to close their office door while selling snake oil to unsuspecting families. I became terrified that would happen to me. What if I was 40 years old with 2 kids? Could I ever be that desperate and pathetic? I needed to quit and find something else to do with my life.

Luckily for me I lived modestly in a 2 bedroom 1 bathroom house with my wife (the girlfriend from the apartment) who had a steady job with a decent income. Our living expenses were relatively low. I decided going to college was my only option. I knew that it would provide shelter for a long and painful recession.

I was a gargantuan failure in high school. Not graduating rewired my brain but left me with insecurities that grew exponentially with every passing year. I was terrified to go back to school. I began at a community college in January 2008 and after just a year as a full time student I have a 4.0 GPA and I’ve been accepted to several high quality Universities.

Without this recession I would have continued the path I was on until I had children, a bigger house, and other factors which could have quite possibly made it financially impossible for me to ever have gone to college. This recession has liberated me from the perpetuating academic and intellectual insecurities that have plagued my life since my failure in high school.

There is very obviously far more negative than positive inflicted on us collectively because of the current economy. I feel horrible for people, like my own parents, who have seen their life savings cut in half, if not worse, because of the recession. I worry about my brother who will be graduating into a bone dry job market this spring with a master’s degree and 90k in student loans. But I refuse to believe that America is going into the shit tank. I believe we will recover, like I recovered from not graduating high school.

Losing Michigan?

William Galston thinks cap and trade may be doomed:

Support for environmental legislation is strongest on the coasts, weakest in the interior areas that depend more heavily on coal-fired power plants. The Midwest, which has already been hit hard by the collapse of manufacturing, would take a second blow. This matters because the Democratic Party is an uneasy coalition between the coasts and the interior, symbolized by bitter fight between Henry Waxman and John Dingell for the chairmanship of the House Energy and Commerce Committee. It is hard to imagine Midwestern Democrats voting for cap-and-trade in current economic circumstances, and perhaps not in any economic circumstances–that is, unless they receive credible assurances of dollar-for-dollar offsets against the higher costs their constituents would have to bear.

Reasons For A Carbon Tax

Wilkinson attacks cap and trade:

A cap and trade system would introduce a new market fabricated by government to regulate the entire economy of mundane markets. Cap and trade is based on the political invention of scarcity.  But the problem of determining the ideal supply of emission permits is much like the Federal Reserve's problem of determining the ideal quantity of government money. In both cases, bureaucrats must appeal to dubious mathematical models and pronounce on questions that remain the subject of raging scientific controversy. When the Fed produced the wrong answers, it helped inflate the housing bubble, which led to the ruin of our economy. Do we trust the government climate bureaucrats to do better?

More here.

Those Activist (Republican-Appointed) Judges

Evan Wolfson emails to note how so many judges who have backed simple civil equality for all citizens have appointed by Republicans:

Massachusetts (Goodridge, 2003) Margaret Marshall, appointed by Chief Justice Gov. Weld (R) in 1996, elevated to Chief by Gov. Cellucci (R);

in 1999 California (In re Marriage Cases, 2008) Ronald George, Chief Justice appointed by Gov. Wilson (R) in 1991, elevated to Chief by Gov. Wilson (R);

in 1996 Connecticut (Kerrigan, 2008) Richard Palmer, Associate Justice appointed by Gov. Weicker (Ind.); in 1993 — Note that Weicker was a Republican during his time in the House and Senate. He won the governorship as an independent.

And today, in Iowa (Varnum, 2009) Mark Cady, Associate Justice, appointed by Gov. Branstad (R) in 1998.

Saving Capitalism

Kristol makes sense, for once:

Singer is one of several conservatives I’ve spent time with recently who’s thinking through the implications of the financial crash, and trying to figure out–not to put it too grandiloquently–the way forward for democratic capitalism. Many of those with the most practical and creative ideas, I’ve found, are practitioners, with experience on the Street (and in some cases in government); some are business school professors. They’re at once free-market-friendly and free-society-committed, while understanding that we need to devise and implement a reasonable structure of law and regulations that will prevent system-threatening leverage, opacity, and irresponsibility. Singer and others can point us to a path very different from Obama-like nanny-state liberalism, but also different from head-in-the-sand-everything-was-fine-except-for-the-Community-Reinvestment-Act conservatism.

Help Needed

Felix Salmon helpfully summarizes the unemployment numbers:

The unemployment rate is now 8.5%, which is very bad, and is up sharply from 5.1% a year ago. But just check out U6, the broad measure of underemployement: people who want to get more work than they’ve got, but can’t find it. A year ago — three months into the recession — it stood at 9.3%. Today, it’s risen all the way to 16.2% — an increase of 6.9 percentage points — and no one thinks it’s peaked yet. There are now 9 million “involuntary part-time workers” in America, and rising; these people are, as a rule, spending as little as they possibly can.

What The Right Is Thinking

Krauthammer lays out Obama's "Ultimate Agenda":

His goal is to rewrite the American social compact, to recast the relationship between government and citizen. He wants government to narrow the nation’s income and anxiety gaps. Soak the rich for reasons of revenue and justice. Nationalize health care and federalize education to grant all citizens of all classes the freedom from anxiety about health care and college that the rich enjoy. And fund this vast new social safety net through the cash cow of a disguised carbon tax.

Obama is a leveler. He has come to narrow the divide between rich and poor. For him the ultimate social value is fairness. Imposing it upon the American social order is his mission.

My sense is not this, although I agree that Obama has a liberal's core instinct that government can and should take more responsibility for the well-being of its citizens than I'd like. What Charles misses is that Obama is not an ideologue the way Charles is. This is, in other words, classic projection.

Obama wants to use government to balance what he regards as the growing imbalance of the last three decades in which most Americans trod water or sank and, empowered by globalization, a small elite really triumphed. Seen in that context, the shift is less profound. Obama's modest healthcare proposals do not amount to "nationalization". His disguised carbon tax is a mistake in my view, but a response to a felt and urgent need. I see no rush to federalize education – certainly much less so than George W. Bush, whose much more radical involvement of the feds in education somehow escaped Krauthammer's censure.

In so far as conservatives keep reaching for ideological purity to gain their balance in this unsettling time, they will lose against a skilled pragmatist like Obama. They seek clarity by defining an "ultimate agenda" because they are so lost in responding to the actual one.

The Cannabis Closet: Views From the Next Generation

Cannabis_female_flowers_close-up

A reader writes:

I'm a 21-year old college student in California on a campus where smoking weed is more acceptable than cigarettes and nearly as common as drinking beer. For myself I don't like weed at all, but I'm one of a handful. My father is a 50-something academic who teaches at a smart little college in New England, and over the vacations he had a dinner party for some colleagues. Afterward, they retired to his office and got stoned. It was a reminder of their days as students, but the only student present didn't want any.

Another writes:

I'm in my mid-twenties, and without reservation I’d say that, at minimum, half of the people I know like smoking weed. Also, many people my age and younger, including myself, say they'd often rather have a joint than go out drinking; we consider it to be an edifying way to have an altered consciousness, as opposed to amnesic destructor of our mental and physical health and a ruiner of countless Saturdays. That's encouraging, especially for an age range in which binge-drinking is thoroughly out of control.

During the week we all work as respected employees, colleagues, or young entrepreneurs. Everyone else either abstains without passing judgment or hides it. But I’ve never met anyone my age who’d scold you about it.

My younger brothers find themselves in an even more accepting social environment. The youngest, who just graduated high school in a politically middle-of-the-road town, once estimated that not a single person in his grade hadn’t tried smoking weed at least once. Obviously the virtues of smoking pot at this age are debatable. But I’m quite sure that attitudes are moving in the right direction, albeit in a maddeningly slow fashion.

Another:

Six days before leaving for my first year at college, a few of my friends and I decided to spend a few final, treasured moments together. To enliven what might have ended up a dull evening, I brought some bud with me. We live in New York, and spend most of our time on the Upper East Side (where we also went to high school). While we were standing around waiting for a friend, four undercover cops (each wearing bulletproof vests, I might add), parked in a taxi, mistakenly took our loitering for drug dealing activity.

As we were walking to Central Park, these undercovers chased us down, frisked us, and sat us down in cuffs in broad daylight (this created a most unusual sight for the wealthy passerby of the Upper East Side). After sitting in a jail cell for a few hours, my friends and I were released to our frowning parents (the charges were eventually dropped due to the illegality of the cops' search).

This blatant misuse of tax dollars is not only cause for worry, but incredibly frustrating. Most of my friends and I — all college freshmen at top-tier institutions — enjoy toking on a J more than guzzling down obscene amounts of alcohol, yet for some reason are stigmatized for our preference. My parents have at times offered to buy me a beer or two, but unleashed their full fury when they found out my marijuana habit. It is this deeply-embedded loathing for pot in the Baby Boomer Generation that is the main obstacle toward Marijuana Policy Reform.

(Photo: cannabis female flowers from Wikipedia.)