Pensions

I'm getting more conservative. Here's a Times article (from 2 days ago) on pension costs in Europe. Due to different attitudes on immigration, their problem is much worse than ours.

"One factor that may offset the issue could be the surprising success some countries have had with the introduction of private pensions.

Sweden created a system in 1999 that siphoned off 2.5 percent of a worker’s gross income and invested it in privately managed stock and bond funds. Employees choose the funds themselves, based on their appetite for risk.

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Managing Globalization: Generational Wars in Europe

Since then, countries including Bulgaria, Romania, Poland and all the Baltic states, as well as Germany, have adopted similar programs. (A proposal by President Bush to do much the same died at the beginning of his second term.)

Germany’s system, using tax incentives to persuade people to save for their own retirement, got off to a slow start in 2001. But now some 11 million Germans have bought into it.

I think the Dems should consider this, even though it's like what Bush and the Reps have suggested in the past. A 1 percent add-on, phased to 2 percent with a corresponding reduction in FICA taxes for the second percentage point, sounds about right to me.

Is Hemingway Back?

Poppa was a big big figure in the arts when I was growing up. People (the artsy types) mocked, but "The Old Man and the Sea" did great (in the 50's). Then, after his suicide and the gradual subsidence of his wives, his children, his reputation, he seemed to be very much a has-been.

But, consider this:

"Bleargh. I did this [i.e., mock a TV show] comfortably from a perch way up on my high horse, where I listened to the Stones and read Hemingway and scowled at girls in obscenely short shorts and bought glasses like Tina Fey's. Competitive dance?"

This is from Caitlin Gibson, a guest blogger for Joel Achenbach, who, by the name alone, must be young, young young. And I swear I've noted a couple other cites of Hemingway recently. He must be on the way back. (Has over 4 million hits on Google--maybe he was never gone, except in my mind?)

The Dutch Are Coming, the Dutch Are Coming [Updated]

It appears that foreign investors have bought up 5+ million acres in the last year. That's what the latest AFIDA report shows. Don't know where they were bought, but if the average is 1K per, that's 5 billion dollars. Could be lots more.

Maine and Hawaii have the highest concentration of foreign ownership, and one Netherlands corporation has over 3 million acres. (Do the Dutch still remember the "purchase" of Manhattan fondly, as an example of the values to be found here? Or maybe they figure global warming is going to doom Holland?)

It's a repeat of the 1970's, when the weak dollar meant lots of foreign investment, and the passage of the AFIDA (reports available here).

[Update: Most holdings are forest land and the changes are in forest land. Canadian paper companies.]

COBOL? A Blast from the Past

The Times has an article on the problems facing the California state government because their IT systems are inflexible:

“In 2003, my office tried to see if we could reconfigure our system to do such a task[i.e. changing wages and terminating employees],” Mr. Chiang told a State Senate committee on Monday. “And after 12 months, we stopped without a feasible solution.”

David J. Farber, a computer science professor at Carnegie Mellon University, said using Cobol was roughly equivalent to having “a television with vacuum tubes.”

“There are no Cobol programmers around anymore,” Mr. Farber said. “They retired centuries ago.”

Mr. Farber said California was not alone in having out-of-date systems — or handy excuses.

“It’s old technology, and you can’t find a repairman who knows how to fix it,” he said. “It also a neat way of figuring how not to get your salary cut.”

It's true enough--Craigslist doesn't show any COBOL listings in its jobs section. But Microfocus, which used to have a PC COBOL, has this language in a current blurb (from a press release announcing a conference in 2009):

"COBOL, the most pervasive language in global IT infrastructures, will take its place at the forefront of this discussion. COBOL applications will become available as internet-based services, operating in the new cloud-based paradigms in the very near future, bringing major implications for the developer community."

And the more important fact is, regardless of the computer language, IBM 360 Assembler, COBOL or whatever, it's the way the system was designed that's at fault. When it was designed (assuming it was, rather than just growing), no one provided for the flexibility. (Or, maybe not, maybe it's a bluff. Arnold should call it--freeze all pay raises until they figure out how to do pay decreases).

[Updated: Found an interesting discussion at slashdot going over many of these issues. The meat is that what Arnold wants to do is pay only minimum for the period during which he's fighting with the legislature over the budget, calculate and hold the difference in escrow, and once the dust settles disburse the back pay. Also some interesting bits about how CA operates.

This sort of issue is also why the added money for FSA--modernizing software is difficult. Particularly when managers don't know what they're doing.}

More Money for FSA?

According to this report:

President Bush has asked Congress on Friday for $172 million in additional fiscal 2009 Agriculture Department funding to implement the new U.S. farm law and to improve the USDA computer system. The spending would be offset by a $287 million cut in the Environmental Quality Incentives Program. Bush proposed the USDA revisions as part of budgetary changes for eight departments and the Environmental Protection Agency, reports Reuters.

And Again, Maybe Our Parents Were Right

My parents (i.e., your great grandparents, probably) thought gambling was the Devil's tool. Not that they put much stock in the devil, but gambling was wrong and foolish (not much difference between the two concepts in their mind, or mine). Catholicism's embrace on bingo was one reason to look dubiously on it. But in the 1960's those attitudes started to seem old fashioned.

But maybe they were right--from a writeup of a scholarly study of lotteries (hat tip, Freakonomics):

In the study, the researchers note that lotteries set off a vicious cycle that not only exploits low-income individuals' desires to escape poverty but also directly prevents them from improving upon their financial situations. They recommend that state lottery administrators explore strategies that balance the economic burdens faced by low-income households with the need to maintain important funding streams for state governments.

Maybe the spread of gambling in the last half of the 20th century has a little something to do with the increase in inequality? Maybe?

Tire Gauges and Sweaters

The Republicans are mocking Obama with tire gauges, every since he observed that increases in energy efficiency could save more energy than drilling for oil (was it off-shore, or ANWAR--I haven't really followed).

Recalls when Jimmy Carter was mocked for wearing sweaters in the White House, turning down the heat in winter, and engaging in energy saving measures generally. Then, of course, there's that President who put solar panels on the White House and went with geothermal heat pumps for his summer house. (Oops, that's GWB, but both sides want to forget about him.)

Bottom line--it's easy to mock, but efficiency is the way to go.

The Curmudgeon Raises His Voice

The Post has an article on the debate whether kids should enjoy their summer vacation or work. It quotes both sides, including this:

"I think the pendulum has shifted," said Gail Hubbard, supervisor of gifted education and special programs in Prince William County, where summer homework policies are under review. "I think we went for several years requiring more and more and more." Now, she said, the goal is "to make sure it benefits the learner instead of burdens the learner."

As an old curmudgeon, in my day, the idea was the burden was the benefit. And that's being proved by modern science, and Dr. Hubbard is out-of-date. An athlete has to train hard, a scholar has to study hard. No pain, no gain. While the brain may not exactly be a muscle, we now know that experience causes physical changes in the brain; the more experience, the more training, the more reading and thinking, the more the brain is able to handle (at least in scholarship). So, make those whippersnappers sweat, say I.

Philip Kennicott and China

Kennicott is not one of my favorite Post writers (writes mostly on architecture and more generally on arts in general. ) Today he reports on a visit to Shanghai, a mega-city (defined as 10 million plus). An excerpt:

In China you also have to remember the larger statistic: the total population of more than 1.3 billion people. In the shadow of that number, statistics about private space in Shanghai -- since 1990, the average amount of living space, per person, has increased from 8 to 15 square meters (86 to 161 square feet) -- become rather ominous.

Personally, I'm more inclined to marvel--doubling living space in the Chinese context, even if limited to the east coast, is amazing when I remember the Korean war propaganda (human wave attacks of subhuman type soldiers). Rising standards of living are a cause for satisfaction, not discontent. Yes, there's misery in cities but on average people migrate to urban areas because they can improve their circumstances. More people living better is good.

EU Dairy Policy Kills

I blogged earlier about the change in US eating patterns--dairy is down over the last 35 years. But, if this post on the CAP (EU farm program) Health blog is correct, EU dairy subsidies have kept their consumption high, with adverse impacts. The idea is that the EU has kept dairy supports high, by buying surpluses, which are eventually consumed somewhere (in school lunch programs, etc.) The resulting increase in saturated fat consumption causes higher rates of cardio-vascular disease and deaths.

I'm not sure of the logic here, or with those who attack US subsidies for corn. I think economists would agree, no subsidies would mean only the most efficient farmers would survive, meaning the price level would drop and, presumably, consumption would go up. Maybe I'm wrong, but you might be able to make a case that subsidies help health, not hurt it.