By The River

I came back to Shipoke this afternoon after taking my older daughter for her regular physical at Jones, Daly & Coldren. I parked in front of my house and noticed I was behind a big American car with municipal plates. My first thought was that the driver was a parking enforcement officer, but it wasn't the right time for him to be here.

He emerged from the car carrying pieces of paper. I couldn't see what they said. He walked up to one of the houses across the street from mine and stapled the flyers on the wall and door. Uh-oh, I thought. Now I could read them. SHERIFF SALE. He worked for the Dauphin County Sheriff (not a law enforcement position in Pennsylvania) and his job was to deliver the worst sort of economic bad news.

I went over and read the notice. The judgment on the property at 110 Conoy was $179,000 and change. This was obviously a mortgage foreclosure, perhaps with some back taxes thrown in for good measure. I knew the owner slightly. He had lived in the house with his family for about a year, then moved away and rented the house to the Motorcycle Guy. But I realized I hadn't seen the Motorcycle Guy in quite awhile, and I wondered if the lack of rental income had pushed the owner over the financial cliff. Not many houses are selling in Shipoke these days.

I turned to the man from the Sheriff's Office and said, "It's a shame." He agreed, and said it had been a busy week. He had posted 35 Sheriff Sale notices in Harrisburg on Monday, 20 on Tuesday, and I think he said 25 on Wednesday, or perhaps that was today's quota. His territory is confined to the city. He mentioned something about Lower Paxton Twp. and gave me the impression that it was likewise a busy territory for sorrow. So was the rest of Dauphin County.

I suspect the rest of America is, too. Obama's stimulus program, while good, wasn't big enough to do more than prevent us from a repeat of the Great Depression. I'll take Nobel Prize-winning economist Paul Krugman's word on that. Krugman favors a second big stimulus program, but worries, as I do, that Obama has been--I almost wrote spooked--rattled by the noisy conservative advocates of the do less, spend less approach to economic recovery. Krugman, who I interviewed once for the Patriot-News, says we might not recover for 10 years or more if we don't do more to jumpstart the economy.

Foreclosure will be financially devastating for my former neighbor, but he doesn't live there anymore and so won't be put out on the street. That isn't true for many other people. It's worth remembering that the worst of the Great Depression didn't begin until well into 1930. Our crash was a year ago, in the fall of 2008, so if history is indeed repeating itself, things are about to get much worse.

Posted by David at 09:36 PM | Permalink | Comments (2) | TrackBacks (0)

Desperate to stop an Obama New Deal and the likelihood it would cement Democratic control of government for a generation, rightwing conservatives have taken to attacking the man who created the first New Deal, Franklin D. Roosevelt, and claiming that no matter what your parents or grandparents may have told you, the first New Deal was a useless fraud.

Think of their ballsy effort as a distant cousin to Holocaust denial. Thirty years ago, when survivors of the Great Depression were everywhere, no one would have dared to make that argument. Someone who tried to say up was down and east was west and FDR only made things worse would have been laughed out of town. But as time passes, witnesses die off. The general public knows less and less about day-to-day life in the Depression, and is vulnerable to the half-truths of the right. The right needs to debunk the New Deal through any means necessary, because it was the most successful program of leftist government in American history. Was it perfect? No. But it put many people back to work, empowered labor unions, and gave America Social Security and welfare for the poor among other things. It created the great American middle class.

The intellectual leader of this effort to deny that the New Deal accomplished anything is Amity Schlaes of the always conservative Wall Street Journal editorial staff. Schlaes argues in her book, The Forgotten Man: A New History of the Great Depression, and in this Washington Post op-ed article, that everything Roosevelt did made the Great Depression worse.

I'll leave it to economists like the Nobel winner Paul Krugman to refute Schlaes' economic accusations against Roosevelt. I'll confine myself to her distortions of Roosevelt's record reforming the utility industry, which I have studied at length for a future book.

Schlaes says there were private companies "ready to supply power to the rural unwired." That would have come as a big surprise to any number of farmers in Pennsylvania and Maryland, where the giant Associated Gas & Electric Co.--it served customers in 26 states--evinced little or no interest in providing electricity unless the farmer agreed to pay for the line himself. Only the wealthiest of farmers could afford this. It was why Roosevelt and the Rural Electrification Administration created rural electric co-ops. My own father remembers the day when electricity arrived at his father's farm in northwest Iowa.

Here's another howler: Schlaes writes, "In 1935, Roosevelt signed a utilities law that so restricted private capital raising that it was known as the "Death Sentence Act." Actually, the "death sentence" provision of the Public Utility Holding Company Act of 1935 was a ban on most utility holding companies that spread across state lines. They had to be broken up, and were for the most part.

Huge utility holding companies like Associated Gas & Electric, which morphed into General Public Utilities Corp. of Three Mile Island fame after 1945, had kept electricity prices high through bad management and stock fraud. These behemoths often escaped effective regulation because individual states couldn't regulate the entire company. And some, like AG&E, were little better than criminal enterprises. Howard Hopson, the leader of AG&E, indeed went to prison in 1940 for massive stock and accounting fraud. He specialized in selling his crappy stocks and bonds directly to mom and pop investors. Their pitiful pleas for recompense largely fell on deaf ears after the company went bankrupt.

I could go on and on. Roosevelt did what needed to be done to get America back on track. He is often credited with preventing a Communist revolution in America, which many feared would happen in the depths of the Great Depression. Ironically, he saved American capitalism from itself, just as Barack Obama will in this new century and new crisis.

Posted by David at 10:49 PM | Permalink | Comments (0) | TrackBacks (0)

I start documentary filmmaking school Tuesday at George Washington University. It's a six-month program leading to a graduate certificate, and i hope to be able to direct documentaries or work in television news production once I finish. With newspapers dying more quickly than any of us ever imagined, television and film seemed the logical area to continue to do the big (and small) investigative and feature stories I specialized in as a print journalist.

The cost of the program is $8,000, or $8.063 once you add in the student association fee and "voluntary" library contribution. I knew when I applied that I would be able to pay it out of my severance money from the Patriot-News, but wondered if there was any state program that would pay all or part of the cost of retraining me for a new profession. I figured it was worth a shot. If I got even partial hep, the severance check would go a lot further.

I drove to the state CareerLink office, which is located in a former Polyclinic Medical Center building on Wiconisco Street. Ironically, I recognized it as the building where, in its former life, my wife and I went for childbirth classes prior to the arrival of our first daughter 15 years ago. The staff was friendly, but the intake counselor told me before we even completed the walk to his office that Pennsylvania has nothing to help white collar professionals retrain for the jobs of their choice. Many come in, he said, but the only job training money available is for things like truck driving.

He thought my plan to retrain for documentary filmmaking was a great idea, and with my background at the Patriot-News, he said, I would very likely succeed in making the transition. Some of their clients don't, he said, because they have unrealistic expectations about the job they want. Some who are attracted by the good wages of unionized truck driving don't realize you have to be able to operate a standard shift and spend nights away from home. I thanked him and went on my way, wishing I hadn't put as many quarters in the parking meter as I had.

President Obama and the Congress might do well to create a program for the unemployed to get financial help in paying for job retraining. An individual decides what he or she wants to do, finds a training program, and applies for a grant to help pay the cost. A program like this would both create jobs in the training industry and get white collar professionals like me back to being fully productive members of the economy doing something we actually want to do.

Posted by David at 07:37 AM | Permalink | Comments (0) | TrackBacks (0)

And now to my second issue for 2008.

2. Rising energy prices. Americans from the middle class on down are already struggling with paying their heating, light, and gasoline bills. In a few years, it's going to get much, much worse. Billionaires will be able to afford all the heating and cooling and light and gasoline they want. You won't. Candidates for President need to convince voters that they will appoint a competent energy czar, not a political hack. They need to put serious money behind energy research, whether it hurts the oil companies or not. And finally, they have to make sure energy companies don't gouge us.

Energy supply gets attention from most, though not all of the presidential candidates. Many of the Republicans, perhaps because of the perception by some voters that the G.O.P. is the oil party, seem to want to avoid this issue. The skyrocketing price of energy is truly addressed by only one candidate, a Democrat. And that is (drum roll) Congressman Dennis Kucinich. So let's lead off with him this time.

Dennis Kucinich: Adopting the position of the Progressive Caucus, he says that escalating energy prices "have almost no correlation" with supply and demand. Deregulated energy companies "are creating an artificial shortage and reaping tremendous profits while doing so." Kucinich and the Progressive Caucus argue for a return to cost-based rates for electricity, natural gas, and oil, with rates returned to 1999 and 2000 levels, or in other words, just prior to the Enron scandals. Customers who have been gouged by the energy companies should get refunds. Kucinich is very anti-nuclear.

Hillary Clinton: She advocates much higher fuel efficiency standards for cars and trucks, noting that transportation accounts for 70 percent of U.S. oil consumption. She would increase the mileage standard to 55 miles per gallon by 2030, but give automakers $20 billion in "Green Vehicle Bonds" to retool their factories. She would support early development of plug-in hybrid vehicles running mainly on electricity. Doesn't say much of anything on reviving nuclear power.

Barack Obama: He would stress energy efficiency in an effort to reduce the "energy intensity" of the U.S. economy by 50 percent by 2030. More than any other candidate, he is an advocate of developing a U.S. biofuels industry, which of course would be mainly ethanol. He says little about the impact of increased ethanol production on food prices. Wants many more flex-fuel vehicles that can burn gasoline with a higher percentage of ethanol. Obama is cautiously pro-nuclear, but says it must be done carefully and with sensitivity to public concerns.

John Edwards: He doesn't say much about energy except to advocate for meeting demand for more electricity through energy efficiency for the next decade. In other words, not by building new power plants.

And now the Republicans.

Mike Huckabee: Probably the best overall energy position paper of any candidate from either party. He is highly critical of "energy independence" efforts to date. "The truth is, we are so pathetically behind the curve right now that federal spending for energy research and development is only 40 percent of what it was in 1979. Our efforts are haphazard and often pointless: today we have six million flex-fuel vehicles built to run on biodiesel or on E85, which is 85 percent ethanol, but only 2,000 pumps for those fuels in a country with 170,000 gas stations." All very true. Nevertheless, Huckabee promises U.S. energy independence by the end of his second term.

Rudolph Giuliani: basicly the Bush-Cheney energy plan of more oil drilling, clean coal, nuclear power, and renewable energy. Like Obama, he is a big fan of ethanol and bio-diesel, saying the bio-fuels industry "can revitalize" rural America.

John McCain: He says almost nothing on energy, but does argue for building more nuclear plants more quickly.

Fred Thompson: Thompson's positions on just about any issue sound like platitudes hastily slapped together by a committee of second-rate consultants. To wit: "The energy challenges our nation faces today are real and significant. Our dependence on foreign sources of oil threatens our national security and puts our economic prosperity at risk. America must rise to the challenge and take the steps necessary to become more energy independent before this becomes a crisis." But he never really says what those steps ought to be.

Maybe Congresman Kucinich can be both the healthcare and energy czars in the next Democratic administration? Getting elected officials to address energy pricing issues is difficult, because it basicly is rocket science. The dilemma they face is to either address the looming crisis now, when there is still a chance to head off the big price increases, or after constituents start screaming at them and voting them out of office.

Posted by David at 07:25 PM | Permalink | Comments (0) | TrackBacks (0)

If you want to understand the state of the U.S. economy and our place in the world, follow the money.

Over the last five years--roughly the period of George W. Bush's ill-fated Iraq adventure--the U.S. dollar has declined 30 percent against the western European euro. Heather Emery, one of my Shipoke neighbors, said dollars "were like pesos" on a recent trip she and her husband made to the Netherlands. Against the Czech koruna--important if you're planning that dream trip to Prague--the dollar has declined 48 percent. And the Canadian dollar, better known as the loonie, has gone from being worth about 66 cents in our money five years ago to $1.07. Canadians are loving it. The American dollar's decline has accelerated this year, with no end in sight.

Not many Americans travel outside the country. To some, even Canada is a foreign place. One of my neighbors, who hails from Toronto, was quite amused at the recent Shipoke Halloween picnic when another neighbor mentioned she was going to Canada, but couldn't recall the place. "Oh, up there somewhere," she said. It is true that if you don't travel anywhere the U.S. dollar isn't used, you may think you are immune to the effects of a plummeting dollar.

But if gasoline in the U.S. goes to $4.00 or $5.00 a gallon, you may not be traveling very far in the good old U.S. of A either. If OPEC were to price oil in euros instead of U.S. dollars, as it does now, any American driver would quickly feel the pain of a weak currency. You can't live in a fool's paradise forever.

Posted by David at 08:34 AM | Permalink | Comments (0) | TrackBacks (0)