Unintended Consequences or Something More?

Recently I visited some friends in the Bay Area who were overjoyed that they were finally able to sell an inherited lot in Bolinas. The wife’s parents’ generosity had become a nightmare since in the years between purchase and inheritance, the environmentalists made sure that the residential lots’ development rights were stripped away. They were left with the obligation to pay property taxes and little else. However, the owner of an adjoining property offered to buy it at a bargain price and they took his deal. With the two properties joined he has the right to build a second home on his property.

So what could have been an owner occupied home is now a rental only dwelling. Was this just an unintended consequence of the environmental taking/inverse condemnation, Agenda 21 style zoning like our proposed General Plan, to get people squeezed into the high density areas? Or is it part of a larger picture?

The decline of home ownership and the increase in renting, due in part to syndicates of buyers representing the very wealthy or foreign governments now owning our single family residences, was noted in my “Is this happening?” on 12/2/13. Also noted in that commentary was the decline in initial public offering offerings (IPO’s) of new stock usually for new companies. The situation has now  deteriorated to the extent that the incorrectly named Wilshire 5000 Total Market Index now contains just 3,666 companies as compared to 7,562 in 1998. An index of new American manufacturing orders declined this past January to 51.2 from 64.4, the largest decline since 1980.

The crony capitalism with sweetheart deals between the mega corporations and Federal regulatory agencies continues. Judge Rakoff challenged this and demanded a trial with a finding of guilt or innocence in a case involving Citibank as I discussed in Beneath the Radar on 7/8/13. The appeals court ruled against the judge. Those in power are consolidating their power. Perhaps this is following the ideas I discussed in Religious Freedom - Obama’s Script, Trotsky & Lenin in 2012. America seems to be dissolving before our eyes.

In the upcoming June election many advocates for freedom, such as Igor Birman in the congressional district just north of us, are running in the primaries. Here in Amador County two county supervisors are being challenged by candidates with dubious positions, at best, on many issues. Attend the candidate forums and ask direct questions.

Copyright 2014, Mark L. Bennett

Our General Plan’s Housing Element

On 2/27/14 the stakeholder’s group for our General Plan’s Housing Element had an open to the public update meeting. What follows is an expanded and slightly revised version of the remarks I made at that meeting. It was preliminary to public hearings in April. I urge everyone to read the relevant documents and to attend the upcoming hearings.

I have read the entire housing plan and will share my observations as both an Amador County resident and a professional planner. When I was in planning school they emphasized that plans should be comprehensive. This one certainly is with what seems like a page for every dwelling unit in the county. And while it doesn’t qualify as a specific plan it is also, as stated in the introduction, detailed. This detail includes statements such as “…households made up of older residents may require smaller homes than families with children” on page H-9 and “…people with lower incomes are also more likely to live in apartments or other multifamily options” on page H-18. Wasting tax revenue to restate the obvious represents the costly growth of government and is one reason that development doesn’t seem to pay for itself. The plan documents fees such as the land development fee of $2,010 to $2,792 to California Fish and Wildlife for a negative declaration to their ever expanding mandates. Yet the plan’s solution is more of the same: increased government coupled with a reduction of government revenues through subsidy programs and creating a redevelopment agency. The traditional planning concept of zoning abundant land for all possible future demand and housing types, which some current critics call over-zoning, is not even considered.

Instead we have, in reality, a social policy plan with many statements that illustrate the writers’ agenda. On page H-2 the plan considers the goal of  “…provision of services in proximity to residents…” This is a bias statement in favor of the town centers and similar concepts that ignores the effect of individual travel patterns, especially longer commutes, upon shopping and other service provision decisions. On page H-59 the plan states, “The intent of local government regulations is… to ensure a decent quality of life for the community.” Note that this is for “the community”, not the individual. And while it probably means things like preventing housing development next to chemical factories, it is a vague statement that can mean many other things. For some,  it can mean church attendance while, for others it can mean “freedom” from nativity scenes, and removing “In God We Trust” from our currency.

Page H-82 states, under programs, “Reduce community opposition to high density affordable housing…” Since when is the role of democratic government to influence public opinion rather than to implement public opinion? “…investigate the feasibility of establishing a County-owned industrial complex, if such a complex is consistent with identified target industries,” on page H-94. So our county is to now develop and own industrial land and decides who locates there, based on the criteria of omnipotent “planners” to employ the existing (frozen?) low income population. Don’t people improve their situation and also move in and out of the county? Page H-95 states, “Identify land available for commercial and industrial development.” I feel absolutely confident that our local realtors would work zealously for commercial and industrial clients without any government imperative. Apparently the plan writers don’t agree. Does the free market exist for them? Do I dare use the s word? Is this socialism?

The plan proposes, and not surprisingly for a planners’ plan, new powers for the planning department. They would oversee code enforcement and public transit among other things. Often the text attempts to rhetorically justify their agenda by various techniques such as word order and juxtaposition of data. Using data from the federal Department of Housing and Urban Development’s Comprehensive Housing Affordability Strategy (CHAS) page H-16 states, “…385 (nearly 40 percent) of large family households in Amador County live in housing that lacks complete bathroom or kitchen facilities, is considered overcrowded, or costs more than 30 percent of the family’s monthly income.” This sounds petty gruesome on first reading. The text laments “incomplete” bathroom or kitchen facilities, but does not define them. Is having a shower stall, but not a bathtub, a so-called ¾ bathroom, a severe deprivation? They do, however, define overcrowding as more than one person per room. So a perfectly comfortable, but modest two bedroom dwelling unit with an open space kitchen/dining/living room is overcrowded for a family of four. Are they just promoting their agenda for a legislated and subsidized standard of living? How many people are really in such dire circumstances that substantial new government intervention is justified? And if there are an unfortunate few, why isn’t the existing social welfare sufficiently helping them? Do we want to become a welfare county attracting new dependent residents?

They denigrate the free choice of “overpaying” for the security and freedom of owning one’s own home. How much of our housing costs are the direct result of California regulations and restrictive land use policies? What power does the County have over interest rates and other issues decided in Washington? They also denigrate the free choice of commuting with their intellectual concept of the jobs/housing balance. Seemingly ignored is the reality of residential location made by the compromises within a two paycheck household. But they want to increase housing costs with the additional burden of design review. Related to this is their assumption of the town centers with transit oriented development from the yet unapproved general plan. In Europe people live in towns and farm the land around them. But in America people live on the land they farm. This fundamental difference is why many of our ancestors left Europe and represents the difference between freedom and collectivism.

If someone lives in means tested low income housing they often become trapped there. Rarely does someone go from poor to middle class overnight. They move upward in small steps. If an increase in income cancels one’s housing benefit the bottom line usually dictates maintaining their lower earned income. (I recently spoke with my accountant and heard about numerous people afraid of making a little bit more money and losing a certain means tested benefit). I oppose building a lower income ghetto in Martell. Wasn’t that parcel bought by the county for future office consolation and not for housing? Martell should remain a commercial area and not become our disastrous equivalent of Marin City in Marin County.

The best solution for housing lower income residents is increasing their income through economic expansion. The housing element discusses the need for more farm worker housing. Why not grow grapes on trellises, as they do in Australia, and use far less labor? The trellises would be made in factories by people at a higher skill level making more money than farm workers. We are a traditional wood products area. We also have billions of dollars worth of gold in Amador County. Yet this plan, on page H-85, proposes housing right on top of the Mother Lode between Sutter Creek and Amador City. Why is this area not zoned as a mineral resource area?

The unnecessary controversy over the Newman Ridge project endangers the survival of our freight rail line, essential for both economic stability and air quality. What amazes me most about this planning process is that those who claim to be the most concerned about the ill housed are often those same people opposing the projects that lift people’s incomes above the poverty level. Is this just ironic or something more sinister?

Copyright 2014, Mark L. Bennett

Have We Gone Nuts? And Merry Christmas!

Within the past week a newscaster was castigated for stating the historical reality that Jesus Christ and Santa Claus were white. A few days later a school teacher told a 14 year old black student that he couldn’t dress as Santa Claus because Santa Claus was white. This was certainly in the spirit of peace on earth and goodwill toward men, wasn’t it? Could you imagine a Jewish man at a costume party being told he couldn’t dress as a knight because Jews weren’t knights in the Middle Ages? Probably not because that’s not likely to happen.

Its common knowledge that Saint Nicholas was a Greek Orthodox bishop in the early 300’s AD whose gift giving provided the basis for Santa Claus. We say “Santa Claus” from our Dutch colonial inheritance, the British say Father Christmas. The now traditional looking Santa was standardized from a Coca Cola ad in 1931 inspired by Clement Clark Moore's 1822 poem, "A Visit From St. Nicholas" better known as 'Twas the Night Before Christmas. But the reindeer may have come from an earlier source. The Roman goddess Diana was believed to sail through the night sky with deer. Some say the basis of Santa is a Siberian shaman high on hallucinogenic plants flying across the sky with the reindeer. If this is the case than Santa is more closely biologically related to the Native Americans than any other group in the USA.

But whatever the mythological or historical origins, Santa Claus, like Jesus, belongs to all of us; including that black teenager and his seemingly racist teacher.

Merry Christmas!

Copyright 2013, Mark L. Bennett

Obamacare: Social Security Redux

As millions of Americans are smarting from the inanities of Obamacare, we must not forget another similar liberal scam that has been perverting our economic lives since the 1930’s: Social Security. Over the past 50 or so years Social Security has returned about 1.6% while the average return on invested capital in the United States has averaged over 8%. One reason for this is the vast Social Security Administration which is so rotten to the core that some of its employees have retired on disability from the stress of going to work and having nothing to do. But the primary reason for the low return is that it’s invested totally in US government debt. In other words, it’s just a scheme for the government to borrow even more money that it has no feasible way to pay back.

Last week I received a letter stating that the Medicare benefit portion of my Social Security will be reduced for 2014 based upon my “income” in 2012. But in 2012 I was negative cash flow and was forced to buy groceries with credit cards. However, I withdrew money from retirement accounts in that year to repair my roof and install a solar energy system. That made me a high income person under their arbitrary criteria. However, my basic monthly Social Security amount is very low because for many years I was engaged in owning and maintaining residential rental properties. I could not have paid into Social Security even if I wanted to because my income was considered “unearned income”.

During those years I routinely cut out rotten waste plumbing pipe. Often I would be covered from the neck down with their contents. (But I won’t be more graphic in describing those contents since I’m not an eloquent MSNBC commentator like Martin Bashir.) At that time I often thought of photographing my effluent covered self, pairing it with a photo of a Senator dining at a fancy DC restaurant with a lobbyist and sending it to Congress with the caption: Which of these activities creates earned income? During the Depression there was plenty of work according to my father, but since wages were so low many people didn’t bother. But he didn’t want to be poor, so he worked three jobs. Two were daytime sales jobs for differing wholesalers and then a graveyard shift as a drop forge laborer. Because his efforts made him higher income, he paid into Social Security at the maximum rate from the day it went into effect until his last paycheck was received after he was already dead and in the ground at age 49. Where did that money go? Probably into the monthly checks of someone who took too much LSD and drank too many beers in the 1960’s and is now “disabled”.

When my mother retired she was unable to collect on my father’s Social Security and instead received the lower benefit my stepfather had earned. But she did get a $500 dead benefit and my brother and I were able to go to college on a benefit that lasted until we were 22. My average check was about $93 a month. These sums received were a small pittance of what my father had paid in without even considering about 30 years of interest or investment income.

In the peak year of 1977 about 900,000 students received the Social Security survivors’ benefit for college. Ending this benefit during the Reagan Administration is certainly a contributing factor to the current student loan mess. How stealing someone’s money is considered by some as a legitimate means to shore up Social Security baffles me. The money we pay into Social Security is our money despite it being called a tax. That is why payments into Social Security are not deductible from the computation of taxable income, unlike state income tax or other items. All these rules, terms and definitions define how we live and hopefully prosper in a manner seemingly divorced from reality. All I can conclude is that

Washington must indeed be a very strange place.

Copyright 2013, Mark L. Bennett

Is this really happening?

This past summer I visited a friend in Colorado. He told me that his seamless gutter business was doing OK, but that he had a new and difficult problem. He now has to order parts from so far away that the freight cost vastly exceeds the parts cost. This is not surprising since Barron’s Business and Financial Weekly recently reported that “…nonresidential fixed investment as a percent of gross domestic product shrank to a 50 year low.” Yet many, including those in government, say that the economy is improving and point to the reviving housing market. But many of the newly sold homes are purchased for cash by Real Estate Investment Trusts (REITs), hedge funds and Sovereign Wealth Funds from “friendly” foreign countries such as Abu Dhabi and rented out. California alone has added 500,000 renters and lost 233,000 homeowners since 2007. But this increased demand, partly due to the investments just cited, has raised the price of the median California home from $274,000 in May, 2012 to $352,000 in May, 2013, a 28.4% increase. To make home ownership more affordable the Federal Reserve is trying to stimulate the economy (under its price stability mandate?) to 2% inflation. This means that prices will quintuple during an average lifetime.

Real economic growth is being stifled at every turn. The Bristol Bay/Pebble Bay project in Alaska, mentioned in a prior commentary with its 42,000 jobs, has been abandoned due to strictly ideological regulation. Almost 300 coal fired power plants are being shut down. President Obama has threatened to veto a House bill that would open the outer continental shelf to drilling with the potential for 1.2 million full time jobs over 30 years. At the same time the Washington regulators seem afraid of foreign powers like China that steal our trade secrets and intellectual property. The National Security Agency estimates the loss at $300 billion which some equate to about one million jobs.

While the capital that is entering the United States is buying assets like our homes our domestic capital is fleeing. Covanta Holdings processes about 5% of our garbage. They recycle the metals with a new, more efficient method and burn the rest to produce energy. But because a waste to energy facility has not been approved since the 1990’s, they are building their new plants in foreign countries. A recent Indonesian government auction received as many as five bids for one bond. This is a county where burning down churches is a popular pastime.

Talk of change continues to eminent from Washington, usually in the form of increased regulation. Recent rules governing initial public offerings (IPO’S) of stock haven proven so costly that middle market companies have been unable to finance themselves. IPO financing has created 92% of all job growth at public companies since the 1970’s. In a likewise manner, the new rules governing speculative trading in commodities contain loopholes for the mega corporations. These mega corporations, or crony capitalists, in turn do Washington’s bidding. They have driven down the price of gold so that China can exchange the depreciating dollars they receive for something of real value. Almost 50% of the world’s annual gold output now lies within China’s borders. Schemes such as this are necessary to finance our increasing deficits since foreign buying of US Treasuries has decreased to $104 billion from $503 billion a year earlier. This slack has been picked up by the Federal Reserve which now holds about $2.1 trillion in US treasuries and about $1.4 trillion in mortgage backed securities. If, or when, interest rates rise the Fed becomes insolvent. Nothing in the world can bail out the Federal Reserve Bank.

But the clever people in Washington, to whom some Americans still trust their well being, have an answer. Instead of the current definition of wholesaler or wholesale trader for an American company like Apple that makes all of its products aboard, the government will now classify them as manufacturers because their product design and production oversight occurs in the US. This definitional change would have added up to two million “American” manufacturing jobs in the study year of 2007.

The picture doesn’t look as bleak now, does it? If this reminds anyone of the torture/finger counting scene in 1984 you are probably not alone. Our situation is called an “enormous doomsday machine” by former budget director David Stockman.

While I have no magic solution, I do know that we have some power locally and that we must exercise it. It is essential to support the Newman Ridge project and the expansion of gold mining. We must assume jurisdiction over our national forests and begin productive ventures. Potential developments such as the portable slaughter house for cattle and a Pioneer biomass plant must be explored. Do we have any choice if we wish to survive?

Copyright 2013, Mark L. Bennett

A Pioneer Biomass Plant?

The cedar mill with its exuberant giant pencils is long gone. The “replacement” greenhouse venture has apparently failed. On the hills above the high tension lines remain like a grim picture of a future Detroit. Isn’t this the perfect location for a biomass energy plant? Every time I drive up Hwy 88 dead trees punctuate the national forest. The Foothill Conservancy has done a commendable job of obtaining grant money and clearing dead trees. (Who likes to fill out government paperwork?) But their effort has two fatal flaws. Firstly, the government money is borrowed from the Chinese for which we have no creditable means of repayment. And secondly, the trees are burned as waste which only adds to air pollution. This additional pollution wouldn’t occur in a state of the art biomass plant as the former waste becomes electricity. And the plant could also produce wood pellets for a worldwide market using nearby ports.

Can the County Planning Department, the Planning Commission and the Board of Supervisors package this site for biomass? Can the Amador Economic Development Corporation interest an experienced operator such as Waste Management to do a detailed study at their own expense? And while I wouldn’t venture a guess on the final economic feasibility, it seems clearly worthy of exploration. The present Buena Vista plant only serves a 50 mile radius and partly burns agricultural waste.

Along with the employment, tax revenue and forest cleaning benefits, I have a vision of the plant also operating like a recycling center. Individuals with dead trees beyond their fireplace needs could bring them in for money. This would cause a small, but worthwhile, reduction in home refuse burning. With woody biomass going for $20 to $35 a ton and a Ford F-150, for example, having a capacity over one and a half tons it seems quite reasonable that individuals could participate. Those struggling financially could go into the national forest and cut. Perhaps a whole new entrepreneurial generation of loggers would emerge. Why can’t we have hundreds of people in the forest competing for dead trees? This would also require that all the roads be kept open with perhaps some new ones. Amador County could have cleaner, safer forests, new employment opportunities and perhaps serve as a model to other communities.

Copyright 2013, Mark L. Bennett

Chaos & Ignorance

California’s recent pension reform bill conflicts with Federal law regarding union members at transit districts receiving Federal aid. Missing that $1.6 billion in aid has caused a halt in funding that threatens millions of daily bus and train riders. The legislature is quickly adopting the necessary changes which will add even more uncertainty to the budgetary process.  But between the time that bill passes and the aid returns the Sacramento Regional Transit District may lose up to 10% of its current budget. Other transit districts are presumably in the same situation.  Whatever one may think of Jerry Brown’s political positions, he is intelligent and knowledgeable. The same probably holds generally true for his staff and the Legislature. Am I to assume that ignorance is the answer for passing illegal legislation? If that is the only explanation than this is not liberal government or conservative government but rather chaos government. I find this frightening.

Many people question or lose their faith because of some inconsistencies in the Bible. And while most scholars agree that both the New and Old Testaments contain inconsistencies, inconsistencies are inherent in sacred writings from many faiths and traditions. Some may reductively express this as being like a Zen riddle. Personally, I feel that sacred texts are meant to prompt you to resolve the so called inconsistencies. It’s a set up for an internal experience. They are not meant for idle readers. Many people seem to be criticizing from ignorance. 

A very pious physicist once told me something amazing.  Assuming that you accept Einstein’s theory of relativity  that time expands as you move outward  from the center of the universe, then the earth is the billions of years old that official science states. But if you measure that same elapsed time from the center of the universe, what  some call the eye of God  and others ground zero for the big bang, then the earth is exactly as old as the Bible states.   So not only is the accuracy of the Bible reinforced, but the writers- the transcribers from divine intelligence- were in tune with something beyond most current awareness. If what I have said is true, then why isn’t this front page news? Couldn’t this information eliminate much acrimonious and passionate debate which may, in fact, be false?

Are we becoming, as many social critics advocate, more ignorant as a people? Does this create chaos as a natural outcome? Is there more to come?

Copyright 2013, Mark L. Bennett