Kind of a mosh pit of ideas today. Too much for one post, but what the heck, so here we go:
– I keep seeing stories like this (click) saying that housing prices are plunging and making it sound as if this is a bad thing.
Why bad? Houses are a commodity — they are something you buy and use. They are subject to the demands of supply and demand just like gasoline or corn or gold or anything else.
We are told that the prices of houses are back down where they were 12 years ago, and again this is presented as a bad thing.
My problem: This completely ignores the “demand” side of the “supply-demand” equation. That demand is the ability of people to pay for houses.
Wages, adjusted for inflation, have gone up hardly at all in the last decade. We are currently seeing huge movements to cut wages for large segments of the population — unions, government workers — and the rest of us have had to live with minimal wage hikes and even cuts in the last few years.
Why did housing prices boom during the Bush administration? It was a bubble, driven by massive influxes of money from all over the world looking for higher investment returns through mortgage backed securities. The sellers of those securities were so desperate to generate mortgages, and the fees they could get from them, that they handed out mortgages to anyone, living or dead. Liar loans were perhaps the ultimate manifestation of this.
So home prices now are still coming back down from that bubble.
Is this bad? It is if you were depending on your home’s value to pay for your retirement, I guess it is. Or you may now be having trouble paying for your toys, especially if you borrowed against the home’s “value” during the height of the bubble and now the piper is due but the home’s “value” has plunged.
Capitalism is a bear when it doesn’t work for you, but I didn’t hear anyone complaining when prices were soaring to unsupportable levels. “Ain’t capitalism grand?” they all said then.
The crash — sort of a nation-wide frat party that got put on dad’s credit card, only dad was broke — has been bad for everyone, but we really have only ourselves to blame. We bought into a fundimentally false assumption: That homes were an investment that could not lose.
That’s how you define a Ponzi scheme, not an investment strategy.
Homes should be a place you live in, not an investment. If you do view your home as an investment, you should be willing to take the loss, just as you must be prepared to do with any other investment.
– I keep seeing articles about nuclear power generation and how few people have died at nuclear plants compared to how many die in the coal industry.
This is somehow presented as an argument for nuclear power. Our own on-line opinion piece in Insight, to which I guess I have access but have never figured out how to use (Help!) has an article on this today.
Not having read the article, I can only point out the falsity of the comparison in general.
How many die in coal mines compared to nuclear plants is not the issue. If you want to compare the entire nuclear industry, I could point out that several hundred thousand died as a result of the nuclear industry’s initial manifestation in Japan in 1945.
Dozens died when Chernobyl blew up.
I could also point out that, if it is safety you are after, we should quickly ban the automobile, which kills something like 50,000 Americans every year, and go to using trains (zero, or very close to it).
The real comparison is what happens if a power generating plant using which technologies goes up in smoke one day.
The coal plant, in addition to generating massive air pollution including mercury, is bad in operation, and coal mining is a dangerous and dirty job, but when the power plant explodes due to an earthquake or other massive failure, it just explodes, causes a big fire, boom, and that’s it. We clean up the mess and start over.
Gas fired plant? Ditto.
When a nuclear power plant goes ka-flooey, you end up with a 50-mile diameter dead zone (Chernobyl again) that humans have to avoid for the next thousand years or so. Even if it doesn’t explode, you end up with waste that has to be stored for 10,000 years or more, which means you will have to build a religion around it to make sure it stays safe.
Much of the trouble in Japan’s disaster today is because of the on-site waste storage containers broaching. Why are they storing that stuff at the plant? Because nobody has anything better.
Those are the real comparisons. And to those who say “demand is increasing, we must do something!” I challenge the assumption that demand must always increase. Why?
We’ve mandated more efficient light bulbs (which is causing a furor among the Tea Partiers and others who would also be the first to complain if a nuclear plant irradiated their grandchildren) but we could do a lot more with conservation.
Like, mandate homes with automatic switches that shut off unused appliances after a while. Your instant-on TV is sucking down juice while you sleep. So unplug it and learn to wait two seconds for it to power up. Fully 25 percent of most home power use is all those chargers and “always-on” appliances, not to mention all the digital clocks everything seems to have to have these days.
Here’s an idea: Raise electric rates for higher users to promote more conservation. The average Utah home uses 800 killowatthours per month. So tell anyone who uses more than that that their rate will double for the overage. Use the extra revenue to reward people who use less.
(I like this idea. My home uses 400 per month. We unplug everything.)
Wind anyone? Solar generation?
– Much discussion on the wires about Obama’s speech about Libya last night.
Wish I could feel good about this mess. Obama’s discussion of the tortures and brutalities of Kadafi that we were preventing gave me a PTSD-style flashback to President Bush the 2th discussing the torture rooms and other nasties of Saddam Hussein.
Does this mean we’ll conquer Libya and start torturing the people there in turn? I would like to think not, but it was still a spooky moment of deja-vu — wars are always justified using the same playbook.
I don’t buy the “America has to do it because we are the only nation that can” argument. We are not the only nation — France, Germany, England, all have massive defense budgets, most are nuclear powers, and we’ve sold huge military stocks to Saudi Arabia and other places.
Plus, as my Republican friends are so fond of saying when they’re holding emergency meetings of Congress to cut funds to NPR, we’re broke. If we’re broke, we can’t afford another war.
So if this job needs to be done, let someone else do it. If nobody wants to, then I guess it wasn’t really all that critical after all.