Category Archives: Economics

Wealth Taxes and :( sigh ): This

23 minutes – This comes from NPR’s . Its about the Ultra Rich wealth tax of Elizabeth Warren. Since my college days forty years ago I’ve been worried that an unfair system leads to pitchforks too. Look at Revolutionary France. Look at today’s Venezuela. Look at the Tea Party railing against the gentle treatment of bankers to gave us the mortgage crisis. https://www.npr.org/2019/07/24/744962126/episode-929-could-a-wealth-tax-work

It would take an amendment to the Constitution which would be a very high hurdle to leap over. I’d support it.

2 minutes – And then Donald Trump takes the one decent, laudable thing he said in the last four years and slits its throat: https://www.npr.org/2019/09/14/760683504/opinion-president-trump-claims-he-was-at-ground-zero-on-sept-11-but-was-he

“Trade Wars are Easy to Win”…Iowa farmers….

… are desperately hoping Donald Trump is right!

I always come back from my wife’s Iowa reunions with new insights. Her cousin who farms a lot of her farm inheritance is free with his views and has a perspective worth listening too even though my politics are not his.

I’ve read much about how farmers, whose products help feed China, are in the process of turning against Trump. This may be true but some have a legitimate reason to fear his defeat. More on that in a moment.

Corn and soybean growers are particularly vulnerable and so too pork producers who raise a commodity much prized on Chinese tables. Other nations can clear land to compete with us particularly countries in South America. Up to a point many American Farmers have bought Trump’s argument that they have a duty to put some restraints on a rogue Chinese economy. And my wife’s cousin appreciates Trump’s actions to compensate farmers for some of their trade war losses.

He is skeptical that other nations can step in soon to fill the void left by China’s refusal to buy our farm goods. We have the infrastructure and mechanics in place as well as the food. And American pork producers may be saved by some really bad news for Chinese pork producers. A swine flu is wreaking havoc on Chinese pig farms necessitating the slaughter of diseased populations to prevent further outbreaks.

Official government sources report that this has affected about 12 percent of the swine. But a lot of American experts are tromping around China and something of a consensus is emerging from them that slaughtered swine may be nearing four times that figure perhaps forty percent of Chinese pork production has evaporated.

This is not Mao’s China. It is a China nipping at the heels of the United States with prosperous people who have come to expect food on the table not shortages. It will he hard for Premier Xi to deny them pork. That would be a boon to American pork producers and the American corn and soybean growers who are fattening up American pork for the Chinese market.

I am in no position to second guess my canny and business savvy friend about any of this analysis.

But there is one item that sticks in some corn grower’s craws. Trump has gutted the ethanol industry. Almost 40 major ethanol plants that turn corn into fuel for cars have been closed at the behest of the Oil Industry. This is despite Trump’s campaign promises to protect ethanol.

These farmers are on a knife’s edge and Trump’s China policies will make or break them. So, they are sticking with Trump because having started a trade war with China many feel that only a reelected Trump will keep up the pressure and force China to back down. They are worried that a Democratic president will cave in to China and cede the upper hand to China forever. This would render their current sacrifice meaningless as well as painful.

So that, along with a lot of calories from roast pork and pot luck desserts was one of my takeaways from Iowa.

What Harry’s reading 8-20-2019

Both stories/opinion pieces are from the New York Times:

I vividly recall the Tea Party demanding that America pay its debts at the beginning of the 2008 housing collapse and Barack Obama instead pouring money into the economy to keep it from grinding to a halt. Nobel Economist Paul Krugman notes that hypocritical Republicans recognized the danger and went along with Obama which gave us Obama’s long economic growth which Donald Trump takes credit for (even though his short term policies are about to derail it) Krugman takes Germany to task for doing just the opposite of Obama and putting the breaks on economic growth:

The World Has a Germany Problem https://www.nytimes.com/2019/08/19/opinion/trump-germany-europe.html

This was fascinating. Amazon is letting all sorts of rascals sell classic books that they have butchered because they are no longer protected under copyright laws. We’re getting books as Cliff notes with all the hideous translations we see when second-rate Urdu speakers mangle the English language. No thank you Jeff Bezos. Unlike your Washington Post this is a great disservice to the truth.

It’s Almost Orwellian: What Happens to Orwell Books on Amazon https://www.nytimes.com/2019/08/19/technology/amazon-orwell-1984.html

Juan Percent’s True Colors

I have a grudging respect for Juan Percent. Unlike the majority of strangers who have anonymously faulted my writing Juan has taken part in an honest tit for tat with me. You can find several such chats on the Duluth Reader Pages of my Not Eudora columns.

My last column on Republican Socialists is one such example: Juan’s latest swipe at me was angry and heartfelt. I loved its candor:

JPFriday Apr. 5, 2019

Central planning for a war should be short term, and one would expect that money to be paid back. The central planning the USA has done since FDR has left us 20 Trillion in debt with no way to pay it back. I acknowledge that your generation doesn’t give a shit about leaving your children and grand children an impossible debt load and no way to pay it back (as long as you got yours!)

The boomers have been making terrible decisions since they crawled out. But then your generation has always had a terrible nihilist streak, maybe it’s been your intention to destroy the USA the entire time. As for the rest of us, we can’t afford more short sighted, feel good decisions that will leave us saddled with even more debt and have no guaranteed benefit. Let me ask you this. Why in God’s name should we listen to you?

Maybe we’ll find a technological solution to capture carbon that doesn’t involve the creation of more waste in the form if lithium batteries and whatever other high tech waste the “green” new deal spews out. Is it better to replace baggies with toxic waste?

As I said before, the green new deal has never been about controlling carbon, it’s always been about command and control of the economy. Maybe it’s time to step aside, and take Nancy and Chuck with you. Haven’t the boomers caused enough damage already?

I could ask you to go to the Reader link above to see my reply or the whole preceding dialogue. I’ll save your clicking finger.
This is my reply:

Thank you Juan,

That’s the most honest thing you have ever written. And I agree with you to a shocking degree. Continue reading

A tale of two Editorial Boards

These days I’m not cranking out five or ten daily posts as I have in the past. I’m being very selective. Even my eight loyal readers eyes must be burning out from gazing at their cell phones this election cycle. But before I attend to this post’s headline I have to follow up the powerful video I posted last night from Fox News’s, Shep Smith, on the real threat of the Migrant caravan, still one thousand miles from the border. Even if it doesn’t crumble under withering 105 degree temperatures it won’t even reach America at its current pace for 44 days – a full month after the election!

As this morning’s NPR interview with an economist makes clear keeping migrants out impoverishes all Americans. Our public schools and colleges don’t spend much time training American students to clean motel rooms, bus tables, or pick vegetables.

Now to this post’s headline.

I was taken aback by the DNT’s Editorial headline this morning – “Yes,” “no,” “no,” on School Questions concerning the School District three part ask for tax revenues. Continue reading

Abood today

I got a question from WDIO today on the case which guts public employee unions. I returned one email reaction. Then I returned a second email with additional comments.

Email from WDIO:

Hey, Harry!

Just checking if you want to weigh in with your thoughts on the Supreme Court Janus v. AFSCME ruling. I’m trying to get all the CD08 candidates in our story on the Web.

Let me know if you can pass along a statement.

Thanks,

MY FIRST RESPONSE:

This decision threatens to eviscerate public employee unions by treating even legitimate negotiation expenses as speech. It violates fair play and past compromises and demonstrates that the Republican Party has succeeded in making the Supreme Court a partisan branch of the federal government. 

MY SECOND RESPONSE:

BTW my father was the president of the Mankato State college faculty union and taught contract negotiation in their business school. I wrote about it once in the Reader. It has a pretty accurate prediction in it.

http://snowbizz.com/Diogenes/NotEudora06/CollectiveBargain.htm

AND ONE MORE THING I FORGOT TO TELL WDIO:

My Dad was a life long Republican.

Condescension in politics

I’ve mentioned to others that Hillary Clinton’s “deporables” comment was a catastrophic mistake.

The great irony of the Trump election is that blue collar workers who once voted in a mighty Democratic bloc now vote for the Republicans who are trying to tamp down Social Security, National Health Insurance and a dozen other protections that make the Koch Brothers think America is becoming socialist.

I was a Republican and a socialism supporter for years when my Mr. Russ, my high school social studies teacher told me in 1968 that America has a mixed economy – a little socialism and little free enterprise.

Back to the “deplorables.”

Here’s an important NY Times think piece that explains what Democrats must do, and do fast, before the Republicans use their former voters to cement in the Koch ideal.

And here in Duluth I’ve seen plenty of condescension from Red Plan supporters who ignored the uneven financial burden it placed on poorer voters who shouldered an unfair share of our shiny new schools. Many local elitists can’t wait to get rid of Art Johnston who keeps reminding them of the bone-headed financial planning that went into the plan which has hollowed out the teachers we need to teach our children.

Many of them stood on the sidelines cheering as he was called a racist, a bully, with a conflict of interest. All lies by my reckoning and made by folks some of whom were everything that they accused Art of being.

I don’t particularly want to conflate national politics with local politics but if the shoe fits…………..

Lifehouse CHUMS and their alter egocentrics

I gave up trying to fall back asleep at 3 and padded downstairs to read the third chapter of Dark Money. The first two chapters gave me the background of the 800 pound gorillas of the big money movement to turn us back to the Middle Ages. They covered the Kochs and Richard Mellon Scaife. The third covered both the Olin Foundation and Milwaukee’s Bradley Foundation. This book is reminding me of forty years worth of sporadic reports and tying them into a comprehensible bow. I certainly believed there was something behind Hillary Clinton’s “vast right wing conspiracy” and this book lifts the veil. The “conspiracy” is all perfectly legal or at least legalish and court rulings like Citizens’s United have vastly if I dare use that adverb, enhanced the power of the big spenders.

I dimly recalled a news story about about some rich guy, (it was Richard Mellon Scaife) putting up a sign in his neighborhood announcing the loss of his dog and wife and offering a reward for the dog. But now I know more about this bonvivant. His rich and conservative Grandfather, Andrew Mellon, was the Secretary of the Treasury for all three Republican Presidents of the 1920’s. He also was a prolific tax cheat and his grandson took up his motto, “Give tax breaks to large corporations, so that money can trickle down to the general public, in the form of extra jobs.”

This philosophy makes for an interesting contrast to last night’s fundraiser for Life House which takes care of discarded young people. Scaife and his silky ilk generally decry coddling the weak putting a much higher premium on protecting the assets of America’s aristocrats. The hundred’s of million Scaife donated to “charity” largely went to maintain his and other rich folks wealth not to the needy.

Claudia and I sat down with some of the people she has been working with at the CHUM homeless Center. Spending the last few months checking people in has been eye opening for her. Seeing someone released from a hospital near death’s door looking for a place to sleep on the floor has a way of impressing itself on the imagination. A young couple sitting next to us volunteer at Life House as I did three years ago. We were a jolly crowd. Our speaker Famous Dave of Rib fame gave a rousing talk and I learned he was half Choctaw, a much larger percentage of that tribe’s heritage than my grandson has but enough for me to some kinship with the Rib Master.

I suspect the billionaires club would consider the Rib magnate an exception to their rule. Milwaukee’s Bradley Foundation financed the infamous 1994 book the “Bell Curve” which posited that blacks were intellectually inferior to white folk. Indians probably didn’t fare much better in the analysis.

There is no end to the unpleasantness emanating from Milwaukee. Its not just my old nemesis Johnson Controls, its Governor Tommy Thompson’s call to make poor people work for their welfare while Republicans happily outsourced decent factory jobs overseas. (Bill “Triangulation” Clinton latched onto both of these planks for his Presidency.) Its also the Milwaukee County Executive, Scott Walker, union buster extraordinaire and Koch Brother favorite. Its also a dreamscape for Secretary of Education Besty DeVos’s world of public education vouchers. I wonder where Billionaires fit on the Bell curve?

Famous Dave, who is a generous contributor to the needy, showed us pictures of his vast and messy library. He told us he reads for hours every day and gives his faithful reading credit for the half-billion-a-year enterprise he built off of a $10,000 business loan. That’s quite a contrast with our current President who can barely squeak through a teleprompter but then again, Trump inherited his start in life. I’m afraid Trump gives billionaires a bad name but the Koch’s are stoked. It was reported today that they are following up their $800 million investment in the 2016 election with a $300 million push to pass Trump’s tax decreases on the wealthy and ending the estate tax before Trump’s impeachment after which the GOP might be hard pressed to help the filthy rich.

The fifth “C”

Last night I decided to skip singing in our church’s Maundy-Thursday service to attend Denfeld’s meeting where parents concerned about their children getting the short end of the stick reported back findings after a similar meeting a month earlier.

Much of the meeting was a repeat but I did note some information that I will keep in mind for future reference. In particular one MOAB. Mother of all Bombs (for you current events fans)

One of the speakers of glittering generalities listed their group’s “four C’s,” Communication, Collaboration, Creativity and Commitment. But then the bomb dropped. It was a fifth C that I remember well from my early years – 1996 through 2003 – on the School Board – Compensatory Education.

This is one of the extras in state funding for public schools to address serious needs over and above their “base” needs. Do you have a vast school district with long bus runs? The state gives your district extra money for gas. Of all these extras Compensatory Education funds are perhaps particularly important, especially in this day and age where we wring our hands over the achievement gap between have and have-not students.

In my first two stints on the School Board my western colleague, Mary Glass, complained bitterly about how comp Ed dollars were spent going to schools in the east that did not generate much of the funds. I talked to administrators I trusted and learned that they were abiding by the laws which gave District’s a lot of discretion about where to spend the money. In ISD 709 we use some of this money to keep class sizes down across the entire school district.

In my old days we had much smaller class sizes, better funding. I wasn’t convinced that a tilt toward the East was all that outlandish. But that was then. Red Plan financing has forced us to take $3.3 million each year out of the General fund to pay off building bonds (something Art Johnston was irritated wasn’t mentioned in this otherwise excellent budget story.) And our voters are so jaundiced about the Red Plan that they have refused to pass a fully fleshed out operational levy which could add another three million to our budget. That’s at least $6.3 million dollars which @ $96,000/average teacher salary would allow us hire an additional 66 teachers. HOLY COW!!!! Thank you old school boards for short changing today’s school children.

The achievement gap in Duluth has never been any wider than it is at present. And last night for the first time ever I saw a side-by-side list of which Duluth schools children generate State Compensatory funds and which schools consume them. Talk about adding kerosene to the fire.

For the uninitiated – Compensatory Education funds are simply called “Comp Ed.”

School……………Comp Ed Earned…….Comp Ed received

Denfeld……………$852,007.00……………$684,128.00
East…………………$136,555.00……………$518,212.00

Lincoln Park……..$973,192.00……………$496,264.00
Ordean/East…….$203,578.00……………$436,741.00

Congdon………….$ 95,567.00……………$400,548.00
Homecroft……….$ 79,622.00……………$295,671.00
Lakewood…………$ 70,212.00……………$181,315.00
Lester Park……….$ 65,506.00……………$324,110.00
Lowell………………..$287,330.00……………$440,228.00
Laura MacArthur..$849,445.00……………$503,071.00
Myers-Wilkins…….$971,153.00……………$573,732.00
Piedmont…………….$715,138.00……………$532,207.00
Stowe………………….$446,994.00……………$402,512.00

What ISD 709 is doing is perfectly acceptable under the language of State Statute. Whether it fully comports with the “spirit” of the law is another thing.

That hotel cleaner you didn’t tip

“Maybe she wipes your child’s face at day care. Maybe he mops the floors at your church. Maybe she makes the beds in the hotel you stay at. Maybe he trims your shrubbery and mows your lawn. Maybe she lifts your elderly aunt in and out of her wheelchair each day at the nursing home.”

My wise school board colleague, Alanna Oswald, shared a column on what it means to be poor with the rest of us. It rings true to her. I recommend it. Here’s another sample:

“But today all that was about to change. She had landed a new job — still minimum wage, but this time with dental coverage. She sat in the waiting room, praying that today would be the day the pain finally stopped for good.

The dentist called Nicole into the exam room, poked and prodded a bit, and listed some treatment options. Nicole crossed her fingers.

But then he stood up and shut her file abruptly, not even trying to hide his disdain. “Look, there are plenty of things we could do,” he said frostily, hand on the doorknob. “But if you’re just going to let everything go to hell like this, there’s really no point.”

And the door clicked shut behind him.”

“Big Trump” or “Little Trump?”

My Buddy sent me this thoughtful appraisal of how the stock market in the US is taking Donald Trump in stride. The Atlantic column takes no stand on Trump. It just lays out the possibilities for Trump either cratering our economy or being irrelevant. Its not very long.

My guess is that he will hurt significantly especially in the huge swath of Red States that depend on Agriculture. Foreign travel is down too. Foreigners have always been hyper sensitive to the idea that the US is the wild west with gunfights breaking out everywhere. The news from my old Homestate, Kansas, today won’t help that perception. That story is already running on Indian media.

I’ve read enough stories that suggest doom and gloom in various economic quarters that I find the idea of a “little Trump” imprint on the economy wishful thinking. Maybe that’s wishful thinking on my part.

“The Little Trump hypothesis regards these fears and declares: “meh.” Instead, it posits that the president will be a loud yet minor figure, sound and fury signifying nothing; a wannabe superhero hemmed in by the limited powers of the executive branch. Rather than rule like a populist demagogue, he will mostly sign bills written by his pro-business staffers and approved by a pro-business Congress. There are extremely smart people who believe in each hypothesis. But the theories are mutually exclusive. They cannot both be true. No matter what happens in the next few years, a lot of people are already wrong about Donald Trump.”

The Big Short

I put this movie in my memory bank over the last year when some economic analyst on NPR gave it a big thumbs up. Last night I saw that it was available on Netflix and Claudia and I watched it. It was Economics made fun and every bit as disgusting as a Zombie Apocalypse movie.

The Housing meltdown roughly coincided with the start up of the Red Plan and its purveyors shared many similarities to the get off scott-free, big money folks who pushed replacing almost all our facilities at a single stroke. They got rich and left the District to draw down its reserves, cut teachers, and compound it all by sucking millions of dollars annually out of our local tax levies in the General Fund to pay off Red Plan borrowing. Their supporters herd-like thinking reminded me of the people in the Big Short who stood back in disbelief as investment bankers cost six million Americans to lose their homes.

I’ve mentioned this before but that meltdown was part of the reason I had a heckuva time fighting the Red Plan. My family got caught up in the housing mania and a massive loan was taken out on my Mother’s house even though it was only a decade away from being paid off in full with very modest house payments. I’ve recently patched up my differences with the family members who lost that house and left me to spend months and months trying to get City Bank and Wells Fargo to let us short sell the house at a loss (for the banks) who eagerly permitted the misguided loan to go through. Our “short sale” took my brother and me months of calling the banks daily to find a human behind a phone. It was all I could do to find time for two simultaneous battles. When the sale neared completion and I finally pulled out of the Red Plan fight I took a vacation with Claudia. I faxed the last papers to the bank while traveling through, Lincoln, Nebraska, on our way to the Colorado Plateau. I was desperate to get out of town. I was so worn out that I got violently ill at the Grand Canyon. One morning Claudia heard an elk bugling outside our cabin and she thought it was me in my deaths throes. That’s what you get for burning your candle at two ends.

This post needs a good editing but that can wait. Claudia and I are going out to see Hidden Figures. That should be a good film too.

Editing is now complete…….

Hidden Figures is great.

Could Trump become a successful President?

My “Buddy” recently sent me a critique of Hillary Clinton and a prediction of her failure to beat Trump written by a nemisis of the Republican Party – Michael Moore. I thought it prescient and replied to my Buddy in this way:

An excellent prediction that was very much aligned to my way of thinking. And I don’t rule out the possibility that Trump may luck into being a successful President. But I will feel compelled to be one of his many tiny nettlesome critics. I hate it when some Napoleon takes the crown from the Pope to put it on his own head especially when the Napoleon is like a spoiled fourth grader.

Today my Buddy sent me a link to this page about Berkshire Hathaway’s famous invester Charlie Munger. I found it reassuring because I mostly agreed with his investing strategy but then I noticed a link to the three things Munger and Trump agree about. To my great surprise I mostly agreed with them too – 1. the dangers of untrammeled free trade, 2. the termination of the Glass Steagall Act, and 3. the drawbacks of corporate income taxes.

It would be amazing but not unprecedented for the embodiment of a spoiled fourth grader to succeed.

How yesterday started

Yesterday I got a lousy night’s sleep. They seem to have come back again with the beginning of the School Year after a relatively blissful summer. Coincincence I’m sure.

During one of my sleepless hours the night before I’d made up my mind to visit Congdon Elementary School that morning at the beginning of its school day. I’d gotten the sense that the school was a little more disordered in recent years due to myriad changes in the School District. But all those sleepless hours resulted in me waking up at about 7:15. (I don’t often set alarms anymore) By the time I’d fed the cats, completed morning chores and cleaned myself up it was ten to 8. I was afraid the busses had long since dropped off the children but I drove over anyway. For the past six months I’ve been making up for the hideous first two years of my service on the School Board. I had stayed away from schools lest employees be brought under suspicion for being seen in my presence. I know that sounds, well paranoid, but it was a concern I had. Twenty years ago I used to joke with another school board member that our school board’s slogan ought to be “Just because you’re paranoid doesn’t mean people aren’t out to get you.” If its any comfort to my readers, and it shouldn’t be, I always worry that everyone in the District is paranoid about me especially what I might write about them in my blog. Mostly I give our employees a pass. As for my fellow elected officials……..I just write what I see, experience or hear tell about them. We are the elephants fighting in the African proverb about trampled grass.

When I got to Congdon it was quiet as a mouse. I’d only seen one parent I knew crossing the parking lot to get to the school. I signed in and introduced myself to the Office denizens and explained my intention and my failure to get to the school before the busses. I told them I’d walk the halls for a few minutes and make sure to get to Congdon earlier next time. On my way out of the office I followed one of the staff members to her office. When I asked her what she did she told me she was working with the homeless children. That rang a bell. I asked her if it was her name on the new emmployee list I’d perused at Monday’s Human Resources Committee. She affirmed that this was the case.

I asked her how many homeless kids went to Congdon. Forty she replied mentioning that there were about 80 such children at Myers-Wilkins (the old Grant School) and some more at Piedmont Elementary.

We spoke for about fifteen minutes before I went on my way. What I was assured of was of great importance to me. These kids going to Congdon, Myers Wilkins and Piedmont are allowed, encouraged even to continue on at the same schools no matter where they may move to while living in Duluth. That’s called stability and transient children need this desperately.

This is a vast improvement over the situation that existed when I was first on the School Board. I’d agonoized over “transient” children in those old days. These were kids who might find themselves in a half a dozen different school within a single school year as their rootless, homeless families wandered from residence to residence or even the back seat of a car – if they had one. Back then Congdon, being situated as it was in the posh Congdon neighborhood, didn’t have many homeless kids. Today it does and even handles more than its “share.”

My walk around the hallways afterward reminded me of the old orderly Congdon. Some of the teachers from Congdon I’d met at Denfeld on August 30th averred that class sizes were a little too generous but I saw no evidence of chaos in my walk through. Whew! That “Whew” said, its still early in the school year.

Among the news stories mentioned in the previous post that had me in their grip was one about Minnesota’s poverty rate reported by Minnesota Public Radio. The story reports that Minnesota has the second lowest poverty rate among the fifty states at 9.1 percent. Having mentioned homeless students I should add that Duluth’s poverty rate is significantly higher than the rest of Minnesota’s rate and that poverty affects children on average more than the adult population.

The DNT had a chart of National poverty rates going back to 1960 that I couldn’t help but contrast with the Op Ed piece the Tribune commissioned from the conservative blogger, John Hinderaker, of Powerline.

Hinderaker makes the case that the reason for Minnesota’s falling from the top to the middle of prosperous states is because of a couple decades of high taxes. I’m not so sure. Republican legislators have managed to fight state tax increases pretty successfully for the past fifteen or so years of this new century. A case could be made that the taxes not spent in education and fixing up old infrasctucture blunted our economic growth. As evidence I’d offer Minnesota’s economy from the 1970’s through the 1990’s during which Minnesota’s growth exceeded that of most other states while we were one of the five or six highest taxing states.

Furthermore, the MPR story about the nation’s declining poverty that ran in the DNT also included an intesting graph showing the decline and leveling off of the nation’s poverty rate from 1960 to today.

Hinderacker might be advised to look at the steep decline in poverty from 1960 to 1970. That was during LBJ’s War on Poverty and judging by this evidence it did a marvelous job lowering poverty rates until 1980 when the Reagan Revolution, with its War on Welfare Queens, left us with a mildly fluctuating poverty rate plateau of 12 percent. That’s half of what it was when Jack Kennedy was elected President. Its been stubbornly stuck there ever since.

Will 709 still be able to refinance our Bonds and get a 3% savings?

Loren Martell’s column written before yesterday’s stunning Brexit vote noted that our Bond Advisers warned us that the economy was fickle. Today the stock markets are about to take a steep plunge. What will this mean for the municipal bond market? It couldn’t get much lower than it currently is which makes a reduction in interest rates possible. If it begins to rise I think ISD 709 will find refinancing our bonds untenable. If stocks become less attractive investors may want to hedge their bets by moving to municipal bonds or avoid them all together. The switch could be almost immediate and I can’t predict the consequences.

In addition to soiling our own community the World is busy turning upside down while Donald Trump cheers it on from his Scottish Castle. (Vultures always live it up when an elephant dies) My Buddy sent me this cheering email:

For those of you who are looking for a tall building from which to jump.

From http://www.bloomberg.com/news/articles/2016-06-24/nightmare-coming-true-for-stock-bulls-blindsided-in-brexit-shock:
While the majority of forecasters see less impact in the U.S. than in Europe, the consequences for American investors could be severe, as Brexit’s passage joins a host of other threats that have weighed on equities. Profits are falling, valuations are the highest in a decade and the U.S. just reported the worst hiring since September 2010.

The BIG objective

This will be so brief my readers will wonder why it took me so long to compose it. Well, the reason is that I expected to write War and Peace with footnotes.

Just now I got another email from a parent who wants me to replace the rubber tire mulch. Frankly I’d spend the $400,000 just to offer parents peace of mind at a time when so many think our administration and school board don’t care about them. Losing 40 kids more would cost about $400 grand at $10,000 a kid. But that kind of reasoning my not cut it with a school board that just turned up its nose at $14.2 million. It has also turned up its nose at Qcomp and Alanna Oswald just showed me the document that demonstrates our do nothing legislature just pulled the plug on our getting any of the million plus we were once entitled to.

So the little objective was saving one or two teachers (about $180,000) to keep a Zero Hour while the News Tribune is editorializing that we should spend ten million to fix up Old Central – $18 million if we don’t get a grant to help us.

The Big Objective is finding one, two or three million annually to put back into our budget. It could be used to fund a seven period day. There seems to be one obvious way to do this and it would be great because the Red Plan promise to save $5 million a year has proven to be a bust. Our Finance Director, William Hanson, has told us repeatedly – for six years – that there is no way we could do this and for six years we have used what should be classroom money to pay off Red Plan Bonds.

I find it hard to believe Mr. Hanson. I see no reason why ISD 709 can’t do what any homeowner has traditionally been able to do – refinance our loans. Art Johnston has worked up amortization tables which suggest that if we took twice as long to pay off our remaining Red Plan debts we could keep a million or much more in our General fund each year. The trade off would be paying for the Red Plan an extra ten or twenty years. But right now we are hemorrhaging students from our half billion investment in new school buildings. We need to stop that and make our schools the magnets they once were – before the Red Plan.

If I learn that we have had this opportunity for the past six years and sat on our thumbs. Well, let’s just say I won’t be happy.