Friday, November 7, 2008

Random Observations: Sarah, Vietnam, Unemployment and Disney

After hearing a story on Fox that a McCain aide claimed Sarah did not know Africa was a continent, Palin Didn't Know Africa Is A Continent, Says Fox News Reporter (VIDEO), I was reminded of a story from a history class when I was in the tenth grade, being taught by an assistant football coach at Lee High School in Huntsville, Alabama.     

I was in no way political then, neither a Democrat nor a Republican.  I really did not have an opinion on the Vietnam war, although the civil rights movement was starting to stir me. The teacher made a claim for staying the course in the Vietnam War, saying that over 40,000 people died each year in automobile accidents and we do not stop driving cars, do we?  

My mouth just opened, and a girl sitting across from looked equally stunned, but the rest of the class just soaked those words of wisdom into their empty vessels. I knew at that point that I was different, and I would never suffer fools gladly.  I also knew that there was no argument, and certainly no facts, that would ever sway people like that football coach.   

Their brains were simply not open to information, frozen in granite since birth. 

I heard a similar comment just recently.  Someone said that we do not pull out of Detroit or Chicago where the murder rate is similar to our losses in Iraq.  So, the argument made by my history teacher back in the 1960s is still alive. 

Sarah Palin reminded me of that teacher. Someone who had no curiosity about the world, no real desire to learn, with no serious effort made to learn during her entire adult life, a rigid ideology, and a certainty that whatever opinions formed without information or analysis are true with any contrary information or opinions being discarded as inaccurate, biased or unworthy of consideration.  While that mind set may be acceptable for a history teacher in Alabama or a voter in the SUV capital of the world, I do believe it is dangerous for a President, regardless of whether you believe in the person's ideology. I could never have voted for McCain after he picked Sarah. She would have been a disaster as President, far worse than W.

Some people assume that I am a liberal. That is a mistaken belief.  

I will give you an example. 

When the Beanpole and the Queen of Everything introduce their health care legislation,  and assuming that I was a member of Congress, I would vote against it.  

My vote would have nothing to do with the desirability of what they are trying to do.  

I would like to see everyone have health insurance. That is a most noble goal.  

To do that, however, the cost would easily reach into the hundreds of billions. No one has yet come close to dealing with the funding gaps in the social programs that we already have, particularly when the baby boomers start to retire and receive their medicare and social security benefits.  

Even with no additional programs like the drug benefit for seniors recently added, where are we going to be in twenty years trying to pay for what the government has already promised? 

It would not be difficult to imagine interest on the debt alone being over a trillion dollars then. Adding more social programs on top of the funding problems that we already have is beyond fiscally irresponsible, and even more so when you take as a given that the funding deficit for the existing programs runs into the trillions of dollars.  This is part of the mind set now. Nobody has to pay for anything anymore, just borrow the money, lower taxes, and hope for the best next year.  Now, does that sound like a liberal?

Another example is when someone hears me talk about W and his sidekick, the Angler, lack of respect for the Constitution. 

Being a fierce believer in the Bill of Rights, and a First Amendment hawk, some say that is being liberal.  

I think that is a false labeling. I view it as part of being Conservative, while certain conservatives view it as being liberal, but they are not really conservative. I doubt that any of them have actually read the constitution or any decision by the Courts.  

The First Amendment embodies the very essence of conservative philosophy. It is not a grant of rights.  It is instead a restraint on governmental interference of the citizen's free exercise of those rights.  Maybe I need to quote it: "Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances." 

For a long time, justices pretending to be conservative tried to limit the protections of this Amendment. One way that this was done was to say the First Amendment provided the citizens no protection against the action by state or local governments. This was actually a huge debate for a very long time. The strict constructionist focused on the first word:  "Congress".  

The "liberal" justices finally prevailed in the last century and applied the protections of the Bill of Rights to protect citizens from their state and local governments through an interpretation of the Due Process clause of the 14th Amendment: "1. All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside. No State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any State deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws."  

Now, who is the liberal and who is the conservative in this debate?  I would say there was one group properly characterized as reactionaries and another that I would label as Conservative. For those unfamiliar with this debate, this article provides a good summary, particularly on how the Bill of Rights were incorporated by the "liberals" into the Due Process clause of the Fourteenth Amendment. Incorporation (Bill of Rights) - Wikipedia 

The economy is falling off a cliff.  The existence of an abrupt slowdown is further confirmed by the release of the unemployment report this morning, where the jobless rate rose to a 14 year high of 6.5%. I have mentioned that I fully expect the jobless rate to hit 8% in 2009. This may prove to be optimistic.

The slowdown is impacting a company like Disney in many ways. Disney missed the analyst's estimates for the 3rd quarter, earning $.42 versus the expectations of $.49.  Reuters About 20% of Disney's revenues come from advertising, generated by ABC, ESPN and its ownership of other cable channels and local TV stations. This will decline. Theme part attendance will be down considerably.  Disney was offering a package, spend 4 days at the theme park and receive the next three days free.   

The stock was at 34 in mid September 2008 and is now struggling to stay above 20. I do not own it and will be looking at a possible entry point at around 15 to 17 for a 3 to five year hold.  In July 2002, the stock hit 15.15 and  to find a similar price of 15 you would have to go back to 1994.

I am going to continue investing my excess cash flow until the S & P 500 average falls to 815, the July 2002 low. If that happens, I am going into hibernation until the VIX falls to below 20 and read about 100 good books.  

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