RISING TO THE CHALLENGE: MT. EVEREST AND COLLEGE

It’s not the mountain we conquer, but ourselves. ~ Sir Edmund Hillary 

There’s a straightforward relationship that explains both the horrendous end of Mt. Everest’s spring climbing season this year and the added challenges increasing numbers of students face of graduating from US colleges. These two trends in one sense display a victory for the marketing of these arduous “projects” to a larger, broader public that’s not completely ready for them. In cold economic terms, it’s consumer demand exceeding available supply. But at what cost? Deaths and drop-outs.

The recent deaths on Mt. Everest have once again peaked the media’s interest. The adventure media while berating the agonies of defeats and deaths fawns over the thrills of the quest each and every season.

Why has this season seen 11 climbers die on the mountain, the most since 2015 when at least 22 people perished due to avalanches? There were 5 deaths last year. For a change, it wasn’t this year’s weather or earthquakes or avalanches. It was because climbing Everest has for some time been commercialized and sold as something folks beyond just the hardest of hard-core, capable alpinists can successfully attempt. Nepal’s tourism ministry, seeking hard currency, issued permits to summit Mt. Everest to a record 381 climbers this season, at a cost of about $11,000 each. Beyond the permit, the trip itself can cost $45,000 or more.

That’s a very long way from Sir Edmund Hillary and Tenzing Norgay’s initial ascent 65 years ago. According to veteran mountaineers, this year there have been too many inexperienced climbers who have bought their way into attempting Mt. Everest who haven’t been adequately trained or supported. Dreadful results have precipitated. These results were created in no small part because of the sheer numbers of climbers attempting to simultaneously reach the peak, shown in the picture below. This is what it looked like last week when too many people (probably over 200) were waiting to capture their moment of glory on the narrow, cold (-13^oF) confines of the summit at 29,029ft. Fascinatingly, Mt. Everest continues to grow about 0.25” each year. With the extended wait, often two hours or more, unprepared climbers can run out of oxygen among other life-threatening challenges.

The summit jam at the top of Mt. Everest, May 2019.

Source: Getty Images via The Washington Post.

Meanwhile back in the lowlands, more than 16.8 million undergraduates traversed the academic slopes at colleges and universities last fall, representing a 27.8% increase since 2000. The number of US adults that have a B.A. or higher degree has increased 36.7% since 2000.

For decades, post-high school academic education has been proclaimed by many authorities, including educators and politicians, as the very best way of ensuring career success. Students and their families have listened and acted on this advice. In 2018, 35% of US adults have received a B.A. or higher degree. This proportion of college-educated adults has never been higher, as shown in the chart below. College enrollment has been increasing for young adults for over a century. This is a very good thing because a more educated, skilled workforce is more productive and more engaged. This achievement reflects not just individual successes but collective ones that have benefited society.

Percent of US adults with a B.A. or higher degree

 Source: NCES.ed.gov 

This chart illustrates that the growth of adults having at least a B.A. degree follows a logistic curve during the nearly 90 years shown. From the 1970s through 2000, the percentage of adults with college degrees rapidly increased; it more than doubled. After 2010 the incremental increases in adults with a college degree are smaller than before. This is expected to continue. The total number of undergraduates enrolled in US colleges peaked in 2010, at 18.1 million.

There are certainly sound reasons why growing numbers of young adults have elected to follow the college pathway to hopeful success. One reason, beyond possessing increased knowledge, is being able to receive higher compensation at work. In his superb Kenyon College commencement speech, This is Water, David Foster Wallace offers a much different and appropriately broader perspective when he stated, "It is about the real value of a real education has almost nothing to do with knowledge, and everything to do with simple awareness; awareness of what is so real and essential, so hidden in plain sight all around us, all the time, that we have to keep reminding ourselves over and over: ‘This is water.’”

The median annual earnings of young adults with a B.A. were $50,000 in 2016. The college income premium is often used as a justification for those of us who are fiscally-focused. It offers a rationale for devoting the considerable time, effort and expense required to receive a B.A. Several studies that have examined the size of the college income premium have found that it has ranged from about 70% to 100% more than income earned by people without a college degree. This premium has neither grown nor fallen very much over the last two decades; it’s plateaued. Other studies imply that the premium may have started to decline for specific cohorts of college students.

What has grown are college tuition and fees, which have greatly climbed for two reasons. First, states have provided a much smaller proportion of public university budgets; and second, the demand for an A.A. or B.A. degree has increased significantly. It’s been a sellers’ market for a long time, especially at “selective” schools. Since 1978, college tuition and fees have increased more than three times as fast as consumer goods and services’ prices have. Student debt has consequently risen; 69% of all college students have taken out at least one loan; the average loan owed is $29,800; the median monthly payment is $222.

I don’t think this necessarily comports as a general, capital “C” Crisis that’s often mentioned in the media. Student debt has increased because a lot more students have chosen to go to college. It’s principally demand-driven. Student debt that enables earning a college degree eventually provides added value to each and every student who graduates, as mentioned above. But defaults on student debt are the highest by a large margin of any type of private debt, especially for students who don’t graduate.

Entering and thriving in college, like climbing Everest, is not for the unprepared. As more and more students are going college, more have found it difficult to summit the academic mountain facing them. According to one report, anywhere from 40% to 60% of first-year college students now require remediation in English and/or math. These remedial courses cost students crucial money – about $1.3 billion each year. Also, these courses don’t count towards graduation requirements. On-time graduation rates of students who take remedial classes are consistently less than 10%. Basically, remedial education in college represents a deep crevasse into which all too many students are unlikely to emerge. The “who’s responsible for this” fingers are pointed in many directions regarding why this increased level of needed remediation has occurred and, of course, who should pay for it. More remediation is needed.

Today’s first-year entrants into college are more broadly representative of all our young adults, rather than a much narrower slice of them in decades gone by. This breadth is requiring more support services on the part of colleges and secondary schools, and more determination on the part of these students. Students who have the required determination and available resources graduate. But a lot don’t.

The travails of our ever-increasing number of college attendees have also risen, with only 40.7% graduating within four years across all US post-secondary educational institutions. For-profit schools’ graduation rate is contemptibly much lower, only 17.6% which is less than one-third the rate for non-profits.

Interestingly, there were several for-profit colleges named after the Earth’s highest peak. Unfortunately, none of the Everest Colleges ever reached high-altitude academics. Their owner/operator, Corinthian Colleges Inc., was successfully sued by the State of California in 2016 for defrauding their students. Everest College graduates have legitimately expressed concerns that their Everest degrees are effectively worthless. If colleges like Everest have been offering worthless degrees, perhaps they should be removed from the education business.

Higher education in the US now is far different than it was even 20 years ago, let alone in the more distant past. When I graduated from college, just after the Iron Age, having a B.A. was quite extraordinary, just one-in-ten adults received a B.A. or higher degree.

Neither the industrial-education complex, nor politicians, nor young people will allow a return to even the 2000s, when just one in four young adults graduated with a B.A. Now it’s one-in-three, which sounds like a small change, but it most assuredly isn’t. Getting a college degree has never been so culturally and socially hard-wired into our successful futures. Some folks even believe it’s a right, rather than an option. Go figure. For now and forever-more, returning to the recent past isn’t going to happen in terms of college access, and shouldn’t. And there are consequences when college degree holders become ever more widespread and less extraordinary.

Student loans have always been subsidized, reflecting the positive externalities associated with being a college graduate. Recently, several Dem presidential hopefuls have proposed increasing these subsidies in several ways. I do not think we should adopt policies like free public university that consequently will incent even more high-school grads and others to enter colleges. Visually think of such programs’ aftereffects as similar to the above picture of the overly long queue of cramped climbers waiting for the momentary grandeur of summiting Mt. Everest. Instead, multitudes of additional college students will be waiting and waiting not only to get into already-filled classes, but also to find a place to sleep and eat. Will these additional collegians, who would not have otherwise applied if it weren’t “free,” be adequately prepared academically? I have my doubts.

Policies like those Bernie and Elizabeth have been pushing for “tuition-free” and “debt-free” college are a doomed fantasy without also dramatically increasing public colleges/universities’ federal funding for expanded faculty, facilities and especially for remediative programs. If such free college programs were to see the light of day, listen for the anguished cries of progressives who whine that such policies will end up subsidizing un-poor people, mon dieu how inequitable! Such expensive, expansionary programs are likely to devalue the worth of attaining a college degree and increase drop-out rates. An A.A. or B.A. would become less exceptional and more normal. More eateries, and other businesses, would begin requiring wait-person jobs to have a post-high school degree. At best, smaller wage premiums would be willingly paid for such normality, just like when high-school degrees became ordinary starting in the 1970s; 55.2% of US adults had a high-school diploma in 1970. So, regarding “free college;” be careful what you wish for.

As Sir Edmund stated, it’s not a real adventure when you have to pay for it. Nevertheless, here’s to prepared adventuring in high places and higher education.

CAVEAT EMPTOR POLITICO

In politics, absurdity is not a handicap. ~ Napoleon 

Promising a multitude of equality-filled rainbows when they’re elected, virtually all of the 23 fervent Democratic presidential candidates have been campaigning for a brighter future, come Nov 3, 2020. That’s a mere 529 days away. Given recent trends and Trump’s example (he formally began his reelection campaign on his Jan 20, 2017 inauguration); I expect the 2024 campaigns to begin just after we’ve finished 2020’s Thanksgiving stuffing. Oh, my.

As long as one anointed Dem is successful, a brighter future isn’t terribly hard to imagine, given our Drama-King president’s continuing record of fear-based ukases and misinformed, damaging policies covering all substantive issues.

What is hard now for every one of these candidates is first getting anyone to care what they are saying, including Iowans, where the earliest Democratic caucuses are but 255 days away. And second, for a specific candidate in the 22andMe throng, does anyone know I’m in the race and how can I distinguish my positions from everyone else’s, assuming somebody cares? At this point, it’s the very rare person outside of the political-media complex or the Washington DC beltway that cares at all.

Nevertheless, the media is overflowing with a plethora of “latest polls.” RealClear Politics lists 58 political polls being undertaken over just the past two weeks. At this neonatal state of the presidential campaign such polls hardly mean anything beyond whether the polled somebodies have ever heard of the candidate. Have you heard of Marianne Williamson or Wayne Messam? No matter who you now might possibly favor for president in 2020, there’s at least one extant poll that will support your choice in some fashion. Current polls about who’s winning the contest for the Dems’ candidate are essentially chaff, not kernels of worthwhile wheat. What else is excessive?

As of Apr 15, when there were only 15 announced candidates (not including Joe Biden), they had already raised $118.5 million. Bernie Sanders has the biggest war chest with $20.7M in his coffers (probably including the $6.1M left over from his 2016 campaign); Juan Castro was last at $1.1M. Naturally, the political-media complex has been reaping large sums of money from the candidates’ ads in this nascent stage of campaigning. According to the Federal Election Commission’s first-quarter filing, 12 of the Dem candidates spent $6.7 million on online advertising and assembling their digital strategy. Each and every Dem candidate is now in full, 24/7 primary voter acquisition mode. Realistically, the vast majority of these 23 candidates are at best competing for consideration as vice president, senator or governor in the Nov 2020 elections.  

These Dem candidates imply that ordinary people, together with their acolytes, won’t be paying any taxes for their plans, only the rich will be. Now they’re simply summarizing what their policies will somehow accomplish, like end inequality, perfect healthcare, put everyone back to work, pay reparations, provide debt- and tuition-free college education, reduce the voting age to 16 years and rapidly clean-up our environment. Such programs will require raising beaucoup government revenues, through increased taxes and public debt financing. Only a few candidates admit these fiscal consequences.

Meanwhile our strategy-free, solipsistic president persists in telling us that China has been paying for his tariffs (I’d give him 4 Pinocchios, adopting the Washington Post’s fact-checker icon) and that the Dems, especially these presidential candidates, are extreme socialists (another 4 Pinocchios), along with his ever-growing multitude of other fact-free fictions. His campaign now has $65.7M to spend, far exceeding that raised by any Dem. L

The Dem campaigns’ diminutive fiscal standing, together with our economy’s sustained strength (3.6% unemployment, 3.2% increase in average worker’s earnings, with 3.2% real GDP growth), represent ample challenges that any Dem will be facing to conquer #45. Defeating Trump will require victories in enough states beyond the coastal true blue ones so the winning Dem graduates triumphantly from the Electoral College, although probably not debt-free.

With rare exception, no candidate has revealed how their programs will specifically work or how they’ll be funded. However, Sen. Elizabeth Warren bravely stated in January that if elected, she would implement a new wealth tax imposed on the top 0.1% of income-earners and later added a new, larger corporate profits tax to finance several of her proposed pro-equality programs. Her policies would reduce student debt, provide free tuition and fees for students in public colleges and offer universal child care and early-childhood education. In making these and other definitive proposals she has positioned herself as the early race’s wonky, “I’ve got a plan” leader in the Dem candidate flock. Consequently, she has twice the number of paid campaign staff as Sen. Sanders. She needs such intellectual firepower to keep churning out thorough position/policy papers like no other candidate.

Actually implementing such wealth and profits taxes is far more problematic. Effecting such new taxes as federal statutes assumes the Dems keep control of the House, gain control of the Senate with her in the White House. Her proposed wealth tax will also need to overcome a number of legal and execution issues that have contributed to eight OECD nations getting rid of their existing wealth taxes. No matter; they are clever ideas that distinguish her from all other candidates. Successful politicians are rarely criticized for under-promising during their campaigns.

It’s quite safe for a progressive Dem like Sen. Warren to propose a wealth tax, because the people she’s casting votes for (progressives for sure, millennials and maybe folks who shower after, not before they work) rightly don’t consider themselves rich enough to be subject to her wealth tax. Her appeals for new government programs, like those of other Dem candidates, are portrayed as basically costless for their targeted potential primary voters. Other folks, the rich ones across the proverbial freeway or tracks will pick up the tax tab, not them. Each candidate knows a “free” program beats all others.

Progressive Dems are proposing momentous, major programs that, if enacted, will have substantial effects, including many unforeseen ones, on our economy and us. This is the “revolution” that Bernie et al. are focused on creating. Programs like Medicare for All and the Green New Deal will influence virtually every aspect of our lives. By voting for either Michael, Joe, Bill, Cory, Steve, Pete, Julian, John, Tulsi, Kirsten, Kamela, John, Jay, Amy, Wayne, Seth, Beto, Tim, Bernie, Eric, Elizabeth, Marianne, Andrew or even another Dem (are there any?), we expect our lives will be significantly improved and nirvana will move much closer to us.

At this point we consumers, taxpayers and eventual voters are mostly left in the dark about how these candidates’ policies and programs will actually affect our lives and what they will cost us. With such evidence we can make more knowledgeable decisions when we’re deciding who to vote for by also knowing how this person’s proposed programs will affect us. Such particulars can illuminate how a candidate’s policies will influence us individually and collectively.

As the Dems canter around their political race course and the field inevitably narrows, starting after the first debates on June 26 and 27, we will hopefully start receiving additional details so we can make more-informed judgements in the voting booth.

Knowing such details matters. Bernie’s single-payer Medicare for All Plan (M4A) has been endorsed by at least five other Dem candidates: Cory, Tulsi, Kirsten, Kamela and Elizabeth. When polls asking about his M4A state that it will eliminate all private health insurance and will increase individuals’ taxes, this program’s support drops dramatically to just 13%. Most published polls show a small majority of respondents favoring M4A; these polls never state the very likely (and unpopular) consequences in their questions.

Thus, we citizens should demand more details, the sooner the better, as well as abide by caveat emptor politico, denoting let the voter beware (my fractured alteration of the well-known 500-year old Latin phrase).

LET’S REDUCE OUR TRADE DEFICIT AND JUST EXPORT HIM

Trade is not based on utility but on justice. ~ Edmund Burke 

The misses and mistakes the president has been making with respect to our international trade policies, especially with China, have one unlikely remedy. Export him and thus reduce our trade deficit, both fiscally and spiritually.

In numerous pronouncements, Donald Trump has provided unequivocal proof that my high-school economics students understand far better how tariffs work and what the likely nasty consequences will be for US consumers and businesses as these import duties raise prices. David Ricardo is again rolling over in his grave. If for some strange reason you’re not already convinced about this lack of his common sense and knowledge, remember his fallacious tweets that “Trade wars are good, and easy to win.” (March 2018), and “Tariffs will make our Country much stronger, not weaker” (May 2019). Unlike the president, my students correctly realize that tariffs are simply taxes levied on imported goods that are ultimately paid by consumers of the goods. Although the many critics of the president’s tariffs have probably overstated their deleterious short-term macroeconomic effects (US exports of goods and services to all nations represent but 12.1% of our GDP; China’s are 19.8%; Germany’s are 47.0%), Trump’s tariffs and China’s reciprocal tariffs have already and will continue to harm specific, important sectors of our economy. Trump vastly broadened his import tariffs on May 10, which will soon raise prices for every US consumer of goods from China, including iPhones, Christmas tree lights and thousands of others. Consumers’ pocketbooks are being picked by the president’s “trade war.”

If the president was interested in gaining any historical knowledge, he’d have long ago understood that substantive tariffs, similar to those he’s actually and threatening to levy, directly extended our Great Depression (the Smoot-Hawley tariffs). It’s no matter to him. Although they can sometimes be a useful negotiating tactic, when implemented tariffs haven’t and won’t make our nation greater or stronger. Just ask a farmer.

His dutiful (pun intended) farmers throughout the mid-West and Great Plains are, once again, caught between their soil and a hard place with Trump’s and China’s tariffs affecting their livelihoods. Since last Spring they’ve seen their largest foreign buyers of agricultural commodities disappear behind tariff walls. But as rock-solid Republicans (so far), they will be loath to vote for any of the now two-dozen Democratic candidates, except perhaps Montana Gov. Steve Bullock, who announced his candidacy on May 14. The best the Dems can hope for is farmers’ political abstinence on November 3, 2020. It might be enough, but keeping many fingers crossed is wise.

My pick for where to export him is the British Overseas Territory of Tristan da Cunha, the most remote inhabited island in the entire world. Tristan is over 6,600 miles from Washington, DC, 2,000 miles away from South America and 1,700 miles away from the nearest coast of South Africa smack dab in the middle of the South Atlantic Ocean.

It should be perfect for the Donald. According to Wikipedia, the island has 251 permanent residents. The only way of travelling to and from Tristan is via an occasional seven-day boat trip from South Africa. Tristan boasts of having a population of rockhopper penguins. It’s starkly volcanic origins may take a while for Mr. Trump to get used to; he’ll have the time. A total solar eclipse will pass directly over the island on Dec. 5, 2048. Wow.

I expect that despite initial resistance, Britain will gladly agree to host Mr. Trump exclusively on Tristan for his remaining earthly days. Why? Because in return for hosting him, the US will unilaterally commit to negotiating with Britain on an expedited basis a comprehensive US-UK trade agreement. What with Brexit, they’ll need this trade agreement big time. The icing on this agreement’s cake will be our financing the construction and maintenance of a small 5-hole pitch-and-put golf course on Tristan to be enjoyed by all its residents, include the most recent one.

Ah, I love this opportunity to take advantage of a rare upside of Britain’s Brexit challenges, because the downsides will stretch for a good long time beyond even Oct. 31, 2019, the current magical (and extended) deadline for Brexit. It could take a year and a half or so to negotiate such a comprehensive trade agreement which coincides nicely with our next presidential election. The House Dems should soon start initial discussions with whomever may be in charge in the British Parliament, be it Theresa, Boris, Jeremy, Nigel or someone else. Onward towards freer trade and deficit reduction…

WHERE’S THE HURST SHIFTER WHEN WE NEED IT?

We drive into the future using only our rearview mirror. ~ Marshall McLuhan 

Distracted drivers kill all too many folks every day. Fortunately, there’s a solution in our automotive rearview mirror.

Motor vehicle crashes is the second largest type of fatal unintentional injury for adults in the US, following poisoning. Unintentional injuries are the third-leading cause of adult deaths, after heart disease and cancer. According to the US National Highway Traffic Safety Administration, 37,133 people died in motor vehicle crashes in 2017. Of these fatalities, 3,166 people died due to drivers’ distracted driving, representing 8.5% of total traffic fatalities. Distracted driving each year also causes over 300,000 accidents that result in moderate or severe injuries. Distractions such as using a cell phone, a navigation app, tuning your SiriusXM radio to your fav channel or operating SoundCloud and Spotify have collectively contributed to a lot of pain, grief and heartbreak.

More prosaic distractions while driving include eating an In-N-Out burger or sipping your Peets double latté, conversing with passengers and looking at the passing scenery. I mentioned in a previous blog that “driverless” Autonomous Vehicles (AVs) have caused fatalities. Last year when driving in “automatic mode,” an Uber AV in Tempe, AZ hit and killed a pedestrian. What was the car’s human “standby driver” doing? He was totally distracted by viewing Hulu rather than the road ahead.

There is a direct relationship between increased automotive automation and mounting deaths and injuries due to distracted driving.

One of the first significant advancements in vehicle automation was the automatic transmission that replaced the standard 3-speed manual (stick-shift) transmissions. The first reliable, fully automatic “hydra-matic” transmission appeared in the 1940 Oldsmobile. It was a popular $50 option, which converts to $893 in 2018 dollars. The 1940 Olds 4-door touring sedan’s MSRP was $963. By 1950 almost every General Motors’ nameplate car offered an automatic transmission.

A myriad of other devices have been introduced after the 1940 hydra-matic transmission to advance the car-driving experience, including backup cameras. These cameras became mandatory on new cars in 2018, and like many other driving improvements are intended to increase safety and prevent accidents. The percentage of new cars sold with backup cameras doubled to 68% between 2008 and 2011. However, during those three years the backup fatality rate declined by just 31% and backup injuries dropped only 8%. Many drivers have apparently become so reliant on their backup screens that they experienced a collision or near miss while driving other vehicles. Have diminishing returns come to the introduction of evermore added car safety systems? It seems so, but not to worry.

There is one automotive feature available today that can increase a driver’s attentiveness instead of shrinking it — the manual transmission. By its design, a stick-shift transmission successfully mandates increased driver attention and action. You have to shift with your right hand while using your left foot to depress the clutch pedal to increase the car’s speed. When manually shifting gears it’s practically impossible to safely hold a cellphone or a Peets cup; although unfortunately I’m sure it’s been attempted many times.

The vast majority of new cars now have automatic transmissions; only 2% of all vehicles sold in 2018 had manual transmissions. They have been left on America’s dusty roadsides. This is true even in the last bastion of manual vehicle-dom, sports and performance cars. Only 20% of Porsche 911 and Boxster purchasers, cars that I’ve greatly enjoyed driving, now buy one with a manual 6-speed transmission. The BMW 3-series has a manual take rate of less than ten percent. You can no longer buy a manual-shift for a new Ferrari or Lamborghini, allegedly for performance reasons. Mamma Mia!

“Who would have thought automating simple things like shifting gears would have made it so much easier to pick up the smartphone?” declares Bryan Reimer, a research scientist at MIT. He asserts when new technology eliminates a driving task (like manual shifting); drivers tend to look for other activities and distractions to fill the time.

As a confirmed, long-time gear-head[1], I believe returning to more manual shifting would be a fine means of reducing the nasty consequences of distracted driving. I have been happily and manually shifting cars’ transmissions for a bit over 50 years.

The first manual transmission car I drove was a maroon 1966 Pontiac GTO Tri-Power coupe, as shown below. It had a floor-mounted Hurst close-ratio 4-speed transmission with a 3.89 limited slip rear differential. Shifting gears was a central part of this car’s delight, laying rubber was a second.

  

The 1966 GTO inaugurated the trend soon followed by each of the three other domestic car manufacturers of successfully selling “muscle cars,” high-horsepower coupes. The GTO’s fuel consumption was exorbitant; the price of gas thankfully was a diminutive $0.32/gallon. [You can’t even count that low, can you?] Those were the days. The GTO’s 6.4L (389 cubic inch) V-8 engine produced 360hp at 5200 rpm. It reached 60 MPH in 5.8 seconds and weighed 3,600 lb. The 1966 GTO was so emblematic of “the times” that it was featured on a 2013 US postage stamp.

The Hurst shifter that my GTO benefited from was the best manual transmission made in the US during the 1960s and early 1970s. It also had great caché. Automotive historian Mike Mueller has noted, "If you didn't have a Hurst shifter in your supercar, you were a mild-mannered loser.” No matter what gear it was in, my GTO was far more adept at going straight and fast than quickly following twisty roads. I fully realized this shortcoming after ending up in a farmer’s soon-to-be planted corn field having misjudged the car’s higher-speed stability on curvy rural roads. So it goes.

After some time, I traded in the GTO and bought my first, far better handling sports car. I have manually shifted Fiats, Alfas, a Jeep, a Land Rover and Porsches. The current, far more curve-compliant car that I manually shift is a Boxster S, shown above. Its 3.2L (193.9 cu-in) flat 6 cylinder engine produces 280hp at 6200 rpm. It has a short-throw 6 speed manual transmission. My Boxster S reaches 62MPH in 5.5 seconds and weighs 2,966lb. I’ve never ended up in a corn field with this mid-engine coupe. It displays renowned handling on virtually all roads. Driving this stick-shift car is not a distracted experience.

 Perhaps if today’s car drivers would look closer in their rearview mirrors and return to the advantages of manual shifting, we’d start shrinking the perils of distracted driving.

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[1] My mother told the story many times about how she taught me the alphabet at a young age. Because even as a toddler I was fascinated by cars, she would walk me over to a car, show me its nameplate, say a Studebaker, and have me say the individual letters. After lots of such car-finding excursions I knew many of the alphabet’s letters (and the cars themselves). Thanks Mom. 

VENEXITING BEYOND CHAOS

Inflation doesn’t exist in real life. ~ Luis Salas 

The Bolivarian Republic of Venezuela has been making headlines for all the wrong reasons. Under the nation’s socialist dictator, Nicholas Maduro, Venezuela has suffered from epic socio-economic mismanagement, stratospheric inflation and colossal emigration.

Mr. Maduro, a former bus-driver, callously blocked needed food aid from entering his ailing, corrupt petroleum state several weeks ago. His thoroughly misguided, cruel policies have caused 3.4 million Venezuelans – more than 10% of its population – to Venexit across its borders into several neighboring nations including Columbia, Brazil and Trinidad and Tobago. Among other things, President Maduro has given socialism (admittedly, an extreme and horribly-implemented variety) a very bad name.

Last month Juan Guaido, an opposition leader, proclaimed himself the rightful president of Venezuela because of widespread election “irregularities” that resulted in Mr. Maduro’s victory last year. Mr. Guaido has received the support of the US and 50 other nations that have recognized him as the president, not Mr. Maduro. For the last week Mr. Guaido has travelled through South America to shore up his broad but thin international backing. He apparently re-entered his homeland today, but fears of being arrested by Mr. Maduro’s forces continue. No matter how this key political issue may be resolved, Venezuelans endure their suffering every day.  

I here examine the on-going, dark humanitarian tragedy of Venezuela and compare its horrific predicament to a much lower-profile, far brighter South American nation, the Oriental Republic of Uruguay. Yup, that’s Uruguay’s official name.

In addition to being an interesting place, Uruguay is an etymologically remarkable word because it is one of the few that has three u’s in the span of seven letters, with no q’s to boot. Another even shorter three-u word is geographically related. Urubu is a black vulture that inhabits Uruguay, and also is the name of not one, but two rivers in Brazil, Uruguay’s northeastern neighbor.

Unlike Venezuela, for the last 35 years Uruguay has been a well-functioning constitutional democracy. Its government has been the most progressive of any in South America: abortion was legalized in 2012, followed by same-sex marriage and cannabis in 2013. Uruguayan athletes have won 10 Olympic medals, including two gold medals for soccer, long ago. Venezuelan athletes have won 15 Olympic medals, including two gold medals, one in fencing and one in boxing.

Moving to the un-medaled dark side, Venezuela holds the ignominious title of the world’s most miserable country for the past three years, according to the Hanke Misery Index. Currently, Venezuela “beat” Syria, the 2nd most miserable country, by a hands-down factor of 10x, principally because of the government’s multi-faceted socio-economic malfeasance.

The table below compares Venezuela and Uruguay by 13 economic, geographic, health and other factors.

Comparison of Venezuela and Uruguay

Factor\Nation	Venezuela	Uruguay
Motto	Dios y Federación [God & Federation]	Libertad o Muerte, [Liberty or Death]
National drink	Chica	Mate
Olympic medals	15	10
GDP (PPP)	$381.6 billion (47)	$78.2 billion (96)
GDP real growth	-14% (222)	2.7% (127)
GDP/capita (PPP)	$12,500 (126)	$22,400 (85)
Inflation – 2017	1087.5% (226)	6.2% (189)
Population	31.7 million (43)	3.7 million (133)
Geographic size	353,841 sq. miles	68,037 sq. miles
Median age	28.7 years (96)	35.1 years (146)
Infant mortality	11.9 deaths/103 births (107)	8.1 deaths/103 births (73)
Maternal mortality	95 deaths/103 births (73)	15 deaths/103 births (137)
Life expectancy at birth	76.2 years (93)	77.6 years (69)
Petroleum reserves	298.4 billion barrels (1)	Nada
Figures in parentheses indicate national rank by factor. Source: CIA World Factbook.

First off, Uruguay’s motto, “Libertad o Muerte,” sounds a lot like a vocal cousin of Patrick Henry landed long ago somewhere in Uruguay. My, how haunting public phrases can hop across vast distances. And now that you know mate is its national drink, enthusiasts can set their sights on visiting charming Montevideo, Uruguay’s capital, for a cup or two. Mate is a tea-like beverage made from an infusion of dried leaves of yerba mate plant. Venezuela’s drink of choice, chica, is a fermented beverage also popular in Andean countries. It’s made with boiled rice, milk and sugar. If you’re into chica, I recommend you drink it beyond Venezuela.

Venezuela’s population is eight times larger than Uruguay’s and its territory is more than five times greater. Venezuela is 30% bigger than the state of Texas, the second largest US state. Uruguay, the second-smallest South American nation, is close to the size of Missouri. Like their disparity in physical size, the two nation’s median age is quite distinct; Venezuela’s is more than 6 years younger than Uruguay’s.

Comparing health-related factors, Uruguay’s healthcare system is shown to be superior. However, Venezuela’s and Uruguay’s life expectancy is remarkably similar, within two years of each other. But this small difference accounts for a much greater difference in the two nations’ international rankings. Uruguay’s life expectancy is ranked 69th lowest, Venezuela’s is 93rd. Infant and maternal mortality rates are not at all comparable. Uruguay’s maternal mortality is only 16% of Venezuela’s. Although Venezuela’s infant mortality rate is less than four deaths higher than Uruguay’s rate, that increase accounts for its ranking 34 nations worse than Uruguay.

The most striking differences between these two countries are found in the economic arena. Venezuela’s GDP, adjusted for purchasing power parity (PPP), is almost five times larger than Uruguay’s. It has been steadily declining during the recent past due to its misconceived economic policies; last year Venezuela’s real GDP declined by a significant 14%. Uruguay’s real GDP increased by 2.7%. Uruguay’s GDP/capita (PPP) was $22,400, 85% higher than Venezuela’s. Overall, the average Uruguayan citizen is far better off than his/her Venezuelan counterpart.

These macroeconomic dissimilarities rest on Venezuela’s mammoth inflation. For the past four years, Venezuela’s hyperinflation has crushed its citizens and its economy. In 2017 it was 1087.5%; the world’s largest, and a zillion times larger than Uruguay’s 6.2% inflation. I exaggerate, it was 175x higher. It’s impossible now to directly estimate Venezuela’s yearly inflation because the government stopped publishing reliable data after 2014. Knowledgeable economists believe Venezuela’s 2018 annual inflation was 1,370,000%, which is equivalent to prices rising 3.5% each and every day. This year, prognosticators expect inflation to reach a staggering 10,000,000%.

An historical aside regarding super hyperinflations: Even Venezuela’s astonishing price increases pale in comparison to the “winning” national inflation rate in my Hyperinflation Hall of Fame. That was the 9.63 x 10²⁶ annual inflation rate which plagued Hungary beginning in June 1945. FYI, the highest yearly inflation in US history occurred in 1779, 192%, caused principally by the costs of the Revolutionary War.

How has such a ghastly macroeconomic situation happened in Venezuela? In part by initiating appalling, ideologically-driven policies, in part by rampant corruption, in part by endlessly printing Bolivars and finally by having folks like Luis Salas appointed as Venezuelan Vice President for the Economy. In January 2016, when inflation was only 254.4%, Luis denied the very possibility of inflation, stating, “Inflation doesn’t exist in real life.” Every breathing resident of Venezuela disagreed. Luis retired for “family reasons” after less than five weeks on the job. Apparently even Nickolas Maduro couldn’t hack Luis’ incompetence and otherworldly disavowal of reality, and that’s saying something.

Venezuela’s prolonged, colossal inflation has necessitated a series of five significant devaluations of the Bolivar, starting after former President Hugo Chavez imposed strict currency controls in 2003. During several of these severe devaluations the official Venezuelan currency also changed. Since August 2018 the official currency of Venezuela has been the Bolivar soberano (VES). The market exchange rate of a US dollar and the VES is zero for all intents and purposes. Even the government’s official exchange rate for VES to dollars – 1 VES = $0.00030 (3-hundredths of one cent) – has no claim on fiscal reality. That’s right, it’s worthless with respect to the dollar, and thus with the international financial community.

In desperation last year the government launched the Venezuelan petro, its own cryptocurrency, to supplement the plummeting Bolivar. The petro’s value was based on Venezuela’s oil reserves. Within six months the forlorn petro did not appear to be functioning as a currency. The petro’s well was dry, what a surprise.

Venezuela’s external debt has blossomed to $200 billion. These issues create huge problems for its petroleum-based economy. That’s because the world’s oil is priced in dollars, something the government cannot easily or economically obtain. Using the Mar. 3 price of West Texas Intermediate (WTI) crude, a barrel of Venezuelan oil costs 184,556 VES.

The practical worthlessness of the VES, together with the stringent economic sanctions the US has imposed and international credit-reporting agencies declaring Venezuela in default with its debt payments, means the country cannot effectively export petroleum to the US or other western nations.

Consequently, Venezuela has been running out of money to pay for everything from medicine and machinery to food and clothing. Its official foreign (cash) reserves have been depleted; they are less than one-half what they were four years ago. Last week, the government apparently removed eight tons of gold from the Venezuelan Central Bank to sell abroad to raise badly needed cash.

In the good ol’ days prior to Venezuela’s hyperinflation, petroleum accounted for 95% of its exports, now it’s over 98%. Venezuela nationalized its petroleum industry in 1975. Petróleos de Venezuela, S.A. (PDVSA), the state-owned energy company, has been used as a partisan tool of the government. It overflows with political and military appointees rather than experienced engineers. Venezuela’s petroleum exports have steadily declined. Last year oil production of 1.24 million barrels a day was one-third of what it was three decades ago and the lowest since 1990, before Hugo Chavez launched his socialist revolution. Despite having the planet’s largest petroleum reserves, for the first time it imported oil to serve its needs in 2018.

Forced by its Oscar-worthy economic bungling, Venezuela is exporting its oil to China, which unsurprisingly has exercised its significant leverage in negotiating agreements with Venezuela. For Venezuela, it’s China’s way or the highway. Over the last decade China has provided Venezuela $65 billion in tied loans, cash and investment. Venezuela owes China more than $20 billion. These trade/finance agreements are similar to those that China has made with other nations like Sri Lanka. Such accords have been referred to as debt-trap diplomacy.

Who has suffered most from the Venezuelan catastrophe? It’s certainly not Mr. Maduro or his military cronies. It’s Venezuelan citizens, whose 1.8 billion VES per month minimum wage cannot buy food, medicines, clothing, or much of anything else in empty-shelved stores. Venezuelans’ daily plight is an entire world apart from tranquilo Uruguayans. That’s why they’re Venexiting across the border.

GREEN DEALING

The future will be green or not at all. ~ Bob Brown  

Rep. Alexandria Ocasio-Cortez (OAC), Sen. Ed Markley and their fellow Green Dealers may be in their ascendency. Their Feb. 7 introduction of the Green New Deal (GND) certainly got the media’s attention. So much so that it was promptly designated another key litmus test that all Democrats vying for the 2020 presidential nomination must judge. How many Dem candidates are there now? It seems like at least 23; with the list including Pete Buttigieg [mayor of Ft. Wayne, IN] but at this moment it’s merely 13 and sure to rise.

After Medicare for All appeared at the top of candidates’ litmus tests several weeks ago, it’s now just basic blue and the GND now basks as uppermost. These litmus tests are being tossed at candidates as each new “hot topic” newly emerges and the media decides it’s one that candidates must instantaneously adopt or reject. Unfortunately, most candidates readily take the bait before understanding what they’ve signed on to. These repeated tests must make each candidate feel like they’re back in high school. Ah, the good ol’ days.

Green Dealers like OAC seem to believe that shouting from the proverbial tippy-top of endangered redwood trees, combined with a fervent belief that they’re holding a royal flush of solutions, is the best way to change laws. Others, including the many more taciturn Democrats, likely disagree. OAC hopes the GND manifesto will rearrange everyone’s priorities, now. Why; because she has gladly taken the scepter of lead spokesperson for the capital “P” Progressive clan at the capital “C” US Capitol and beyond. She also sees herself as savior of the truly environmentally righteous (or is it leftous) across their much-expanded purview. This expansion comes from the nature of progressivism.

Progressivism is progressive. Over time it seeks ever larger moral advance. If progressives have their way, the list of things considered unequal, unjust and unworthy will broaden, as the scope of the GND’s “environmental” agenda has swelled. This can be a good, but. Here’s a recent example of progressivism’s progressiveness: Additional New York City regulatory guidelines to be released this week will give legal recourse to individuals who have been harassed, punished or fired because of the style of their hair. NYC will henceforth ban discrimination based on an individual’s hair style, which will now be considered racial discrimination.

Because I live way outside the DC beltway, I wasn’t aware of the GND’s initial rounds of formulation, based on gathering opinions of experts and stakeholders. There were some discussions, right? If so, it’s not obvious. Instead, it appears OAC and Markley couldn’t and didn’t say no to any progressive idea that’s somehow connected to an improved “environment” for needful people, especially workers. Beyond decarbonizing the entire US economy in 11 years, the GND’s extra-environmental commandments, er objectives include the government being responsible for:

·        guaranteed jobs, with living, sustainable wages and full benefits for all workers, including folks who have been unable or unwilling to work;

·        affordable, adequate and energy-efficient housing for all;

·        universal, high-quality health care provided by a single-payer;

·        competitive economic markets not clouded by nasty monopolies and oligopolies; and

·        high-quality, free public college tuition for all.

In other words, the GND comes in many varieties of green that will cost lots of green; likely over $40 trillion during the next decade. And these multiple, herculean goals must be accomplished by 2030, only a few proverbial ticks of the governmental clock to entirely revamp the world’s largest economy. Sir Thomas More, the creator of utopian literature 500 years ago, would be impressed with the GND.

Advocates of the GND, being fantasists, are insisting that no trade-offs will be needed nor sacrifices incurred in order to satisfy their manifesto’s objectives. Indeed, AOC has stated, “The question isn’t how will we pay for it, but what is the cost of inaction, and what will we do with our new shared prosperity created by the investments in the Green New Deal.” [Emphasis added.]

She’s not worried about how to pay for these grand objectives perhaps because progressives like her are thoroughly at one with emerging Modern Macroeconomic Theory (MMT). MMT posits that sizeable government deficit spending, which increases the nation’s public debt, isn’t a concern at all. The government can keep printing Benjamins 24/7 as long as inflation doesn’t rise to an unpleasant level.

Fiscal irony is very much alive and well in Washington. MMT’s semi-magical leftish thinking is completely in line with solidly-right Republican conservatives who happily passed their unfunded 2017 Tax Cuts and Jobs Act that’s raised the US debt to historically high levels. This year’s federal budget deficit will be nearly $1 trillion. The 2017 tax law revealed Repubs to be hyper-hypocritical deficit scolds. They condemn “excessive” government expenditures only when it involves Democratic policy, not their own.  

Let’s look at the GND’s principal environmental objective, rapid decarbonization of our $20.7 trillion economy. I spent the majority of my career working to promote and assess energy efficiency programs and policies. I’m all in with a greener America. The GND’s objective of requiring the entire nation to produce 100% of its energy from renewable sources and produce net zero carbon emissions by 2030 is as astonishing as it is realistically unattainable. The International Panel on Climate Change (IPPC) has previously and ambitiously proposed to cut global emissions just by 40% to 60% by 2030, and hopefully get to net zero by 2050. How does OAC and her Green Dealers propose do to this in 20 less years than the IPPC? They never say; that’s for others to stress about.

For reference, in 2017 (a baker’s dozen years before 2030) just 18% of total US power generation was produced from renewable energy sources, an all-time high. In the nine years between 2008 and 2017 this renewable share of power generation doubled, an impressive accomplishment. The GND’s goal for 100% of US energy use, not just power generation (electric power accounts for about 16% of total energy use), to be produced from renewable sources, would require renewable energy to increase by 550% over the next 13 years. The Green Dealers leave reality by the side of their utopian, all electric-vehicle throughways to the future.

I have no doubts that were only one of the GND’s lofty objectives to be undertaken; it could certainly benefit us all and would create many prosperous winners in that endeavor. But there also would be losers. For example, the vast majority of workers in the coal, oil, gas and petrochemical industries (1.44 million people, over half of which are blue-collar workers) would be out of jobs. Sure, job retraining is clearly called for, but in the undefined interim that can last for a while in job retraining, such workers would be SOL. They are not likely to be happy GND campers, nor would their employers. But no worries; each of them would be offered a government-guaranteed job.

Eliminating the internal combustion engine as the transportation sector’s motive power, another GND goal, would likewise lead to numerous lost high-paying manufacturing jobs and large economic dislocation in the short- to medium-term. Transportation of people and goods accounts for 29% of US total energy use. The auto industry is one of the largest in the US, contributing about 3% to the US GDP. Three percent seems like a small number, but it works out to $620 billion in cumulative yearly economic activity. That’s not a small number to trifle with. In 2018, US electric vehicles (EVs) sales reached an all-time high of 361,300, accounting for 2.1% of total vehicle sales. Getting to 100% EVs in 11 years boggles my mind’s engine.

As always, trade-offs will be present if and when the government begins investing in GND’s vast decarbonization. Any and all trade-offs have been denied by the Green Dealers, together with dismissing the substantial costs of attaining the manifesto’s goals. Such denials weaken OAC’s Green Dealing in the jungles of Congress and make the prospect of political victory much smaller. She might not care.

However, if AOC et al. really do want to create actual legislation based on the GND, then it’s incumbent on them to transparently develop specific plans for how the GND objectives could be met by 2030; how these objectives can overcome inevitable challenges; and what trade-offs, if any, the Green Dealers are willing to make to secure decarbonization within 11 years. That process is unexciting and tedious compared to commandment creation.

Maybe OAC is playing a longer game. Fundamentally, I suspect the Green Dealers don’t view their GND as a basis for actual legislation. In this sense it’s worthwhile remembering that Nancy Pelosi has already agreed to step down as Speaker by 2022. After all, the GND will require unprecedented and very big expansions of federal, state and local government programs, oversight and regulation. This is entirely consistent with the precepts of the few elected democratic socialists, like AOC and Sen. Bernie Sanders. This future is not consistent for the majority of current Congressional Democrats. Speaker Pelosi has given the GND a “seal clap,” hardly unequivocal support. But who knows what the future will bring.

With all its practical and political challenges I imagine AOC and other acolytes see their GND more as an edict for progressives of every stripe to rally around their maypole, not as a summarized playbook for real legislation.

Any specific legislation that might have a chance of becoming law coming through Speaker Pelosi and other “establishment Democrats” will elicit cries of derision from progressives. Because Democrat decrees that could actually pass the House will be instantly declared limited, insufficient and unworthy by Green Dealers. They have already claimed the very highest green ground, even if it’s realistically and politically impossible. They’ve now planted their flag, the GND, atop an ever-green Mt. Everest, without having to worry about actually climbing it.

It will be a long time before AOC and Green Dealers might gain enough votes in the House to pass her GND. I’m not holding my exhaled CO2-filled breath. Nevertheless, she has three million Twitter followers right now who have rallied behind her and probably the manifesto. To these devotees, the GND and its 6 commandments are gospel for achieving an alleged more perfect and far greener future. Alas, I’m not one of them; I’m too pragmatic.

  

BEING THERE AND WHERE

Finally, in conclusion, let me just say this. ~ Peter Sellers 

The president’s delayed SOTU (acronymic Washington slang for the State of the Union speech) was eviscerated in a recent Slate story, stating he said nothing new and pretty much had nothing to say. “Trump was just a piece of furniture along the wall [not his wall] of a room. He was just … there.“

This last sentence whisked me away on a return voyage to Peter Sellers’ “Being There: a story of chance,” the brilliant 1979 satiric commentary on Washington politics. Being There’s trailer is here.

Peter Sellers skillfully plays the movie’s simpleton protagonist, Chance the Gardener, who also assumes the name Chauncey Gardiner. Chauncey is a truly passive non-agressive schlub who lives in Washington, D.C. and tends to his rich employer’s garden. When he’s not gardening, his only other activity is watching TV. His world is his garden, literally. The movie follows Chauncey through a series of wholly unexpected, astonishing circumstances as he becomes a confidante of the US President. The proposition of the movie is: Could a person of seemingly diminished intelligence ascend to the heights of political power in the US? Peter Sellers provides us with the unsettling answer based on his dexterous portrayal of Chauncey.

In one of the movie’s scenes the president asks Chauncey “Do you think we can stimulate [economic] growth through temporary incentives?” After pausing for a long time (it’s actually just ten seconds), Chauncey latches onto the word growth, which he recognizes, and then slowly replies, “As long as the roots are not severed, all is well, and all will be well in the garden. In a garden, growth has its season. First comes Spring and Summer. But then we have Fall and Winter. Then we get Spring and Summer again.”

The president is initially dumbfounded by Chauncey’s answer that appears utterly nonresponsive. But after the president’s colleague misinterprets Chauncey’s declaration as a profound comment on economic growth, by saying “We welcome the inevitable seasons of nature, but we’re upset by the seasons of the economy.” The president finally declares, “Well Mr. Gardiner, I must admit that is one of the most refreshing and optimistic statements I’ve heard in a very, very long time. I admire your good, solid sense. That’s precisely what we lack on Capitol Hill.” And thus, the schlub becomes the savant in the nation’s vain political stratosphere.

Sellers' performance of Chance/Chauncey was universally praised by critics and audiences. Sellers commented on his role as Chance/Chauncey, “My ambition in the cinema, since I came across it, was to play Chance. I have realized that ambition, and so I have no more.” He died the year after the picture was released.

Is cinematic history now repeating itself, or at least rhyming, in real life 40 years later? Can Chauncey be a representation of President #45? After dutiful deliberation, I’d say yes. Except that Chauncey has none of #45’s singular egotism, bellicose intransience, unfounded sense of self-worth, profound untruthfulness or thin skin. The two do share, however, an extraordinary inability to see the actual world beyond one solitary, restricted perspective. Chauncey’s sole perspective is as a gardener; #45’s seems to be his bombastic conceit. Chauncey's and #45's rise to prominence is likely due in no small part to Washington's miasmatic atmosphere. 

It’s not now so much about if #45 is being there as is he being where? We all know where his world is defined by: falsehood, prejudice, extremism and ego. Chauncey’s world is defined by the plants he carefully tends. Fewer and fewer Americans want #45 to be where he is. Just like Chauncey, I believe #45 continues to walk on ever-thinning ice towards his just demise. But that future requires help.

Can Dems help by providing a broadly-appealing, alternative candidate and pathway back to what in pre-Trumpian times passed as workable normalcy? I certainly hope so for all our sakes. I believe the Dems’ pathway should not rest on fundamentally and radically expanding the role of government or by mandating Senatorial impeachment proceedings. Instead, this pathway rests on American citizens decisively voting #45 out of office on Nov. 3, 2020; and having him not being there at 1600 Pennsylvania Avenue on Jan. 20, 2021.