Tuesday, November 25, 2008
Evoking the memory of a 1956 Loony Tunes cartoon called "Deduce You This", Alderman Sam compared himself to the Shropshire Slasher (see left).
Much like the Slasher shakes the money out of Dorlock Holmes (Daffy Duck), Alderman Sam promises to shake the extra money out of next year's budget.
Later in the night, Alderman Sam had a chance to put his money where his mouth was. He went on record during a debate to solidify a city government position, declaring that we need to take due diligence in deciding to make such an impact on the personnel budget. He then said that he supported postponing the bill, but when the roll call came up, he voted not to postpone.
So to recap, Alderman Sam voted against what he gave a speech in favor of, and I had to leave the meeting in order to avoid slashing myself.
Monday, November 24, 2008
This is a public hearing, and man is it public. There are untold numbers of persons here to speak about the city manager stuff, and Ed Hartman has assembled an impressive stock of supporters for the lease giving him the rights to the boat show. I shoved my way to the front of the line, and was able to obtain my normal VIP seat with borrowed internet access, so here we are.
I can't see a darn thing, which is good, because it also means that anybody watching on tv cannot see the soy sauce stain that soiled my sweatshirt in the line of duty today. Mrs. Politics is at a Tina Turner concert, so you, the faithful readers, are all my dates tonight!
The public hearings are starting. The mayor has adopted the strategy of hearing the bills that nobody is here for first, so we are starting with O-38 (updating the recycling code). Tony Evans supports it. Also, Tony Evans supports a sense of humor, as he is sitting next to me and told me a funny joke no more than 4 minutes ago that made me chuckle out loud.
O-40-08: Lawn Fertilizer Regulation in the city. A man claiming he is the only person affected by the bill is testifying against it, because it will prevent him from even carrying fertilizer. He says the city should wait for the county and/or state to pass it. But, he supports an amendment that extends the process, I think. Tony Evans just stood up, so this guy might be in trouble.
Alderman Shropshire is addressing the masses, and just commended the above mentioned guy for.............getting rid of plastic bags. Then he just made a claim that was not true and the guy corrected him.
Tony Evans argument: "condoms and pornos are above the counter, but we can't display fertilizer?" Good argument.
R-62-07: Supporting the state-funded redevelopment of the Annapolis Gardens and Bowman Ct. housing projects. Eric Brown (the HACA pres.) is here supporting this, and is talking now. I have been informed that HACA is getting out of the property management business, and the private companies that are going to develop and manage the property are here with Mr. Brown. The housing authority would have the land, but not much responsibility, as I understand it. Even though the city's money is not on the hook, the state requires local support as part of their approval process.
Mr. Brown indicates that the CIQ (Cash In Question) here is around $20 million.
A big shout out to all my peeps reading this live feed, probably in posh, climate controlled, couch-filled abodes--the exact opposite of the conditions here.
The R-62 people are still making their case, which is probably a bit frivolous, because I don't expect many of the Aldermen to throw up any road blocks. In any case, it gives me some time to work on a proposal for an upcoming catering event that I have, for which the CIQ is only like 1000 bucks.
Alderman Hoyle asks if we will lose any public housing units in this process, probably a fair question for people who are concerned with such issues. Answer: of 144 units being redeveloped, 6 will change from public housing to home-ownership opportunities. Also, if the state $$ doesn't cover the project, the developer will have to cover the shortage, and not Annapolis taxpayers.
Alderman Israel calls the idea of a public-private partnership an "experimental approach", perhaps suggesting that he supports public housing funded entirely by the taxpayer. He says that he would not be inclined to support any arrangement like this for the duration of his tenure on the council. I must say that I am surprised at his position.
The council doesn't seem to understand that the city has no financial obligation here--they just need to approve the idea in principle so the developer can get state money. As you might have discerned by now, the ownership and management responsibility for public housing is very confusing which is probably why nobody can figure out a good way to address the problems.
Boat show public hearings!! See my boat show post to understand the bills in question (O-35 and O-36). I have no idea how I am going to describe what are these people have to say.
I don't think that counting the number of people in support of each bill would be a fair representation of how many people (if given all the information) would be in support of each applicant. I can predict that more people here are in support of Ed Hartman.
The mayor suggests that she would entertain other bidders for the boat show, inviting "anybody else who might have a contract like this should come to the hearing". (Note: that is not an exact quote).
So far, the Dowling/Barthold crew (O-36) have had their supporters up first. Dowling is telling his story, which has not been told publicly (other than on this blog) before, and if you are watching on TV, pay attention because you might learn why much of the VIP crowd back here is supporting the D/B bid.
The first Hartman supporter says that changing the shows might be troublesome because international participants might be spooked. "If it ain't broke...", etc. His implicit claim is that the show is not broken, a claim that would be argued by the other lease applicants.
(By the way, "H" stands for Hartman and "D/B" stands for Dowling and Barthold.)
Ed Hartman is speaking right now, and claims that D/B are avoiding personal responsibility by creating a corporation, which is not really a critique because this is a common practice of people starting a business. I have Limited Liability Companies, but rest assured that it's my ass on the line if those corporations go bust. H is arguing that, even though he has a corporation too, his has a history and a financial background. He is positioning for the argument that his company is more financially equipped to handle the shows than the investors that D/B have put together. He is taking a long time to do what I just said in that last sentence.
Right now H is giving a visual presentation, complete with a laser pointer. The presentation is basically a laundry list of all the expensive S that has to be purchased to run the boat show. Again, this is simply an attempt to somehow show that D/B cannot afford this equipment, unless he is going somewhere that I don't anticipate.
(By the way, "S" stands for what you think it stands for.)
H got to his point, that he brings $4.4 million to the show. Not quite a logical argument, but he just asked the people in the audience that support him to raise their hand, and like everyone raised their hands. As someone promised me earlier, H puts on a good show.
H just made the "business needs continuity" argument, an argument that I have made in some of my economic development posts.
(Note to amateur bloggers: see how I just took a seemingly unrelated issue and used it to support an argument that I believe in? That's good stuff.)
H just said that he proposed and extra year on his lease (until 2014) because "my employees are asking me if they are going to have a job in 5 years...they are looking for a career", failing to establish the link between their careers and the requisite implicit approval from the taxpayers.
I was also alerted that H has the support of the 'Good Old Boy Sailing Crew', of Arnie Gay, Bert Jabin, Knut Aarsand (don't quote me on that one), and others. So far, so true--Rod Jabin is here in support. The implication was that a sense of entitlement has developed amongst people who feel they have created the sailing business in this city, an implication that I am too young and too landlocked to indulge further.
The H people are continuing the accusation that D/B are a "limited liability shell", where as the H corporation is not because it has declared assets. They also are hitting on the argument that the shows are not broken.
Alderman Israel's 4 factors for determining who gets the lease:
2. financial backing
4. management plan
He just said (not in so many words), "What are we going to do when Mr. Hartman dies"? He used the item #4 on his list to address this issue. To his credit, the H guy is answering well, saying that there is a good team in place that knows what to do.
There is also a bit of a side argument, in that the H corporation does other things, like wine festivals and the like. One side of the argument implies that it favors H, as they gain expertise, but the opposition says it favors D/B, because they are not distracted.
Alderman Paone points out the D/B were part of the team that the H guy just mentioned. B is now speaking, and the room is respectfully devoting their entire attention to paying attention.
I confused the start time of this meeting and didn't realize my error until like 20 minutes before the meeting started, and tragically I was prevented from having dinner or even coffee in preparation for this feat of blogging endurance. I hope some of these boat show people leave soon, because it's getting hot in here, and for reasons named above, I am cranky.
The boat show hearing is over. We will take a recess. Predicted time for restart: 8:42.
Back in business. 2 minutes off with my prediction. Time for the city manager parade. There are like infinity bills pertaining to city manager, or purporting to pertain to city manager, so I'm just going to cite certain points, I think.
On second thought, I am not going to pay much attention to the people testifying. Instead, I will now launch into a soliloquy as to where we are at this point.
The city manager idea was considered and rejected in Annapolis some time ago. In the past couple of years, the idea is gaining steam again. The idea is that city managers can manage operations, and elected people can make policy decisions. Right now, the mayor of Annapolis can do everything.
Probably in part because of the disappointment with the current mayor, the idea is being pushed by notable factions, namely Wards 1 and 8. The politics behind the idea is intriguing. Most aldermen who want to stay aldermen support it, because it would give them more power and more evenly divide power. The current Mayor opposes the idea, for reasons unknown, but probably related to the belief that the Mayor is important and should have the power. The Aldermen that want to run for Mayor, ignoring the ethical problem of voting for their future self-interest, also oppose the idea because they want to have that power when they get elected! In fact, I have heard that Cordle doesn't want to run for Mayor if City Manager Legislation passes. Josh Cohen seems to have a similar feeling, without having formally declared he is running for mayor!
The jumble of city manager legislation is the result of efforts from any number of politicians to support their positions. One of the bills is closest to the real city manager form of government, and others simply 'put lipstick on pigs' by changing a few words and calling it a city manager. In my estimation, a real city manager is defined as one who is hired/fired by a majority vote of the council, and is the operational manager of city employees, with the instruction to carry out the policy of the council. Whichever bill ends up getting closest to that is the one that I will support.
Alderman Shropshire just complained that a city manager would prevent him from going to a department head and telling them to do something for his ward. I guess that's what city employees do, but that just sounded weird to me.
A demand is made that the city manager issue be put to referendum, alluding to the oddity that is the city's failure to have all Charter Amendments go to a referendum. The only referendum procedure is through voter signatures on a petition.
Alderman Cordle just spoke for what I estimate to be the first time tonight, and he gave a mini campaign speech. I guarantee you that before the end of the night, Alderman Sam will one-up him with an inspirational speech of his own. I look forward to it, as well as the Polish sausage dinner that Alderman Sam has been promising me for some time now.
Note to readers: people are still talking about city managers.
Note to readers: I am still hungry, so if you have any Polish Sausage, put it in a reusable container and I will pick it up on my way home.
Josh Cohen is speaking about the philosophy of city managers. You'll remember that he is against, and the other Aldermen are challenging him a bit because they are more expert than him at this point in term regarding the specific terms of the legislation. Plus you learn in city council 101 to never miss an opportunity to challenge your county councilman when he has to debate in your forum.
Don't fall asleep or do anything fun! Keep reading because the council is scheduled to vote on the homestead credit tonight, which means lowering property taxes, which means you getting more money, which is hopefully important to you.
The mayor must be more bored than the rest of us, because she just left. Now Alderman Arnett is sitting in the important chair. FYI, Alderman Paone left like 20 minutes ago.
Ok, I did some snooping around, and found out that Alderman Paone is still here. Also, early word on the Homestead Credit bills is that the 102% (2%) bill is going down, but that Alderman Arnett is the swing vote on the 105% (5%) bill.
Alderman Sam gave the inspirational speech I was waiting for. "I wasn't elected by the people of Ward 7 to vote only on the easy issues".
Cordle: just returned.
It's fair to say that most people here tonight support the "real" city manager idea that I described above. Nonetheless, people are still talking about it.
Alderman Sam addresses the people watching on TV! Yes!! Like clockwork.
The public hearing for a city manager ends.
There is a 6-3 vote to suspend the rules and consider f'ing legislation past 11:00.
Classie Hoyle just made the odd comment that there are like 6 potential mayors in the room, and that they should learn to ride in convertibles and wave because they are about to lose the power that the mayor has been privileged to have. That is weird.
The mayor just said you can reduce the homestead credit and reduce the tax rate if need be, but we have been the only jurisdiction to reduce the rate. It really doesn't matter. High popalorum or low popahirum.
O-31-08: 105% Homestead. POSTPONED. 5-4 vote to postpone (Israel, Paone, Cordle, Stankivic). The aldermen are actually really fighting about this and calling each other out. Alderman Paone, in particular, is on the warpath and called out the 5 people that voted to table this, calling them the same people responsible for the budget increases and higher taxes. "The present budget has more fat in it than a weight watchers convention", he said word for word.
O-32-08: City of Annapolis Exempt Service: PASSES. 6-3. (Paone, Cordle, Stankivic)
O-34-08: 102% Homestead: POSTPONED. (see above)
R-62-07: Support For Redevelopment of Public Housing: PASSES. 8-1. (Stankivic)
R-46-08: Reclassification of Transportation Positions: PASSES. 5-4. (Paone, Cordle, Stankivic, Arnett)
R-47-08: Stanton Center Recreation Manager: ?
R-48-08: Dance and Fitness Coordinator: ?.
R-49-08: Hispanic Community Liaison: ?.
R-50-08: Police External Affairs Officer: ?
R-58-08: Excepting Parking Fees At Park Place: ?.
R-59-08: Economic Affairs Advisory Commission: ?.
I had to leave because I couldn't take it anymore. I will try and call the city clerk to see if the rest of that stuff passed.
Monday, November 10, 2008
Otherwise, tune in to channel 38* on Fios or 99* on Comcast to see the excitement**.
(*Channel listings may not be accurate.)
(**It might not be exciting.)
First it was only banks that got special protection. Then investment banks.And today, we have evidence that the government has no intention of stopping. (You may have seen this link on Drudge but I'm giving it to you anyway.) Today it is being reported that in addition to the $700 billion that we already know about, the Fed has loaned some $2 trillion--that's $2,000,000,000,000--to troubled firms, and is refusing to disclose who is getting the money:
Then an insurance company. Now maybe the auto industry. The list will stop when
the government stops sending good money to chase after bad.
The Federal Reserve is refusing to identify the recipients of almost $2The news agency (Bloomberg) that published this story has filed a FOIA lawsuit to obtain the lending records, but it's appalling that the government requires a lawsuit to disclose spending $2 trillion. In lieu of working this week, I predict that I will be adrift in daydreams, pondering reforms to the Federal Reserve System, and wondering what might have been if I hadn't been tragically denied admission into the graduate economic program at the University of Maryland.
trillion of emergency loans from American taxpayers or the troubled assets the
central bank is accepting as collateral.
Fed Chairman Ben S. Bernanke and Treasury Secretary Henry Paulson said in
September they would comply with congressional demands for transparency in a
$700 billion bailout of the banking system. Two months later, as the Fed lends
far more than that in separate rescue programs that didn't require approval by
Congress, Americans have no idea where their money is going or what securities
the banks are pledging in return.
Total Fed lending topped $2 trillion for the first time last week and has
risen by 140 percent, or $1.172 trillion, in the seven weeks since Fed governors
relaxed the collateral standards on Sept. 14. The difference includes a $788
billion increase in loans to banks through the Fed and $474 billion in other
lending, mostly through the central bank's purchase of Fannie Mae and Freddie
Before Sept. 14, the Fed accepted mostly top-rated government and
asset-backed securities as collateral. After that date, the central bank widened
standards to accept other kinds of securities, some with lower ratings. The Fed
collects interest on all its loans.
Sunday, November 9, 2008
Saturday, November 8, 2008
Many firms on Wall Street and around the world ran up debt-to-equity ratios
larger than 30 to 1. That means they borrowed $30 for every $1 they actually
had. They didn't get to that point on the strength of mortgages to poor people.
They were playing a leverage casino far beyond the subprime market.
When Lehman Brothers collapsed, its ratio was 45 to 1. That is what is
causing Wall Street to collapse in less than a month, at our great expense. Our
government, including both political parties, have failed us by ignoring the
abuses and failing to exercise proper oversight of the financial industry. Let's
give credit where credit is due.
The stance of many, notably the Obama campaign, is that the blame for our financial crisis lies mainly in the failure of government regulators. I tend to believe that the regulators knew what was going on, but were powerless to do anything because their interests were in conflict with a more momentous political prerogative. Let's discuss!
Leverage is a great way to make money, and a great way to lose it really quick. It's important to understand that leverage is tied to the assets being leveraged (borrowed against). In this case, artificially easy credit and artificially high demand for homes eventually dried up, rendering the writer's leverage complaint valid.
For most people, their homes are their chief investment. Taking that a step further, securities that are tied to mortgages make up a huge pool of investments, and a huge pool of profit for the companies mentioned in the above letter. The government, via Fannie and Freddy, distorted the market for mortgage-backed securities, and essentially forced such risky behavior. Acting on the assumption that every family deserves to own a home--a notion that is much younger than some might think--Fannie and Freddy created demand for sub prime loans by buying them from mortgage lenders. Banks felt the need to participate, lest they lose ground to the competition. Bottom line: the fault does not lie with unregulated capitalism, it lies with the government's forced limitation of free-market principles.
Perhaps more alarming is the preferred method of bailing these companies out. In the late 1990's, a hedge fund named Long Term Capital Management was on the brink of bankruptcy. To put it in perspective, they were leveraged at least 30:1, and probably more--they were very secretive and nobody really knew where their money was or how much was at risk. A failure of LTCM was thought to have far-reaching effects, as many banks had significant stakes. After a bailout offer from Warren Buffet was rejected, the Fed was brought in. BUT, rather than bail the fund out themselves, the Fed merely acted as a mediator--orchestrating a $525 billion bailout from the fund's creditors, and not the taxpayers.
The contemporary method to bail out companies is direct investment or securitization from the government. Unlike the creditors or investors of a company, the government has significantly less expertise in monitoring the company, and significantly less incentive to recover its money (because the government doesn't have its own money, it has our money). And whereas investors only deal with their investments, the government has no clearly defined restraints. First it was only banks that got special protection. Then investment banks. Then an insurance company. Now maybe the auto industry. The list will stop when the government stops sending good money to chase after bad.
Monday, November 3, 2008
Let's compare. Here's the entirety of the bill:
A program is hereby established to encourage energy efficiency
improvements and or renewable energy production within the city.
City property owners who privately finance energy efficiency improvements
and or renewable energy production equipment, have the option to voluntarily
attach up to 100% of the privately finance amount to the subject's property tax
The Director of Finance is authorized, at the request of a City property
owner, to add up to 100% of the privately financed amount, amortized over a
specific number of years to the property's tax bill.
All policies governing management of the program shall be determined by the
Director of the Department of Neighborhoods and Environmental Programs in
collaboration with the Director of Finance. All fees collected under this
program shall be remitted to the financier along with remittance details.
At first glance, this seemed to say that people can voluntarily pay more taxes, a proposition that did not make sense to me, because I am rational. So, I asked Alderman Arnett (who is sponsoring the bill along with Shropshire and the Mayor) to explain this mystery.
Much to my disappointment, the program in fact does not call for people to voluntarily pay more taxes. Rather, any person borrowing money to invest in some green-related home improvements (bill is very vague on what qualifies) can employ the city as a middle man. Instead of taking and paying back a bank loan, the borrower can pay back the city with to-be-determined loan terms. The city will collect the money along with the property tax bill, and the city will pay the bank.
The bank involved in this arrangement is First Commerce. For them, it's a good deal as long as they are willing to make the loan in the first place--if so, they earn the interest and the city collects the money for them.
So, is it a good idea in general? Well, I would say it isn't horrible. I don't particularly like the idea of the city getting involved in such matters. If banks are willing to loan money to the private sector, let them deal with the logistics. On the other hand, the program just might work. The city has expertise in collecting taxes, and their ability to collect the money would probably not be any worse than a bank's. And as long as the city's loan terms (in the form of amortized property taxes) are more favorable than the bank's loan terms, the program benefits the citizen as well. Moreover, this bill came up for public hearing without opposition from other banks, which means that they are either unconcerned about a loss in business or unconvinced that the loans will be profitable--neither of which puts the city at risk.
I wouldn't mind if this program got a chance.
While not the perfect candidate to indulge all of my political views, McCain is much more likely to preserve individualism, economic freedom, and small government—the 3 of which I would describe as core political beliefs. I am not persuaded by the argument that McCain is too old, leaving an unqualified Palin as a likely successor. She is a Governor, which makes her roughly as qualified as any other Governor, and more qualified than Obama, who has never been an executive. I am also unpersuaded by Obama’s “hope” rhetoric, because he has not offered any policy that inspires me to be hopeful. Somebody told me that if Obama’s tax plans were combined with O’Malley’s taxes, that as a business owner I would be paying $.60 on the dollar in taxes, a claim that I did not attempt to verify for fear that it might be true.
U.S. Representative, District 3
Thomas Pinkston Harris.
I don’t know much about this one, so I’m using a combination of ‘party line’ and ‘anti-incumbent’ strategies. I’ve only seen Mr. Harris once, when he gave a speech at the state GOP annual dinner. He started his speech by saying “change”, then pausing for a minute while the crowd laughed at his mockery of political rhetoric. Good enough for my vote.
As an aside, I believe that there is value in party politics. Most people know what they believe, and why. Most people take the time to do some basic research on Presidential candidates, Gubernatorial candidates, and maybe some others. But beyond that, many people have neither the time nor the desire to become as politically educated as they need to be. I enjoy the political process, yet there are many things that I just don’t follow.
Enter political parties. All you have to do is take your beliefs and pick the party platform that is most reflective of your beliefs. Even if you don’t know much about a candidate, you can approximate that candidate’s compatibility with your beliefs by seeing his political party, and you can make a relatively non-ignorant choice about which candidate you really want. Now, I realize that this process is susceptible to many factors that taint its effectiveness, but it’s better than having every person campaign randomly and forcing the voter to choose without adequate information.
As another aside, discrimination is good. Discrimination is the process of using readily available information to discern facts that you do not have the resources to investigate. For example:
I believe in small government.
Republicans believe in small government.
Ray is running for office, but I know nothing about Ray except that he is a Republican.
I will vote for Ray because it is likely that he believes in small government.
Discrimination is not good when it is based on false information, which is called prejudice. For example:
I do not want to hire any dumb people.
Tall people are dumb.
I will only hire people under 5’ 5”.
The assumption that tall people are dumb is obviously invalid, which gives an incorrect result if someone were to use height as the proxy for intelligence. Throughout history, bad assumptions have been used as signals for other information, resulting in the negative connotation for “discrimination”. I came to this conclusion after reading some tidbits by Walter Williams, so if I’m not explaining it well, do a Google search for him and read more.
Enough with asides.
5th Circuit Court Judge:
Michael Wachs, because he is unopposed.
Board of Education At Large, Tricia Johnson, for continuance in office.
Yes, because I have no reason to vote ‘no’. Maybe that reason makes me a bad citizen, but it is my honest thought. I just have no idea.
Apply the above reasoning to:
-Deborah Eyler, Court of Special Appeals Judge
-Teresa Milio Birge, District 32 Board of Education
-Robert Zarnoch, Court of Special Appeals Judge
Question 1: Early Voting.
There are enough problems with the logistics of election day. Finding the election judges and implementing the safeguards to ensure fair elections and prevent fraud for a 10-day voting period would be nearly impossible. Moreover, the locations of the early voting polls would be determined at the discretion of the legislative leadership, leaving it vulnerable to political gerrymandering. There is ample opportunity to vote as it is now, and the marginal improvement to the ability of every citizen to vote is outweighed by the risk of fraud created by early voting.
Question 2: Slots.
-language does not belong in Constitution
-would be hard to change if citizens changed their minds in the future
-validates wasteful spending by state government
Question A: Charter Amendment, Failure of Bills.
This would effectively eliminate a ‘pocket veto’, and allow bills to become law without action from the County Executive after 10 days. I want to see action.
Question B: Charter Amendment, Nomination of Ethics Commission.
Currently the county exec. nominates all positions, which are then approved by the county council. One member of the current council wants more power in this process, and has pushed this charter amendment. Having half of the commission nominated by the county exec and the other half nominated by the council (as this CA would do) does not appeal to me.