A Citizen's Guide to Indiana

Niki Kelly, writing for the Fort Wayne Journal Gazette, has an article on how wine leads growth in Indiana alcohol sales. Beer is still the overall leader, selling 124 million gallons to wine’s 10 million gallons, but wine has been growing at a bigger clip. (That’s even if you consider the fact that you’re likely not going to consume the same volume of wine in a sitting as beer.)

Some of the comments in the article track my experience as well. I have always been more of a beer drinker and will probably remain that way for the foreseeable future. But, in general, my interest in wine has increased. (It probably doesn’t hurt that my sister-in-law is a huge wine fan.) The availability is up and prices are not intimidating. I was pretty amazed at the selection in our local CVS the other day. And you can buy a decent tasting, non-headache-inducing bottle for $7-$8.

The article talks about the increase in alcohol sales even in the face of the recession. But, my recollection is that alcohol sales are historically recession-proof anyway. I was going to suggest that maybe as a society we are developing a more relaxed attitude toward alcohol. But, I don’t think that’s the case. Old timers in the legal profession recount times in their youth when the old timers in their day would fairly routinely drink a fair amount at lunch and whatnot. The crusade against drinking and driving has increased awareness of the dangers of drinking irresponsibly. So I’m not sure how you would explain the overall increase in alcohol purchases. Maybe it’s just that the available stuff has gotten so much better: more wines available, more craft beers available. It’s not just Budweiser and Paul Masson (no relation) wines. Maybe we’re drinking a little differently – not just swilling a lot of crappy alcohol to get drunk, but also drinking good stuff because it tastes good. (Or maybe I’m just projecting the change in my own drinking habits from my early 20s versus my late 30s.)

September 11, 2001 is slowly fading from current event into history. The wound of the moment seems to be scabbing over. Our reaction to the injury, unfortunately, seems to have become more of a chronic condition.

I, like most others who lived through it, remember that day fairly well. I remember being in the office when one of the staff members came in talking about it. So, we were all paying attention when the second one hit. Not much work got done that day. I recall refreshing various news sites on my web browser frequently. Personally, I got a lot of my information via the people on a bulletin board system called The Well. I also recall getting some insight into which cable channels were owned by the same company – since everyone was playing news feeds. Before that, for example, I’m not sure I had appreciated that MTV was aligned with CBS through Viacom. In retrospect, a lot of my 9/11 experience was through the media. And on that day, I think the major media did us a service. A lot of people were credits to their professions and humanity generally that day.

It was the reaction that mostly got us in trouble. I think we were all in something of an altered mental state following the attacks to one degree or another. I’m not a weepy sort of fellow, in general, but I remember crying a little bit on the drive home from work. The enormity of the day got to me, I guess. After awhile, though, I think the pressure to continue covering the story made the media a little stupid. And the pressure to “do something” made our politicians a little stupid. The terrorists had very little power over us that we weren’t willing to give them. Knocking down a few planes and killing, sad as it was, a relative handful of people was at the far reaches of their power to directly affect us. The rest was power we gave them through our reaction.

They were able to scare us and make us angry and afraid. Staying angry and afraid was something we chose to do. Saddling ourselves with war debt and casualties in Iraq and Afghanistan were also choices. Things like Gitmo and the PATRIOT act were self-inflicted. Unlike, say, Germany or Japan in the 30s and 40s, al Qaeda lacked anything like the resources to impose its will directly on a significant portion of the population of any industrialized country, let alone ours. Rather, it had to do a bit of geopolitical judo, using our energy against ourselves. And they certainly got into our heads. For awhile it was wall-to-wall 9/11 this and 9/11 that. Politicians reflexively supported anything that could be framed as anti-terrorist and cowered away from anything that could be framed as pro-terrorist. Civil liberties took a back seat. War spending got a blank check.

We just ended one phase of our involvement in Iraq, but I’m sure our people (keeping with the conventional tradition of ignoring the effect on the Iraqis themselves) will keep dying there and, while our schools wheeze along and our infrastructure decays, we will continue spending gobs of money on Iraq-inflicted debt. We’re still going on in Afghanistan, with the goal being somewhat opaque, as far as I can tell. I supported the U.S. going into Afghanistan, but in retrospect even if it was better justified than Iraq, I’m not sure how useful the whole enterprise was.

Comparing the country today to the country ten years ago in 2000, pre-9/11/01, I don’t think the state of the nation has improved any. So, we’ve either stagnated or taken a step back. I can’t say that was all the work of the terrorists; we’re dealing with a lot of problems with roots that extend back a long way – e.g. the loss of manufacturing as the world catches up to the head start we got in the wake of World War II; our decisions during the 80s and 90s to engage in some profit taking of the wealth built up in the country during the 50s-70s. But our response to 9/11 acted as a force multiplier for those underlying problems. Now it feels like we’re in a hole, and it’s not clear whether we are digging out or digging deeper. Certainly I’ll be interested to see what things look like in another ten years.

Some cheery thoughts on this rainy Saturday morning; quite a contrast from the perfect weather the morning of 9/11/01 that was horribly interrupted by the planes striking.

In the State Treasurer’s race, challenger Pete Buttigieg hammered incumbent Richard Mourdock on the waste associated with a risky investment of state money in the, at the time, foundering Chrysler corporation compounded by spending gobs of money on a wasteful lawsuit. The loss to Indiana from its payout in the Chrysler Bankruptcy was about $6 million. It invested about $18 million and got about $12 million back.

Buttigieg points out that the State used pension and Toll Road Privatization money to pick up Chrysler debt at $0.43 on the dollar, a clear sign that an investment is carrying a certain amount of risk. I have outlined in the past why Mourdock was tilting at windmills when he challenged the Chrysler bankruptcy decision – among other things, there simply wasn’t a better deal available for creditors than that received through the bankruptcy court; and, even if there was, Indiana did not get to make that decision because it had agreed to turn over decision making on such deals to a committee of creditors in which Indiana was a very minor stakeholder.

Now, Buttigieg has uncovered information about just how much good money was sent after bad to pay for the lawyers necessary to tilt at this particular windmill. The State spent $2 million trying to recover its lost $6 million with marginal legal arguments:

Buttigieg, a South Bend businessman, said the billing records raise serious questions about Mourdock’s management of state funds. He questioned why Mourdock could not have used an Indiana law firm, and noted that the New York attorneys billed the state from $365 to $1,050 per hour, with paralegals and legal assistants billing between $205 and $295 per hour.

And, he said, the costs of the pricey lawsuit was born by the funds that had lost money because of the poor investments. The Major Moves Construction Fund paid more than $427,000; the Teachers Retirement Fund paid more than $1.5 million and the Indiana State Police Pension Fund paid more than $64,000.

I really can’t say I know anything about Mr. Mourdock. I’ve heard that he is a very pleasant individual. But this Chrysler business is a debacle. To me, it looks like a questionable but not outlandish decision to invest funds in the shaky Chrysler because of the discounted price of the debt that has been aggravated by an effort to grandstand, on the public’s dime, against the Obama administration and its involvement in the Chrysler bankruptcy. Had the Bush administration been involved in the Chrysler bankruptcy, my suspicion is that the State would have borne its losses quietly and not increased them by 33% to pay out-of-state lawyers wads of money to advance long shot legal arguments.

I’m not really in favor of most gun control laws. And I think the 2nd Amendment is not there for hunters and target practice, but with the (perhaps quaint) idea that an armed populace can resist a tyrannical government. But, if nothing else, stories like this make me careful about where I let my kids go to play:

Crawfordsville police Detective David Long tells WRTV of Indianapolis that witnesses reported 27-year-old Steven Bixler was acting carelessly with a gun in a bedroom where four children were playing when it went off, striking the 10-year-old in the torso.

I wonder how the number of burglars fended off or criminals deterred by gun owners compares to the number of kids and other innocent bystanders who are killed or injured by improper use of firearms.

It’s Labor Day which I will celebrate by not working. I think it’s the disparity of wealth in this country that’s killing us at the moment. You can be poor but happy, but that’s tougher when there is a wealth class appropriating a significantly disproportionate part of the value of the nation’s production. I’m not an economist and won’t pretend to be one, but I don’t think it’s “envy” (a major bugaboo in these conversations) that makes such happiness tougher. I think perhaps it erodes the sense that if you work hard and play by the rules, you’ll get a fair shake. I know I look around and see that folks made piles of money moving around paper associated with real estate and walked away from the bust without losing their shirts. It’s hard to escape the notion that working is for chumps.

From my simple high school economics education, I have come to the conclusion that risk, innovation, and labor are the things that our economy should be rewarding. If you aren’t adding value through one of those things, you probably shouldn’t have any money. That probably doesn’t help us find the leak in our economy though; find places where value is being diverted inefficiently. Anyone can probably point to some level of risk, innovation, and/or labor they put forth in almost any given business undertaking. The question becomes whether those levels are being compensated adequately. My sense is that minor levels of risk are being over-compensated and major levels of labor are being under-compensated. Innovation is a crapshoot.

I am willing to be convinced that my notions of how labor should be compensated are skewed. I have come to the conclusion that some of our social conventions are skewed by a tendency to view the post-war 50s as a yardstick instead of an aberration. It occurs to me that I have to consider the possibility that the same is true of economics. The postwar boom where unions were strong and workers were well compensated for manufacturing had a lot to do with the fact that the rest of the world was a smoking ruin while our factories were up and running. The rise of production elsewhere means that an equilibrium is settling in among the workers of the world. (Idle thought: I wonder if this means equilibrium will settle in among the world’s capital?)

But, at the same time the equilibrium has been settling in among the working classes, our national tax structure has shifted in a way that is decidedly beneficial to the very wealthy. Over the past 30 years, productivity has been increasing; wages have been largely stagnant; and taxes on the wealthy have decreased sharply. The rich have gotten a lot richer over this time period. It’s hard for me to escape the conclusion that our economy has a bit of a leak where the very rich are concerned. I think they could be convinced to put forth similar levels of risk, innovation, and labor for less compensation. The excess is probably an inefficiency in our economy.

I’ve noticed an interesting thing when it comes to discussions about compensation of ordinary workers versus compensation of the wealth class. The focus seems to be more often on the proper workings of an efficient economy when it’s worker compensation being discussed. When it’s the compensation of the very wealthy, it seems like individual rights are more likely to come up . . . along the lines of: “Who cares if we could structure the economy to extract the same value from these individuals for less; it would be morally wrong to do so.”

Anyway, here’s hoping for a pleasant labor day for all. And, the best pro-labor song I know, from the Dropkick Murphys:

Amanda Iacone, writing for the Fort Wayne Journal Gazette, has an article (featuring Everybody’s Favorite Economist(tm), Larry Deboer) on the anticipated expiration of state funded homestead credits. This will cause pretty much everyone’s property taxes to go up unless they are already up against the tax cap.

The homestead credits, if memory serves, were funded by selling slot machine licenses to the horse tracks, (and got us through the 2008 elections with lower property taxes.) According to the Journal Gazette article, rural property owners benefited most from the homestead credits (as compared with tax caps) because those areas typically do not pay as many taxes as more urban areas – and therefore don’t hit the caps.

Frank Rich has a column inspired by the New Yorker article by Jane Mayer on the Koch Brothers who bankroll such things as the “grass root” Tea Party movement.

It remains to be seen whether Mayer will be the Koch Brothers’ version of Ida Tarbell whose expose of Standard Oil mobilized public sentiment against it and John D. Rockefeller. But, Rich points out that the Kochs & the Tea Party is nothing new in American history.

All three tycoons are the latest incarnation of what the historian Kim Phillips-Fein labeled “Invisible Hands” in her prescient 2009 book of that title: those corporate players who have financed the far right ever since the du Pont brothers spawned the American Liberty League in 1934 to bring down F.D.R. You can draw a straight line from the Liberty League’s crusade against the New Deal “socialism” of Social Security, the Securities and Exchange Commission and child labor laws to the John Birch Society-Barry Goldwater assault on J.F.K. and Medicare to the Koch-Murdoch-backed juggernaut against our “socialist” president.

Here’s to hoping the immune system of our body politic is up to fighting off this kind of thing again.

Eric Bradner, a really top-notch reporter for the Evansville Courier Press, has an article looking at Unigov in Marion County which is relevant for the Evansville area in that they appear to be considering the concept.

The upshot is that the Democrats lost a mayoral election to Dick Lugar in 1967, lost big at the state level in 1968, and found themselves legislated out of power in Marion County for the next 30 years. African-Americans were the big losers in this deal. They went from being about 50% of the majority party in the city to being a minority of a minority party in the city-county government. From the article, it seems that the big “tell” that this was more of a power grab and not so much directed at more efficient government is that the schools were left out of the consolidation. The wealthier suburbanites were willing to share city-county resources to some extent if they got to call the shots, but they weren’t going to send their kids to a unified school system.

The article did note that Indianapolis has fared better than places like Cleveland and Detroit where consolidation with the suburbs did not happen and black politicians maintained control. Their control of the city often reflected the fact of white flight to the suburbs and the resulting lack of resources for use in addressing their cities’ problems.

I’m a reasonably affluent white-guy so I probably don’t have the basis to comment a whole lot about this, but reading the article I found myself thinking we’ll all be in a lot better place if/when we reach a place where race isn’t a primary determinant of one’s political affiliation. Note: this is not by default a critique of how blacks choose to cast their votes. Whether one considers race or socioeconomic factors, Republicans, by and large, have not given blacks much of a reason to vote for them. And, with the latest round of nativist hysteria, “conservatives” (loosely defined) seem determined to alienate other racial groups as well.

Curt Slyder has an article in the Lafayette Journal & Courier about a workshop to discuss the social and economic future of Warren and Fountain Counties. I was struck in particular by the fact that Warren County has a population of about 8,600 people. That seems like way too few to support an entire county infrastructure, including a judge, prosecutor, sheriff, county council, recorder, auditor, clerk, assessor, and county commissioners (just off the top of my head). Adjacent Fountain County apparently has 17,030. I wonder how feasible a merger of counties would be. (Probably not very, politically, anyway.)

Education and Internet access were cited as areas for improvement. Anecdotally, I’ll just mention that I have heard Warren County is regarded as anti-creditor, at least in the collections community. Not really the reputation you want if you are trying to induce people to do business in the community.