Thursday, December 31, 2009

Wearily Looking Back

This is one of those years that you would like to simply pass quietly into the night. Much like a book that was completely disappointing in its story line and then surpassed by a lousy ending. That's not a book you keep on your shelf. You throw it in the collection bin at the library and let it pass from your memory as soon as possible. This past year was in that category.

Before I join the many Americans putting together prognostications for the future it is time to grade last year's completely random and inept guesses as to what might have transpired in 2009. Here for the record is the list.

1. The stock market did start to turn around after the third quarter and earnings were disastrous. I had predicted a finish over 11,000 however came up about 500 points short.

2. The pirate problem became even greater and of course the U.S. deployed more warships than anybody else in trying to deal with the problem. Score one for us as a couple of pirates bit the dust when they foolishly exposed their heads to three Navy Seals who promptly delivered three shots and three dead pirates.

3. Castro did not pass away. This guy has more resiliency than a plastic six pack holder floating in the ocean.

4. The news coverage of the presidency did get better. Obama had a longer than usual honeymoon and still is using the prior administration as an excuse for what is still going wrong.

5. Ahdmadinejad did win re-election or did he? The streets in Tehran are in chaos at the moment. The opposition has grown more bold and is actually reported to be mocking the supreme leader. Tehran has responded with threats to crush the opposition without mercy. How do you think that will work out in the long run?

6. There was increased social unrest in China according to the Chinese Academy of Social Sciences. Six different outbreaks occurred including one with over 200 deaths.

7. It was a bad year year for Boston fans as the Celtics did not repeat as the hated Lakers took the crown. Even worse was the Evil Empire finally spending it's way to a World Series Championship.

8. Caroline Kennedy did not get the New York senatorial appointment replacing Hillary Clinton. After hearing her interviews it came as no surprise.

9. The state budget deficit did soar to nearly two billion and taxes were raised but the big surprise was not that local aid was cut but state employees actually increased! If I was Governor Patrick I would better be prepared to defend that bit of nonsense

10. The Boston Globe was not sold for a very small price. Some would argue that the New York Times would actually have to pay someone to take it off their hands. The ever supportive of organized labor Times managed to use on the Globe employees some of the worst union busting tactics seen here in a very long time. Of course, the Globe editorial board was silent on that topic.

11. Lastly of course was my most accurate prediction. I didn't lose ten pounds.

So what is in store for 2010?

The Red Sox, Celtics and Patriots will all win championships. You know I am an insufferable Boston homer so what did you expect?

Samuel Huntington was prescient in Clash of Civilization, as he predicted where ever Islam intersects with other cultures there will be conflict. This trend is going to continue and will likely break into open hostility in a number of places. Two possible combatants are India and Pakistan. Another repeat of the Mumbai bombings and India most certainly will retaliate.

Somalia will definitely be a target if there is continued attacks on shipping. At some point the world will tire of paying ransom and actually do something. Yemen may also be a target if Al Qaeda continues to grow in influence there.

There will be more incidents in the U.S. such as Fort Hood and the Northwest Airline flight 253. Perhaps water boarding will make a comeback in 2010?

This may not be the year but the time is getting close to some sort of action on Iran's nuclear program. There may not be a full out aerial assault by the Israelis but perhaps a mysterious explosion will damage the Iranian centrifuges.

President Obama's strategy of reaching out to the various regimes such as Iran, North Korea, Syria, Venezuela and Cuba has been unsuccessful so far and will fail miserably in 2010. If he lets John Kerry visit Iran we will know for sure the man is in well over his head.

Cap and trade and other carbon trading schemes are dead in the United States. Our own Massachusetts duo of Rep. Ed Markey in the house and John Kerry in the senate are co sponsors of climate change legislation with Rep. Henry Waxman and Sen. Barbara Boxer. You can bet their colleagues can read the poll numbers that most Americans simply do not believe the climate alarmism any more.

The damage that has been done to the Intergovernmental Panel on Climate Change by the East Anglia whistle blower is irreversible. Rajendra Pauchuri has been the chairman of the IPCC since 2002 and this will be his last year as he is likely to be a victim of his own investments in climate politics.

Deval Patrick may win re-election but it will be by a fraction of a whisker and only because Tim Cahill as an independent and Charles Baker as the republican will evenly divide the opposition so that Deval's 34% approval will win.

Martha Coakley will win the senate seat and provide a completely uninspiring performance as senator eclipsed only by her completely uninspiring effort as attorney general.

The democrats will suffer a significant defeat in the mid terms. Not enough to reverse the majorities but still enough to still the idea of any more radical swing to the left.

Government takeover of health care may come about by legislation but it is certainly no shoe in to be fully implemented at this point. There is enough public opposition so there may be a significant revolt amongst the states.This may result in many mandates in the plan landing in the U.S. supreme court. Health care legislation should really be called the lawyer full employment act, primarily because there is no tort reform and now there will be so many more cases to pursue.

Tiger Woods will lose a hundred million in a divorce, He will be back on the golf tour simply because the big business of golf is in dire straits without him. The drop off in public interest without Woods at a tournament is enormous.

President Obama will play more golf and attend more fundraisers in one year than Bush did in four. Quite frankly I hope for all our sakes it is a quiet year and that the president has plenty of time for golf and more importantly that the Secret Service is more diligent in preventing party crashers ( or others) from getting near our leader.

Sarah Palin will continue to be the target of that nasty spinster, Maureen Dowd. You have to love the way Palin makes the likes of Keith Olberman, Rachel Maddow, Ed Schultz and Chris Matthews on the Left go crazy. They ask the themselves how could the American people possibly like her more than them!

Interest rates will not start to move up until late in the second quarter. The Fed Funds rate will finish the year under two perccent. Unemployment will continue to be a challenge to the president and will not get below 8%. Inflation will remain relatively low however the ten (to 4.10%) and thirty (to 5.20%) year treasuries will jump in yield. After all, how much more debt can congress get us into and how much more U.S. paper will the Chinese buy?

It is a new year and a new decade but the challenges facing us on a local, state and national level have not changed. So to do the every day challenges of life in general remain the same. So damn the torpedoes, open the champagne and warm the butter for the lobster. Happy New Year all you wonderful American knuckleheads!



Friday, December 25, 2009

The Relationship is on the Rocks.

We were introduced by an IBM salesmen in 1985. You were new and relatively inexpensive. You had software that was now available to the average business. Accounts payable and recievable and inventory management were all at the flip of a switch. Your dot matrix printer would spit out reports that would normally take hours. Your ten megabytes of hard drive was more than I would need for ten years the salesmen said.

After a couple of months of dual entries you became a member of the family. Inventory cards, paper spreadsheets and manual entries became a thing of the past. After a while having one of you wasn't enough, there had to be one on every desk and then one at home as well.

Then came the net and computer games and you further ingratiated yourself at every level of my life. The world was at my finger tips. No waiting for the paper or network news. No getting information from a few completely biased outlets. Now the information age was truly available to me and I have you to thank.

At first it was easy to overlook your faults. Hard drive crashes, freezing and lockups, and lost data were all bearable because you were so new and exciting. These things were understandable because you were offering so much, how could you be expected to be perfect? The solutions were simple, higher amounts of ram and storage, operating system upgrades and new and faster microprocessors all solved the problems.

Lately the bloom has come off the rose. You are tempermental and fickle. You have had relationships with hackers, malware, adware, popups and viruses. You can longer be relied upon to perform at a high level in the relationship. You keep falling back on your bad habits. Visits to the PC doctor several times have not changed your attitude.

This is it, your last chance. One more incident, just one and I will be leaving you forever. Apple is waiting for me with open arms. Go ahead PC, make my day!

Saturday, December 19, 2009

Hero of East Anglia

Science is not a cult, movement, political party or belief system. By one definition it is "A branch of knowledge or study dealing with a body of facts or truths systematically arranged and showing the operation of general laws."

Now that the Copenhagen meetings have ended in abject failure, it is important to give credit where credit is due. More than any one person, the University of East Anglia whistle blower should go down in history as an American folk hero.

It is more than the fact that this person saved American tax payers from becoming obligated to a deal that would involve an enormous taxing scheme and transfer of American wealth. The more important aspect is that perhaps now a much more critical level of public attention will be brought to bear on the current environmental orthodoxy of the sky is falling alarmism regarding climate change.

It is clear from the information released in the emails and computer files that the leaders in this field were involved in a systematic effort to shape the facts of their science to match the conclusions of their thinking. No amount of skepticism from outside of this little cabal was going to change the "facts" as they arranged them.

It is also clear that the bulk of the raw data that was used n the Climate Research Unit and subsequently the basis for the IPCC Intergovernmental Panel on Climate Change was either lost or compromised severely through "alterations."

As the fraud became more public, the fraud deniers sprang into action. Al Gore was quoted as saying the following, "To paraphrase Shakespeare, it is sound and fury signifying nothing. I haven't read all the emails but the most recent one is more than 10 years old." Unfortunately for Al, the most recent ones were two months old.

Al further damaged his dwindling credibility when during a Copenhagen presentation he stated, "These figures are fresh," Mr Gore said, pointing to the slide. "This is the volume metric measure of the ice and some of the models suggest to Dr Maslowski that there is a 75 per cent chance that the entire north polar ice cap, during the summer months, could be completely ice-free within five to seven years. This was simply a lie as shortly there after Dr. Maslowski repudiated Gore by saying he mentioned only such a possibility in a conversation with Gore over three years ago.

The Cap and Trade legislation that was the United States law makers reaction to the Global Warming hysteria is likely now dead. However, the EPA's recent announcement that it's unilateral decision to regulate carbon dioxide as a dangerous emission (your breath is dangerous?) is still very much alive. The decision was rendered shortly before the Copenhagen conference and in many quarters was viewed quite suspiciously as a political effort to force the senate's hand on CO2 emissions.

Any effort by the EPA to enforce regulations based on the findings of the existing data will ultimately end up in very long and expensive court battles.

Climate change is happening as it always has during the 4.5 billions years since the birth of the earth. What is not settled science is whether or not it will get hotter or cooler over the next few hundred years. What also is very far from settled is whether or not the United States has any responsibility in Mother Natures over all climate plan. Before the U.S. government commits to any transfer of wealth from the American taxpayers by a non elected U.N committee, a lot more objectivity and skepticism should be brought to the subject.

As for the Massachusetts congressional delegation, they should be acting a lot less as citizens of the world and denizens of Washington and a lot more like citizens of Massachusetts and in the interests of our residents.


Tuesday, December 15, 2009

Pundit Induced Dust Up

The latest pundit induced dust up in the Boston area surrounds last Sunday's game involving the Carolina Panthers and our own New England Patriots. The subject of course is Randy Moss and whether or not he"quit" on the team.

Apparently it had been a relatively quiet early week in Boston sports. Tiger seemed to be running out of mistresses and the Sox hadn't made news with the Lackey and Cameron acquisitions yet. So some sensationalism needed to be produced and so the Sunday Moss performance became the crisis du jour.

Did Moss have a lousy game? Yes he did. He caught one ball for a 16 yard gain which he promptly fumbled. In another effort it appeared that he cut a route short on a ball that was intercepted. However, despite his lack of production it was also obvious that as usual for most of the game Moss had double coverage. In addition unless my eyes deceived me he was quite active blocking in the run game.

Did he quit on the team? No, he didn't and if you examine his tenure here in New England it is apparent that he has been more than we ever hoped for when Belechick picked him up off the Oakland scrap heap for a fourth round draft choice.

This isn't the first time that Moss has been accused of being a dog but one need only look at his career stats and wonder if it is his peers or simply self important so called experts in the viewership that make these claims.

You can view his entire body of work here: http://www.nfl.com/players/randymoss/profile?id=MOS699912 But let me make a few observations. In his first year as a Patriot he was a large part of a team that went 16 and 0 in the regular season. In that season he caught 98 balls for 1498 yards and 23 touchdowns.

They then marched through the playoffs and was a miracle catch by David Tyree and a botched interception by Asante Samuel from winning a Super Bowl. In that game, the biggest of his life, he caught the go ahead touchdown with 2:45 left to go in the game.

In his second year in the very first quarter of the first game the Patriots lose the best quarterback in the NFL as Brady goes down with a knee injury and is out for the season. Matt Cassell, a guy who had not started a single football game since high school becomes the Patriot starter. Did Moss quit? No, in fact for the ninth time in his career he went for over a thousand yards. Moss was a big reason why that team went 11 and 5 and Cassell went on to score a huge contract. Thank you very much Randy!

This year Moss has already exceeded last years production after 13 games. This from a guy who is in his 12th season which is about 6 seasons beyond the life of the average NFL wide receiver. He certainly has to be in his twilight years and is bound to have a game or two where he is simply human. There is also the distinct possibility that he is injured like most people who are in the 17th game of the NFL season (13 regular and four pre-season) along with countless practices.

But make no mistake about it, Moss is durable and he shows up game after game. Out of a total of 189 possible regular season games over his career, Moss has only missed 6. During that career he has caught 912 balls for 14,275 yards and 144 total touchdowns which is second all time. Out of all that production in catches, yards and touchdowns and an untold number of hits from angry opponents, Moss has fumbled a total of 12 times.

Moss may have bad taste in clothes or hairdo's and he may not be as cooperative as the Punditocracy might like. He may even sulk a little when things don't go his way. His team mates have no question about his work ethic and Belechik has never entertained the idea of sitting him down.

Moss is one of the best 2 or three wide receivers that have ever put on shoulder pads. He certainly is no quitter. My guess is he bounces back and we get to enjoy watching this gifted athlete play out the rest of his career. Oh, and we did win the game.




Sunday, December 13, 2009

A Norwegian Surprise

It is hard to imagine what the Norwegian Nobel committee were thinking when they awarded President Obama the Nobel Peace Prize. After all, he had only been in office 11 days when he was nominated. Norway is not a very significant player on the world stage so perhaps the committee thought that somehow they would be affecting future world events by such a dubious choice.

If they thought they were choosing an award winner that would somehow repudiate American actions on the world stage in recent history then they got a very big surprise from our president. So to did American conservatives and dyed in the wool nationalists who believe in American exceptionalism.

The opening remarks were for the Nobel Committee when President Obama stated the obvious, "And yet I would be remiss if I did not acknowledge the considerable controversy that your generous decision has generated. In part because I am at the beginning, and not the end, of my labors on the world stage." Compared to some of the giants of history who have received this prize- Scwheitzer and King, Marshall and Mandela- my accomplishments are slight."

In diplomatic parlance, this is the equivalent of asking what the Hell were you dummies thinking?

The rest of the speech essentially was a no nonsense embrace of American foreign policy since our arrival as a major power on the global scene. The president simply laid out the obvious, when referencing the non violence of King and Ghandi he said,

"But as a head of state sworn to protect and defend my nation, I cannot be guided by their examples alone. I face the world as it is, and cannot stand idle in the face of threats to the American people. For make no mistake: Evil does exist in the world. A nonviolent movement could not have halted Hitlers armies. Negotiations cannot convince al-Qaidas leaders to lay down their arms. To say that force is sometimes necessary is not a call to cynicism — it is a recognition of history, the imperfections of man and the limits of reason."

What Obama made clear is that when the smoke and rhetoric of elections clears it is the interest and the values of the nation that come first. By fully embracing the policies of the president's who have come before him (yes Geo Bush) he has made clear that we are not likely to abdicate our responsibilities on the world's stage. Nice job Mr. President.

Attached is the complete text.


Tuesday, December 01, 2009

12 Days and Counting

I am no climate change denier or skeptic. After all the climate changes on a daily basis in New England. When you think the sun will shine it rains, when you think it will snow it's warm and when the alarmists tell you the worst hurricanes seasons are coming they usually don't.

Global history is full of climate changes. Ice ages, volcanoes, meteor hits and primordial soups have all been part of the mix. So the climate is going to change and frequently. What I wasn't convinced of is that science has advanced far enough yet that specific global climate change can be predicted with any truly accurate results.

What I do believe in however is the scientific method. You know, where you ask a question, do research, construct a hypothesis, test your hypothesis by doing experiments, draw a conclusion and then tell all the skeptics in the world about your results and challenge them to prove you wrong.

I was starting to be convinced that indeed science was on to something with this global warming issue. After all, Al Gore won a Nobel Peace Prize and an Oscar touting the science behind global warming. Lots of actors, writers, politicians and even royalty were sure of it. Captains of industry were beginning to put substantial money into being green. The United Nations was building a whole bureaucracy around the threat to humanity.You knew it was gaining momentum as congress was considering a monumental taxing scheme to combat the imminent danger. The up coming meetings in Copenhagen were going to be a resounding victory for the renowned climatologists.

All of that momentum however came to a grinding halt on or around the 20th of November when some party pooper poked a finger in the eye of climate change science. By releasing the East Anglia emails the curtain was drawn and what we see behind the curtain is nothing but a bunch of technical politicians who have no interest in the scientific method. They only want their point of view to be the consensus and to Hell with anybody who thinks otherwise.

It is not the fact the director of the Climate Research Unit, Phil Jones has now admitted that the original data on which his conclusions were built has been lost, or that he systematically refused legal freedom of information requests, or that he attempted to exclude papers skeptical of his work or that he deleted emails pertaining to data that disagreed with his findings that is most irksome. It is that the information in the Harry.read.me files tells the tale of computer programs that he knew simply were not producing accurate or even consistent data. For a hypothesis that exists almost solely on the basis of computer modeling doesn't the old adage garbage in garbage out count for anything? Any eighth grader with a computer at home knows this.

Not only are poor scientific practices on display in this drama, so to is journalistic malfeasance.

This whole ( building) storm began rather innocuously. Apparently, a whistle blower at East Anglia thought this information important enough to leak to the BBC. Paul Hudson of the BBC had done a semi negative piece on global warming asking where was temperature decline? http://news.bbc.co.uk/2/hi/science/nature/8299079.stm This must have been enough for the whistle blower to think Hudson might be an ally and think the information contained in the emails to be newsworthy. Hudson now admits that he received them five weeks ago and sat on the information. No reasons explained yet as to why.

Getting no response this intrepid guy or gal decided to go all out by releasing the emails in a variety of places on the web. Traditional media had no interest in them but the blogosphere has gone wild. The climate change establishment had held out hoping for it to blow over by pointing out such things as the emails were stolen! The comments were simply collegial conversation taken out of context! After all don't you and all your friends regularly delete emails that are the subject of Freedom of Information requests? All of this obfuscation was dutifully carried by the main stream water boys in the U.S. big media.

Our own Boston Globe is now a full 12 days and counting without so much as a whisper of the controversy. Well all of that is going to change very quickly. This scandal can longer be contained. Tonight it has been announced that Phil Jones has temporarily been relieved of duty. Michael Mann of Penn State and Kevin Trenberth of the National Center for Atmospheric Research may not be far behind.

The geo political ramifications are being felt as far away as Australia as Prime Minister Kevin Rudd's consensus is rapidly falling apart with open rebellion in the oppositions ranks. The U.S. Senate may conduct investigations and even the New York Times ran a critical piece on the subject.
The whole issue of climate change is finally going to get the non peer review it so desperately needs.

Tuesday, November 24, 2009

Staying on Message

You have to hand it to the Globe. Despite the fact that the blogosphere is alive with recent revelations contained in the hacked emails from the Climate Research Unit at the University of East Anglia, the Globe is sticking to its guns that global warming is settled science.

Rather than run a story and some analysis of the information contained in the emails and what impact that information might have on the global warming debate, the Globe chooses to stay on message tonight and run a front page piece on Boston.com trumpeting the future inundation of the City of Boston by rising sea level as a result of you guessed it, global warming!

The report produced by the "World Wildlife Fund and insurer Allianz warns that sea levels could rise along the U.S. coast a whopping 26 inches by 2050 as the world warms. That would place assets worth 7.4 trillion dollars at risk along the U.S. coast."

Rather than speculate on events 40 years from now how about taking look at events unfolding right under their noses? If the reports of the contents of these emails are true, global warming skeptics will have a field day in mocking the essence of the global warming model.

Don't get to excited about your property in Burlington soon becoming ocean front.

According to reports of the content of some of these emails, it seems as though some of the data being used by the IPCC (International Panel of Climate Change) may have been falsified or manipulated in order to achieve the result that the scientists needed to advance their AGW (anthropogenic global warming) theory. If that is the case then the entire IPCC gloomy global warming forecast would now be under a cloud of suspicion.

If one statistic or measurement were called into question it might not be a problem but it appears as though there is a constant theme running through these emails and communications that exposes the scientists as politicians trying to make a case for legislation (and perhaps green business) rather than unbiased members of the scientific academy prepared to have their theories suffer through rigorous peer review.

Since this issue has enormous geo-political and economic consequences, all the data supporting the pro climate change position ought to be available to anyone with an opposing point of view and skeptics with legitimate criticism should be encouraged to air their data.

That does not seem to be the message being conveyed in these emails by the major figures and proponents of the AGW theory. Requests for data are being stonewalled and people and journals that seek to challenge conventional wisdom are being shunned or marginalized.

With the Copenhagen meetings coming up and with cap and trade legislation on the table in Washington, this issue should be taking a front page position in the main stream media.
If the Globe continues to ignore this controversy, it would be one more example of the degradation of the Globe as a journalistic institution and another nail in its coffin as an ongoing business enterprise.


Sunday, November 22, 2009

Trash Review

Back in May of 2008, the selectmen asked for and received permission from town meeting to award a five year contract for trash collection instead of the regular 3 years allowed by state law. The reasoning behind the request was to allow the winning contractor a longer period of time to amortize the cost of new equipment necessary to implement an automated trash collection system.

This new system would save money in a couple of different ways. One was to reduce the personnel on each truck since one person could do the pickups versus two or three under the old system. The other way would be to reduce the amount of tonnage going to the incinerator by increasing the amount of recycling.

This proposal was introduced in conjunction with a new contract that the town was signing with NESWIC. This was a compact of communities that had been put together in the early eighties to construct the incinerator up in North Andover. At the end of that contract the tipping fee the town was charged for each ton of trash was $140 per ton.

With the contract expiration the town was now free to negotiate with any incinerator or land fill and the result was the fee dropped substantially to around $73 dollars per ton. Since the town disposes of nearly nine thousand tons a year you can see that the savings were significant.

The new automated pick up system was implemented this past July and so far the program has lived up to its billing. Knowing that the tax payer would be moving out of their comfort zone with a new system, the town and DPW leadership took great pains to reach out to every homeowner with a variety of different education programs. Mailings were sent, demonstrations were set up at various town events, local cable news and other programming was used to tout the benefits of the new system.

When the kick off date came around on July 1, I took a long ride around town to sample the results and found that the participation was remarkable. Every where I went I saw the blue containers standing on the side of the road in proper position like toy soldiers at attention.

So how has the first quarter gone? According to DPW Superintendent John Sanchez just about as advertised. Year over year the numbers look like this. Last year for this quarter we had approximately 1905 tons of trash, and recycled 280 tons of paper and 115 tons of mixed plastic and glass. This quarter we have 1575 in trash, 350 tons in paper and a whopping 170 tons of glass and plastic. The net result is that in a short time we have increased our recycling rate from about 17% to nearly 32% on an annualized basis.

As time goes by and a little more effort that rate can still be increased substantially. Town management is right on with this issue, in good times or bad it simply makes no sense to throw money in the trash.

Thursday, November 19, 2009

Dominoes

Many in political circles in Burlington are keeping their eyes glued on the special election to fill the vacant Massachusetts senate seat.

Not a lot politically happens in Burlington unless acknowledged front runner, incumbent Attorney General Martha Coakley should win the seat.

That event could possibly trigger a domino effect through out the town.

As you may or may not know, when that office becomes vacant it is filled by an appointment by the legislature. Since the house far outnumbers the senate then it can be deduced that the likely appointee would be a sitting house member or their designee.

Here is where it gets politically delicious for the Burlington political gadfly. Our own Representative Charles Murphy is rumored to be interested in the position. Having already shown his influence in the house by virtue of his appointment as the Ways and Means chairman, it would automatically seem that Charles is in play.

Add to his interest the fact that for a change we have a potential political appointee with credentials. Charlie is a former Marine captain assigned to the Judge Advocate’s office. His education credentials also seem to be a match having graduated from the following schools, Villanova University '87; Vermont Law School '90, Kennedy School of Government '02.

So let’s assume for a moment that Charles does get the appointment. He would then have roughly nine months to get powered up to run in a state wide election next November. In the mean time, a special primary and general election would have to be set up district wide in order to fill his rep vacancy.

The domino effect now comes into full play because of the plethora of candidates already in town wide offices that might make a run to fill Charlie’s seat. A list that is by no means complete might include the following rumored candidates in Burlington; planning board members Jane Hyde and Joseph Impemba, board of selectmen members Ralph Patuto and Sonia Rollins as well as ways and means committee member Tim Cummings to name just a few that might have interest.

So let’s hope Burlington’s stature is increased by having a member of our community holding a constitutional office and then let’s get strapped in for the domino effect!

Wednesday, November 11, 2009

Real Deals Only

Over the last two years, the planning board has recommended and the town meeting has passed four very large zoning changes or planned development districts. The one thing that each had in common was that proposals significantly increased the development rights on each of the parcels.


Those development rights greatly increased the resale value of the parcel to the landowner, however, without an actual building going up it has done absolutely nothing for the town's tax base.

The town wouldn't have considered these deals if there wasn't some inherent justification for the proposal. Some of the changes were driven by the need to upgrade aging properties while others added ancillary uses which may contribute to the tax value at some point in the future.


The position that the town now finds itself in is this, we now have granted development rights for new buildings somewhere in the order of 4 or 5 million square feet. The development is so massive it is hard to actually get a complete picture of what the town might look like and what demands would be made on infrastructure if a good deal of this actually got built out.


The good news is that the absorption rate for this amount of space could range anywhere between 20 and 25 years. A good example might be the original Trammel Crow PDD on Cambridge street. That was approved sometime in the middle to late eighties and that project is still not completely built out. The building that was recently finished seems to be standing idly by with no apparent tenants.


The bad news of course is from a planning stand point. Are we going to grant these development rights continually increasing the density of the community and piling on building after potential building with no concern for the competitive consequences on our existing tax base?


A non industry connected consultant should be assigned the task of analyzing the future revenue stream from the tax base as well as answering a few questions. For instance, with all of the building that we have done over the last five years why is the tax burden shifted dramatically back to the home owner?

In 1999 the commercial industrial sector of the town paid 65% of the total tax. By 2007 it had slid down to 54.96%. The last two years seemed to stem that trend however according to the assessors office there will be a drop in residential values this year but it will be exceeded by a larger drop in commercial values shifting more of the tax burden to the resident.
http://burlington.org/AssessorsDepartment_files/HIST-C~1.pdf

This flies directly in the face of current thinking in the town. Many of the leaders who promote continued growth do so on the basis of the need to keep the residential tax burden down. Although counter intuitive, a strong case can be made that less is more. A simple example is the market for retail space. We have simply over burdened the market with new space and potential new space and we suddenly find that retail values are falling and may continue to fall in the future. In addition of course is the unknown effect of the increase in the state sales tax. Will our retail tenants begin to see declines in sales beyond those driven by recession?

Perhaps it is time to slow the promise program down. Instead of passing bylaws that increase density or planned development districts that grant additional density rights we ought to take a more pragmatic approach. Bring in a project with a real tenant that is going to bring value to the resident not just appraisal and resale value to the landowner.



Sunday, November 01, 2009

Death of an Option

The announcement this past week of the chapter 11 filing of Erikson Retirement Communities should be the death knell for the Patriot Partners option and proposal to develop the Land Locked Land. As you know, Erikson was a key component of the proposal by Patriot, citing the enormous need for senior assisted type living in the region. The re-organization filing immediately begs the obvious question, if there is such an enormous need how is it they were not financially viable? They have 20 of these large communities and they could not pay their bills?

This event confirms the town's decision not to engage in any kind of a deal with the proponents. Can you imagine the financial complexities the town might have faced had a deal been in place and a bankruptcy resulted?

There is a certain irony in these events as the last two companies involved in the property have also gone into some kind of bankruptcy. In fact, the only reason Patriot has ownership of the option is because they purchased it from the Delaware bankruptcy court.

The events point out the need for the town to be ever more vigilant in any development proposals that are brought forth that includes any involvement by the community. Much of the same rhetoric was used by the original development proponent of the property over 20 years ago. Cadillac Fairview had trumpeted the opportunity that was available to the town and the tax revenue that would be generated and the wonderful companies that would be attracted to the development. Shortly after the town rejected the overtures, the company went out of business.

There seems to be still some glimmer of hope in some minds that the deal will still go through. Strangely, the town administrator is quoted, "if it is not Erikson, someone else will step into the void." He is further quoted in the weekly paper this way, "No decision has been made regarding the Landlocked Land." That is not entirely true since a multi board committee deliberated for several months two summers ago and rejected the idea of any further discussions and the town meeting ratified that decision. So to did the board of selectmen since they have been unwilling to enter into any discussions with Patriot.

According to Mr. Mercier, the next step is that a group favorable to Patriot will submit a petition to the board of selectmen asking for a referendum question in April. Considering the filing by Erikson, it will be interesting to hear the proponents justify how such a question would be in the town's best interest. Based on current events, the board is certain to reject such a request and will suggest to the proponents that they are free to collect the 1500 plus signatures necessary to put the question on the ballot themselves.

Even if those signatures are collected, whatever the language of the question, it would be non binding. Within a month of any election results, Patriot's option will run out and this chapter of the Land Locked Land saga will end.




Monday, September 07, 2009

Health Care Showdown

The health care proposal has failed to generate wide public support up to this point for a variety of reasons. President Obama, rather than submit specific proposals of his own, has relied on congress to prepare a bill that even by his own admission he doesn't understand. Perhaps this will change with his Wednesday night address on the subject.

The president is not the only one having a problem with the 1000 plus page bill. Congressman John Conyers had this to say “What good is reading the bill if it’s a thousand pages and you don’t have two days and two lawyers to find out what it means after you read the bill?”

If you take a look at the document, House 3200, you can almost sympathize with Conyers' statement.

The administration, the congress and the national media including our own Boston Globe has not laid out in detail exactly how this thing will work. Who will collect the premiums? Who will ok procedures? What taxes will be raised? Why no tort reform? Why are government employees and many unions exempt? Will there be age restrictions on certain treatment? How many new government employees? How many private sector jobs will be lost? Will it create more doctors?
How will it reduce over all costs of health care? How will it stem the rapid increases?

So far the party in power has mis-charachterized the opposition to this plan. The first mistake was the president expecting and even demanding that the bill be taken up and passed before the August break. If his fear was that congress would get cold feet when they went back to their respective districts and heard from constituents that fear was well founded.

When the shouting began back home, the house democratic leadership called it Un-American in a USA Today op-ed piece and according to senate majority leader Harry Reid, town hall protesters were "evil mongers" using "lies, innuendo and rumor" to drown out rational debate.

This is a huge and complex part of the economy (reportedly 16% of GDP) that needs to be fully understood by the participants before it is forced on them. The idea that six senators sitting in a conference room can craft a system that will smoothly be implemented and then efficiently provide a service to a couple of hundred million people is preposterous. How will the nation react if a new health care program operates as efficiently as cash for clunkers?

This is now purely a democratic party conundrum. With the large majorities in both houses of congress, the democrats cannot blame republican opposition to the plan as the reason for failure of it passing. What ever ultimately comes out of this debate will surely be the reason the democrats sink or swim in the mid term elections.

If the democrats ram this through without some semblance of bi-partisanship then they do so at their own peril. Obama is a 52% president and American political opinion is quite fickle. He has no sweeping mandate and that small margin of victory for him and the democrats can swing very quickly.

Thursday, August 27, 2009

Power Corrupts

"Power Corrupts, absolute power corrupts absolutely." This quote is attributed to John Emerich Edward Dalberg Acton, first Baron Acton (1834–1902) and is one we are all familiar with. It can apply to almost any setting in which one human or group of humans hold decision making power over others. With the passing of Senator Kennedy we are about to find out whether or not it applies (again) to the Massachusetts legislature.

Even as the papers and TV programs are filled with endless coverage of Kennedy, some offices are more concerned with who succeeds the "liberal lion" than with venerating him. In the old days the succession would have been simple as like most states, the governor had the appointing authority to fill the vacant post until the next regularly scheduled election.

That process however was deemed to be undemocratic back in 2004. In those heady days when Massachusetts democrats were polishing their resumes to send to president elect John Kerry in Washington, it was deemed unacceptable that then republican Governor Romney would have the authority to choose a successor.

In very short order and with Senator Kennedy's urging, the law was changed and lo and behold the voter was now going to be given the opportunity to choose a successor by special election. What could be a better solution than that?

Well we now find that there is a better solution according to a death bed letter from the same Senator Kennedy. According to the late senator it is imperative that we have two voices from Massachusetts as soon as possible. Apparently the 145 days necessary to hold a special election is far to long to have our senate seat vacant. No mention was made of the last 15 months when the same senator was absent from Washington.

Despite the obvious hypocrisy and blatant power grab, Governor Patrick in a Boston Globe story is now on record as supporting the change in the law. Of course, the Globe, ever the water boy for the party in power added this in an editorial, "Kennedy himself has offered state lawmakers an elegant solution: change the law to allow the governor to make a temporary appointment with the assurance of an “explicit personal commitment’’ that the appointee would not run for the office." An explicit personal commitment from a Massachusetts politician doesn't generate much confidence I am afraid.

Today's Globe Kennedy coverage on his passing as well as the succession issue is noteworthy because for the first time that I can recall not one of the stories allows any public comment. Is this event so sacred that it shouldn't be sullied by the opinion of the unwashed masses?

Unfortunately, as blatant and hypocritical as this action would be it appears as though it is gaining momentum under the guise of needing that extra vote in the senate as soon as possible so that the current health care proposal can be passed under the banner of 'win one for Teddy."

The political pendulum has not swung the other way for a longtime in Massachusetts but these types of shenanigans can only go on for so long before the average voter has had enough.

Saturday, July 25, 2009

Summer Musings

I should know better that when writing about or discussing the Red Sox that it is taboo to make any predictions. Last week they were resting comfortably atop the American league East by 3 games when I had the temerity to be a tad to optimistic. Today they are two and a half behind the Yankees and look like they can't hit their way out of a paper bag. If the Yanks trade for Roy Halliday it will be a very interesting October.

We can at least thank Professor Gates and Sargent Crowley for elevating a minor issue into something big enough to knock Michael Jackson's death off of the front pages. The Jackson story was an endless string of media over kill. The tipping point for me occurred one morning last week when Robin and Diane on Good Morning America cut to a reporter who breathlessly explained that according to his sister Latoya, Michael would be buried with one glove! Now that's the type of hard hitting reporting we have come to count on.

The Gates episode has taken on a life of its own. Again this morning, the Globe has the front page above the fold filled with Gates related stories. The issue took on new life Thursday when President Obama, after acknowledging that he did not have all the facts, then stated that the Cambridge police acted "stupidly."

He has been back pedaling ever since to the spot now where he has invited Sargent Crowley and Professor Gates to the White House to share a beer. One thing this proves is that the White House polling office is nimble enough to measure a blunder pretty quickly.

Gates of course is the beneficiary of all of this. Despite the number of times he is referred to as an eminent scholar, he is a relatively obscure figure in Massachusetts and the nation. Not obscure you say? Well how is it that his own neighbor did not recognize him and apparently is the one making the 911 call reporting him breaking into his own house? To add insult to injury, she was an employee of the Harvard Magazine which had previously done an article on the professor.

He is in a position now to profit handsomely by playing the race card. Racial profiling was brought up immediately yet how is Crowley guilty of racial profiling when responding to a 911 call? No matter what color person was in the house, Crowley followed the proper protocol, he identified the person and then asked if anyone else was in the house. Gates responded in a way that is guaranteed to get a person of any color arrested.

If you are uncooperative and scream at a cop "do you know who I am?" then nine times out of ten the cop will respond "no but let's go down to the station and find out."
Sargent Crowley could be criticized for being to aggressive by not letting a thin skinned, typically arrogant Harvard professor type get away with some mouthiness however the black patrolmen that was with Crowley at the scene backed up his actions 100%.

All of this was a major distraction from what is going on in Washington. President Obama early in the week had a victory when the senate killed funding for seven more F-22 air superiority fighter planes. It is just the type of weapon the Air Force loves but is not really suited for the real world of modern day combat. The most effective air weapon in the past three military engagements has been the military's least expensive air craft. The A-10 has done more damage to the enemy then all the air superiority fighters combined.

The president did not do so well on the health care front however. Obamacare is dead for the moment and in all likelihood may suffer the same fate as Hillary care. The week was marked by pronouncements by Rahm Emanuel and Nancy Pelosi that a vote would be taken in the house and Obamacare would be advanced. A solid block of Republicans can't derail the plan but if you add in 45 or 50 Democrats it is going no where. That is the current state of affairs as the Blue Dogs in Obama's own party are the ones that are blocking the legislation.

The Congressional Budget Office added fuel to the fire this week. The Director, Doug Elmendorf, poked holes in the proponents theory that some how government controlled health care would reduce health care costs. President Obama did not help himself when responding to a question about whether or not a person could keep their current private plan when explained that he hadn't read the house version.

So despite the president's urgings it is unlikely that the congress will vote on this legislation before the break. It is even more unlikely they will vote for it after they hear from their constituents when they return home. The central question that should be asked of all of them is this "is congress and the president going to have the same health care plan as the rest of us?"

Another of the president's major initiatives, Cap and Trade (cap and tax) climate legislation is also stymied for the moment. This decision is likely to meet geographic resistance as opposed to party line resistance. Coal provides more than half of U.S. electricity, and 25 states get more than 50% of their electricity from conventional coal-fired generation. In Ohio, it totals 86%, according to the Energy Information Administration. Ratepayers in Indiana (94%), Missouri (85%), New Mexico
(80%), Pennsylvania (56%), West Virginia (98%) and Wyoming (95%) and others are going to bear the brunt of the penalties for emissions.

Further problems are coming from inside and outside the US. India this week announced that they would not have anything to do with reducing carbon emissions. With other nations voicing concerns, unilateral action by the United States would seem to be expensive and foolhardy. The house passed the bill by only six votes. That small a margin indicates that it is surely dead in the senate.

The bloom is not completely off the Obama rose as of yet but there are some ominous indications in the polling area. The Rasmussen tracking poll has him below 50% for the first time. This is one or two points below where Nixon was in a comparable time frame in his presidency. He better get some pictures of him on vacation playing with the kids on Martha's Vineyard as soon as possible.

Speaking of bloom coming off the rose, how about our own Governor Patrick? Apparently the governor is in some big polling trouble in the commonwealth as various people are lining up to take a shot at him. Treasurer Tim Cahill recently announced his intentions to change his affiliation to independent and consider a campaign for governor. No sooner was the ink dry on that story when Charles D. Baker who is President and CEO of Harvard Pilgrim Health Care, Inc. announced that he would be in the race on the Republican side along with Christy Mihos.

If Patrick is in trouble with voters, at first blush it would seem that Cahill being in the race as an independent would benefit Patrick by siphoning off votes away from the Republicans. If Cahill were to run as an independent it would indicate that he believes he cannot get the required 15% of delegate votes at the Patrick dominated state democratic convention to get on a democratic primary ballot.

Cahill may have made a strategic error here since no sooner did he make his intentions known when Steve Grossman announced he would be in the race for treasurer. If Cahill runs for re-election for treasurer he has needlessly made the job more difficult by attracting a well heeled opponent. He may conclude that being treasurer is better than being a defeated gubernatorial candidate. After all, Mihos ran as an independent and garnered about 7% of the vote last time around.

Saturday, July 18, 2009

Sox at the Break

The Sox are rolling along a top the American League East and the reason is because of pitching. In fact it has almost become an embarrassment of riches. This was illustrated last night with minor leaguer Clay Buckholtz going 5 and 2/3 innings shutting down Toronto on four hits. The problem for Clay of course is that this was a spot start and at the moment there is no room for him on the big club.

Strengths can turn to weakness in a heart beat but the team still seems to have insurance against any health problems. At some point Matsuzaka will be back and by September will we have a good feeling for whether or not Smoltz is back in form. If either or both of them fail then the team still has Beckett, Penney, Lester and Wakefield to which they could add Buckholtz and Michael Bowden not to mention Tunichi Tazawa who has been burning up the minors.

Equally as strong as the starting pitching is the relief core. While performing at near the highest levels up to this point the bull pen has improved even more with the emergence of Daniel Bard. Francona has been careful with the spots he has used him in up to this point but you can see Francona's confidence rising in the kid. Last night he brought him in to relive Buckholtz with 2 on in the sixth with the tying run at the plate. He escaped that jam and then pitched another inning. Three of his four outs were recorded by strike out.

The shortstop position and infield in general has been strengthened by addition and subtraction. Jed Lowry comes off the DL today and Julio Lugo has been designated for assignment. That brings the Lugo era to a close in Boston and in all likelihood the move will cost the team over 13 million dollars as it appears unlikely that anyone will trade for him. Nick Green and Lowry should more than capably handle the shortstop position as well as filling in at third and second when the regulars need some rest.

The batting order continues to produce runs and does not appear in desperate need of adding a bat as David Ortiz has emerged from his early season snooze and is now back in the clean up spot and producing.

The trading deadline is fast approaching and it would seem that the Sox can deal from a position of strength. If they wanted to make a play for Toronto's Roy Halliday they have plenty of young talent to offer in return. Similarly if they wish to add a bat they could do so with those same bargaining chips.

You know the Yankees will make some sort of move but the Sox need not panic. The club as constituted right now is good enough to win it all.

Sunday, July 05, 2009

Health Insurance and Public Officials

This issue first surfaced some 28 years ago at town meeting when the selectmen were queried about 2 former public officials widows who were allowed to be carried on the town's health insurance plan. Eventually that practice was stopped, however the elected officials themselves remained eligible for the benefit.

That central issue remains and occasionally comes up in public discussion. This past May a resolution was offered by the town meeting requesting that the selectmen stop the practice of allowing elected officials to have access to the insurance.

Of the total of 36 elected officials in town 11 of them are taking the insurance for a total expense of around $110,000. According to state law chapter 32B which allows this practice and is administered only by the board of selectmen, only elected officials that receive any compensation or a stipend are eligible for this benefit. The total stipends offered equal 25 thousand dollars and range from the chairs of the board of selectmen and of the school committee receiving the highest amount of $1500 to yours truly, the town moderator making the lowest at $150.

I don't take the insurance but do admit that if I was in need of it I would take it. Just as some opponents of the practice now admit they would do the same.

There are three points to be made regarding the boards continued support of this policy.

1. There are approximately 13,000 registered voters in the town, anyone of which could be eligible for the benefit if they chose to run and win an elected position. If it is such a coveted benefit why don't we have many more candidates running for these positions?

2. The total compensation including the insurance benefit totals approximately $130,000 for the entire elected management team of the town. Were we a council type of government, similar sized communities are paying nearly $10,000 a year in salary, retirement and health benefits for each of these positions. Our total cost seems relatively cheap for a roughly 100 million dollar public corporation that Burlington has become.

3. Lastly is the cost to the candidate to "win" one of these positions. Although voluntary unpaid public service is admirable, the fact of the matter is that a campaign to win a hotly contested seat can run between five and ten thousand dollars of yours, your family and your friends money.

At some point ego gratification is supplanted by reality. Without some measure of remuneration the number of (experienced) people willing to continue to make the commitment of time and effort will decline. The danger then becomes people with a vested interest are always willing to run.

Whether you agree or disagree on the issues with the current or former regimes in any of the elected boards, we can agree by observation that for the most part, we have been well run and have avoided many of the major problems that have beset other Massachusetts communities.

Unless a better alternative is proposed and can maintain a steady stream of residents willing to take on the time commitment necessary to run this operation, then the status quo should remain in place.

Thursday, June 25, 2009

Border Town?

News out of the state house is that we are getting closer and closer on the three basic conditions under which Governor Patrick would support the proposed new tax package. Those conditions were pension, transportation and ethics reform. The last piece of that trio is being worked on right now.

It is note worthy that some of Patrick's posturing on the issue was mostly bluster since it was probable that senate and house leaders would have a veto proof majority if Patrick did take issue with any of the proposed legislation.

The center piece of all of this is the proposed increase in the sales tax from 5% to 6.25%. It will also include a sales tax on liquor (tax on a tax) as well as local options for increasing the hotel tax and a new piece of the meals tax.

At a business function this week Speaker Deleo was asked about the rationale between an increase in the sales tax versus one on the gas tax. His response was that a gas tax would heavily hit working families for a basic such as transportation while the sales tax was more of a choice and would hit those that have the means to spend more.

There has also been some justification in that the sales tax has not been "raised in 20 years." While it is true that the rate hasn't changed it is also true that the tax income has risen dramatically because things certainly don't cost today what they did 20 years ago.

So what does it mean for Burlington? It is certainly likely that the town's leadership will opt for the increase in the local option taxes. That may result in over 200 thousand dollars in increased income from the hotel tax and also a very sizable take from the meals tax.

What may be more difficult to measure and will only be born out by time is what impact the sales tax increase will have on retail sales, retail property values and the corresponding retail property taxes in town. We have already seen some softness as a result of increased competition, what will happen if a good deal of retail sales simply by pass Burlington and travel the extra 21 miles to the New Hampshire border?

Retail sales along the border have long suffered because of the difference in taxation between Massachusetts and New Hampshire. Has the border gotten closer to Burlington with imposition of a substantially higher sales tax?

Wednesday, June 17, 2009

Land Locked Option Expiration

If I am reading the copy of the 20 year option on the Landlocked Land property correctly, then the expiration date is May 14, 2010, exactly 20 years after the option agreement was executed.

As we are getting closer and closer to that date, the current holder of the option is likely to become more and more desperate in their attempts to lock up the town in some sort of an exclusive deal so that they may maintain control over the property.

Those efforts are likely to include a request for some sort of referendum question that asks the voters to endorse the option holder in some way or there is likely to be some sort of grass roots efforts to promote the cause of development on the site and specifically the option holder's proposal.

One such effort is under way under the heading of "fiscal responsibility." The argument is that the property should be developed and developed by the option holder because it would significantly impact the tax rate.

Let us for a moment completely agree with that rather dubious premise. Let us say that the town is unanimous in support of selling the property and building it out to the maximum. The question then becomes if we intended to maximize the yield from the sale why would we restrict ourselves to the current option holder?

Wouldn't we want the option to run out so that:

1. We wouldn't be selling the town's largest capital asset at the absolute bottom of the commercial real estate market and into the teeth of the worst recession in 70 years?

and

2. We would have any number of very well financed and nationally recognized companies bidding for the property?

Letting the option run out is the fiscally responsible thing to do if you wish to maximize the return to the tax payer. There is nothing that distinguishes this option holder from anyone else in the development market. Any life science company or elderly housing complex builder that has interest in the property while the option is in force over the next 11 months is still going to have interest after the option expires.

If you favor developing the property and feel it is in the best financial interest of the town then let's wait till the option runs out, conditions are better and have a town wide referendum asking the question "should the property be sold" and then move forward one way or another. Any other action is simply a strategy that places the option holder in an exclusively favorable position. Doing that cannot be trumpeted as "fiscally responsible" by anyone other than champions for the option holder, not the taxpayer.

Since the holder acquired this option in some sort of a bankruptcy fire sale, the tax payer is not obligated in anyway to give them any thing other than a fair chance to win a deal in an open competition.

Saturday, May 16, 2009

Teary Eyed Moralist Hypocrites

http://yidwithlid.blogspot.com/2009/05/video-of-pelosis-press-conference.html
Anyone watching House Speaker Nancy Pelosi's news conference this week had to feel some what sorry for her. Her repeated denials and then admission of knowledge of water boarding is a classic example of political flip flopping.


She basically had two choices. She could have done the right thing and admitted that in 2002 as the then ranking house member on the intelligence committee she had to be completely aware of what the CIA was doing in its attempts to glean any information possible to prevent any further attacks on the country.

Or she could deny knowledge of the enhanced interrogation techniques to curry favor with the teary eyed moralist hypocrites in her party who now want to prosecute anyone associated with establishing methods to extract information from an unrepentant mass murderer. Of course, she chose door number 2.

Jump in the way back machine and consider what had happened. Not only did we have the tower attacks but we had also had a long string of attacks against us off shore. Couple that with the anthrax attacks which started on 9/18/01 and we were a nation under mental siege wondering what catastrophe might be next.

Any public official, particularly the ranking member of the house intelligence committee would certainly want to be on top of any and all measures that were being taken to protect the country. If they weren't then a thinking person would have to question whether or not that person was fit to be in government.

Speaker Pelosi did not admit to being fully engaged in the CIA's intelligence gathering effort. Instead, she says that she was far removed from the process and only briefed once on the subject. She further says that she was lied to and congress was mislead by the CIA. (One can only wonder how the CIA will retaliate.)

For many of us the issue of water boarding is a tempest in a teapot. The continued referring to it as "torture" is somewhat misleading when you consider that some of our own troops are subjected to it during training.

But now that a big deal has been made out of it and certain portions of the political spectrum want to have a full airing of the issue then it is only fair that all of the officials involved should come under scrutiny including the people who condoned it but now deny knowledge of it and now want investigations and show trials .

In addition, now that the President has released portions of the interrogation documents he ought to heed former Vice President Cheney's call for release of what information was gained.

Victoria Toensing writes in today's Wall Street Journal a very informative piece regarding the lengths which the Bush justice department went to establish a legal framework to authorize enhanced interrogation while at the same time restricting measures that would inflict harm on the prisoner.

Ms. Toensing concludes the piece with the following, "There should be a rule that all persons proposing investigation, prosecution or disbarment must read the two memos and all underlying documents and then draft a dissenting analysis."
http://online.wsj.com/article/SB124243020964825531.html

Tuesday, May 12, 2009

Not Their Year

Every once in a while you know the hand writing is on the wall and that your team is flawed in many ways and that the hoped for achievement of a championship is simply wishful thinking.

For some that is enough for them to jump off the band wagon and move on to the next best thing. In this case that would mean abandoning the Celtics and focusing on the Red Sox.

The Celtics aren’t going to repeat this year as NBA champions and we all know why. With the Big Ticket, Kevin Garnet as well as Leon Powe sitting on the sidelines, both with knee injuries it would seem that this is the Year of Lebron James and the Cleveland Cavaliers.

It is inevitable that our team is going to get eliminated and according to Charles Barkley it is going to happen in this, the second round of the playoffs against the Orlando Magic. Since it is too painful to watch the Green lose I have been considering turning the station and letting the inevitable happen. Apparently, the Celtics have other ideas.

Despite the fact that they are undermanned and must be exhausted after the epic seven game series that included a record 7 over times against the youthful Chicago Bulls, the defending champs are not going quietly.

After losing game 1 to the Magic and giving up the home court advantage it seemed as though Superman Dwight Howard and the Magic would go to Orlando and fashion a 3 games to 1 advantage. Well they held serve in the first home game but on the strength of a Glen Davis buzzer beater in game 4 the Green are home tonight having snatched back the home court advantage and giving the Magic a lot to think about.

Although there is a temptation to wonder what could have been had Garnet been healthy it is worthwhile to note the benefits that have emerged as a result of the team being so thin in man power. Who knew that Rajon Rondo was this good? His point guard leadership was proven last year in the playoffs but he might very well be elevating himself to one of the best 2 or 3 point guards in the league. How many six foot guards anywhere are averaging double digits in rebounds?

Big Baby Davis is the other youngster that has emerged during these playoffs. How can a man over 300 pounds be so agile? His work in the practice gym is obvious as he has gone from having a maybe jump shot to become a pretty consistent and reliable scorer inside 20 feet.

They aren’t going to repeat as champions but they are certainly over achievers, proud champions and a pleasure to watch. It would be appropriate for them to face the heir apparent in the Eastern finals.

Saturday, April 25, 2009

Appropriate for Who?

The April 22 edition of the Times Chronicle includes comments regarding my concern about a simultaneous presentation of a zoning change by the planning director and an application to change a parcel to that as of yet non existent zone by New England Executive Park.

Mr. Vaughn of Riemer and Braunstein describes the simultaneous presentation of the Office Park Zone by the planning director and the application by New England Executive Park to that as of yet non existent zone as both “appropriate and common place.” These simultaneous proposals are neither common place nor is it appropriate for Burlington to conduct business in such a foolhardy manner.

The two examples that Mr. Vaughn described in Burlington were not at all comparable to what he now proposes. The Office Park Zone has very far reaching implications for the community as it relates to one of the most dense, congested and environmentally sensitive areas in the town.

Two more comparable zoning issues were the Northwest Park and Town Center overlay district both of which had multi board study committees that deliberated for months and in the case of the center overlay, for years.

I understand Mr. Vaughn’s duty to his client to get approvals as quickly as possible with as little public scrutiny as possible. My job as moderator is quite the opposite. I work for the town meeting members and my advice to them at this point is that the proposals as currently constituted are not examples of good government.

It is simply foolish to suggest that our zoning is any kind of a barrier to development or is the cause of New Executive Park’s vacancy rate. We have put up more development than any community our size in the state.

This is the same law firm that has told us that the PDD at Northwest Park would result in a flood of class A tenants and are proposing the same for the Land Locked parcel. Why isn’t our zoning a barrier to those? Could it be that we are over built or their rental rates are too high or that we are in the most severe economic down turn in 70 years that is the reason that business is slow?
Could it be that Blackstone’s buyout of Equity office in one of the largest leverage transactions in history is causing them to seek more development rights as quickly as possible?

I am not alone in the community in wondering how this Office Park designation proposal has even come about. None of the boards or town meeting requested that the planning director propose a new zone. Nor am I alone in wondering how it is that an application for the zoning change is progressing at the same time that the zone is in the public hearing process. How is it the applicant is so informed as to the content of the proposal before the boards or town meeting have seen the finished product?

If an Office Park designation is deemed to be appropriate then town meeting will act accordingly. It is not unreasonable to suggest that applications for that new designation wait until the attorney general has actually approved the new legislation before the town meeting takes up changes to that zone.

Saturday, April 18, 2009

Deleveraging

Leverage is commonly referred to as borrowing money with the hope of increasing returns to equity. A business takes out a loan to increase its inventory so as to sell more goods and increase its profits. A consumer might take a mortgage on a larger home so that as the home appreciates, the return on his or her original investment is magnified.

Margin is another example. You buy stock and then borrow against it to buy more stock so that when (if) the stock rises your return is enhanced. These are wonderful strategies but only when under certain conditions and best of all of course is when they work.

The past 2 years are classic examples of when these strategies have failed completely. A good many homes have fallen below the purchase price, the stock market has tanked and business has certainly been curtailed. Add to that, low returns for cash invested and you have a complete turn around in consumer attitudes.

This can be reflected in this months consumer debt figures released by the Federal Reserve http://www.federalreserve.gov/releases/G19/Current/ While the government is busy trying to pump up the economy by issuing huge amounts of public debt, the American consumer is deleveraging as fast as possible. Consumer debt has dropped three out of the last four quarters and for this quarter revolving debt dropped on an annualized rate by a whopping 9.7%.

Revolving debt is dropping because of analysis by the consumer. The simplest is to take a look at what yield you are getting on your savings account and what you are paying for non tax deductible interest on your credit card. If you are getting 2% yield and are in a 28% tax bracket, after state and federal taxes your net yield is about 1.4%. If you are paying between 9 and 15% on your credit card, it simply makes no sense to carry any kind of a balance on your card.

Well that's great but what if you don't have a savings account at the moment? The most tax efficient way to reduce your leverage is to cut up your card and refinance your home ( if you have equity) to both a lower rate as well as shifting that revolving debt into either a home equity loan or a first mortgage. The numbers are much more attractive. Your 9% card interest now costs some where in the 4.5% to 5.5% range and the interest is deductible. Again if your in a 28% tax bracket, a 5.5% cost of money now becomes somewhere near 3.7% after state and federal deductions.

This is all well and good if you have options such as money in the bank and equity in your home. The answer of course for all of us and the country in general is to stop spending money we don't have. Yes, it may slow the recovery and a new national attitude toward debt might mean slower economic growth off into the future.

That growth however would be real growth, not the illusion of a pumped up economy roaring along built on the false foundation of borrowed money. The reason we are in the economic straits we are today is excessive debt in almost all segments of our economy, consumers, businesses, non profits, municipalities, and state and federal governments have all been on a spending spree which has resulted in the entire nation having some sort of a mortgage.

Perhaps the current strategy of pumping more borrowed government money into the system is the right one to revive the U.S. and world economies, however when we get things straightened out a bit, the nation and indeed even each of us as individuals has to address the idea of using enormous debt as the foundation of a sound personal and national economy. It simply will not work over the long haul.

In Ben Franklin's book, The Way to Wealth, he says this about debt, "when you run in debt, you give another power over your liberty." The Chinese currently own over a trillion dollars in our government bonds, is that a good thing?

Tuesday, April 14, 2009

Selectmen News 4/13/09

The selectmen met for the first time since the annual election on Monday night. The first order of business was reorganization and by identical 5 to 0 votes, the board chose Ralph Patuto as chairman and Walter Zenkin as vice chairman.

It was a busy meeting as the board dealt with a number of agenda items.
Town administrator Robert Mercier presented the board with a capital spending plan that covered each of the department and building needs projected over a ten year period. The total of that capital wish list would reach 100 million dollars if every project was implemented.

Mr. Mercier also announced that Burlington’s pension costs for this fiscal year were going to show a less than 1% increase to $6,113,755, however he cautioned that next year would reflect the current market turmoil.

The B-line bus service was the subject of much debate as the service has been cut down to 2 buses during this fiscal year. The cut became necessary when fuel costs ate up a sizable portion of the appropriation. The recommended amount this year was 166 thousand dollars to fund the new schedule for two buses however after much discussion regarding adding back the third bus, selectmen Gianino amended the motion back to last years appropriation of 216 thousand dollars to present to town meeting. Since the estimates for this years service seemed to be based on $4.80 per gallon fuel cost, whether or not a lower cost would will add back a third bus will be determined later.

Police Chief Hart was before the board for a public hearing speaking about a second alcohol violation by the Ginger Pad restaurant. The chief reported that the enforcement program includes two under age people working with the department who attempt to buy alcohol. On March 12 the 18 year old male entered the restaurant and ordered a beer and was served with out being carded.

Manager Michael Halciotis said the server admitted the violation when officers identified the buyer. Chairman Patuto explained his displeasure over the incident in particular that the establishment had two violations in such a short period of time since opening. The management of the firm said that the server had been terminated immediately and that they were ashamed and embarrassed by the incident. Selectman Gianino pointed out that termination of the employee may not always be the best solution particularly in this type of an economy. Perhaps management should bear some of the responsibility as well.

The board imposed a three day license suspension commencing next Monday.

Next up was a long list of warrant articles presented by Mr. Mercier that included a number of multi year programs that are be proposed for completion this year.

Fifty one thousand was approved for the second year of the police radio program, 20 thousand dollars for the semi annual mandated leak detection program and 60k for the sidewalk along the Bedford street side of the town common

Self funded articles included the cemetery road work funded from the sale of graves account, 20k for odor control from sewer enterprise, and parking lot repaving at the Ice Palace from the Ice Palace enterprise fund. Two large equipment purchases were approved, a new ambulance for the fire department at $216,000 and a new street sweeper for DPW at $166,000, replacing the current 15 year old model..

The 1.5 million dollar bonded appropriation to complete the water meter automation program sparked a great deal of discussion. DPW superintendent John Sanchez explained that the town cannot account for 20% of the 1.2 billion gallons that it pumps and that the new system would completely automate the meter reading system and replace antiquated meters. A 10% loss of production in a system is considered normal. Mr. Sanchez explained that at approximately $4000 per 1 million gallons, nearly 400,000 could be recovered annually from the program resulting in a 9 year payback.

The meters would be read electronically from DPW headquarters and would eliminate the need for manual reading. Chairman Patuto and selectman Gianino questioned whether or not the program might be delayed so that the 1.5 million in bonding authorization might be used elsewhere. Selectwoman Rollins and Mr. Mercier explained the need to complete the appropriation this year so the program could begin to be implemented in July. After much discussion the article was approved.

All of these recommendations will now go on to the Ways and Means committee for their consideration and recommendation to the annual town meeting.

Saturday, April 11, 2009

Threats and Intimidation

Fascist thugs try to break union. That might be a headline you would see about another American corporation in the the New York Times. You won't see that headline because it is the Times itself that is demonstrating those tactics in its dealing with its wholly owned subsidiary, the Boston Globe.

The Globe as currently constituted is rapidly failing in its business and there isn't much the ownership of the Times can do about it. It is reported that the paper lost fifty million last year and is on target to lose another 85 million dollars this year. With ads and subscriptions continuing to fall and a bottom in the industry no where is sight how will 20 million dollars in forced union concessions stop the bleeding?

The Times itself is in danger for a variety of reasons including a huge debt load, a real estate project that was ill advised, dramatic changes in the industry and finally entrenched genetic leadership that is incompetent. There can be no doubt that given a choice, the Times will opt for self preservation so you know the Globe would be sacrificed first.

In an age when a 2 or 3% cut in municipal or state budgets are referred to as Draconian or cutting to the bone, the 25% reductions sought at the Globe are indeed drastic. Mary White, who leads Teamsters Local 1 which represents the 250 mailers said the Times Co. "is seeking a 25 percent wage cut, the virtual elimination of its contributions to their health care plan, and an end to company contributions to pensions."

This is the fourth or fifth year in which layoffs and concessions have been on the table at the Globe and the numbers suggest it is not over. If we are nearing the end game for the paper as it is currently constituted then what strategies can be put in place to save the paper as an institution in Boston?

Getting rid of New York in the mix would be the first order of business but short of finding an outside buyer with really deep pockets what can be done? Bankruptcy is an option since it has been reported that the Globe is a 100% owned subsidiary of the Times Corp. and therefore could go into bankruptcy without dragging in the parent company.

If that does happen it would bring up a number of interesting possibilities for potential Boston owners or indeed in my view the most viable option which is an employee purchase of the Globe. The employee unions have both the most to lose as well as the most influence over controlling costs at the paper. There is certainly a break even point somewhere in the mix that would enable the paper to go on while protecting as many union jobs as possible.

What that point is and how much sacrifice the unions would have to make remains to be seen but it would seem to be a better alternative than watching the paper and its jobs rapidly disappear. An employee buyout would save the most jobs and bring the most equity to the employees if the ship could ultimately be righted. The benefit to the readers of course would be to clean out the Times influence and place the paper in the hands of local stakeholders instead of New York based ideological nitwits.

Sunday, April 05, 2009

These Times They are a Changin

The results are in in the annual town election and though not especially shocking in terms of who the winners are it does bring about an unusual result. Year after year we have winners and losers in the selectmen race but infrequently does the tally result in a changing of the leadership on the board. That has happened this year and in a substantial way.

The former minority is now the new majority with incumbent Ralph Patuto and newcomer Dan Ditucci winning the seats and defeating incumbent Al Fay. This will almost certainly result in Ralph being referred to in the near future as Mr. Chairman.

I was not particularly surprised by the results but was shocked by the margins of victory. Patuto and Ditucci bested McKelvey and Fay by 500 plus vote margins. In a vote for 2 race with 3599 people turning out a margin of victory that large is surprising. After the results are in it is much easier to speculate on the reasons why they shook out the way they did.

Fay had a couple of issues that weighed against him. He had held both a planning board seat and a selectmen's seat and a change in the law required him to give up one of those seats this year. Three years ago he topped the ticket in his selectman's seat after a 24% tax increase and while holding both seats so what happened during the intervening three years?

Fay's support along with the majority of the board on the ICE (U.S.Immigration and Customs Enforcement) issue may have had a lingering effect as perhaps did the Landlocked Land issue. The town has approved a number of major developments that have not really gotten off the ground nor has the impact been fully felt. The idea of considering a huge new development on the LandLocked was viewed by many as simply nonsense. Not coming out as forcefully against the Patriot Partners development plan as did others may have been a factor.

The board's refusal to take any kind of a position against Boston on the Cummings property might have also hurt the majority.Perhaps however it was not those things but that it was simply a superior campaigning effort by Ditucci/Patuto. Initially it was thought to be a major mistake when Dittucci entered the race after former selectmen McKelvey announced he was also running. Conventional wisdom said that a 2 person campaign is frequently a mistake and that a Ditucci/Patuto alliance might damage Patuto.

That line of thinking is obviously not born out because both Patuto and Ditucci garnered nearly the same tally and Patuto topped the ticket. Ditucci ran a very hard and nearly successful campaign last year running against Gary Gianino in the single seat election. It is almost unheard of to have the incumbent defeated in that seat yet Ditucci nearly did the impossible failing by a mere twenty something votes. It is clear from this year's results that both Ralph and Dan benefited from the other's second votes.

Ditucci had the same team this year headed by Cindi Gilpin and they proved last year's results were no fluke. Ditucci was out of the gate quick and continued to build on last year's momentum. It was no secret that Dan and Ralph were aligned nor was it a secret that they both had supported Walter Zenkin when he ran.

So the old majority is the new minority and both will find out different things. It is much easier to be in the minority because you aren't really responsible for much. The shoe is on the other foot now for the new majority. They will be confronted with the same issues but now will be expected to produce some results.

This is a very challenging budget year as well as some residual issues remain unresolved. How will the majority deal with a lingering police contract issue? Will they hold the line on demands for drug and alcohol testing and lower the proposed raises? Will they review applicants for town counsel? Will they move forward on a new sewer line and address the surcharging issue? Will they propose a referendum on the Landlocked Land or simply take a stand that it is not for sale? Will they demand accountability from Boston as trustee on the Cummings property? Will the new trash contract transition smoothly? Are we going to recruit from outside for a new police and fire chief? Are we going to have a public safety superintendent? Will they make changes of members at the Board of Appeals or crack down on some of these variances? Will more and more liquor licenses be issued? Will they find a new site for the town barn or cemetery space?

Progress on these things will determine the new hold on power. Like any after election analysis, focus is already being put on next year. Both incumbents are viewed as being vulnerable for different reasons. Rollins has been very active on issues and produced results that have been met with varying approval in the community. Zenkin on the other hand has been relatively silent without much initiative. Roles will switch this year and both will be looking for ways to properly position themselves for next year.

A lot can happen in a year and the new majority will only have to hold serve next year to hold the mandate.Regardless of the individuals involved the town as a whole is a winner when we have a race of this kind. Good solid people came out to run for the top elected office in the town. They ran clean, well informed races and motivated new people to be engaged in the process.

In a couple of days both the disappointment of defeat and the elation of campaign victory will fade and the day to day business of running a 92 million dollar a year municipal corporation will begin all over again. Whatever the political alignment, it does not detract from the fact that five of them are running the show and it is our best interest that they work together to get results.

Being a politician is a two part process, you have to run to win and when you win the difficult part begins as you now actually have to serve in the position and pleasing everyone all the time is no easy task.