Paranoid about the paranoics

I've been remembering the frustrating conversation I had at a wine tasting a while back.  One thing this annoying person said is that he has a gun in his house to defend himself against the government when they try to take away all his rights.

Even though the Berkeley world in which I am now so immersed does not trust the government, I don't live in an environment where the government is seen as a threat to be armed against.  But I know there are many parts of the country where government is so mistrusted, so hated, that people would like it to go away, and they proudly maintain their guns for the opportunity to return to the natural order of things.

This is the source of the Tea Party movement.  Every morning I wake up and hear on NPR about the (potential for, and now real) government shutdown.  It frustrates me because of the premise embedded in the discussion: that government should not be shut down.  The disconnect between this premise and that of the Tea Party frightens me for the future.

The Tea Party wants radically smaller government.  And they've won.  The sequester: we are still functioning under radically reduced government funding.  The government shutdown: radically reduced government funding.  Support for food programs is vanishing.  NPR presents this as a terrible impact of the shutdown.  The Tea Partiers are cheering: they do not believe in food programs.  Go down the list of what the media presents as an impact of the government shutdown, and you will see a list of the items that the Tea Party does not want funded by the government anyway.  Eight hundred thousand federal workers: that's their win.  Food safety inspection.  National Parks.

Fox News calls it a government slimdown.  The term isn't just a way for them to play down the impact of the shutdown -- it's a way to celebrate that government is getting smaller.  Who doesn't want to slim down?

The Tea Party has been clever to focus on Obamacare as the item they want to negotiate on.  If for some reason the Democrats begin to discuss this law, they win.  If, as the Tea Party knows, this law is a done deal, then they can confidently hide behind the impenetrable shield of the issue and radically reduce the size of the government.  It's win-win for the Tea Partiers.

I am a diehard Democrat, and I have wanted to give the President the benefit of the doubt for his five years in office.  But someone on his team doesn't get it.  It's not just the economy, stupid: it's jobs, stupid.  It's not about programs, because that plays into Tea Party hands.  It's about individuals and their paychecks.  As the countdown to the shutdown began, the President should have had a daily news conference, each day talking about jobs.  In the second person: make it immediate.  On the first day, he could talk to the 800,000.  On the next day, he could pick one ripple effect and warn another segment of the population about their paychecks.  And so on.  If the shutdown occurred, he should keep going.  He could have a different cabinet member speaking each day to a different segment under his or her purview.

He could declare that he would fund the Bureau of Labor Statistics as a critical government function, sending the message that he cares more about tracking the jobs of the citizens than the Tea Partiers.

Instead, the Democrats are gleefully watching the Tea Party tear the Republicans in half, not realizing that they are all in the same sinking canoe.  However, the premise we hear in that is that the Republicans have a problem, but the Tea Partiers have no issue tearing their own party in half, tearing the government to pieces. Their goal is not to become the majority power in the Republican Party.  If Tea Partiers no longer exist because there is no functioning government of the United States, then they win.

This is my paranoia.  We are dealing here with something much bigger than a movement within government: we are dealing with a movement that is truly trying to destroy government.  When the debt ceiling is not raised, and the economy tanks, and more people lose their jobs, the people will say, "The government messed this up," not "The Tea Partiers, the Republicans messed this up, so I think I'll vote Democratic."  Having the people turn on the government means that we no longer have government by the people, for the people.  We just have a world where those with the biggest guns win.

Ordinary people suddenly get good deals on mortgages

I'm a first time homebuyer, and the ride is a blast. It's an adventure, an exploration, a learning experience.

I locked in my mortgage rate today, and I am feeling so proud of myself. And, since this is such a tiny bit of good news in the economic disaster we're living in, I haven't seen headlines of "Ordinary people suddenly get good deals on mortgages." So you heard it hear first.

I'm no economist -- I'm more of an intuitionist -- and I've never paid much attention to the details of how financial systems work (despite the evidence of my education). So the mastery of the art of mortgage prediction I gained over the past week has me feeling really smug.

This is what makes mortgage rates go down: bad news. I'm sorry to say that when the terrible jobless rate came out last week I jumped up and down. Heartless of me, I know. But I work in career services, so maybe I can atone for that one.

When the stock market fell I nodded in sympathy with others and then ran to my computer to see if mortgage rates had budged.

But the rates didn't drop. In fact, last Tuesday they went up and then didn't move. Banks still weren't lending money. No credit action, no mortgage rate change. So I waited until the House signed the bailout package. That could improve confidence and increase liquidity ... but it didn't. With my own good credit, I could get a decent rate on Friday, and I was tempted to take it, allowing me to take another step to closing on my new home ... and then I decided to wait.

When I saw the news that California was going to have to ask for a government bailout because of its inability to get short term credit, I knew that the end (to my mortgage rate wait) was near. Something had to move. And this morning the stock market crashed again, and the Federal Reserve indicated that it would considering using its new powers (from the bailout bill) to relieve the credit crunch. And Bank of America indicated it would find a way out of the Countrywide mess for people who were going to lose their homes, so someone was going to get mortgage relief.

I checked the mortgage rates practically hourly, and then, bam! at 9:30 AM PT today they dropped. A lot. I called my mortgage broker. I couldn't get through for hours because apparently he had five clients move to lock in rates today. But I did it! I didn't even take the lowest rate I could get (because of the fun and funky incentives I'm being offered by Pulte Homes). And rates fell a fraction after I locked. But I got a good one, a doozy, lower than I ever thought I could get on Friday.

I feel lonely. Despite my lack of interest in economics and finance, I love spreadsheets, and I've built all sorts of models over the last several months to help my decision-making and keep myself fact-based. Today it all came together, and I can't really share the great news, the great numbers. I know people who've bought in the past several months, and I know my rate is lower than theirs, so I can't celebrate with them. And people who are deep into homeownership aren't going to think it's so cool. But it's my first time, and I think I did a damn good job of it.

The great Democratic plan

For everyone who is frustrated with the Democratic primaries, who is worried that the party is damaging itself by having two candidates to continue to duke it out, keep in mind the following:

1. Americans love a competition. By taking the campaign to all 50 states, the Democrats are taking the motivation to participate to all 50 states. 
   
2. If the Democrats get out the vote, they win. There are more Democrats in this country than Republicans. In Texas, on March 4, almost three million Democrats turned out to vote, to the Republicans' 1.4 million. And this was when it was still a race: Mike Huckabee did not drop out of the race until that evening. 
   
3. The longer we have a Democratic competition, the more likely we are to have Democratic voter turnout in the red states of Mississippi, North Carolina, Indiana, West Virginia, Kentucky, Idaho, and, if this keeps going, Puerto Rico, Montana, South Dakota, and Nebraska; as well as in the perceived battleground states of Pennsylvania, Oregon, and New Mexico. 
   
4. If people vote in primaries, they are more likely to vote in the general election.
   
5. The rhetoric between Hillary Clinton and Barack Obama reflects that they know this, and that in this home stretch they are going to work for party unity as they continue to compete.
   
6. Airing Democratic candidates' dirty laundry early enables the clothesline to be clear in time to focus on McCain's dirty laundry in the general election.
   
7. Enlisting new Democratic voters for this election could have effects that reach far beyond 2008.

I am very excited that the Democratic candidates continue to campaign, and I am optimistic about the process and the results.