California's Finances, a Retrospective

Below is a snippet from an old November 2009 LAO report--but boy, does it have amazing data. Here is one particularly juicy excerpt:

In General, the Legislature Retains Power Over the Budget. Some observers of the California budget process have asserted that—due to voter–approved propositions, federal law, and court decisions—the state’s budget is unmanageable and basically impossible to balance. In reality, however, the Legislature remains in control of the vast majority of state spending. This is particularly true over the longer term when there is enough time to allow major decisions by the Legislature to be fully implemented. Even in the shorter term, the Legislature generally holds a considerable degree of freedom to adjust state spending. Such decisions are often more restricted by the lack of political consensus as opposed to any structural budgetary constraint.

More here. Voters must realize that almost everything they read from CNN, Fox, or any major media outlet contains some element of bias. In contrast, all states have finance departments that will provide you with the (mostly) unvarnished truth. In California, we have the LAO. For the feds, we have the CBO. Turn off your television, and go forth and read.

Emerson on Trade

Ralph Waldo Emerson, from his 1844 lecture, "The Young American":

Trade was the strong man that broke it [feudalism] down, and raised a new and unknown power in its place. It is a new agent in the world, and one of great function; it is a very intellectual force. This displaces physical strength, and installs computation, combination, information, science, in its room. It calls out all force of a certain kind that slumbered in the former dynasties...

Trade goes to make the governments insignificant, and to bring every kind of faculty of every individual that can in any manner serve any person, _on sale_. Instead of a huge Army and Navy, and Executive Departments, it converts Government into an Intelligence-Office, where every man may find what he wishes to buy, and expose what he has to sell, not only produce and manufactures, but art, skill, and intellectual and moral values. This is the good and this the evil of trade, that it would put everything into market, talent, beauty, virtue, and man himself...

The `opposition' papers, so called, are on the same side. They attack the great capitalist, but with the aim to make a capitalist of the poor man. The opposition is against those who have money, from those who wish to have money.

Isn't it fascinating to see the great transcendentalist speak so eloquently about trade?

Rumi, the Romantic Alchemist: Copper over Gold

Rumi: There's courage involved if you want to become truth. There is a broken / open place in a lover...What's the use of old and frozen thought? I want / a howling hurt. This is not a treasury where gold is stored; this is for copper. / We alchemists look for talent that can heat up and change. Lukewarm / won't do. Halfhearted holding back, well-enough getting by? Not here.

Fiscally Responsible? Follow These Resolutions

An oldie from 2010, but still a goodie:

Don’t vote for any ballot measure that creates an unfunded obligation on the state budget or “locks in” more of the budget.

Constitutional provisions that limit the use of certain tax revenues or impose spending requirements on the budget without providing the resources to fulfill those obligations exacerbate California’s fiscal problems. These provisions range from dedication of sales taxes collected on gasoline to transportation to the “Three Strikes” law establishing minimum sentencing requirements.

Why don't we teach these civics concepts to kids in high school? More here.

Law Quote of the Day

Dean Roscoe Pound: "The law must be stable and yet cannot stand still."

Netflix Finally Agrees to Caption 80% of Streaming Content!

Netflix has announced that 80% of its streaming content will be captioned by the end of 2011. It's about time. The issue of online captioning didn't appear to be on CEO Reed Hasting's radar at all in May 2009. That all changed with this May 2009 post.

Thank you so much to everyone who supported the online captioning campaign. We couldn't have done it without you!

Also, thank you to Netflix and CEO Reed Hastings for rising up to the challenge. We know it's not over yet--some people doubt that Netflix can meet its own goal of captioning 80% of its streaming content by the end of 2011--but at least the company finally appears to recognize captioning issue is an important issue.

Disclosure: I have either no shares or an insignificant number of shares in Netflix (NFLX). I continue to be a Netflix member, but have not watched more than a handful of movies online because of the captioning issue.

Update in January 2017: Reading Netflixed (2013), it appears Blockbuster's John Antioco had Netflix on the ropes when investor Carl Icahn disputed 5.6 million of Antioco's deserved bonus. The dispute led Antioco to leave Blockbuster, essentially bankrupting the company's online business (now Sling) and giving Netflix a clear path ahead.

Even more interesting is the "loss leader" strategy employed by Antioco to drive subscribers to switch from NFLX to Blockbuster Online. Having bricks-and-mortar stores once gave Blockbuster advantages--it could sell ancillary products to increase cash flow, and allow customers to return mailed DVDs to physical stores--while Netflix relied completely on online distribution. More importantly, the revenue from existing Blockbuster customers could allow it to create "loss leader" strategies to bankrupt the smaller Netflix--as long as franchisees were onboard. Such new strategies present fascinating anti-trust issues, because once a new competitor is vanquished, what prevents the sole winner of a complex, costly business model to drive up prices? 

Movie Recommendation: Gideon's Trumpet

It's actually a made-for-television film starring Henry Fonda, but it is beautifully done and a must-see. Gideon's Trumpet has everything--great acting and a look behind the scenes of the Supreme Court and our legal system. If you're a high school teacher, please show this film to your students.

Bonus: list of the best movies you've never heard of here.