MAGNIFICENT CARNAC

I've explained why I think Cap and Trade is a bad idea. When EO was young(er) the Great Carnac, a clairvoyant, often made an appearance on the Tonight show. His ability to predict the future never failed to astonish.

Carnac the Magnificent.

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EO does not pretend to have the same ability as Carnac, but does have a carnival huckster's flair for embellishing the obvious with the faintly absurd. EO has a dozen predictions, probably because he likes eggs. as well as most numbers evenly divisible by 3. Plus, there were 12 apostles and 12 tribes in Israel. And 12 days of Christmas. The 12 predictions below are neatly divided into four groups of three. Because Threeness is important.

12 Apostles.

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12 PREDICTIONS FOR CAP AND TRADE

PREDICTIONS 1-3: LOTS OF MONEY, EXCEPT FOR US.

1. Crooks (think Joe Kennedy, President Kennedy's bootlegging father) will become Cap and Trade billionaires by cheating the system.

Joe Kennedy: Nazi sympathizer, Democrat, philanderer, bootlegger.

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2. Consumer prices will go up dramatically; so will unemployment. Wages will stay put or go down. Bill Gates and friends will not notice at all. The rest of us will suffer.

Bill and Warren rocking the recession.

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3. Al Gore will become an even wealthier man than he is now.

Carbon Bigfoot print: Al Gore's Nashville mansion.

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Think Halliburton, only with an earnest Al Gore smile. (The link takes you to a sympathetic NYT article on Gore making tons of money from businesses that stand to profit from his Green lobbying). I don't actually mind Al Gore making money, if taxpayers also made out as well on their investment. Unlikely, in this case.

PREDICTIONS 4-6: MALFUNCTION JUNCTION

4. The massive transfer of wealth forced by Cap and Trade will be poorly managed and have bizarre, unintended consequences. The Road To Economic Hell will be paved with Cap and Trade's good intentions. Along with the Reid-Pelosi health care reform legislation.

The Good Intenders
Coming Summer, 2010
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5. The program's intended results will be largely unquantifiable and highly debatable, much like TARP and the economic stimulus.

6. Cap and Trade's benefits - affordable cleaner energy and a cleaner environment - are decades away and by no means certain, while the trillions in costs are both certain and immediate.

PREDICTIONS 7-9: BIG, UGLY, SNARLY GOVERNMENT

7. The government will have to hire 100,000 new federal agents - a new IRS - to police the very complicated Cap and Trade laws. IRS has its hands full already.

8. The system will be as smoothly administered and well received as Prohibition and the War on Drugs. Ouch.

9. Cap and Trade will wind up looking eeriely like tobacco allotment, a federal program still hanging around from the 1930s. The purpose of tobacco allotment was to limit tobacco production in order to prop up the rural South by keeping tobacco prices high. Bottom line: the Government pays farmers billions not to grow tobacco. Tobacco allotment serves no legitimate economic purpose. It is just a zombie program that redistributes billions of dollars annually to satisfy a very narrow political clientele. But politicians - left and right - love it: they can play sugar daddy with other people's money.

Imagine if we could expand tobacco allotment to cover everyone!!

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PREDICTIONS 10-12: PRINT MORE MONEY AND LEARN CHINESE

10. The next Crisis du Jour will be a longer term problem and more expensive to fix than the last one. That has been the pattern so far:

Sub-prime (immediate problem) to
Stimulus (1-2 year horizon) to
Health Care (decade) to
"Cap and Trade" (century).

Each one less urgent and more expensive than the last.

11. When the government tries to punish people for using oil and coal, the resistance, both political and economic, will be more ferocious than it was for Prohibition. Fuel tax evasion is already a billion dollar industry. Wait until every industry in the economy has a stake in the game.

12. If we keep spending money we don't have, we will become Big Greece and China will become our Big Germany. But unlike the (current) Germans, the Chinese have a vicious totalitarian government, nukes, a booming economy and visions of dominating the Far East. They have a population of more than 1 billion and a land mass bigger than the U.S.

China & U.S. - Big Boys.
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Comparison of gross domestic product of various
countries portrayed as a portion of the map of the U.S.
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Germany actually wound up bailing the Greeks out, after much grumbling. I'm not so sure about China coming around when we drive off the cliff.

So we got that going for us.

Next Post: EO's simple, "can-do" suggestions for improving simply EVERYTHING.

CRISIS DU JOUR

It is baseball season. EO always liked keeping score. Who wouldn't while watching Willie Mays, Hank Aaron, Tom Seaver, Bob Gibson, Sandy Koufax and other mythic figures?

Bob Gibson inspired awe in one young fan in 1968.
22W-9L, 34 starts, 28 complete games, 13 shutouts, 1.12 ERA.
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So I thought I would do a scorecard on our many crises. "Crises" is an inelegant and unfortunate plural. It's hard to see or hear the difference between the words "crisis" and "crises." Which makes it hard to figure out if we are having just one crisis or many crises.

See what I mean?

But a scorecard promises pristine order where there was only chaos. So here goes.

TARP (Troubled Asset Relief Program) (2008) - $100 billion. Purpose: Bail out bankers, fix results of stupid government sub-prime mortgage programs. Seems to have staved off total planetary chaos for now. Lots of toxic assets and upside down homeowners still running around. We'll see how that goes.

All hail the aliens who designed the bank bailout!

Job Stimulus (2009) - $800 billion. More expensive than Iraq and Afghanistan combined. Goal: keep unemployment to 7-8%. Hasn't worked so much. Unemployment stuck at 9.8-10%.

Stimulus: not so much.

Health care (2009-2010) - about a trillion (not sure). Extend broken health care system to cover 40 million more people. Doesn't fix runaway costs in Medicare/Medicaid/Social Security (MMSS) system. Accounting gimmicks run out 2020. Not promising.

"Cap and Trade" (summer 2010) - many trillions (not sure). This is the Global Warming fix. If successful it will reduce the expected 1' to 2' rise in seas (ca. 2100 AD) by a centimeter. At a cost of $3,000 to $4,000 per household. Per year. Forever. That's $450 billion a year - in addition to taxes we already pay - redistributed by government fiat.

If you think the government is better than you at making productive use of your money, you rate this a huge plus. If not, this is a painful mistake.

Cap and Trade: Naked and Unafraid.

The reason for "Cap and Trade" is that government doesn't know how to make cheaper, cleaner fuel, but it does know how to regulate. So we will fire up regulations to make oil and coal more expensive, which will force us to use less fossil fuel.

Simply put, we will cut back substantially on fossil fuels, trading present economic well-being and growth for (possible) reductions in carbon dioxide emissions.

Now this may be what you want, but understand that it is fuel rationing. Remember Prohibition? Alcohol rationing. How did that work out?

Al Capone. Loved Prohibition. Everyone else?
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The War on Drugs? Dope rationing.

You see my point. Dope and alcohol rationing do not have histories of solid endorsement by the American public. Neither does sex rationing, in the form of keeping it within the bounds of marriage. At least not since my generation came on the scene.

I've heard the lectures about the evils of Demon Oil, many of which I agree with. But the three deadly amigos - sex outside marriage, drugs and alcohol - have killed tens of millions of people, while giving us nothing much in return, except some classic rock songs.

Allman Brothers Band at Fillmore East.
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We still can't get people to quit smoking dope, fornicating and boozing, despite millions of hours of lecturing and the obvious and horrendous social consequences of the prohibited behavior.

Meanwhile oil and coal - by giving us cheap heat, power and food - have saved millions of lives and lifted millions more out of brutal poverty.

If we can't stop people coking, boozing and sexing themselves to death, never mind the clear cost/benefit rationale, why do we think fuel rationing will work?

Magic?

Illusionist David Copperfield.

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Beats me.

Next Post: "EO's Top Ten Predictions for 'Cap and Trade.'"

PYGMY

I picked up this book called Pygmy at the airport the other day. The book is written by Chuck Palahniuk, who wrote Fight Club. Fight Club became a movie in which very pretty male actors beat the snot out of each other.

Fight Club: Stylized Beatings of Pretty Men.
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Pygmy said "National Bestseller" on the cover. The Washington Post said "Palahniuk is brilliant."

The blurb on the back sounded interesting: "Pygmy is one of a handful of young adults from a totalitarian state sent to the U.S. disguised as exchange students . . . they are planning an unspecified act of massive terrorism that will bring this big dumb country and its fat dumb inhabitants to their knees." The Baltimore City Paper said "A hilarious cover-to-cover read."

I picked it up. I started reading it. My bad.

First, Palahniuk is a gifted writer, and extremely funny. But being gifted and funny is not a magic potion that makes everything okay.

In the second chapter the little cutthroat protagonist contemplates, in some detail, the homosexual rape of a snot-nosed teenage bully he encounters at a Wal-Mart. A few pages later, the protagonist began acting out on this meditation. I put the book down.

I was about to toss it in the trash can when I remembered that I can bring the book back to the airport bookstore where I bought it and get half the price back. So I'll be making a stop there the next time I'm through the airport in Hotville.

This is what passes for great literature in my country. It is apparently okay to depict torture and rape in order to (a) be funny (b) write satire (c) serve any other artistic purpose one may have in mind.

Dipping religious icons in feces and urine, writing about sexual perversity and wallowing in descriptions of torture are considered fine art by my cohorts, the Baby Boomers. This is part of what will mark us as "The Worst Generation," when that book gets written 50 years from now.

We mistake our perversions and illnesses as something worth staring at and chatting about over cocktails. To label a novel scandalous is to ensure bestseller status.

In reality, Chuckie P's rape fantasies are just the puss that leaks out of unattended boils. I cannot imagine what degradation he has been through to arrive at the point where a detailed description of homosexual rape seemed like a brilliant idea for his novel, but I would say Chuckie P. is officially a broken unit.

Maybe he could focus on getting better, rather than helping infect other people with his afflictions.

And by the way, Chuckie P. needs to stay away from my children.

Enough said.

HOMELESS

Mrs. Optimist and I sold our home in Big Cold Town (BCT) recently. The process was tinged with sadness, but our sadness was assuaged by the $3,000 or so per month we save from (a) not paying the big mortgage for the big old house (b) not paying the big taxes from BCT and (c) not paying the big utility bills for heating and cooling and watering and sewering the big old house.

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But most of all we save the psychic pain that comes from the sudden, catastrophic "you must fix this immediately" moments that are such a charming part of home ownership. Mrs. Optimist totaled up all our out-of-pocket "fixer upper" expenses while we were fussing around getting ready for settlement. It turns out we averaged $666 per month during our 12 years. That's over and above fixed costs.

666 is, of course, the Sign of the Beast. (Revelation 13:16-18). I'm not suggesting this is significant. Just noting the coincidence.

I used to joke that I should film a TV show called "This Damn House" for PBS. Mrs. Optimist and I were compulsive "This Old House" watchers. We could relate. But then I realized that Bob and Norm and the guys were having a lot of fun. We were not having so much fun.

Bob and Norm had carpenters and plumbers and electricians and an unlimited budget. Not us.

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We had a bunch of kids and not enough money.

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And so when Mrs. Optimist would call me at work and say "there is water pouring through the second floor roof like a waterfall - it's running all the way down to the basement -" I would go home and go on the roof in a hurricane (yes, this happened) and hammer shingles.

Roof + Hurricane = Hurricane wins

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That's what I'm talking about. Not a lot of edifying things said on the roof during the hurricane. Wish I was a better man, but there it is. I was angry, soaking wet, cold and scared out of my wits.

So as much as I loved our home, I'm feeling mighty fine right now.

I'm thinking of taking the monthly savings and purchasing us a little solace. Like a trip to Jamaica. All cash. No credit card.

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And while I'm on the beach I will dream a dream about standing on a rickety ladder holding up an 8' sheet of gypsum against the plaster ceiling with my head while I try to balance drywall screws on the tip of my screw-gun as I drive them through the sheet rock.

These guys are wimps, using their hands.

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It is a cool trick, but it leaves you with permanent headaches. They don't tell you that stuff on "This Old House."

Holding drywall with head = bad headaches.
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I like renting a lot.

BUYING PLUTO

With our new found fortune - derived from paying off all our debts and selling our house - we are faced with the remarkable problem of where to put our money. I've hit on a new investment scheme that is destined for greatness.

Buy Pluto.

The opportunity here is immense. Pluto was recently downgraded from planet status and de-listed from all the major exchanges. Nevertheless, Pluto has not actually changed shape or form since being downgraded. So it is severely undervalued right now, especially when you compare it to any of the planets. Pound for pound, it is even undervalued when compared against asteroids and comets.

Which makes no sense at all, since Pluto is a lot closer to Earth, on average, than any of the asteroids or comets. This is how you know that an irrational herd mentality is at work.

By the way, a guy tried to get me to buy Mars. That is crazy stuff. EVERYONE is long Mars, and it is hopelessly overvalued.

Besides, Pluto just fits for me and Mrs. Optimist. It is way out there, it has a weird, eccentric orbit, and no one can figure out exactly what it is. We feel a kind of empathy for Pluto, a real sense of solidarity.

What's great is that I've found an outfit that sells fractional shares of Pluto, so I can do this over time. The deal is I pay a regular amount each month, so I'm buying more of Pluto when the price is down, less when the price is up. Over time I undercut the average market price for my Pluto stock.

Right now there aren't many buyers for Pluto, so the price is very low. In a few years, when everyone can see the value, the price will skyrocket, and Mrs. Optimist and I will probably be on to the Tibetan yak dung futures I read about in the Wall Street Journal the other day.

That's just the way we roll.

NOBEL PRIZE

Is it not hilarious that Al Gore and Barack Obama have both received Nobel Peace Prizes for doing nothing about peace? Gore made a documentary about global warming that rivals Reefer Madness for zany overstatement. Obama spent a year apologizing for George Bush while continuing Bush's war policies.

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I think the Swedes are doing this on purpose, to mock us. It's like the Nobel Irony Prize now.

Next up for Nobel Peace Prizes are David Cameron, for (kind of) winning the recent British elections, and Oprah Winfrey, for publishing a magazine every month about herself.

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I also predict a Nobel Peace Prize for Madonna for learning to speak with an English accent, and one for the entire State of California for going broke.

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Those Swedes think because they are tall and have blond hair that they are entitled to laugh at us. Wait until global warming hits and their country gets really hot. When President Obama refuses to send them a trillion dollars to bail out Saab and Ikea, let's see who's laughing then.

HEALTH CARE AND ME

It is tax day tomorrow, April 15, 2010, and I have a new tax code tweak that I think will "hope and change" the health-care debacle to death. The beauty is that everyone, whether right or left, can get behind this idea.

The Democrats and Independents who voted for Obama like big government and like paying over most of their income to make government bigger, stronger and better able to pay out benefits.

The Republicans who voted against Obama don't like that so much.

The tax gambit is this: everyone who was a registered Republican in 2008 gets a "Health Care Tax Credit" (HCTC) from IRS for their per capita share of any taxes paid that are attributable to funding Obamacare.

The Republicans will use the money to jump start the economy by buying fur coats or cars or some such. Or maybe even buying health care, if that's what they want. It's just like the $8,000 stimulus for first time home buyers, only more effective, since first time home buyers are usually not as smart with their money as "Rs."

Everyone who registered Democrat or Independent pays their share of the extra tax burden, plus extra bucks to fund the new HCTC. This satisfies the "D" moral fervor to pay more taxes and grow government and makes them feel much happier than they are now.

To pay for the heavier taxes, "Ds" can sell their houses and cars, buy older bicycles (the ones with heavy tires), move into cramped apartments in the city, smoke home-grown marijuana, stop shaving and using air conditioners, eat more tofu and navy beans, and stop having babies. Since these are all things they know they should be doing anyway, all the better.

Republicans can buy cheap health care from highly qualified non-citizen professionals in Metuchen, or even Singapore, with their extra HCTC money, and maybe catch a few days in South Florida or Acapulco, where they will smoke too much and eat unhealthy foods. This means they will die sooner, which has to be a plus for "Ds."

Democrats and Independents can get health care insurance through carefully regulated regional cooperative insurance federation thingies with impenatrable names and accounting rules. These Leviathans will provide mediocre health care insurance and mediocre health care for all "Ds" and "Is," while reducing America's budget deficit and making America just a little bit more like France, without the arrogance, racism and huge unemployment problem.

As I said, this is a total win-win. Republicans get to spend the money as they see fit while dying sooner from their inevitably poor decision-making, while Democrats get to pay taxes and grow government.

The only potential glitch is if the Republicans pool their HCTC money and start shorting U.S. Treasury bonds. But so what? Who cares if the Chinese lose money?