Monday, February 20, 2012

New television sparks memories of old ones

I hunted through our file drawer trying to find a record of the last television we had purchased. It had been around 20 years ago, when we daringly opted for a 25-inch TV to replace the 19-inch model purchased some years before. Alas, I could not find any record of the purchase, nor a user's manual for the hefty Sanyo tabletop model. But I do remember how long ago it was, based on the model car I was driving and the memory that we could not get the TV in its pasteboard box into the car, either in the trunk or in the back door. Standing in the Wal-mart parking lot, we pulled the heavy, awkward TV out of the box and folded it into the back seat.

I replaced that TV over the weekend with a model that would fit neatly into the trunk of the car and that weighed only about 15 pounds, compared to the 80 or more the old TV weighed. In the 1970s, a friend told me that the heavier a TV is, the better it is because heavier TVs have more parts in them. He may have been right at the time. Weight was not the only difference. The new TV has a 32-inch screen (a size dictated by the width of the cabinet we had to place it into) and offered high-definition video and stereo sound. After setting up the new set, I tuned in the end of the N.C. State basketball game. Wow! What a difference.

While everyone on the block, all of the relatives and most of the people in the country had switched to flat-screen, high-def TVs, I had resisted, smugly opining that my TV was perfectly fine. It had a "good picture" and allowed me to watch the football and basketball games with relatively clarity. But I was wrong. High-definition video makes a huge difference. (Let's not even talk about 3-D televisions — I'm not going there.) I thought I might ultimately resign myself to buying a flat-screen TV and measured the space I had available. Conceivably, the space could have accommodated a 46-inch screen, but that would have required a new cabinet or table to place the TV on, or a switch to wall mounting — an option impractical before flat screens came along. We decided recently that we liked our TV cabinet, which allows us to close the doors and not have the TV continually staring at us, so we measured the width and decided a 32-inch TV would suffice. I'm happy with it.

I may be just as happy as I was 28 years ago, when I bought the first TV I ever purchased. I studied product reports and settled on a 15-inch RCA XL100 set. It was the latest thing. I watched the ads and caught it for $100 off the $399 list price. It had a yellow molded plastic shell, dials for both VHF and UHF channels, a button on the front that promised to correct any color problems and built-in rabbit ear antennae. We replaced the 19-inch black-and-white with the snowy picture that had been my late grandfather's. We placed the new TV on the chrome and fake-wood TV cart that had been handed down by my wife's late grandmother. We thought we had arrived. I could watch NFL games in color! About five years later, we invested another $200 in the set when we had to replace the picture tube. On the day President Reagan was shot, I spent the day on the roof attaching a TV antenna to the chimney so I could get better reception and watch the NCAA championship game that night.

It was a yearning for a remote-control TV that prompted the replacement of that first TV I ever bought. The 19-inch model, which I remember costing around $250, was a big step up. There was nothing wrong with that set, which we moved to a bedroom, when we bought our most recent set with a larger screen some 20 years ago. For the first time in our marriage, we became a two-TV family.

Considering the $300 sale price and $400 list price plus inflation over the past 28 years, that very first TV I ever bought was a huge luxury, costing probably four times more in constant dollars than our new TV. The advances in electronics have been difficult to grasp. In even less time than this television chronology, the first (second-hand) computer we bought for $800 had far less computing power and data storage capacity than the iPod I carry in my pocket and costs less than one-fourth as much as the used computer.

So now I have a used television with a 25-inch screen that works perfectly but that, likely, no one wants. I'll donate it to a charity, which will try to sell it for a pittance. The Catch-22 in electronics advances is that TVs, computers, stereos and the rest now last far longer than their technological guts. Technology makes them obsolete long before they wear out.

Friday, February 17, 2012

Payroll tax cut has consequences

Congress has reached a deal that will extend the reduction in the payroll tax by 2 percentage points for another 10 months, along with an extension of unemployment benefits and a change in Medicare reimbursements. The payroll tax change is the clincher because, unlike the other two provisions, it affects every working American.

Democrats wanted the payroll tax extension as a continuing stimulus for an economy that is beginning to awaken from its long, deep slumber. Republicans adamantly opposed the tax cut because it would add $100 billion to the national debt. They rejected the Democrats' proposal to offset the cost with a surtax on millionaires. True to their no-new-taxes mantra — and certainly no new taxes on millionaire/billionaire "job creators" — Republicans appeared ready to go down with that ship. But then reality struck: 160 million working Americans would blame the Republicans for the $20 that disappeared from their paychecks each week if the tax cut ended. No matter how much Republican leaders wanted to protect their rich friends from a surtax, they didn't want to endure the rage of 160 million American workers.

So the Republicans caved on this one. They agreed to let the $100 billion be added to the federal debt of somewhere around $15 trillion and rising. Democrats got their way — sort of. They protected the payroll tax cut and endeared themselves to workers, even though they did have to give in on their proposal to raise taxes on the richest of the rich.

This is not, however, a win-win situation, even though both parties got something out of it. A $100 billion addition to the federal debt is not inconsequential and arguably does greater harm, long term, than its benefit as an economic stimulus in the short term. This agreement also raises the question of when Congress will ever be able to restore the payroll tax to its normal, statutory level of 6.2 percent. Whether it happens next year or 10 years from now, ending the tax cut will take money out of taxpayers' pockets, and Congress is loath to do that. Using a payroll tax cut as an economic stimulus effectively breaks the bond between the payroll tax and Social Security benefits. Since 1935, Social Security has been funded by the payroll tax on employees and employers. The tax rose as benefits rose over the years. But with this payroll tax reduction, Social Security benefits were not reduced. Thus, the payroll tax has become just another revenue stream for the federal budget, not a dedicated trust for Social Security.

Congress seems incapable of looking beyond the short term. The rising federal debt is as unsustainable here as it is in Greece or Italy. President Obama's budget proposal calls for reducing the federal deficit but does not foresee the day when the federal budget balances expenses against revenues. Therefore, the federal debt will continue to rise and rise and rise. Congress has the power to reduce spending and raise taxes to put the budget in balance, but to do so, members will have to look beyond the next election.

Monday, February 13, 2012

Bishops irate over administration policy

The Catholic Church's battle with the Obama administration over health care coverage for contraception is a strange one, not because the two sides see this issue differently but because the American public is playing silent majority, largely sitting this one out. The administration got into trouble with the church when it announced a rule for health insurance that would require all employers, even church-related institutions, to cover contraception as the 2010 national health care law is implemented.

Catholic bishops responded as if they were ayatollahs and Obama had drawn a cartoon of the Prophet Muhammad. They — joined by many Republican commentators and some GOP presidential candidates — declared that Obama was waging war against the church. Religious freedom prohibits the government telling church members that they had to buy products they consider sinful, they said, ignoring the fact that no one will be required to purchase or use contraceptives. Some compared the rule to ordering the church to ordain female priests.

Cooler heads would see the administration's rule as a requirement to provide not contraceptive pills or devices but health insurance. Government mandates, after all, require taxpayers to pay for all sorts of things (wars, for example) that their religion forbids. But the bishops would not relent from their claim that the administration policy violated freedom of religion.

The administration backed down, at least part of the way, adjusting the wording of the rule to put the onus on the insurer, not on the employer, to provide contraceptive coverage. This is little more than a veil because the cost of all health coverage is paid by the employer (and, usually, the employee, who pays a share in most situations), and neither the bishops nor the conservative pundits are satisfied.

This argument has dragged on for a week, despite polling that shows the vast majority of Americans approve of requiring health insurers to provide contraceptive coverage. Polls also show that the vast majority of American Catholics practice forms of birth control the church considers a mortal sin. While bishops (who aren't dealing with this issue in their personal lives) and conservative commentators raise hell over this matter, the American public, including Catholics, approve of the use and insurance coverage of contraception. You'd hardly know that from the news media coverage or the heated statements of critics.

Another aspect of the Obama administration's promotion of contraception has received little media attention. A few weeks before the contraceptive coverage imbroglio, the administration announced that the health care regulations would require that contraceptives be provided at no cost to insured women. That is a pretty broad leap: Insurers would have to pay the full cost of contraceptives without any co-pay at the pharmacy, not even a penny. No other prescription would receive this exclusive treatment.

This provision, even more than the rule that so irked the bishops, is a political favor thrown to women's groups at the expense of all other people buying health insurance. While promoting this provision as an assurance that all women will be able to obtain birth control, regardless of economic status, the administration ignored the sensible axiom that giving anything away for free increases demand for it. Co-pays by patients have been instituted for years to make people think twice before seeking treatment. Are free contraceptives a greater good than free blood pressure pills or free insulin or free anti-cancer drugs?

The only reason for making contraceptives free of any co-pay is to win the women's vote.

Friday, February 3, 2012

Bowles bows out; McCrory can coast

Erskine Bowles will not run for governor, and who could blame him? He lost two bruising elections for U.S. Senate, and being rejected twice by voters had to hurt. With Bowles' absence, however, Democrats have little hope of keeping the governor's chair.

Bowles, former White House chief of staff, successful businessman, highly praised for his work as UNC system president, would have been the Democrats' best hope in this abbreviated campaign since Gov. Bev Perdue surprised colleagues with her decision not to run for re-election. With only weeks remaining to launch a campaign, Democrats have been floundering about for a viable candidate.

Lt. Gov. Walter Dalton is running. So is Bill Faison, an Orange County legislator. Former U.S. Rep. Bob Etheridge has joined the race. Others, including U.S. Rep. Brad Miller, are considering taking a shot at the race.

The problem for Democrats is that none of these candidates have the name recognition and respect enjoyed by Bowles. Dalton is little known, despite years in the legislature and a term as lieutenant governor (a nearly powerless office). Faison is nearly unknown. Etheridge served two terms as superintendent of public instruction, meaning he has statewide campaign experience, but he also has baggage. As state superintendent, he presided over wasteful spending and ineffective educational schemes (remember the highly touted but quickly abandoned Basic Education Plan?). And he lost his last congressional race to an unknown, Renee Ellmers, after a devastating ambush video that made him look mean and arrogant.

All of this means that Pat McCrory, who lost the governor's race to Perdue in 2008 has a clear glide path to election unless he stumbles very badly during the campaign.