GMOs Revisited – Still Look Fine to Me

tomato.svg.medProducts certified by Non GMO Project (by a private entity – proving the government is not the only source of such information) nearly tripled last year, and Whole Foods may require GMOs to be labeled in their stores, while Trader Joe’s and Chipotle have “sworn off”

GMOs, according to slate.com. But my opinion, expressed in previous posts about GMOs, has not changed. I see opposition to GMOs as increasingly irrational.

While philosophical concerns may appeal to some, fear of health effects seems to be the primary motivation for avoiding GMO foods. I have noticed no one worries about GMOs that manufacture medications.

I still find no compelling scientific evidence that GMOs are more dangerous than conventional foods.

Slate says “it’s true that the issue is complicated. But the deeper you dig, the more fraud you find in the case against GMOs. It’s full of errors, fallacies, misconceptions, misrepresentations, and lies… [Activists] defend drugs, pesticides, and non-GMO crops that are loaded with the same proteins [as the GMOs they condemn].” That’s a pretty strong statement.

The article goes on to discuss a few anti-GMO campaigns in detail, concluding that “the stories of papaya, Bt, and Golden Rice demonstrate, in several ways, that [health] concerns are unfounded.” If you’re worried I encourage you to read the article for yourself.

Slate also discusses pesticide resistance, which is a legitimate concern. Evolution doesn’t care where environmental factors come from, and weeds could become Roundup resistant. Shifting to crops that are naturally herbicide resistant also contributes to the future problem. A wise farmer will look beyond this year’s crop.

Slate also covered the super tomato: “Tomato lovers, rejoice, for science has achieved the impossible: the perfect supermarket tomato. The Garden Gem won’t bruise during shipping, it resists many of the major diseases that regularly decimate tomato crops… the Garden Gem is very different from every other supermarket tomato: flavor. It actually has it. Lots.”

Sounds perfect, doesn’t it? If your own garden tomatoes are suffering from blossom rot, like mine this year, this could be the answer. But the tomato industry (yes, apparently there is such a thing) has said “no” in what Slate calls “incomprehensible dysfunction in the tomato market.” Garden Gem would cost more, and the tomato industry does not believe consumers will pay more because they just won’t believe a supermarket tomato will taste better.

I bet they’d be cheaper than my garden-grown! (Dip into The 64 Dollar Tomato for a story crazier than mine.)

Our previous GMO posts are here.

Too Much Money

US_productivity_and_real_wagesI’m afraid our country has too much money – or, at least, too much money in the wrong places.

America had a wonderful run after World War II when the middle class blossomed, but over the past thirty years or so there has been a gradual redistribution of wealth upwards.

Over the decades, the wealthy and powerful have tweaked the tax code and financial regulations to make it easier for them to make and keep money. When rising workforce productivity does not lead to rising wages, something seems unfair.

This trend has been documented in many places, for example:

“Unequal wealth distribution is hardly a new or uniquely American problem. In fact, it’s been prevalent throughout society since humans first built civilizations: A small minority of aristocrats has always wielded the most power throughout history.

“The [top] 1 percent [executives, doctors, lawyers and politicians, among other professions] are worth about 70 times the worth of the lower classes.

“It’s historically common for a powerful minority to control a majority of finances, but Americans haven’t seen a disparity this wide since before the Great Depression — and it keeps growing.” forbes.com

Ideally, the wealth at the top would be used to capitalize increased production and an expanding economy, but America today doesn’t need more production. Wealthy people, quite reasonably, want to invest money in a safe place that earns a decent return, which fueled the 2008 recession debacle – the financial industry decided to meet the demand through fraud.

Are we in the same place again?

I fear we will see increases in corporate corruption and more frequent bubbles. If more of this wealth (and the income that precedes it) belonged to the middle and lower classes, they would spend it on products and services which would grow the economy. That would be good for everyone, but I doubt many wealthy Americans (despite Warren Buffet) see their own enlightened self-interest here.

By the way – it may not be just the wealthy driving the problem. If Wall Street can count on a certain amount of money flowing into the stock market through 401k’s every month, but that money is not needed to increase production, will it just feed corruption and bubbles? More money to Wall Street could have negative consequences. This leads me to deep skepticism about, for example, privatizing Social Security Insurance.

The obvious solution many liberals jump to is to tax the wealthy and use that money for services to the rest of the country – to build roads and bridges perhaps, or provide direct subsidies. It would be better, in my opinion, to reverse the many tweaks to our economy that have lead to this imbalance, but that would involve a huge amount of work. With such polarization in our legislatures today, the problem is overwhelming. But returning the middle and lowers classes’ wealth seems imperative to our future.

Social Security’s History and Future

Social Security WorksRecently I reviewed a book because I hated the premise. I read this book because I like the premise. The title says it all (with an exclamation point): Social Security Works! Why Social Security Isn’t Going Broke and How Expanding It Will Help Us All. I wanted to see the proof offered by authors Nancy J. Altman and Eric R. Kingson.

With an average of five stars from over three hundred reviews on Amazon, the book has a following. Altman and Kingson aren’t Social Security’s only champions, as this article on slate.com shows, there was anger over Obama’s willingness to “give away the store…[and] cut spending on Medicare, Medicaid, and Social Security In exchange for a modest tax hike of $100 billion over 10 years—targeted at the wealthiest Americans… an outrageous deal.”

Some 54 million Americans receive benefits today, with the “average retiree’s checks roughly equal to the gross pay of someone working fulltime at the federal minimum wage.”

The authors seek to debunk “a three-decade-long, well-financed campaign [that] has sought to dismantle Social Security… [and been] successful in undermining confidence… The mainstream media has aided and abetted the campaign by uncritically accepting and advancing a panoply of misconceptions, while largely ignoring the facts.”

I must admit to being swayed by the anti-Social Security campaign. Since I started my career, I have assumed I would never receive any Social Security and used to joke that my tax went to my own grandmother. Yet, here I am, nearly forty years later, and Social Security looks secure for the next 20 years (assuming Congress doesn’t damage it.)

From the beginning, many opponents called Social Security socialism. “These same opponents rarely, however, express disgust with, or seek to privatize, America’s socialized police, fire, and prosecution services or our socialized system of roads, canals, and national parks, not to mention our socialized military.”

I found it interesting to read that President Eisenhower thought the opposite. In a message to Congress, he called Social Security “a reflection of the American heritage of sturdy self-reliance which has made our country strong and kept it free.” Continue reading

Enlightened Self-Interest and Climate Change

earth climate changeThe Earth’s climates are changing. I’m an American. I’m currently “winning” in terms of climate, so change is likely to be bad for me. Efforts to mitigate the impacts will be important to me and to posterity. We can also reduce our ongoing contributions to the problem.

Huge international summits produce more media stories than useful action. The world carries too much political baggage from the age of European colonization and – especially for America – the Cold War. At climate conferences, westernized nations see attempts at revenge and emerging economies see ongoing imperialism. Talking is better than shooting, but we need many answers, tailored to specific problems or locations.

I prefer enlightened self-interest, so I was pleased to read that “plenty of entrepreneurs are not waiting for the diplomats. They are finding ways to cut carbon emissions and make money from doing it.” While some “carbon offsets” seem phony – a tree planted today can be cut down tomorrow – I like the idea of reducing greenhouse gases at the source.

“Methane is… a potent greenhouse gas that warms the atmosphere – cow manure is ripe with it – but [on an Oregon dairy farm], the methane is captured and funneled into a red generator the size of a mini-bus. The generator burns it to make electricity. That electricity is sold back to the local power company. The farmers get paid.” To reject this idea and say we should get rid of the cows is to miss an opportunity.

But the manure to methane project has another source of income. “FarmPower makes additional money just for taking that methane out of circulation. For every ton of that methane they capture they earn a credit worth about five to $10. FarmPower then sells those credits to anyone who has to lower their own carbon emissions, say, a coal-fired power plant.”

America has used the “cap and trade” technique for many years, for example, to reduce sulfur-related smog. In the late 1970s, a refinery I worked for paved dirt roads around its plant to reduce dust generated by vehicles and thereby allow the refinery to put dust out its stack. (Don’t laugh at dust. Inhaled dust particles are directly linked to health problems.) Continue reading

The Rich Pay All the Taxes

Jane Wells reported last December on CNBC that the Congressional Budget Office had issued a report analyzing the amount of taxes paid by the “five tiers of wage earners” for 2010.The report doesn’t seem to indicate that the rich are getting away without paying their fair share, although those who advocate there is income inequality will find ammunition for their argument if they read deeper into the report. The report presents the statistics on payment of taxes by the different income groups in a variety of graphs and written discussions. (The report is overly long and not written to keep your attention, but it contains thought-provoking information.) Table 3 on page 13 shows the lowest wage-earning quintile pays 0.4% of all federal taxes, the second quintile pays 3.8%, the third 9.1%, the fourth 17.6% and the top quintile pays 68.8%.

The report includes the interesting kicker that the top three quintiles pay all the taxes!  Page 11 of the report says, “Much of the progressivity of the federal tax system derives from the individual income tax. In 2010, the lowest quintile’s average rate for the individual income tax was -9.2 percent and the second income quintile’s rate was -2.3%…(A group can have a negative income tax rate if its refundable tax credits exceed the income tax otherwise owed.)…For example, although the lowest quintile’s average rate for individual income tax was about -9 percent, more than one-quarter of the households in that quintile had an average rate below -15 percent, more than one-quarter had a rate of zero or higher, and nearly half had an average rate between -15 percent and zero.” Continue reading

Beware of Pension Predators

There is valuable information in an article by Marsha Mercer for retirees struggling to pay their living expenses. Many didn’t save enough for retirement and some who did save and invest were driven from the stock market with heart-breaking losses during the financial crisis. Many of those didn’t get back in the market, which would have resulted in them recovering the losses. They probably instead put their money in “safe investments”, such as insured certificates of deposit (CDs). The Federal Reserve policies have driven those kinds of investments to paying interest rates that are below the rate of inflation. Putting money in a CD or similar relatively safe instruments at this moment in time is like saying to the banker, “Take my money and give me almost all of it back when the certificate matures.” The result is that many retirees are looking for ways to pay monthly expenses without the help of income from investments.

There have been a slew of ads on television targeting retirees.  The ads tell people they don’t have to wait to get their money from retirement programs or structured settlements.  Mercer’s article warns against jumping at those offers. It describes a retiree beset by bills that “…arranged to get a cash advance in exchange for signing over most of his $1,083 monthly pension for eight years.” He agreed to pay $1,070 a month in return for money up front. The cost for the $42,131 cash advance was $102,720. He was named the lead plaintiff in a suit against the company and the judge ordered all the people could stop making payments and that the retirees would be repaid nearly $3 million. The company declared bankruptcy and none of the victims were paid anything. Continue reading

Social Security Private Accounts

There was a commentary posted February 1, 2012 about George W. Bush’s proposal to allow young people to voluntarily invest a third of their Social Security “contributions” into private accounts. That was successfully vilified as a proposal to “privatize Social Security.” The attacks were based on the lie that the proposal would reduce monthly payments to people already receiving benefits. Older people are dependable voters, and politicians scrapped an idea that would have been wonderful for younger workers.

I wrote in the earlier commentary what would have happened if the proposal had been passed by Congress. Workers could have put the proposed one third or their Social Security “contributions” into a private account invested in an S&P 500 index fund beginning in 2005. There is no doubt 2008 was a scary year for investors. Workers earning $50,000/year would have invested about $8300 into their private account from when the change was proposed. That investment would have dropped in value to about $5700 at the low point of the financial crisis. That would scare anyone! However, what would have happened if the hypothetical investor had the guts to continue to invest two percent of their $50,000 earnings as the market dropped and beyond? The monthly “dollar averaging” investments would have bought more shares in the S&P 500 index fund, and that would have had a powerful effect on the current value of the account.   Continue reading