Looking Forward

There isn’t like waiting until the eleventh hour to make a decision to post. Indeed, this will be the final post of the 2011. Speaking of not being able to make a decision, I suppose I would fit in fine company were I in Iowa as the final poll predictions are coming out with Romney coming out on top. Still, for Republicans, this has been a roller coaster ride. I wouldn’t be surprised to see Rick Santorum actually top the polls in the next couple days.

2011, I feel, was a relatively unremarkable year from an economic perspective. As I posted last year, 2011 was not much different from 2010.

But while I have a few moments, here are my predictions to usher in the New Year.

1) Barack Obama will be re-elected. Let’s face it, if the economy recovers, this will be all but assured.

2) There will not be a double dip recession. If there is a double dip recession before election day – which I sincerely doubt – my first predictions will be shot.

3) Unemployment will drop below 8%. Again, economy.

4) I will post twice a month. At least.

I know, short post. More to come in January. Times two.

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Mental Fortitude in the Early Morning

Today the sun rose at 5:52AM this morning and I’m proud to say that I was up – well up before then.  Back in the day, which technically isn’t incredibly far removed – I would be running already – maybe have even completed a good portion of ten miles.  It was an incredible feeling when one could start and finish the workout before the the sun appeared over the mountains.  For me, I had already accomplished something – a workout, part of my training routine during the cross country or track season.

Yet it required a great deal of mental fortitude.

I’m not sure that that waking up early ever comes easily – with or without coffee.  It’s almost as if the heavy presence of tryptophan in the air continually pulls down on my eyelids until I wake up at the same time as of the sun.  Maybe this is as life should be.  In heaven.

But again, I’ve reverted to my early bird discipline – not with running in the morning (I’m only disciplined enough to work out in the evening), but with attempting to seize the day – err morning.  (How many of these blog posts are actually *written* in the morning?  Few).  In following with my last post, the morning time helps to re-evaluate and formulate my objectives in the short term.  I know, impromptu habit/discipline sounds like a New Years Resolution – which, in that case, it’s either overdue or premature.

I wonder how much Congress could accomplish by grabbing a cup of joe and hashing out the details of cutting a trillion dollars from the budget in the disjointed raucous of a heavily trafficked coffee shop in downtown D.C.  (or Phoenix) in the early morning.  My guess is that they may be able to accomplish more here than behind closed doors.  Sarcasm aside, I think the larger sentiment reflected by the myself and portion of the nation is that we are less than optimistic over any budget deals.

With the election battle lines being drawn, the economics the debt ceiling and sequelae  will be pushed back until at least December where a vote isn’t required until just before Christmas.

Until then, we can only hope that our government will possess the mental fortitude needed to place the nation ahead of politics.  And that’s a venti hope.

Americans: The Overcomers

It strikes as both frightening and eerily fascinating how many individuals live one paycheck away from financial oblivion. I see it nearly every day. Resilient but shaken are most clients that walk through the tinted glass doors at the personal injury law firm where I work.

Many are blue-collar, state-dependent individuals that manage to stay afloat financially – but just barely. A substantial number have no formal education beyond high school. Some are secretaries, medical assistants, and waitresses. Others are unemployed, or illegal. Still a few are drug dealers, drug abusers or homeless. Regardless of one’s background, these are our clients, and we treat them just as we would the upper and middle class folk; we have those clients too (though few and far between).

For being one accident away from fiscal ruin, these clients do survive. For example, Sally (a pseudonym) was rear ended when an F-250 barreling down at thirty miles an hour failed to stop. The impact totaled her 1997 Oldsmobile Alero. Sally did not have insurance on her car; it lapsed because she needed to pay rent – not that it mattered anyway since originally she only possessed state-minimal liability coverage. It’s frightening really. Sally has no other vehicle and the defendant insurance company in this case will take three weeks to accept responsibility for the accident. Her boss will fire Sally if she does not arrive at work on time. Besides her injuries, transportation is her main issue.

Sally represents the majority of our clients. Clients like her live paycheck to paycheck with little to no rainy-day savings. One auto accident potentially cripples them. Here, Sally manages to bum rides, take the bus, bike and think of other temporary ways to plan for the next day. I cannot commend her lack of financial planning, but I am fascinated with how clients like Sally manage to survive. Without fail, the hardships they endure because of an accident are overcome. I’m not sure how they do it, but they do.

As of late, I can’t help but think this is the American way, for better or worse. With the depressed economy, underwater mortgages, unemployment near ten percent and more debt in dollars than stars in the sky, I often wonder what the future holds for this country. Somewhere along the way, Americans have failed to grasp the basic principles of sound financial planning. “Saving for a rainy day” takes a back seat to “buy now, pay later.” When that rainy day arrives, Americans struggle not to drown.

I don’t mean to criticize or demean those that are barely making ends meet. Just the opposite, even those hanging by a thread manage to press onward; this is commendable. Nonetheless, proper planning is always an acceptable trump card to play. While we can overcome accidents and terrorist attacks man-made disasters, we also need to be prudent in planning for the unanticipated. Baby steps like saving a portion of one’s paycheck in a bank can offset many of the financial disasters that inevitably occur. Though it is important to help clients like Sally, it is equally important to teach those like Sally the methods to adequate prepare for life’s interruptions.

Arizona’s Budget Deficit: More Cuts to State Programs

Lest ExDeserto drift into blog heaven, I am pleased to finally post this month. At least I can check the box for “September Postings” even though it is a meager meal for voracious readers.

Earlier this morning, I am across this article on the Arizona budget deficit. Arizona is now in $850 million dollar deficit. That’s the good news because the next year, it gets worse with the projected budget next year at $1.4 billion dollars. I have stated before that raising taxes is not the appropriate response to this budget crisis.

Reliance on state funded programs – particularly on non-essential services – creates a welfare state. It’s not uncommon to confuse the non-essential with the essential. Without a doubt, government is needed to police its citizens and maintain stability. When it grows beyond those confines, it risks creating unsustainable benefits or committing superfluous expenditures, even if it is well-intentioned.

To cut this deficit, certain programs will be reduced. To a certain extent, this is unfortunate because corporately, Arizona citizens have become accustomed to certain benefits. Still, while budget and service cuts are inevitable, these cuts will hopefully stimulate the private sector to profitably operate a previously subsidized operation.

So where are we looking to trim these costs? The state-funded universities are not out of the clear yet. In fact, they are probably among the first on the chopping block – rightfully so too. Over-funding public education risks watering down the quality of education. It’s the same problem with socialized medicine.

Speaking of health care: the Arizona Health Care Cost Containment System (AHCCCS) – the state and federally funded health care program – will receive its share of benefit reductions too. These are not easy cuts, especially with healthcare. Nonetheless, a time existed when these programs did not exist, yet we managed; and we will continue to do so.