HorsesAss.Org

As a vestige of a previous life, I still somewhat track the personal computer industry, with a particular interest in the fortunes of Apple, a company I have long admired for its innovative and elegant products.  And it has always been particularly amusing to read the dire warnings and earnest advice of industry analysts and other “experts” pontificating about Apple’s latest imagined misstep.

Most recently, as the world economy headed into a nosedive, the fear and loathing focused on price… specifically, Apple’s continued refusal to dip its toes into the low end of the market at a time consumers are rightly counting their pennies.  For the first time in years, Macintosh market share was on the decline in terms of units shipped.  Low cost netbooks were the hot new thing, yet Apple was snubbing its nose at the market.  Meanwhile, Microsoft was more than happy to pick up on the “Macs cost too much” meme with an advertising campaign that featured Windows PCs’ low cost versus Apple’s pricey cool factor.

Yet this week, amidst all the usual economic gloom and doom, and even as Microsoft was announcing its first revenue decline, well, ever, Apple bucked the trend by reporting a 15% profit increase, and its best non-holiday quarterly revenue and earnings on record.

So much for conventional wisdom.

There are a number of factors that have contributed to Apple’s relative success during these tough economic times, but I think there are two that stand out from the rest.  The most obvious is that Apple’s counterintuitive strategy of focusing on the high end of the market during an economic crisis turned out to be pretty damn smart.  The high end is where people with money tend to hang out, and these are exactly the people suffering the least during the Great Recession.  Apple’s devotion to quality, design, and yes, coolness over price, is also responsible for enabling the company to maintain gross margins the rest of the industry drools at.

The other major factor in Apple’s success, and somewhat related to the first, is that, at least since Steve Jobs retook the helm, Apple has displayed an uncanny knack for giving consumers what they want.  Not what they think they want… and certainly not merely what they think they need. No, once they see it, touch it, feel it… Apple gives consumers what they really, really want.

Sure, one could buy a generic, plasticy, yet perfectly functional Vista laptop for hundreds of dollars less than the lowest priced MacBook… but one gets the feeling that even those characters in the latest Microsoft ads would have chosen the Mac if price was no object.

But… um… this is a political blog.  So what am I doing delving into the Mac vs PC wars?  Well, it all comes back to conventional wisdom.

Under Steve Jobs’ leadership, Apple is a company that has consistently defied conventional wisdom, and profited handsomely from it.  While the rest of the industry has responded to the recession by focusing on affordability, sacrificing margin for market share, Apple understood that most of those already willing to pay a premium for its products would continue to be able to afford to do so.  Apple also refuses to lower its standards in pursuit of lower prices, a steadfast resistance to commoditization that consistently earns it by far the highest consumer satisfaction ratings in the industry.

Now compare that to the budget compromise Democrats are hammering out during the final days of the legislative session.

Despite a gaping $9 billion revenue shortfall, a proposal to partially fill the gap with a high-earners income tax was largely scoffed at by the conventionally wise, as a politically futile and/or anti-stimulative tax increase during a recession.  Instead, the Legislature has settled on a cuts-only budget that includes a sweeping rollback of spending on education, health care, public safety, parks and other popular and essential services and investments.

Not exactly the Apple way.

No doubt Democrats expect that, as unpopular as the cuts might be, they’ll at least get credit for being fiscally responsible, but I think it’s just as likely that their race to the bottom will actually make it more difficult to generate public support for refunding these services in the future.  By joining the likes of Alabama and Mississippi as one of the Windows netbooks of state government—small, cramped, slow, clunky and cheap—Washington is setting consumer expectations awfully damn low.

Over time, some voters will grow accustomed to reduced services and expectations, and decide that a governmental netbook is good enough.  (Today, we call these people “Republicans.”)  Others will still long for the governmental equivalent of an iPhone or a MacBook Air, but will no longer trust the state to deliver these sort of “premium” services, at any price.  Alas, a brand once tarnished is hard to rebuild.

What Democrats in Washington state consistently miss is what Microsoft’s ad campaign intentionally obscures:  that there is a difference between price and value. Apple has thrived by delivering value that cannot be measured simply in terms of gigabytes and megahertz… a lesson Democratic leaders would be wise to learn, however unconventional.  If we diminish public education, voters will be less willing to pay for it, as they rightly perceive government to be incapable of delivering value for their tax dollars, and the same holds true for nearly every other government service, commodities all.

Any Democrat who thinks our party will ultimately benefit from holding the line on taxes has another thing coming; what voters will really remember is the crappy service and real hardships these cuts will inevitably produce.  As such, this budget will make it more difficult to enact a progressive agenda, not just in the short term, but in the long term as well.  For who in their right mind would ever be willing to pay the so-called “Apple tax” on a brand better known for cheap, PC clones?

Speaking of Texas, a new Research 2000 poll for Daily Kos shows Texas Republicans are split, 48%-48% on the issue of secession.

Do you think Texas would be better off as an independent nation or as part of the United States of America?

US: 61
Independent nation: 35

Democrats: US 82, Ind 15
Republicans: US 48, Ind 48
Independents: US 55, Ind 40

Do you approve or disapprove of Governor Rick Perry’s suggestion that Texas may need to leave the United States?

Approve: 37
Disapprove: 58

Democrats: Approve 16, Disapprove 80
Republicans: Approve 51, Disapprove 44
Independents: Approve 43, Disapprove 50

Traitors.

John Brown, bitches.

“The only difference between you and Tim Eyman,” a prominent member of our state’s media/political complex once privately chided me, “is that Tim actually manages to get his measures on the ballot.  That’s why he’s taken seriously and you’re not.”

Ouch.

We weren’t talking about my recent advocacy for a high-earner’s income tax ballot measure, which apparently is now officially dead, but we could’ve been.  While a handful of state senators, a couple of representatives and one or two journalists deserve kudos for attempting to at least start a conversation on the issue, my posts were generally greeted in the halls of power with a dismissive roll of the eyes.  Washington voters will never approve an income tax, and my exhortations to the contrary did nothing but chip away at what little credibility I had.  Or so I’ve been told.

Regardless, I remain convinced that 2009 was the perfect political climate in which to put a high-earners income tax on the ballot—perhaps a unique confluence of reality and perception that won’t be there in 2010 or beyond—but barring the imminent donation of the half million dollars or so necessary to buy the requisite signatures between now and the July 3 deadline, my hypothesis will never be tested.

And that gets to the real difference between me and Tim in regards to our relative influence on Washington politics: the half million dollars or so necessary to get an initiative on the ballot.  There’s nothing particularly populist or credible about hiring signature gatherers; all it requires is the money.  And for the past several years Tim has relied on Woodinville investment banker Michael Dunmire to fund the bulk of his signature drives.

And why should Tim have all the fun?

So if you’re a rich liberal looking to make a splash in the political scene, have I got an initiative for you:  a 3-percent tax on incomes over $250,000/year, 5-percent on incomes over $1 million… combined with a full one-cent cut in the state sales tax.  No, it doesn’t raise much additional revenue for the state, but that’s the Legislature’s problem, not mine.  What it does do is make our state’s tax structure a little less regressive, while putting cash back in the pockets of 96-percent of voters.

Using a sugardaddy’s money to pander to voters… that’s apparently what gets Tim taken seriously.  And if it’s good enough for Tim, it’s good enough for me.

So, Rep. Cathy McMorris-Rodgers has a Downs child who she clearly loves and cherishes and sees as “a special gift.”  Good for her, and good for her son.

But that still doesn’t give her the right to tell other women what to do with their uterus.

I mean, really, the very notion that raising a special needs child gives McMorris-Rodgers some sort of special authority to speak on the sanctity of life… well… it’s kinda offensive.  She made her choice, and other women should be equally free to make theirs.

Oregon critics of the CRC project, including Steve Duin at The Oregonian, continue the drumbeat that plans for a new bridge are too big and too ugly. From Duin’s column this morning:

The Columbia River Crossing design, of course, is boxed in by all manner of restrictions, including the ludicrous height limits that owe to the proximity of Vancouver’s podunk Pearson Air Field.

But the most daunting constraint, notes Metro Council President David Bragdon, “is the restriction on the imagination of the two state Departments of Transportation.

“You have two DOTs that are just driven to build huge slabs of concrete. That’s what they do. That’s what they’ve done for the last 40 years. They engineer the biggest, baddest thing they can, and think about the design later, the budget later, the community impacts later.”

I’m kind of wondering how long it will take Vancouver Mayor Royce Pollard to respond to Duin’s slam on Pearson Air Field, an historic site that Pollard has made clear is a vital part of Vancouver’s heritage and downtown future.

[Read more…]

I’ve spent an awful lot of time criticizing the Legislature these past few weeks, and I’ve no apologies.  I put a lot of effort into helping to elect Democrats, and thus I have a special obligation to keep their feet to the fire once they’re in office.  But as frustrating and disappointing as the budget battle has been, there have been quite a few positive things to come out of this session, not the least of which is HB 1517, which finally reforms our states convoluted system for restoring voting rights to felons who have served their time.

For decades, Washington has been home to some of the nation’s most restrictive felon voting laws, which as of today have effectively disenfranchised over 167,000 otherwise eligible citizens.  As no less an authority than the American Correctional Association has long argued, felon disenfranchisement is “contradictory to the goals of a democracy, the rehabilitation of felons and their successful reentry to the community.”

Under HB 1517, felons may now register to vote once they have served their sentence and completed state supervised parole or probation. It wasn’t an easy vote for many Democrats, who are often made the victim of Republican efforts to label them as soft on crime, but it was the right thing to do.  And ironically, while our restrictive felon voting laws have long had a disproportionate impact on minority communities, Washington’s felon population is still overwhelmingly white, male and working class… the state GOP’s core demographic.

Amongst Rossiphiles, the felon voter is still a potent bogeyman.  But if there is anything positive to have come out of the GOP’s losing arguments in the 2004 gubernatorial election contest, it was the increased awareness of our undemocratic and unworkable felon disenfranchisement laws, and this new bill that reforms them.

Lots of volunteer opportunities this weekend and beyond:

* Seattle Parks

* King County Parks

Leave others in the comment thread.

When I wrote this morning about a House amendment that sticks Seattle taxpayers with potential cost overruns from the risky Big Bore tunnel, I suggested that “now is the time for Mayor Nickels and other local political leaders to send a clear message to Olympia” that if they change the deal, the deal is off.

Well, I didn’t hear what I wanted from Mayor Nickels, but we did get a quick response from challenger Mike McGinn, who in a press release today promised exactly that:

Michael McGinn today announced his opposition to the Alaskan Way Viaduct replacement plan emerging in the Legislature.

“This deal keeps getting worse”, said McGinn. “As Mayor, I will not authorize the use of city tax dollars for the tunnel or associated cost overruns.”

In highlighting the riskiness of this project, McGinn points out that a bored tunnel of this size, 54 feet in diameter, has never been built anywhere in the world.  And that’s a financial risk that Seattle’s taxpayers, who voted overwhelmingly against a tunnel, should not be expected to bear on their own.

So… over one million Washingtonians vote to approve I-937 at the polls, and the Seattle Times editorial board argues that the House and the Senate should work together to amend it, because… well… I guess we the people didn’t really know what we were doing.

But, a mere 5,000 teabaggers (according to the Times’ own over-inflated count) stage a made for TV rally at the Capitol, and OMIGOD! Lawmakers can’t possibly consider raising taxes in the midst of such a widespread, populist tax rebellion!

Did I get that straight?

In reporting that Sen. Jeanne Kohl-Welles will hold a hearing on the high-earners income tax tomorrow in the Ways and Means Committee, the TNT’s Joe Turner adds…

I’m not sure what the purpose of holding a hearing will be…

Well Joe, um… maybe the purpose is to debate the merits of a high-earners income tax?

This, for me, is what has been most infuriating this session… the absolute refusal of most in the media and political establishment to even consider discussing the issue itself.  Here we are in the midst of our state’s worst economic and budgetary crisis since the Great Depression, and Kohl-Welles is being mocked for daring to discuss the highly regressive and inadequate tax structure that is at the heart of Washington’s long term budgetary problems.

Make the argument that it is a sound policy to tax our state’s poorest families at six times the rate we tax our wealthiest.  Explain why it is in the best interest of our citizens and our business community to stand by and watch our state government’s spending power gradually and steadily erode as we continue to rely on an ever shrinking portion of our economy to provide the bulk of state revenues.  Offer even a little bit of evidence to suggest that if we only ride out this recession, state revenues will ever return to pre-crisis levels, adjusted for population and inflation.

Go ahead… try to make an actual argument as to why the income tax is unfair, unworkable, and unrealistic, for chrisakes.  But no… you’d just rather mockingly dismiss it out of hand as an unserious proposal because voters rejected one iteration of it some thirty-five years ago.

My God.. there are two sides to the budget equation—expenditures and revenues—so why is it that the only responsible, reasonable and serious thing to do, is to debate the former while ignoring the latter?  Shame on all of you.

Freddie Mac CFO David Kellerman was found dead this morning, the apparent victim of suicide by hanging.

So… how long before the righties start producing videos accusing Obama of complicity in Kellerman’s murder? Or is Kellerman just another victim of D.C.’s most notorious serial killers, the Clintons?

Don’t forget, the “will of the people” only counts when that will is expressed as anti-tax, anti-consumer and anti-worker sentiment intended to destroy things.

No worries about a special session to fix this!

The House passed the bill, HB 2363, on an 84-12 vote. It now goes to the Senate.

The raises were spelled out in Initiative 732. But they would be suspended through mid-2011 for school district employees, community and technical college academic employees and classified employees at technical colleges.

Obviously paying teachers enough money to afford extras like food and housing was a bad idea, because that would be constructive, not destructive.

So when citizens decide they want to support things like education, it doesn’t matter, the Legislature will just discard the program rather than work on the tax system. You don’t really hear crap about the “will of the people” now, because the only people who count are politicians, lobbyists and well-heeled contributors who can buy their way onto the ballot.

The suckers are the ordinary citizens who play by the rules, buying houses and goods they can actually afford, paying bills and taxes on time, expecting only some basic opportunities from the state like quality, affordable education.

But teachers and parents should vote for a regressive sales tax increase to fund health care this fall! Because it makes so much sense to lay people off, crowd classrooms, raise tuition and then ask for a regressive tax increase.

Good luck with that, Democrats, you’re going to need it.

“Why does Frank Chopp hate Seattle?” That’s the question Josh asks at Publicola after State Rep. Reuven Carlyle (D-36) showed him an amendment to the Viaduct Bill that pins potential cost overruns on the backs of Seattle taxpayers.

The amendment, sponsored by House transportation committee chair Rep. Judy Clibborn (D-41, Bellevue, Factoria, Newcastle), says any cost overruns on the Viaduct tunnel project have to be paid by Seattle-area businesses—a standard for a state-funded project that Carlyle argued had never been applied to locals before. (Without any local accountability measures, for example, Rep. Carlyle pointed out, the state has spent $1.56 billion on 405.)

[…] Carlyle wasn’t simply standing up for his turf, though. He believed the amendment, if passed, would set a “dangerous precedent” that locals across the state could now be held accountable for cost overruns “on any bridge, ferry, roads, or building project.”

The “Big Bore” is the brain child of the oh so credible Discovery Institute, which, based on its profound respect for the sciences, promises that new and barely tested deep bore technology can dig the tunnel cheaper and faster than ever before possible.

Um… maybe.  But maybe not.  The deep bore tunnel is without a doubt the least studied Viaduct alternative from an engineering and a geological perspective, and yet it was quickly embraced by the powers that be after local voters and politicians appeared to be reaching a consensus on the much less sexy surface/transit option.

Surface/transit was also the least expensive option, for both the state and the city, and no doubt the easiest to accurately estimate costs, as we have a helluva lot more experience laying down asphalt than we do sending giant boring machines through downtown Seattle’s relatively unexplored substrata.  Discovery’s assurance’s aside, the Big Bore is by far the riskiest option in terms of potential cost overruns.  I’m loathe to bring up Boston’s infamous Big Dig, as I don’t subscribe to the notion that Americans have somehow lost the ability to engineer tunnels, but… well… shit happens.

And if shit happens, it should be the responsibility of the state to clean it up.  After all, it’s the Governor and the Legislature who put up the most resistance to the surface/transit option, and who eagerly sought out the Big Bore as a magically delicious alternative.  So why the hell should local taxpayers, who were already prepared to settle on a less expensive, less risky (and yes, less elegant) solution, pick up the tab should Discovery’s faith-based transportation plans turn out to be not all that intelligently designed?

We shouldn’t, and now is the time for Mayor Nickels and other local political leaders to send a clear message to Olympia that, if they change the terms of the deal on us, forcing us to pick up the costs of their potential blunders, then the deal is off.  Seattle has already agreed to pony up $1 billion toward the cost of replacing this state highway, but if this amendment sticks, placing all the risk on our backs, I say we put away our checkbook and tell our legislators to just go screw themselves.