Banbury Cross

Suppose you have a large mortgage, you are paying off your car and you have $30,000 hanging on your credit card. In other words, you are up to your ear tips in debt. Would it be economically prudent to take on some more?

If you are about to jump from your chair and exclaim "Noooo!", hold your horses and give it a little thought. There is actually good debt and bad debt, and the answer really depends on what you are going to do with it. In the first scenario, you borrow money in order to put yourself in a position that will create a positive cash flow in the future. You could use your debt to increase your education level and pay for a tuition at a respectable college, or you could buy an equipment that would help you start a new business. If all went well, you would soon be able to make enough money to pay off all your debts. In the second scenario, you would use the new debt to merely help cover your living expenses, or worse to pay for some luxury items, like a plasma TV or a vacation in Bermuda. This kind of borrowing would clearly exacerbate your financial predicament and send you on the way to a bankruptcy spiral.

National finances, albeit operating on a scale several orders of magnitude larger, have to obey the same laws of economics, much like all material objects, whether the Earth or a snowball, have to obey the laws of physics. Going into debt may not be a bad thing if you know what you are doing. Republicans like to reminisce that Reagan proved that budget deficits don't matter and that a nation's borrowing power is virtually unlimited. But the reality is not that simple. Nations have to heed what the debt is used for as well, they just have much larger leeway in dealing with consequences.

Contrary to what the Greenspan/Bernanke school of thought would make you believe, money does not grow on trees. It is supposed to represent value. Just because Central Bank can create credit out of thin air, does not mean that it can solve all our problems by throwing money at them. Just ask Rudolf of Havenstein, one of the Weimar Republic's central bankers, who learned the hard way that you cannot have something for nothing. He controlled the German financial system in the early 1920s when runaway hyperinflation basically wiped out their currency. His undoubtedly good intentions eventually paved the political way for one Adolf Hitler. And we all know where the road paved with good intentions leads to.

In the past two years our national debt increased dramatically. That means it is about time for us to start paying very serious attention to how that money is being spent.

We could spend our financial resources on education grants to talented kids from poor neighborhoods, on laboratories developing new generations of materials that the world would love to buy, on upgrading our aging infrastructure (whether introducing fast trains or superconducting grids) to facilitate future economic activity or on reducing our energy needs and steering the whole industry towards alternative and green sources. That would be the good debt. But we could also spend the borrowed funds on supporting overgrown bureaucracies at all levels, on rectifying grave investment mistakes of private banks, on recapitalizing institutions hollowed out by their greedy and incompetent management, or on bankrolling unproductive pork barrel projects, such as building water pipelines to money losing golf courses or funding research of Icelandic Arctic Environment in Viking Era.(*)

(*) Both of these examples came from the recent stimulus bill. I understand that pork barrel projects serve as important bargaining chips in political maneuvering, but I think it would be entertaining to hear the legislators publicly explain how these projects will contribute to the nascent recovery.

At the end of the day, it is our choice how we use the money we borrow and that choice will determine our economic future. We can either educate our population, modernize the production lines and repay our debt with something of value, or we can follow in the footsteps of Rudolf von Havenstein and annihilate our economy by gradually monetizing our obligations (i.e. paying them off by printing more and more of an increasingly worthless currency).

The report card is not very impressive so far. I hope Paul Volcker will take a hard look at it.

This winter just keeps on wintering.

Not so long ago, a rogue December snowstorm dropped 20 inches on DC and we thought we had experienced history in the making. Little did we know what was coming down the atmospheric pike. Nobody saw the frozen tsunami until it hit the celestial ice shredder. Now, 2 blizzards, 30 inches and 4 snow days later, it is clear that this winter will be the snowiest on record. Ever.

Three days ago a friend of mine sent me a short message complaining about the snow's unwillingness to melt speedily and opined that clearing 6 inches of snow four times would be much easier than facing all 24 that were dumped on her (and her driveway) in one lump sum. I told her that my view was exactly the opposite. I would take the full 24 inches over the four easy installments any day.

The thing is that dealing with 2 feet of snow gives you the extra strength that comes from engaging in a fight of cosmic proportions. Think Star Wars on Ice. Even as I had to extricate my car from a deep snow drift twice within one week, I felt that every dig of my shovel made me part of history. A face off with a snowstorm of such epic magnitude arouses deeply embedded survival instincts worthy of Hemingway's pen. It is the classical Man versus Nature thriller. On the other hand, removing six inches of snow four times is but a repeated nuisance, a vexing toil. Nothing to write home about. You can't count that as a heroic endeavor. Being a rowdy bar bouncer four days in a row is not going to make you into a war hero the same way a day spent on a battlefield front line does. So there.

When the first wave of the flurricane passed by, I was thinking about an appropriate way to celebrate this momentous white siege. At first, I placed 3 fresh snowballs in my freezer to be tactically launched from my balcony on a hot July weekend. That didn't seem to be festive enough for the occasion though. So next I sent an email to one of my friends challenging him to a game of tennis at a nearby public court. He thought I was joking. But when I laid out for him the unique photo op of serving over the snowed in net, he agreed.

Who would have thought that walking to a tennis court could be a trekk worthy of Roald Amundsen. On Sunday afternoon, we gathered in a parking lot and set on our way. Snow was thigh deep and pristine, the skies perfectly cloudless, and the familiar public park turned into a laconic verse of Siberian poetry. A scenery Doctor Zhivago might have relished. But the strenuous trip was well worth the effort. The court looked surreal and although we had to stork step our way around it, practicing a diving backhand into the deep drifts was a snow owl hoot and brought about a welcome addition to my hitting repertoire. We both took a couple of serves for the camera, and after our clothes got unseasonably cold and wet, we hurried back home.

So that was the day when I finally figured out why they call tennis a white sport.

Stretching the rules is the essence of beauty. The trick is not to abandon them completely.

No one understands this better than a patron of a blues alley. Jazz may be anchored in classical tonality, but as it sluices past chromatic horizons, it restlessly forays into different keys and scales. After all, there is only so much beauty that can be evoked within the confines of a single key. A good pianist may take an innocent phrase in say G major and spike it with an E-flat major 7th chord on a whim. Sure, that chord has no business in the G major key, even Johann Sebastian Bach couldn't come up with a solid justification, but if you stick it there anyway, the sky will suddenly swing its color. The notes will tickle your ears and their echos will jive on the trail winding along the crest of the Zingy Mountains, that eternal continental divide between the lively and the boring. Such is the power of a little twist. It is a preview of a different state of mind, sometimes a vista into the harmonic future. Just make sure you won't pack too many zingers into your compositions - since they might tear down your delicately balanced musical structure and deluge its vacated church with an ear-splitting cacophony of lawlessness.

What harmony is to music, grammar is to literature. I think that the best writing thrives in disputed regions where the Great Empire of Propriety gets regularly challenged by invasions of linguistic Vandals and Visigoths. The only difference is that they pelt the ramparts of established structures with gobs of slang instead of diminished chords. But the end result is the same - an army of words rushes through the breach and a free joy ride on a lexical roller coaster ensues. That is why I like novels by Carl Hiaasen or Rolling Stone articles of Matt Taibbi. Their verbal imagination canters effortlessly like a black mustang and if you tag along, sitting comfortably on its bucking back like a curious fly, your mind may discover ravines and promontories you never knew existed - all rendered in vivid colors and served at a breathtaking tempo. If it wasn't for the literary cowboys, we'd all be reading moldy sentences strained together by meticulous monks from the times of Good Ol' King James.

Human behavior has its grammar too. It is called politeness. And I would not recommend completely abandoning it either. Without it, uncontrollable hordes of loutish sociopaths would rule the Earth, littering our concert halls with their loud and off-key burping. But just like any other set of rules, etiquette is amenable to creative bending. An occasional misdemeanor can be quite charming. I love people who can skewer a manzanilla olive with their steak knife in the middle of a formal dinner and transport it non-chalantly into their oral cavity, right in front of the rolling eyes of gasping schoolmarms. They are the 7th chords of the social order, the trailblazers who will hop over the fence without hesitation and cut straight across a meadow if need be. To them we owe our diamonds - for on this planet, the precious stones are rarely found alongside the well marked trade routes. They are usually hidden out there, in the wild land of chance and the rule breakers can lead us to them.

Many, many summers ago, an officer of the British East India Company sat idly in a shaded corner of a local watering hole and pondered the vagaries of the British Empire. A glass of gin in one hand and a glass of tonic in the other, he stared blankly at his choices. And although his Mamma was telling him time and time again that nice boys do not mix their drinks, something inside him snapped. The elbow of Lady Fortuna nudged him gently in the ribs. With a sudden blast of resolution, he emptied the contents of his gin glass into the tonic and kicked the resulting potion down his parched throat. And blimey and crikey - did he like it. And so did generations and generations after him.

So here is to all those who tirelessly stretch the rules we live by and in the process put sparkling bubbles in our daily drinx.

Old things have a very special charm. They bear evidence of having lived. The little scars inflicted on their skin by Mother Nature are receipts that the toll for the passage through life has been paid. Whether it is the dent on your car's bumper, a monogram cut into the bark of a stately maple tree, a flaky wall in an abandoned alley, or a worn out instep of an old shoe - they all share unique fingerprints of passing events. What a treasure trove of clues for Mr. Sherlock Holmes.

Part of the appeal of old paraphernalia is our tendency to romanticize the past. That scratch on your motorcycle that made you so mad when it was fresh is now the last surviving memento of the party at which you met your sweetheart. That scar on your arm that hurt like hell for three weeks is now the climax, the punchline and the corroboration of a story to be imparted on your grandchildren. We are conditioned to discount bad memories so that history seems a bit rosier in the rear view mirror than it actually was when seen through the windshield. I have quite a few fond memories from my childhood - and hey - I grew up in a totalitarian regime.

Old things are umbilical cords to our memory. One of the things I brought with me to the USA when I moved here 20 years ago was my dad's old leather briefcase, which he used for carrying blueprints into his office in the 1960s, and which I used for carrying textbooks in college after I inherited it. Or rather after I rescued it from the trash. My Mom was appalled when she found out that I am taking that old piece of junk across the Atlantic. But I could not leave it behind - there were too many memories embedded in it. Every little blemish of its surface, every little laceration had a story to tell. A friend of mine had to sow it together 10 years ago lest it would fall apart, but I still have it. No new bag can emulate the appeal of having lived and the bond of having lived together.

When I am sightseeing I gravitate to old quarters that retain their authenticity (or authentitown as the case might be), which invariably leads away from the beaten path, away from the touristy routes inlaid with gleaming stores and freshly stuccoed palaces. My little expeditions through the looking glass of history often wind up in places where you can brush against a wall and grow curiouser and curiouser - did Franz Kafka once lean against these bricks when stricken with one of his depressive bouts? I hunt for secret nooks and inconspicuous recesses. And after I find them, they tease me to try and decipher their scars - those old fashioned memory cards, faithfully recording life as it bites along.

Democracy is a great system but it has one serious flaw. Political issues have become so complex and multifaceted that it is virtually impossible for average voters to make informed decisions on their own - and remember that by definition most voters are average. Who can truly grasp all the ramifications of the Health Care Bill, or what kind of financial reform will be beneficial to our economy 10 years down the road? You'd have better chances understanding Lehman Brother's balance sheets. But even more importantly, who can see through the smokescreen of boilerplate soundbites and tell which candidate masters the issues best? You can't really make much sense out them without some sort of guidance.

That leaves the door to voters' hearts wide open for sly propaganda and interpretation games. The gray border between right and wrong is seemingly teeming with seamy teams. Either side of the aisle has no qualms kicking the opponents under the table, ripping their utterances out of context and framing them in all the putrid mud they can dredge from partisan bayous. In the world of high politics, truth counterfeiters work round the clock. Democracy was an easy trade to ply in times of Socrates or Washington, but in the era of talking heads and YouTube warriors practicing public governance may warrant some pretty steep information tariffs. Say that you want to take a stand against building an extra school in your district because there is no money in the budget. Your followers can paint you as an uncompromising fiscal hawk who will make sure that public funds do not get squandered on unnecessary projects. But that very same act will prompt your opponents to slice you to pieces for not having a clear vision of well educated population. At the end of the day, your political fate will depend on which side can spin your story more effectively, i.e. which side has more dough to do so.

It used to be "One man, one vote". A John Wayne kind of democracy. But running for public office has become so insanely expensive that it sounds more like "One dollar, one vote" these days. The merry-go-round of public opinion massage therapists, 30 second TV torpedoes, in house mendacity menders and assorted PR flacks requires dizzying sums of money. In the meantime, the underlying political competition has tacitly been reduced to one simple skill - reading the teleprompter. It is not clear whether we still have elections or whether the public offices are given away in carefully scripted auctions. I am not sure what Andrew Jackson's running for the office cost, but I am fairly certain he'd be mad as hell about selling democracy to the highest bidder.

The way our elected representatives waltz with waddles of money from Big Pharma, Military Complex and Wall Street makes you wonder what promises were whispered into their ear on the dancing floor. Scanning the long scrolls of campaign contributions stuffed with future pork and saturated lard could single-handedly push your heart into cardiac arrest, although citizen's arrest would be a more apposite course of action. With hordes of lobbyists swarming the corpse of democracy like a pack of hungry hyenas, you might think it is time to consider a serious campaign finance reform and limit the amount of money gushing into politics.

The Supreme Court, specifically its Republican appointees, would strongly disagree. In a close vote held on Wednesday, they rejected limits that up to that point were restricting corporate spending on political campaigns. Rather ironically, they cited free speech violation as the basis for their decision. That means our spendthrift campaigning habits will be exacerbated rather than mitigated. Rather conveniently this shocking charade happened two days after Scott Brown (R) won Ted Kennedy's seat in Massachusetts and dealt the Democratic supermajority in Congress a lethal blow. Any legislative response to this travesty of judgment will now be as hard as finding a character witness for a recalcitrant donkey.

I think that "free speech" should be limited to entities that have mouths, lips, tongues, vocal chords and other accessories necessary for speaking. That would be human beings. Sure, constituents of private companies, from CEOs to janitors, can still say whatever they want. Just not as corporations. Corporatism is one half of fascism (the other half being nationalism) and I don't think we want to flirt with that historical beast.

Corporations are abstract legal entities whose purpose is to conduct business. Influencing electorate should be none of it. If for nothing else then for a simple fairness argument. Who could compete with Intel, Pfizer or Citigroup? Not charities, not civic societies, not local churches and certainly not private citizens.

Corporations do not have the right to vote directly, so they should not have the right to vote indirectly (through the use of their money) either. Whose interest would they represent anyway? Do we want the Prince of Dubai or some Russian billionaire on the board of a multinational conglomerate to partake in our public affairs? And even if the foreign entities were surgically removed, many nagging concerns would remain. What if deep pocketed pharmaceuticals supported candidates going easy on their drug testing? What if AIG sponsored pro-bailout candidates? What if Microsoft wanted to strengthen its virtual monopoly through creative use of politics? How could we compete with their televised weapons of mass instruction?

Today, lobbyists have to deal with whomever we vote into the office. In the future, they could actually have a say in choosing the lot. And you can bet your health insurance premiums they wouldn't go for the principled and incorruptible types.

The Constitution of the United States begins with the phrase "We the People". Please, let's keep it that way.