Sneaking Suspicions
Archives-- April 20-May 3, 2003

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This page includes posts from April 20-May 3, 2003 in the usual reverse order. Each posting on the home page is perma-linked to these archive pages.

May 3, 2003
Ignoring basic economics at one’s peril

A Reuters story yesterday helps prove a policy point sometimes lost on the nation’s lawmakers: One ignores basic economics at one’s peril.

Current projections are that the moneys generated from increased tobacco taxes are not going to meet previously estimates, as smokers decrease their purchases of the cancer sticks:

By boosting excise taxes to more than $1 per pack in some cases, states have pushed smokers to abandon their brands or quit altogether. That in turn has threatened the profit picture for leading U.S. cigarette makers, analysts say.…

Manufacturers had anticipated a drop in consumption at low single-digit rates.

"We think we're experiencing something substantially greater than that," Andrew Schindler, chairman and chief executive of R.J. Reynolds Tobacco Holdings Inc., said in a conference call in late April. "I can't quite explain at this point, but I am confident we've got a consumption decline that's way different than what we thought."

RJR said the decline in consumption of its brands could be as much as 8 percent to 10 percent this year.

As noted in the article, Big Tobacco will most likely try to use this data to force a cut in the take by state governments under the terms of the huge tobacco lawsuit settlement.

Nasty little conundrum, isn’t it?

The states are trying to avoid both large spending cuts and across-the-board tax increases to meet their budgets. If the current trend continues, the states will also be faced with the inconvenient fact that there really are limits to the potential revenues from this targeted tax.

I doubt there’ll be any political will to cut the current excise taxes, even in the face of declining income. Too many folks, especially those seeking to replace incumbents, could claim that the legislators are simply kowtowing to Big Tobacco’s poor-mouthing.

On the other hand, I haven’t seen any sign that the state governments are suddenly coming around to thinking that general tax increases are the way to go. I think it’s more likely that this news will push the governors and state legislatures to search for other subsets of taxpayers to tap for replacement revenue, if the projected tobacco money doesn’t materialize.

That’s because the interest in re-election will nearly always override any desire to maximize revenue with a consistent, broad-based approach to taxation. From that perspective, it is far better to split up one’s potential opposition by enacting a mix of occasionally shifting targets of revenue opportunities.

As this story shows, however, sometimes the laws of supply and demand can’t be ignored.

May 2, 2003
Filling the land use regulatory vacuum

Based on an Eighth Circuit decision issued this week, it would appear that nature is not the only thing that abhors a vacuum.

Sebastian Rucci owned about 18.3 acres of land in Franklin County, Missouri, several hundred miles from his home in Ohio. Under the county land use ordinance, the parcel was zoned as a Suburban Development District (SDD).

In 1997, the City of Pacific, Missouri annexed Rucci’s land, but did not adopt a zoning classification for his property under its own land use laws.

(I assume that the City’s decision not to rezone the Rucci parcel initially was to give him a chance to figure out what he’d like to do with the parcel first, and then see how to accommodate that interest. That’s not an unusual practice for most local governments.)

Five years later, Rucci presented the city with plans for a new residential subdivision of 62 homesites on the property. In a move more notable for its boldness than its diplomacy, a letter accompanying the plans claimed that his property was exempt from city land use regulations, because the city hadn’t zoned the parcel.

The city disagreed.

The Pacific officials told Rucci he had to file for a rezoning with the city before any subdivision plans would be approved.

Rucci then filed a Federal lawsuit making the same claim—the act of annexation without accompanying rezoning acted to create an “unzoned” parcel, free of city regulation of his development scheme.

This time the district court disagreed. The judge ruled that the parcel retained the Franklin County zoning classification in the absence of any city rezoning, thus filling the potential land use regulatory vacuum.

On appeal, the Eighth Circuit had little trouble agreeing with the lower court:

Before the City annexed Rucci’s property, Franklin County imposed a zoning classification of SDD upon Rucci’s property. Following annexation, Rucci’s property retained the SDD zoning classification. The SDD zoning classification remains in effect until the City rezones the property…. Since Rucci’s property is neither unzoned nor exempt from the City’s zoning regulations, Rucci’s complaint failed to state a claim.

Rucci’s argument would have had some appeal under Missouri law if Franklin County hadn’t zoned the parcel before the annexation. If that were the case, then he would have had a better chance of successfully convincing the courts that he owned a tiny little unzoned oasis, as if it were located in Houston, Texas instead of The City of Pacific, Missouri.

If Rucci’s property was in Delaware, however, he would have never had that opportunity.

A recent spate of annexations by several towns, often sought by developers seeking to escape New Castle County’s land use ordinances, led to reform legislation enacted in 2001. Current Delaware law requires the annexing city to amend its comprehensive land use plan to take into account the proposed addition, and to rezone the parcel as it is annexed into the city.

These two requirements tend to promote better coordination and planning, not only with the city government, but also with the state agencies that are affected by local land use decisions. It doesn’t directly address the interest of New Castle County in blocking annexations, but it certainly eliminates any argument that there’s a land use vacuum created by leaving the county to become part of a city.

May 1, 2003
Barrels of fun

The first home we bought over 20 years ago was an old row house in Wilmington, built in the early 1930s. It was part of a short block of eight such houses, each about 21 feet wide and with four bedrooms instead of the usual three. During the summers the vent in the skylight in the upstairs bathroom sometimes let a whiff of tar downdraft from the angled flat roof.

Whenever it rained, the water from the roof collected at a couple downspout pipes, and then disappeared down the pipes and under the sidewalk.

We had no idea how environmentally incorrect this drainage system was until long after we sold the house. 

The City of Wilmington’s stormwater drainage system mixed the rain and melted snow directly into its sewer pipes. It is now struggling to comply with EPA rules requiring the separation of these Combined Sewer Systems, as they're called.

Imagine thousands of such rowhouse downspouts throughout the city, now being forced to run new storm pipes into a wholly separate drainage arrangement, and you can appreciate what over 1,000 such local governments face in meeting this unfunded federal mandate.

Wilmington, with about 70,000 in population, expects to spend well over $100 million in the next two decades to eliminate 85% of this mixing.

Fortunately, there are a few options available that could provide potentially practical alternatives to spending some of those millions.

Today’s News-Journal described an experimental program using rainwater-collecting barrels that at least some environmentalists recognize as a good idea:

The city will pay for the $50,000 pilot program, which will be administered by the Delaware Center for Horticulture. The plastic rain barrels connect to downspouts. Water collected during storms would be stored and used later to water lawns and gardens, said Vikram Krishnamurthy, tree program manager for the horticulture center….

"It's not just a way to reduce the runoff from storms into the city's combined sewer system," Krishnamurthy said. "It's also a sound water conservation method that will reduce the demand on the city's water system."

Others are not quite so positive:

Allan Muller, director of the environmental group Green Delaware, said the rain barrels are a good idea. But his group wants all of the discharges captured and treated. "It's a step in the right direction, but it's also a drop in the bucket toward a real solution," he said.

Personally, I wonder whether that pun was intentional.

The plain fact is that Wilmington is deeply strapped for cash. In fact, the Governor is on record as supporting some kind of financial assistance to Delaware’s largest city, even as the State tries to handle its own budget crunch.

This barrel idea may not be a final solution, but the experiment shows promise as a common-sense temporary option.

May 1, 2003
Return to Blogging

Like a bad dream, or a nasty case of zits, I'm back again.

Tomorrow's golf column will have some of the details.

April 24, 2003
Spring Break

I'm taking a spring break from this site. I expect to return to blogging here in a week or so. In the meantime, please enjoy browsing among the posts from this year or last year, at your leisure.

April 24, 2003
Points for chutzpah

Some folks just don’t seem to accept the notion that they must pay their criminal debts to society in general, and sometimes to their victims in particular.

Joseph Bova embezzled $104,000 from his employer, the St. Vincent de Paul Corporation. He was caught and prosecuted in Illinois.

The judge gave him a break by not sentencing him to any jail time. Instead, Bova was placed on probation for a period of years, and ordered to pay full restitution for the 104 large.

When the probation term ended, the judge entered an order for the rest of the money Bova hadn’t yet finished paying back, by then a bit more than $69,000.

Apparently Bova felt otherwise. He stopped making the payments.

On the other hand, the folks at St. Vincent were not in a forgiving mood. They found Bova in New Hampshire, and filed suit to collect on the remaining restitution obligation. The New Hampshire court agreed with St. Vincent.

Not finished with his plans to frustrate his former employer/victim, Bova then filed in the local bankruptcy court to eliminate the payment order. St. Vincent challenged the suggestion that it should be satisfied with the partial reimbursement, and won their argument in the bankruptcy court proceedings.

It just so happens that these kinds of restitution orders are not dischargeable.

On appeal, Bova and his wife argued that Illinois law placed a five-year limit on restitution orders that kept this obligation from being subject to the non-discharge provisions.

The First Circuit Court of Appeals disagreed:

The statute in question states that a sentencing court "shall fix a period of time not in excess of 5 years within which payment of restitution is to be paid in full."… We do not read the statute as setting forth an expiration date for criminal restitution orders. Rather, it acts to ensure that sentencing judges do not set unduly long schedules for satisfying restitution obligations. The Illinois courts have rejected the Bovas' reading of the statute, … and so do we. [emphasis in original; citations omitted].

The Bovas, in other words, were trying to put themselves in the same status as the victim. This five-year statute was for the benefit of the victims, by making sure they didn’t have to wait an unduly long time to receive their restitution payments.

In refusing this claim, I would have also awarded Bova points for chutzpah. That’s about the only quibble I have with this Circuit Court opinion.

April 23, 2003
A good Claude candidate buried deep in the story.

Most of the time I discover Claude-worthy candidates in the headlines of major newspapers.

On occasion, however, even better contenders are buried deep in the story, when in context the obvious point had already been made repeatedly.

Today’s Washington Post provided a good example, with a piece about how the U.S. sugar industry is fighting to block a World Health Organization report about healthy diets.

As noted in the story's first sentence, for some reason the sugar growers are upset,

questioning why the Geneva-based group would urge people to derive no more than 10 percent of their daily caloric intake from sugar additives.

WaPo Staff Writer Juliet Eilperin notes the fundamental point made in the WHO study in the story’s fourth paragraph:

WHO's report suggests that people can reduce their susceptibility to obesity, diabetes and some heart problems by curbing the amount of sugar they consume. It warns that "unbalanced consumption of foods high in energy (sugar, starch, and/or fat) and low in essential nutrients contributes to energy excess . . . and obesity."

Two paragraphs later, the reporter also divulges the extent of “sugar” spread among politicians by the influential agricultural industry:

The sugar industry is a major player in U.S. lobbying and politics, doling out more than $3 million in donations in last year's federal elections, according to the Center for Responsive Politics. It also represents a major agricultural constituency, with sugar cane and corn farmers in many states.

The story then discusses other players in the controversy. It also mentions some basic facts about American sugar consumption, before presenting a routine defense of the WHO report provided by Pekka Puska, director of the agency's chronic disease unit.

Finally, in the fifteenth paragraph of this piece, this four-Claude winner appears:

Puska said U.S. sugar producers are attacking the new report "because of their own commercial interests."


That was a great one.

April 22, 2003
The Baghdad-friendly MP may have had his reasons

Andrew Sullivan, Tim Blair, and others are noting with something like anxious glee the news stories published by The Telegraph about a stash of Iraqi papers that appear to implicate Labor MP George Galloway in a highly compensated arrangement with the Hussein dictatorship.

Thus far, Galloway denies the allegations and is threatening a libel action. The Guardian is now also reporting about the controversy, so perhaps the list of potential defendants will grow larger before the suit is filed.

On the other hand, if the story turns out to be true, there will finally be a very practical basis to understand the sincerity behind Galloway's actions in the last few years with respect to the Hussein regime.

After all, an honest politician is sometimes defined as one who, when bought, stays bought.

April 21, 2003
Recommended reading in the aftermath of beating Hussein and the Taliban

Bob Cullen doesn't blog much at all, in the sense of posting a daily (or hourly) piece on his website.

Whenever he writes his intermittent Screeds, however, they are always worth reading.

Here's a link to his latest, Jefferson and Islam.

I highly recommend it for those thinking about the next required steps for the United States, after eliminating the immediate threat posed by the Taliban, Hussein, and others like them.

April 21, 2003
Nothing trashy about PBR, at least by comparison

Several bloggers noted with mostly fond approval a Washington Post story about the apparent revival of interest in Pabst Blue Ribbon beer:

Pabst Blue Ribbon, a forgotten if not forsaken brand, once the solace of the beleaguered working man, and, regrettably, a beer often associated with what people in polite company call "trash," has staged a surprising comeback. The resurgence is mostly among young adults, led by colleagues such as snowboarders and indie filmmakers….

While most young consumers buy clothes and cars to make themselves seem as affluent and desirable as possible, the materialism of many of today's counterculture youth is just the opposite. It is meant to reflect the economics of "reality," of working-class thriftiness, of the notion of America at its best, at its most optimistic, at its blue-collar prime. Of course, this is not America. This is Americana -- and an appetite for what was good when things are going bad.

The story described the mainstay of the former Pabst Brewing Company, now a brand produced under contract by Miller Brewing, and how PBR’s market share is noticeably increasing.

As I read the piece, however, one statement stood out:

What did they mean, “trash”?

About thirty years ago, Pabst Blue Ribbon was a cut above the stuff we drank in our basement as we shot pool.

My parents, who struggled to raise four sons and a daughter, hit upon a plan to increase their sense of security—make our house the hangout, so they could keep an eye on things.

Red White & Blue, an even more humble brew from Pabst, played a critical role in their mostly successful scheme.

They usually made sure a case or so of cold RWB was available, which made our house and its refrigerator a popular place for us and our thirsty friends.

It must be said that RWB was a beer about which one could safely say, “When you cared enough to spend the very least.”

Sure, it was vile.

But it was really cheap.

And sometimes you just had to watch the pennies.

RWB had some nasty side effects, but for some reason a pounding hangover headache never seemed to be among them. Perhaps it was because there was a limit to how much of it one could stand to drink at any one time.

Compared to RWB, Pabst Blue Ribbon was up there on the social scale.

To us, therefore, there was nothing trashy about Blue Ribbon.

RWB, on the other hand....

April 20, 2003
A break in the routine

The dog and I have a quiet routine in the mornings.

I wake up and walk downstairs. By this time he's usually stretching on the kitchen floor by the stairs, if he hasn't already greeted me as I leave my bedroom.

I fix his breakfast, a mix of dry and wet dog food. He picks through the dry stuff, saving it for later, and eats all the wet pieces.

I fix my coffee as he snarfles around in his bowl, and look around the house for the leash.

He then shifts around a bit near his half-finished bowl, and waits for me to attach his leash and take him to the back yard for his morning constitutional.

His stroll and momentary stops for necessities around the stake holding the dog cable takes about five minutes. While he's out there, I log onto the computer, do some surfing, and start on the first cup.

At this time of day, usually about 6:30, we normally don't see anybody else out and about. Bird calls are usually the only sounds we will hear.

Not this morning, however. Not long after I returned inside the house, the dog began barking pretty consistently. It wasn't his "I'll protect you!" bark, but his "Hey! What are you doing?" bark.

I went back out to see what he's was going on about.

It was the kids in the house behind us, about a hundred yards away.

They were giggling and laughing, and occasionally leaning down into the grass or near the bushes to grab something.

Someone had organized a very early morning Easter Egg hunt.

It was a nice break from the routine.

Happy Easter!


Contact Information:

Fritz Schranck
P.O. Box 88
Nassau, DE  19969


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© Frederick H. Schranck 2002-2003