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Argentina and the PracticalDad Price Index

It’s irritating that so many don’t seem to realize how much of the greater world truly does impact their everyday lives, seeming to think that the world exists beyond their own cocooned existence.  We live in a world that is almost – in some ways – a Kevin Bacon game as what does happen elsewhere truly impacts us in ways that we don’t expect.  These links go beyond the pedestrian there’s yet another near-war in the Middle East so oil prices are going to potentially rise and stretch farther than we realize; things occur elsewhere that gain little notice here but can have a considerable bearing on our lives.  Such is the case when I noted an article from ABCNews.com, in which the Argentine government is criminally charging economists who challenge their reported inflation data.  My larger mental self says okay, that’s eight thousand miles away and twelve miles down the rabbit hole but my smaller, more provocative mental self is far more cautionary of the news.

Let’s step back a ways first, however.  Argentina is the favored poster child for images of sovereign defaults, a nation with significant resources that should be far wealthier than it is; it’s a nation which has undergone revolution and a bloody military junta that kidnapped and tortured thousands of its own civilians – many of whom were young adults – in an effort to eradicate domestic terrorism, but wound up attacking legitimate and peaceful opposition groups.  After coming through that period several decades ago, the existant government simply confiscated the savings of the public; the Argentine middle class was literally wiped out overnight as their bank accounts simply went poof at the stroke of a governmental pen and the click of a keyboard.  Since then, the government has forced Argentines with dollars to convert them into Argentine Pesos and/or Peso denominated bonds, flooded their monetary supply with pesos in a loose accomodative policy, asked for foreign investors to participate in energy exploration while simultaneously demanding that they submit to quarterly governmental audits and most ominously – like the accumulated debris of the previous actions wasn’t enough – been accused by multiple parties – both domestic and the IMF – of openly falsifying their inflation data.  The government has felt threatened enough that it’s now pursuing criminal actions against a small group of economists who publicly post their own estimates as the real rate of inflation in the Argentine economy.

So what does that have to do with me?  Plenty, since I’ve run a cozy, low-tech monthly price index to keep tabs on the level of grocery prices for almost three years.  

There’s been a growing distrust of our own government over the past decade, one that’s moved out of the right wing blogosphere and directly into the middle of the American mainstream.  Part and parcel of that has been a sense amongst financial bloggers and commenters that the numbers aren’t exactly as they appear; this is especially the case with the employment numbers coming out of the Bureau of Labor Statistics and their purely statistical birth/death adjustment model.  There have been more than a few months where the only improvement in the employment rate has been solely due to the application of this statistical model, followed several months by a readjustment that retroactively increases the number of unemployed Americans.  This growing skepticism has carried over to the inflation data since many can’t conceive of how the Federal Reserve and US Government can respectively keep interest rates at zero bounds and still spend like a Beverly Hills housewife on a meth-driven shopping bender.  Others – such as John Williams Shadowstats and MIT’s Billion Prices Project – have been created to keep tabs on prices, either via separate analysis of existing data or the mass accretion of global prices from online retailers.  

This PracticalDad has neither advanced degrees in Economics or Mathematics nor access to significant computing power.  What I do have is the experience of having participated in a cost-of-living index early in my professional life and the knowledge that comes from having shopped and cooked for a family for far more than a decade.  I could watch the fireworks and blog bullshit at the situation or actually utilize the skills and create my own index; this I did with the PracticalDad Price Index, which debuted in November 2010.  It’s an admittedly kitchen table affair that trades breadth of data for a grocery marketbasket of 47 separate items that is immediately understandable for the typical parent.  Other bloggers have commented that while it’s interesting, it isn’t national in scopeand they’re right.  However, it simply provides a consistent monthly glimpse of grocery price activity in one locality.  While there are certainly price differences from one region to another, the fact is that the index monitors the change in prices from a baseline and not the prices themselves.  In the aggregate, prices rising due to factors in one region will most likely rise at a similar pace in another region.  

The Argentine government’s action is cautionary in demonstrating the extent to which those in power will go to assure their continuance in power.  Our college graduates have been told that a higher education is necessary because our economy has become a knowledge-based economy; the implication is that knowledge is crucial and henceforth, knowledge is power.  When true public knowledge is monopolistically controlled, those controlling it have the power.  The Argentine economists are a direct threat to those in power within the Argentine government.  Will such a governmental challenge to information occur here?  Could someone like John Williams and an institution like MIT be threatened?  Could that actually happen to me and if so, what would I do?  While I frankly doubt that it could happen here, it’s sobering to consider it should it actually occur and I don’t know what my response would be.  It’s one thing to put out a datapoint, but what do you do when those in power try to erase it?  This is truly what I find so admirable about these few in the Argentine Wonderland, that they’re willing to undergo the risks of speaking truth to power; a courageous act.

Of course, I never thought that I’d be able to purchase depleted uranium shotgun loads for drones, either.

 

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Teaching The Ugly Realities:  9/11

Parents want to protect their kids, not only from harm, but also from the knowledge of some of the terrible things that occur in contemporary society.  We might discuss such things when they age, but a picture is worth a thousand words and no amount of classroom or dinner-table discussion can bring home the impact of what occurred and it’s unclear when the kids might be ready for a more visceral examination of an event.  Such was the question in this household as I pondered whether Youngest was now old enough to view a CBS news documentary – What We Saw – issued about a year after the attacks.

The documentary is a 2002 hardcover book with accompanying DVD that relates the events of 9/11, commencing with Bryant Gumbel’s morning interview with a witness to a purported plane collision with the first of the two towers.  It then moves through the rest of the day as New York and Washington, DC reel from the events, and further recounts the actions of the passengers on United’s Flight 93 as they willingly sacrificed themselves and took the plane into a remote Pennsylvania field.  The scenes of the devastation are still frightening and visceral to watch; in one news clip, a person opts to jump to his death instead of burning alive atop one of the towers and we can watch this poor soul plummet for hundreds of feet before a nearby building mercifully hides his final impact from our view.  Not everything is grisly and there are segments on the ensuing rescue efforts, patriotism and the resultant move into Afghanistan in search of the now dead Bin Laden.  It was a book that I purchased years ago precisely for the purpose of showing to the kids when they were old enough to more fully take in its meaning, and it was shown to each of the older two kids when I deemed them old enough.

But was Youngest now old enough?  At the time of the attacks, he was still in utero; he has spent his entire life in the shadow of those attacks and all that’s changed since then.  There is no understanding of life before the TSA, drones and a constant threat – real or imagined – of terrorism.  The seemingly ever-present surveillance camera was far less prevalent and we didn’t seem to be living with a sense of constantly impending menace.  Youngest has certainly known about the attacks from his mother and I, school and the media, but he’d never been exposed to the visual panoply of that time.  Making it an even harder question is that we’ve tried – and never fully succeeded – to keep him away from the graphic violence that permeates video games and the media.  He’s certainly seen violent movies, although rarely until this past year, but we’ve made efforts to keep the graphic combat games away and there is no – for now, but that will change – game system in the house.  The upshot is that he hasn’t become desensitized to the violence that permeates our environs.  This was brought home two years when I finally allowed him to watch the first part of Saving Private Ryan and he only lasted through the initial assault on Omaha Beach before having to stop watching.

The boy has an interest in history and the world around him, and preparing him and his siblings for the world is my principal role as a father.  It’s become an increasingly ugly world, one in which terrorists kill others for media coverage, the deranged arm themselves to hunt for our most vulnerable and schools now openly discuss what to do in the event that a gunman comes strolling down the main hallway.  Given his interest, his maturity and the nature of how we’ve had to adapt, I opted to share the DVD with him years before I did so with his older siblings.  We’d watch for a few minutes and then he’d pause the program to ask a question or listen to an explanation I’d offer for something that was on-screen.  It was a brutal experience and there were moments when I wept along with him as we viewed the CBS news reports until we could watch no further, ultimately turning it off midway through the program.

Our job as parents is to prepare our children to make their way in the world.  This means that we must pay attention to the world around us so that we can adjust plans and actions to fit the times, and what might have worked for an older child might have to be re-evaluated for the younger kids that follow.  It also means that we must be personally involved teaching these things, as uncomfortable as they might be.  We cannot leave the lessons for the schools alone, and we certainly shouldn’t leave them to the media culture; the children require a sense of context to help them make full sense of what they see and we parents are the ones who can best provide that background and context for them.  We know how they process information and whether or not they’re ready for the more unpleasant lessons of life around us.

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When School Technology Programs Affect Family Policy

The letter from the local high school came in the mail two weeks before first day of classes, amidst an assortment of administrative odds and ends, and I frankly didn’t catch it’s significance until after the new school year began.  What prompted me to go back and review it again was a comment from Middle, who’s now in high school; he remarked that he’d be getting a laptop in January and when I responded that it was unlikely, he told me that it was being given to all high school students as the start of a new “1 to 1” program.  This news was problematic since we’ve made it a point to not provide the kids with their own laptops until going off to college and this was what happened with Eldest, who received a laptop as a graduation present in May of her senior year.  This was compounded a day later by Youngest’s comment that they – his sixth grade class – had been told that they could now bring in their smartphones, laptops and iThingies starting in the Fall in order to also access the web with their teachers.  Because we do try to control the level of access and amount of screen time, Youngest has none of these devices.  So…what to do when the family technology policy collides squarely with the policy initiatives of the local school district?

This initiative revolves around grant money that can be used to purchase inexpensive laptops for the high school students.  In January, 2014, each district high school student will receive a new laptop, to be used throughout their secondary education period and afterwards, each class of incoming freshmen will receive the same for their four year period.  The rationale for this program is the letter’s reference to the opportunity for students to now take full advantage of all that technology offers in terms of educational opportunity and there are certainly good reasons for such an investment.  The presence of the laptops permits faculty to direct their students to a much broader scope of information available through the internet, potentially opening more young minds to possibilities.  Likewise, it’s “green” and there is far fewer paper used and far more trees saved.  A more prosaic reason is that with more resources available online, even textbooks, the school has less cost for school supplies.  Wow, someone else’s money for a one-time investment and X% of our own costs go away…For The Win, Baby!

While it’s a win for the school district, it’s both a question and just one more thing to monitor within the household.  We’re not Amish by any means and there’s certainly screen time going on within the household, but it’s been a conscious decision and ongoing effort to create family guidelines, monitor activity and enforce limits regarding electronics.  The remaining two kids in the household – Middle and Youngest – are definitely behind the curve from an electronics standpoint as there are no game systems, iThingies or smartphones although Middle now possesses a cell phone to match his driver’s permit.  There are families for whom this particular policy initiative would be a dealbreaker, family policy now ostensibly being dictated by a public entity; there are some – admittedly a very few – who would opt instead for a different route of education and pursue either a private institution or else homeschooling.  The irony in this situation would be that a considerable amount of homeschooling is now done via cyberschool, in which case a separate computer might also have to be purchased for the student.

So, what to do?  Homeschooling isn’t an option here since we do find great value in public education, apart from the academics alone; although I’m annoyed from reading the letter that this program was taken on after considerable reflection by staff and faculty with no mention of parental involvement.  The best that we can do, if we’re to stay within the system, is to simply shoulder the burden of amending the house rules and continuing to uphold them as best we’re able.  In Middle’s case, the laptop will have to be used in common areas and out of the bedroom; free surfing will have to occur on the family computer as before and I’ll wind up having to check more often to assure that the technology isn’t being overused.  Youngest’s case is different however.  We’ve known that many more of his friends have unfettered access to the web, both in terms of their personal devices as well as parental oversight and we aren’t willing to provide him with a device despite what the school is now offering for the nascent middle-schoolers.  It’s bad enough that I’m now going to have to add one more piece of technology to the list, but adding another for Youngest is unacceptable>  What Youngest’s teacher did advise was that any device with a wireless capability would work, including a Nook HD or Amazon’s Kindle Fire and that presents an option; not that we’re going to purchase one for him but one for the family that could be taken to school during the day but would be returned to the kitchen upon returning home…in other words, mine.

This initiative isn’t something that’s going to break our relationship with the school district, and the simple truth is that it will probably be of value.  But it’s not an innocuous change and has a direct bearing upon how we’ve heretofore chosen to raise the kids and run the household.  There are plenty of other changes that school districts roll out and the cumulative effect of some of these programs has been to push parents into disaffection with the public system, sometimes to the extent that they simply withdraw their children and seek other educational alternatives.  I can intellectually understand their discomfort but there hasn’t been anything to date that has actually made me sit back and say hmmm… and while this one isn’t a dealbreaker, the understanding has now shifted from the academic and intellectual realm to that of the real world, the one that we inhabit each day.

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PracticalDad Price Index:  Moving Again in September 2013

PracticalDad note: After an odd summer, I’m officially back and the writing will again pick up. Thanks for reading…

After an eight month period of decline, the PracticalDad Price Index rose by half a percentage point to 108.39 (All Items Index) and 113.76 (Food-only Index) in September 2013.  

Since it’s inception in November, 2010, the 47 grocery item PracticalDad Price Index rose until it peaked in December 2012 at an index level of 108.07 for all items and 114.33 for the separate Food-only items index (November 2010 = 100).  In layman’s terms, the prices were 8.07% and 14.33% higher than at the index creation.  But after the December 2012 peak – which itself was a full percentage point rise from November 2012 – the indices dropped; by August 2012, the Food-only index was 113.14, more than a full percentage point below the peak eight months previously.  But after this decline, the prices are starting to move upwards again in September 2013; it’s as if a car were spinning tires wildly and accelerating quickly after they gained purchase on the wet roadway.

One of the items that I was watching from the August 2013 Price Index was the cost of beef, since the size of the cumulative national herd was at levels not seen in decades.  Sure enough, the cost of a pound of 80% ground rose by 2.5% over the month and I’ll continue to watch.  What has been fascinating about the process is seeing how grocers are finding new, lower cost food suppliers when they believe that their market can no longer absorb price increases.  September was another instance in which a single store found a new supplier for a generic product; a grocer’s generic box of spaghetti – still at 16 ounces instead of the stealth adjusted 12 ounce box from one national producer – dropped from $1.29 to $1.00/box, a 22% drop.  This is on the heels of previous drops, since November 2010, in products like tomato sauce, diapers and women’s pads.  But the monthly indices are still up a half percentage point, despite this downward adjustment.

The results of the past four months are as follows:

Month/Year          Total Index          Food-Only Index          Spread

6/13                        107.65                  113.55                            5.90

7/13                        107.57                  113.13                            5.56

8/13                        107.90                  113.14                            5.24

9/13                        108.39                  113.76                            5.37

 

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Youth and Political Apathy:  Can You Blame Them?

There are still some of us who – despite all of the unalloyed stupidity, graft and cynical machinations – still believe in this whole government of the people, by the people, and for the people schtick.  We want and try to raise our kids to pay attention to events, form educated opinions and engage in the political process, even if only to vote when they’re old enough.  But the chronic incompetence of recent sitting Presidents and Congress make it impossible to want to do so, let alone try.  The recent picture of Senator John McCain playing poker on his smartphone simply drives me over the edge of indifference; the Senator – who long ago and far away had my respect – was sitting in the Senate Committee hearing on the President’s proposed use of force in Syria and decided to take a little break by playing poker.

Seriously?  Seriously?  While my Youngest is still in elementary school, I’m old enough that some of Eldest’s peers now serve in the Armed Forces and any of them could be sent overseas because of this business.  Yet a senior Senator sits in the hearing regarding their future, playing electronic poker; the fact that this is the guy who spent years as a prisoner of war makes it mind-boggling in the extreme.  Being a parent means that at some level, the kids’ friends – who I’ve historically referred to as the Opies – become young adults with their own discernible dreams, hopes and wishes.  Some of them virtually become our own kids and their safety and welfare matters as much as that of our own offspring.  The fact that senior senators are sitting around during the hearings hoping to draw a flush is not only insensitive to those of us who give a damn, it’s insulting.

The great majority of adults reach an age at which they understand that there’s a difference between the ideal and the reality.  We know that money and power come into play but hope – with some sufficient pressure applied – that these elements are somehow offset by a sense of the public good and simple common sense.  Yet the survival of a democracy is based ultimately on optimism; not the saccharine Hallmark-card variety, but the elemental optimism which believes that the great majority of people are decent sorts, able to put aside their differences and live in some degree of peace with one another.  We can teach about our form of government in school – and that’s not going too well, either – but this core belief is one that, like so many other beliefs, is passed along as much through the quiet conversation and personal interaction that occurs daily in the home.  Contemporary American society is crass and cynical and I freely admit that I’m trying to raise my kids to be skeptics.  But such a deep-rooted optimism requires continual nurturing in the face of the crap that our politicians throw around like so many chimps with their feces, and the Senator’s hope for a flush crosses a boundary that is deeply offensive on a personal level.  Man, there’s actual use of chemical weapons and now there’s the prospect of sending them to the sandbox – again.  What’s the evidence for this and more importantly, do I trust a government that provided manipulated information for a previous trip to the sandbox?  I only hope that the leadership is paying atten…no, wait.  Nevermind.

Idiots.

Any good politician knows that politics is a fusion of substance and imagery and that the latter can trump the former.  The 1988 image of presidential nominee Michael Dukakis in a tank was as much a killer as the fictitious image of Abraham Lincoln splitting rails was a winner.  But the image of a senior senator playing smartphone poker like a high schooler in the back row of Civics class is damaging.  It not only portrays McCain in a poor light, but reinforces the notion amongst the public that the political leadership is not only cynical, but callous towards the ramifications of the actions that they are – or aren’t – about to take.  McCain acknowledged in a subsequent tweet that he was indeed playing poker “during a 3+ hour Senate hearing” yet the tweet is meant derisively: yeah, I did it but geez, it was three hours of bloviation and if you’d been there, you might have done it, too.  The Arizona Senator’s behavior during and after the hearing is a gross, immense action of unabashedly immature stupidity and when I’ve heard similar exculpatory flatulence come from the mouths of any of my three kids, I’ve dope-slapped them, Gibbs-style, across the back of their heads.  This isn’t rambling about the tax code, but a matter of the use of force and after previous administrations’ efforts in 2001 and even earlier, in 1964’s Gulf of Tonkin resolution – and that one led to the Vietnam War – the public deserves better.

Public upset over this will pass quickly since the American public has a short attention span and memory.  But while the exact instance will pass, there will be a corrosive after-effect.  The cost of running for, and gaining, office is now prohibitive to the average American and assumes dollar amounts that are not attainable for Joe and Jane Six-pack and there’s already a belief that to gain office requires more than a little duplicity to please the backers who pay the freight for their pet candidate.  One of the goals of the nascent Occupy movement was to grab the attention of the politicians via demonstration and sit-in and that did seem to work until the movement imploded.  But the corrosive element is not only that the political classes are no longer like us, but that they simply don’t care about the typical American’s needs.  That was the knock painted against the Republicans but it’s increasingly the same knock laid against Democrats, many of whom are also independently wealthy in their own right.  Lifetime pension?  check.  Lifetime healthcare?  check.  Access to inside information that can be used for personal gain?  ah yep, check.  It is this behavior that drives home the point that the government really doesn’t care about the public, and drives Americans away from the system.  The internal intelligence apparatus has grown to massive proportions and the reports about the extent of domestic electronic surveillance foster a sense of helplessness amongst the public, and Americans cocoon themselves in the hope that they’ll be left alone by this whatever-it-is that we’ve constructed.  It’s difficult enough fighting through the societal noise to raise kids that both understand and care about the political process; when the public behaviors are so stupidly callous that they discourage and dishearten the parents who are trying to wage this fight, then the Congress has only itself to blame for the image and we ourselves for the political results. 

There is true irony here.  John McCain’s persona is intimately tied to the tortures that he endured as an American prisoner-of-war in the Vietnam conflict.  That conflict was an undeclared war, but then-President Johnson was provided political cover by a Congress that passed the Gulf of Tonkin Resolution in 1964 on what is now known to be questionable information.  Were the existant Congressmen of that year paying full attention to what was happening, or was their attention engaged elsewhere?  And what would then-Lieutenant McCain have thought – in Hanoi – had there been proof that the civilian leadership responsible for the Resolution’s passage spent their time in Chambers playing poker instead of attention?