By many standards, the modern US government can be considered due for a trim. Shrinking the budget deficiet requires doing less and less people are needed for that. The complexity lies in shrinking the government by eliminating the less effective participants, instead of waiting for the upper echelon to retire or younger people to quit. The federal workforce has come under the axe several times before, but none of the axings where particularly effective due these factors. The failings of these policies stem from the methods managers used to achieve them. By mandating gross reductions in force without figuring out how to cut deadwood, Congress implicity encourages managers to make defensible cuts based on seniority. Legislating reductions across all grade levels in a series of 1% annual cuts over 10 years would be the best way to effectively reduce the size of the bureacracy and increasing its effectiveness.
The annual reduction policy is the best choice for several reasons. It is phased in over time, allowing managers to make strategic decisions about where the axe falls. It addresses the seniority versus merit bias in the federal hiring system. Mandating a series of cuts encourages the existing workforce to work harder to ensure job security. Finally, it achieves a %9.5 reduction in the workforce. According to the EPA's Capital Planing and Improvement Controls, government workers cost an average of $133k per year. With a federal civilian workforce of 1.2 million, that reduction translates to $15 billion.
Sunday, September 7, 2008
Sunday, February 17, 2008
The Great Bond Game
Recently two large bond reinsurance companies, Ambac and FGIC, have entered into discussions with regulators to determine if these companies can split themselves asunder. The goal is to create one company that has a portfolio of municipal and highly rated bonds while the other company is saddled with junk. Its a cry for aid.
A plausible assumption is that the executives at these companies are betting that the government will allow them to float a new company that has a dream portfolio of AAA bonds. The only way to make that work is if the government comes in and saves the financial sector by handing out cash for the defaulting junk bonds. But let's backup and ask how this happened.
2001. You know what happened. The FED responded by dropping rates to the floor. This pushed money out of the bond market, as cash could get better returns on other investments. The stock market was fizzling after the dotcom bubble, so people began putting money in their houses. Analysts and financial advisors agreed that is was a viable investment, as house prices had gone up 50% over the 1990s. Furthermore, the federal home mortgage deduction encouraged people to finance their houses to the hilt, so purchasing a larger and more expensive home could lower one's income tax burden. So investing in houses was good, right?
To a point. But the US over-invested. By a substantial marginal and in the wrong type of house. But the point that matters here is that anyone who wanted a house was given one. Anyone. Now you might be "eqalitarian" and think that everyone is entitled to everything that anyone else has, but I'm not. Houses should go to those that can afford them. By giving away houses, both the prices of houses and the chances of default were pushed up. That is not a virtuous circle and soon the bond market began to exhaust itself. Fancy debt vehicles called Collateralized Debt Obligations were created so that many of these "subprime" mortgages could be packed together. Then the mortgages were graded based on a fictitious reasoning that some lots were AAA and some were junk. These were resold to the bond reinsurers, Ambac, MBIA, FGIC, etc. The critical point here is that these companies allowed themselves to be sold junk bonds that were rated AAA. When these bonds began defaulting, which AAA bonds aren't supposed to do, the subprime housing bond market began to deflate. Then housing hit a rough patch, as inventories of unsold houses began to pile up, and suddenly big corporations like Citi and Morgan Stanley began writing off large sums for their subprime exposures. Now several forces are converging on housing as the market corrects.
As for FGIC and Ambac being split into separate companies, let's hope so. I don't get government aid for many things, so it would be nice to get some, as the markets are sure to benefit from a handout like that.
A plausible assumption is that the executives at these companies are betting that the government will allow them to float a new company that has a dream portfolio of AAA bonds. The only way to make that work is if the government comes in and saves the financial sector by handing out cash for the defaulting junk bonds. But let's backup and ask how this happened.
2001. You know what happened. The FED responded by dropping rates to the floor. This pushed money out of the bond market, as cash could get better returns on other investments. The stock market was fizzling after the dotcom bubble, so people began putting money in their houses. Analysts and financial advisors agreed that is was a viable investment, as house prices had gone up 50% over the 1990s. Furthermore, the federal home mortgage deduction encouraged people to finance their houses to the hilt, so purchasing a larger and more expensive home could lower one's income tax burden. So investing in houses was good, right?
To a point. But the US over-invested. By a substantial marginal and in the wrong type of house. But the point that matters here is that anyone who wanted a house was given one. Anyone. Now you might be "eqalitarian" and think that everyone is entitled to everything that anyone else has, but I'm not. Houses should go to those that can afford them. By giving away houses, both the prices of houses and the chances of default were pushed up. That is not a virtuous circle and soon the bond market began to exhaust itself. Fancy debt vehicles called Collateralized Debt Obligations were created so that many of these "subprime" mortgages could be packed together. Then the mortgages were graded based on a fictitious reasoning that some lots were AAA and some were junk. These were resold to the bond reinsurers, Ambac, MBIA, FGIC, etc. The critical point here is that these companies allowed themselves to be sold junk bonds that were rated AAA. When these bonds began defaulting, which AAA bonds aren't supposed to do, the subprime housing bond market began to deflate. Then housing hit a rough patch, as inventories of unsold houses began to pile up, and suddenly big corporations like Citi and Morgan Stanley began writing off large sums for their subprime exposures. Now several forces are converging on housing as the market corrects.
As for FGIC and Ambac being split into separate companies, let's hope so. I don't get government aid for many things, so it would be nice to get some, as the markets are sure to benefit from a handout like that.
Friday, February 8, 2008
Boring political stuff
Mitt Romney stepped down yesterday, as he thinks that continuing to fight John McCain would damage the party. Wow. What a team player. Its party discipline like Mitt's that allows the Republican party a persistence in power politics that's disproportionate to their base's size. If only the Democrats could do something like that. But their choice isn't clear. Mr. McCain's shot at the nomination was secure by his substantial margin. The democratic contends have a much murkier decision because they're so close. Their closeness, combined with the elongated election season, will lead to a prolonged political battle that saps the power of the Democratic Party for the national election.
Hillary and Obama have a different destiny than the Republican contenders. Their historic run will be marred by the fact that they were run against each other. Don't think that I'm begrudging them their right to run for president. I think a monkey's uncle should be able to run for president. I even think people should be allowed to vote for who they think is proper. What I am saying is that the democrats will flail at each other in an increasingly acrimonious way that will deplete their reserves and leave them wide open for John McCain to rip them apart.
Lets examine McCain versus Hillary first. Hillary is low on funds but up on delegates, so there's no point in quitting now. I remember John Kerry being low on funds during the primaries, taking out a personal loan against Theresa Heinz's fortune, and going on to lose the national election in a "just barely" sort of fashion. I don't think that will happen with Hillary. She'll spend most of her money on beating obama and that whole time, McCain will be stocking up cash and moderating his position so that he can win. Its called the Median Voter Theory. The end result of that strategy is Hillary getting thumped on by a war hero.
Now ponder what Mr. Obama will do. He's raising money like a champ, but is still behind in the delegate category. However an ephemeral thing called "political momentum" is propelling him along to an extent where he'd be a fool to quit. Great. Now he's going to slug it out with Hillary through every state in the Union. Its actually quit democratic, but the whole reason we have shortcuts in our democratic system is because the system takes too long and is too expensive. Obama will do ok against Mr. McCain, but the debates will hurt him badly. McCain will look presidential and on the ball, while Obama's strength lies in laying out the bullshit for crowds. Being parsed by a seasoned political fight like John McCain will be damaging. Middle aged white america will flee Obama and the republicans win.
Hillary and Obama have a different destiny than the Republican contenders. Their historic run will be marred by the fact that they were run against each other. Don't think that I'm begrudging them their right to run for president. I think a monkey's uncle should be able to run for president. I even think people should be allowed to vote for who they think is proper. What I am saying is that the democrats will flail at each other in an increasingly acrimonious way that will deplete their reserves and leave them wide open for John McCain to rip them apart.
Lets examine McCain versus Hillary first. Hillary is low on funds but up on delegates, so there's no point in quitting now. I remember John Kerry being low on funds during the primaries, taking out a personal loan against Theresa Heinz's fortune, and going on to lose the national election in a "just barely" sort of fashion. I don't think that will happen with Hillary. She'll spend most of her money on beating obama and that whole time, McCain will be stocking up cash and moderating his position so that he can win. Its called the Median Voter Theory. The end result of that strategy is Hillary getting thumped on by a war hero.
Now ponder what Mr. Obama will do. He's raising money like a champ, but is still behind in the delegate category. However an ephemeral thing called "political momentum" is propelling him along to an extent where he'd be a fool to quit. Great. Now he's going to slug it out with Hillary through every state in the Union. Its actually quit democratic, but the whole reason we have shortcuts in our democratic system is because the system takes too long and is too expensive. Obama will do ok against Mr. McCain, but the debates will hurt him badly. McCain will look presidential and on the ball, while Obama's strength lies in laying out the bullshit for crowds. Being parsed by a seasoned political fight like John McCain will be damaging. Middle aged white america will flee Obama and the republicans win.
Wednesday, September 26, 2007
Don't Do WORK!!
Idiots will kill you. I know. Its been proven. I am dying. It’s the kind of slow fulminating death that comes from people missing the mark time and again. Examples? I can give you none that will elaborate very precisely without giving away government stupidity on a criminal scale, but I will try. Please note that writing
it out like this prevents my girlfriend from killing me from hearing it all the time.
it out like this prevents my girlfriend from killing me from hearing it all the time.The guy upstairs isn’t home. You might think, hey he hired me, so he must be great. Yeah sure, that’s what I thought. Today was a reminder that appearances can be deceiving. Now I know that all he does is talk.
My team leader made some statements to the press that got everyone upstairs a little jazzed. Something about picking one vendor over another, which is completely not his decision, yet he’s close to retirement so it doesn’t matter what the fuck he says. The paperwork won’t clear before he’s gone. After pissing everyone off, he looks at me, says ‘Have fun with this mess, I’m going on vacation for 2 weeks’ and rolls out.
For a brief shining moment, I rejoiced in having everyone’s attention. Then I realized they weren’t happy. Best part is that I wasn’t even in town the day it happened. Now when I give a briefing, everyone imparts their view of the team leader onto me.
So. So. So. So. So. (when I write I type the word “So” at the beginning of every sentence and then have to delete it later. I’m very annoying to speak with)
On an email list today, a message popped up that asked about the particular program in question. Since my team leader was away, I answered it as factually as possible.
Yes we have that. We’re having training next month. Here’s the guy who knows about the training.
Pretty Simple… My boss emailed me a hour later, telling me not to make announcements without him looking over them.
1.) It was already announced, since everything the government does is announce in the Public Record
2.) We had trainings prior to this. All were invited to attend.
3.) The guy who is in charge is the lead IT contractor. He was emailed all the 2 months ago.
4.) The team leader announced it in the media.
So I tried to set the record straight. I’ll be reprimanded tomorrow about going off and doing things without permission. So I guess I should just do nothing…
Perhaps I’ll go back to school, get a degree and get a better job. And do all of that while i'm at work, cause working at work just causes pain.
Monday, August 27, 2007
Mental Fart
The other day I was in a meeting and began to have some really deep thoughts on how random things are. My apologies, but this diatribe will certainly contain some ideas that I learned getting a degree in physics, but I'll keep it as light as I can.
So I'm looking at this ex-vet contractor who's trying to sell me on a HUGE investment and I start wondering about the caliber of his personality. I mean, is he a generally good guy trying to make a living or is he a cold, calibrating marketing machine determined to make me a notch in his belt. Either way, I don't care cause its his product I'm after, but judging his character keeps me entertained through the meeting. After all, the personality type is basically random. From here, my thoughts on randomness follow. Apologies that it rambles, but I thought it would be much too rude to begin outlining my thoughts while the contractor was talking.
First, I'm going to accept that things are random. There is a chance (x/set(x)) that everything happens at. Just like the roll of a die. Now, there are many different sets of chances going on all the time, everywhere. trying to track all is too hard and you have to come up with really abstract rules, so lets track 1. The one I'm tracking right now is my desire to invest based off meetings with vendors.
In statistics, you need to come up with a general model of your target population to determine its distribution...
Hmm, I'll go slower.
So I'm meeting with 1 vendor, out of a sea of vendors. Sometimes for a statistics model, you can say the sea is infinite, which makes the modeling easier, but that's not appropriate right now. There really aren't that many vendors in my market, so I have a finite number of vendors. Forget that we don't know how many.
Anyway, vendors have a couple of attributes that are desirable and various grades are available for those prices. Like how gum is cheap in a vending machine, but doesn't satisfy like the microwave pop-corn. Unlike a normal curve, a random sampling would show that there is a pyramid of contractors, with many shabbier outfits down at the bottom and the better at the top. There might be a belt of good firms in the middle or some other clumping, but in all, more at the bottom. I found a nice picture below
As I sat there, I could feel the bottom dropping out of my life. OH NO!! I'm going to be spending the rest of my life sitting in meetings so boring that I'm resorting to statistics to relieve my mind!!! Exclamation points all around!!! So the more vendors I talk to, the more likely I am to find bottom feeders. I sat there, stunned.
Then I though so more and realized, well when I find a good vendor, I can just use them over and over again. That made me feel much better. So how do I find a good vendor?
Well I can look some more. Here's me with some cool military looking glasses.
I could ask around. (I tried looking for a picture of this but only came up with porn)
Or I can steal other peoples contractors. Hmmmm. I should go back to the porn
So I'm looking at this ex-vet contractor who's trying to sell me on a HUGE investment and I start wondering about the caliber of his personality. I mean, is he a generally good guy trying to make a living or is he a cold, calibrating marketing machine determined to make me a notch in his belt. Either way, I don't care cause its his product I'm after, but judging his character keeps me entertained through the meeting. After all, the personality type is basically random. From here, my thoughts on randomness follow. Apologies that it rambles, but I thought it would be much too rude to begin outlining my thoughts while the contractor was talking.
First, I'm going to accept that things are random. There is a chance (x/set(x)) that everything happens at. Just like the roll of a die. Now, there are many different sets of chances going on all the time, everywhere. trying to track all is too hard and you have to come up with really abstract rules, so lets track 1. The one I'm tracking right now is my desire to invest based off meetings with vendors.
In statistics, you need to come up with a general model of your target population to determine its distribution...
Hmm, I'll go slower.
So I'm meeting with 1 vendor, out of a sea of vendors. Sometimes for a statistics model, you can say the sea is infinite, which makes the modeling easier, but that's not appropriate right now. There really aren't that many vendors in my market, so I have a finite number of vendors. Forget that we don't know how many.
Anyway, vendors have a couple of attributes that are desirable and various grades are available for those prices. Like how gum is cheap in a vending machine, but doesn't satisfy like the microwave pop-corn. Unlike a normal curve, a random sampling would show that there is a pyramid of contractors, with many shabbier outfits down at the bottom and the better at the top. There might be a belt of good firms in the middle or some other clumping, but in all, more at the bottom. I found a nice picture below
As I sat there, I could feel the bottom dropping out of my life. OH NO!! I'm going to be spending the rest of my life sitting in meetings so boring that I'm resorting to statistics to relieve my mind!!! Exclamation points all around!!! So the more vendors I talk to, the more likely I am to find bottom feeders. I sat there, stunned.Then I though so more and realized, well when I find a good vendor, I can just use them over and over again. That made me feel much better. So how do I find a good vendor?
Well I can look some more. Here's me with some cool military looking glasses.
I could ask around. (I tried looking for a picture of this but only came up with porn)Or I can steal other peoples contractors. Hmmmm. I should go back to the porn
Tuesday, July 31, 2007
Rules For Drinking
As a government beauracrat, I feel it is my duty to formalize my personal rules on drinking in the following document.
No straight liquor before 5 pm (martinis and scotch)
Drinking before noon is only for vacation, funerals and all night parties
No rowdy behavior during shots unless you have a group of people (more than 4) who aren't dating
Using your loose change for tip is perfectly fine as long as its from the nights transactions and you haven't touched it yet. However once touched, you can only leave whole bills.
White Wine
- fish, chicken and white sauces
- Serve Chilled
Red Wine
- Serve any other time
- Open beforehand and let breathe
- drink until your teeth turn red
Martinis
-gin is preferential
-stirred only. Shaking martinis over ice cracks the ice, making it melt into the liquor faster. Martini spoons are specially notched to prevent this chipping. If you want a watery martini, go ahead, but you're missing the point.
-add a little olive juice if you so desire
-vermouth - pour a drop into a chilled martini glass, swirl it and pour out the excess
-garnish as appropriate
Scotch
-over ice or straight up
-10 years or older (this will increase as my income does)
Beer
-there is no bad beer, only subpar
-fruity/sweet = bad
Ciders
-fruity/sweet = bad
No straight liquor before 5 pm (martinis and scotch)
Drinking before noon is only for vacation, funerals and all night parties
No rowdy behavior during shots unless you have a group of people (more than 4) who aren't dating
Using your loose change for tip is perfectly fine as long as its from the nights transactions and you haven't touched it yet. However once touched, you can only leave whole bills.
White Wine
- fish, chicken and white sauces
- Serve Chilled
Red Wine
- Serve any other time
- Open beforehand and let breathe
- drink until your teeth turn red
Martinis
-gin is preferential
-stirred only. Shaking martinis over ice cracks the ice, making it melt into the liquor faster. Martini spoons are specially notched to prevent this chipping. If you want a watery martini, go ahead, but you're missing the point.
-add a little olive juice if you so desire
-vermouth - pour a drop into a chilled martini glass, swirl it and pour out the excess
-garnish as appropriate
Scotch
-over ice or straight up
-10 years or older (this will increase as my income does)
Beer
-there is no bad beer, only subpar
-fruity/sweet = bad
Ciders
-fruity/sweet = bad
Friday, June 1, 2007
In Front Of the White House
Today I threw up on George Bush's front lawn.
The story begins with my colleague leaving us to go back to grad school. She was one of the few people in the organization who was my age, which made us automatic friends. Plus she's cute.
We all took her to the bar across the street from work to see her off. I had contributed to a gift for her and was shocked to find out that the lady who in charge of the event bought her a scale. WTF? Scales aren't something that you buy people who are leaving the office. But that's beside the point. I stayed at the bar with her until 11, when I staggered home, ate some mac and cheese and fell asleep on the couch.
I woke up at 4 in the morning and got into bed with my girlfriend. We live in sin.
Later, I got on the bus to work and started feeling a bit ill. Apparently gin martinis will do that if consumed in the proper quantities. The bus didn't help. I kept thinking, "breathe deep" and "don't puke on the bus." I got off at the White House and lingered by a trashcan but the feeling passed. I was walking through the park in front of the white house when it came back. I saw a trashcan by a group of tourists and made my way towards it but it was too late.
I truly hope that the tourists saw my gov id badge before I started hurling, as it would probably give them something much more memorable than pictures of the the white house gate. Its a shame I wasn't dressed up, cause puking businessmen are always great to see.
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