Politics Without Context

Someone sent me a link to this video today. It purports to show Mitt Romney as a wild flip-flopper. Watch for yourself.

Is Romney really incapable of holding a single position on these issues?.. maybe, probably; but this video provides zero real evidence, because all of the clips have obviously been sliced and diced, cherry picked, and presented without any relevant context.

This is what is so offensive about politics. The folks who made this video (apparently the Democratic National Committee, as it turns out) know that there are people who will actually be persuaded by it. To me, that says that they believe either a) people have already made up their minds and just want to make themselves feel good about their decision or b) people are not independently-minded enough to think beyond these carefully selected clips.

I don't care for Romney, but I'm also not persuaded by this sort of video. Sadly, it's going to continue, because enough people are. It looks like it's already shaping up to be a long political season.

Seasonal Scarcity

Earlier in the month when I was traveling in Ohio, I got to drink some of the first Great Lakes Christmas Ale of the season. I've always been intrigued by its popularity. Even though it's a seasonal beer and only sells for two months of the year, it's the second highest selling beer in GLBC's entire portfolio.

For a beer that popular, it must be good, right? I've always thought so; but I recently looked it up on Beer Advocate, and found that the reviews are not nearly as overwhelmingly positive as I might have expected.

(from The Cleveland Kid on Flickr)

The primary complaint appears to be that it's overly spiced. Beer fanatics, it seems, don't like a lot of "stuff" in their beer. I get that. It's much like a coffee fanatic who doesn't want sweeteners, dairy or other flavors distracting from the taste of the drink.

Even so, I do think the seasonal scarcity is what makes a beer like Christmas Ale so good. You really can only drink the stuff in late fall and winter, which is why I've never found the "Christmas in July" events at bars in Cleveland appealing. Christmas Ale is good because you only have it for 2-months out of the year, then you stop. If it were around for any longer I suspect it would probably start to taste not-so-good and its popularity would wane.

In a way, I feel the same way about pumpkin. When September rolls around, like many others, I'm gung-ho about pumpkin - pumpkin pie, pumpkin bread, pumpkin cookies... but by November I'm pretty sick of it. I don't eat any pumpkin for another year, and then the cycle continues.

Some foods and drinks are seasonal because of mother nature. You harvest certain crops at certain times of year. Others are seasonal because it makes more sense to consume them when the temperature outside is a certain way. Christmas Ale falls into the latter category; but in a way it's also artificially seasonal, in the sense that the brewer decides to stop selling it on January 1st, rather than February 1st or March 1st. That's probably a smart move on their part, at least in terms of keeping the mystique and allure alive.
Emily Badger has a though-provoking article over at The Atlantic Cities about the desire, even in today's market, to buy a home, rather than to rent. If there's one topic that I've had a major change of opinion since I started writing this blog, this would be it.

(from Images_of_Money on Flickr)

Nearly three years ago I sat down and wrote a four-post series about why I thought owning a home was a rotten deal. Today, I feel nearly the opposite. What's changed in the meantime is the place where I live. I believe that place, even at a subconscious level, is a major driver in opinion on this topic, all else equal.

To understand further, it's important to recognize the difference between the place I was living then (Cleveland) and the place that I'm living now (Washington DC). These are two wildly different housing markets, both on the rental and the sales side. Buying in one has benefits that don't exist in the other. Renting in one has benefits that don't exist in the other.

First and foremost, renting in DC is a hedge against inflation. This isn't so much the case in other cities, because inflation isn't much a problem in other cities. Between 2000 and 2010, I calculated that real-dollar rents in DC increased 52%, compared to only 8% nationally. For a home-buyer, that means that whatever your monthly payment is on the day you close is going to be (roughly) the same for the next 30 years. In an inflationary environment (and I would not hesitate to classify DC's rental market this way), buying locks you into a predictable payment for the long-term.

The biggest wildcard, of course, is maintenance and repairs. This is especially true if you're drawn to DC's beautiful Victorian housing stock, much of which is old and fragile. You never know when you're going to need a new roof, when you might have a problem with the foundation, or a pipe in the basement might burst.

The thing is, when you pay as much as, say, $2,000 a month for your mortgage, repairs suddenly feel a lot less outrageous. Need a new stove or dishwasher? The price is basically the same no matter where you live, but in DC, it might cost less than one monthly payment. In other city, it might be equivalent to several payments. When you think about it on that metric, it doesn't really seem so bad. That's not to say it's a cost that doesn't exist, but psychologically, it doesn't feel as painful, compared to someone who has to spent the equivalent of a year's worth of mortgage payments on home renovations.

If I were living in Cleveland today, I believe I would still have very little interest in buying. In Cleveland, there's a pretty significant risk that your house might decline in value. There's a risk that if/when you want to sell it will sit on the market with no interested buyers. There's a risk that you'll have a hard time finding a good tenant to rent it out to. These are all much much smaller risks in DC.

In Cleveland, you can get a luxury apartment or even rent a whole house for under $1,000. For that little, I'd happily invest my remaining discretionary income in stocks and bonds. This is much less feasible when rent makes up a large portion of your income. Like it or not, homeownership is a form of "forced savings", and when you're putting as much as $2,000 a month toward the mortgage, that adds up fast. Even if the home turns out to be a dud as an "investment" and you sell it down the road for what you paid, you're still walking away with a lot of cash in the bank that otherwise would have simply been "consumed" on rent.

I'll end this by saying that for some people, homeownership will never be a good deal. The responsibilities you take on when you buy is something that will cause them more anxiety than it's worth. And there are others who will want to buy, no matter where, or what the cost and the risks. It's the people in the middle, like myself, that I think are most heavily influenced by place.