My Cousin’s Water Wheel Important to Nevada County Mining

Ever since we first bought property here in Nevada County over thirty-five years ago, people from time-to-time have asked me whether I’m “related to the same Pelton who invented the water wheel.” I’ve always shrugged and said “I don’t know … probably.” I’ve enjoyed the possibility that it might be true, since the name has a certain cachet in these parts.

A few days ago I learned — thanks to our daughter’s recent interest in genealogy and her father-in-law’s expertise at it — that Lester Allen Pelton is indeed my cousin (“fourth cousin, three times removed”).

What do you know! I guess mining is kind of our family business.

Or, at least water wheels.

As I understand it, cousin Lester hoped that his invention would make it unnecessary to burn so many forests in the steam engines powering the mines (by replacing them). He got his wish. I take this to mean that Lester was a 19th century environmentalist, and I choose to believe that — if he were alive today — he would oppose the re-opening of the Idaho-Maryland Mine, as I oppose it.

The first time I suspected that we were related occurred about twenty years ago when we got a small bio of him inserted into our Palo Alto PG&E bill. It mentioned that he died broke. “Aha!” I thought. “We are related.”

Our daughter says about Lester, “He looks like a Pelton.”

If Congress Does Nothing, the Deficit Will Disappear

Check out this graph from the Congressional Budget Office. Look particularly at the dotted line, representing revenues, and notice in the lower portion of the graph how — if the Bush tax cuts are extended (revenues are depressed) — the deficit will persist.

The upper portion of the graph shows how the deficit disappears by approximately 2016 (the end of Obama’s second term, if he has one) if the Bush tax cuts are allowed to expire, as they are scheduled to do.

In other words, if Congress does nothing.

Texas Is a Shining Example of Right-Wing Governance in Action and That’s Why It’s a Complete Basket-Case

Note from Editor of Sierra Voices: Would California’s 3rd District Assemblyman Dan Logue still have a mancrush on Texas Governor Rick Perry if he really understood what an economic basket case Texas is? That’s a big if. Understanding that might be too much to ask of Logue, or any other conservative ideologue. I heard Rick Perry a few days ago say, “Conservatives have won the war of ideas.” Is the Texas Miracle one of those ideas? What a hoot.

Reprinted from Alternet.

by Joshua Holland

Conservatives claim the “Texas Miracle” is a model for the nation, but it’s actually a blueprint for winning the race to the bottom.

Conservative mythology now holds up Texas as a shining example of right-wing governance in action. Republicans would have us believe that gutting the state’s social safety net, denying workers the right to bargain collectively and relentlessly cutting taxes unleashed a torrent of “job creation” and, ultimately, prosperity.

Under governor Rick “Goodhair” Perry’s term in office, Texas has indeed been a model of conservative governance, but the truth is that it has resulted in anything but prosperity for the people of the Lone Star State. In fact, Texas is not only a complete basket-case, it would be faring far worse today without the help of policies enacted by Democrats at the federal level – policies Perry lambasted as “irresponsible spending that threatens our future.”

The kernel of truth on which the tale of the Texas Miracle is built is that the state has in fact added a lot of jobs over the past decade. In a gushing lead editorial, the Wall Street Journal noted that “37% of all net new American jobs since the recovery began were created in Texas.”  The Journal then spun that fact like this:

Capital—both human and investment—is highly mobile, and it migrates all the time to the places where the opportunities are larger and the burdens are lower. Texas has no state income tax. Its regulatory conditions are contained and flexible.  It is fiscally responsible and government is small.  Its right-to-work law doesn’t impose unions on businesses or employees.

In the Journal’s hyper-partisan view, the lesson to be learned is that “the core impulse of Obamanomics is to make America less like Texas and more like California, with more government, more unions, more central planning, higher taxes.” That spin was echoed during last week’s GOP debate by none other than Newt Gingrich, who asked, “Why [would] you want to be at California’s unemployment level when you can be [at] Texas’s employment level?”

James Galbraith, an economist at the University of Texas, scoffed at the whole narrative, telling AlterNet, “the notion that our state government is a model is almost enough to beckon the spirit of Molly Ivins back from the shades.” Galbraith said “Texas has been a low-tax, low-service state since the time of the Republic,” and noted that it’s “therefore impossible that this fact suddenly accounts for its better job performance over the past few years.” (Texas’ record of job creation under Perry is the same as it was under former governor Ann Richards, a Democrat.)

“Texas is an energy state benefiting from high oil prices and the incipient boom in natural gas,” explained Galbraith. “That’s an accident of nature.” He added that the state “went through the S&L crisis, had major criminal prosecutions and more restrictive housing finance regulations this time around; hence it was not an epicenter of the subprime housing disaster. That’s called a learning experience.” Tighter regulation of the lending industry is also anathema to today’s GOP.

Arguably the biggest sleight-of-hand in the Texas Miracle storyline, however, is that many of those jobs were a result of a huge surge in the state’s population, much of it fueled by immigration from Latin America (rather than liberal hell-holes like California).

Texas’ population grew by 20 percent over the past decade, and Hispanics accounted for almost two-thirds of that growth. A surge in people created greater demand for goods and services, which leads to more jobs. But the jobs being created in Texas aren’t keeping up with the state’s expanding workforce – the Wall Street Journal somehow failed to mention that during the exact same period in which it was adding all those new jobs, Texas’ unemployment rate actually increased from 7.7 to 8 percent (it also failed to note that 23 states — including such deep blue ones as Vermont, New York and Massachusetts — enjoy lower unemployment rates than Texas).

But perhaps the most laughable claim in this whole narrative is that Texas has been “fiscally responsible.” Perry certainly adhered to the conservative playbook, offering massive tax breaks without the deep cuts in services that might inspire a voter backlash. As a result – an entirely predictable one – the Austin American-Statesman reported that “state lawmakers have spent much of the year grappling with a budget shortfall that left them $27 billion short of the money needed to continue current state services.”

CNN adds that while Perry was railing against the Democratic stimulus package passed over the fierce resistance of conservatives, the state “was facing a $6.6 billion shortfall for its 2010-2011 fiscal years,” and “it plugged nearly all of that deficit with $6.4 billion in Recovery Act money.” The stimulus package created or saved 205,000 jobs in Texas, second only to California. But as James Galbraith told AlterNet, while “the state budget has not yet been cut drastically” due to the stimulus boost, “the key phrase is ‘not yet.’” Now that the stimulus has run its course, “if projections for the current budget cycle are correct, things will get much worse in the next year.”

Indeed, those cuts are now on their way. The Texas legislature imposed draconian cuts to Medicaid, cut tuition aid to 43,000 low-income students and is weighing $10 billion in cuts to the state’s education system. According to Texas state senator Rodney Ellis, D-Fort Bend, the 2012-2013 budget will underfund “health and human services in Texas by $23 billion, 29.8 percent below what is needed to maintain current services.”

But Perry’s tax breaks are indeed part of the state’s jobs picture; as Time magazine’s Massimo Calabresi noted, Perry established several massive business tax breaks “designed to lure companies from other states.”

But the funds have been controversial. They have channeled millions of dollars to companies whose officers or investors are major Perry campaign donors and Perry has allowed them to keep their subsidies in many cases even when they fail to deliver promised jobs. More important for the purposes of judging Perry’s job-creating record, even those that do produce jobs don’t necessarily create long-lasting ones, or increase the state’s overall prosperity.

In a report written for Perry last spring, Michael Porter of Harvard Business School noted that such tax breaks “ultimately don’t support long-term prosperity,” because companies that can move easily “are looking for the best deal and when the deal runs out they move” again, taking their jobs with them.

He also found that Texas’ per capita income growth was the eighth slowest of any state in the country between 1998 and 2008. That’s because, as the American Independent‘s Patrick Brendel noted, “Texas has by far the largest number of employees working at or below the federal minimum wage,” and the number of crappy jobs has exploded while this supposed Texas Miracle was taking place. “From 2007 to 2010, the number of minimum wage workers in Texas rose from 221,000 to 550,000, an increase of nearly 150 percent,” wrote Brendel. As a result, Texas is now “tied with Mississippi for the greatest percentage of minimum wage workers, while California had among the fewest (less than 2 percent).”*

At a fundraiser this week, Rick Perry, who despite toying with the idea of secession in the past may now be eying a White House bid, told a group of Republican fat-cats that in his state, “you don’t have to use your imagination, saying, ‘What’ll happen if we apply this or that conservative principle?’ You just need to look around, because they’ve been in play across our state for years, generating real results.”

In this, Perry is absolutely, 100 percent correct. He slashed taxes to the bone, handing out credits to his political cronies like they were candy. He decried the evils of Big Government while hypocritically using federal stimulus funds to help close Texas’ budget gap in the short term, and now he’s using the state’s longer term fiscal disaster – one of his own creation – as a premise for destroying an already threadbare social safety net serving the neediest Texans. As a result of these policies, plus immigration and other external factors, his state’s added a lot of low-paying poverty jobs without decent benefits. He’s added very little in the way of “prosperity.”

In the final analysis, Texas is indeed a shining example of conservative governance, as well as an almost perfect model for winning the race to the bottom.

* It should be noted that the cost of living is higher in California than in Texas.


Joshua Holland is an editor and senior writer at AlterNet. He is the author of The 15 Biggest Lies About the Economy: And Everything else the Right Doesn’t Want You to Know About Taxes, Jobs and Corporate America. Drop him an email or follow him on Twitter.

Convictions based on Evidence Held by Nevada City Police May be in doubt

News Release (Mountain Messenger)

NEVADA CITY – The Mountain Messenger newspaper is on the streets today with a story revealing how Grand Jury criticisms of Nevada City Police Department evidence handling may affect cases already tried.

A local defense attorney told The Messenger attorneys should consider what, if any, action they should take on behalf of their clients. The source said a review of past cases by the district attorney’s office is called for.

Nevada County District Attorney Clifford Newell says his office has started such a review. In San Francisco County the DA has dismissed convictions because of irregularities in police procedure. The Messenger story says the same thing could happen here.

To read the full story, The Mountain Messenger can be purchased for half a buck at the National Hotel (sidewalk), Nevada City Post Office (sidewalk), Nevada City SPD (outside), Nevada City Express Mart (outside) and in front of Safeway, in the Brunswick area. The Mountain Messenger, California’s oldest weekly newspaper, is published on Thursdays from Downieville, California.

Nevada City Seafood Temporarily Closed (Will Re-Open Next Thursday)

I was surprised to see this handwritten sign on Eric Juell’s Nevada City Seafood this afternoon when I drove there to buy some salmon:

When I got home I called Nevada City Seafood and spoke to Mike Duffy, the new owner. Mike told me that he’s taking over the business (with Eric still involved for now as a “silent partner”), and plans to re-open the business by Thursday of next week (or possibly even Wednesday).

Whew! I was about to fall into a state of grief.

Mike is a fisherman and has three boats at Half Moon Bay.

He intends to re-open the market with all of the same great fresh offerings.

He asked me, “What is your favorite?” and when I answered “salmon” and “sable fish,” he assured me that these will still be plentifully available. He fishes those himself, he said.

Mike will continue to maintain the Nevada City Seafood email newsletter. You may join it here.

Should This Historic Site Be Blown-Up for Coal?

The Battle of Blair Mountain in Logan County, West Virginia, happened in 1921. Bobby Kennedy called it “the Gettysburg of the union movement.”

The Battle of Blair Mountain was one of the biggest civil uprisings in the United States history and the largest armed insurrection since the American Civil War. For five days in late August and early September 1921, in Logan County, West Virginia, between 10,000 and 15,000 coal miners confronted an army of police and strikebreakers backed by coal operators during a struggle by the miners to unionize the southwestern West Virginia coalfields. Their struggle ended only after approximately one million rounds were fired, and the United States Army intervened by presidential order. (From Wikipedia).

Watch this short video to understand why the struggle is not over:

America For Sale

by Dylan Ratigan

” … these deals are often profitable because they constrain the public’s ability to govern, not because they are creating value.”

“In Chicago, it’s the sale of parking meters to the sovereign wealth fund of Abu Dhabi. In Indiana, it’s the sale of the northern toll road to a Spanish and Australian joint venture. In Wisconsin it’s public health and food programs, in California it’s libraries. It’s water treatment plants, schools, toll roads, airports, and power plants. It’s Amtrak. There are revolving doors of corrupt politicians, big banks, and rating agencies. There are conflicts of interest. It’s bipartisan.

“And it’s coming to a city near you — it may already be there. We’re talking about the sale of public assets to private investors. You may have heard of one-off deals, but what we’ll be exploring with the Huffington Post is the scale and scope of what is a national and organized campaign to shift the way we govern ourselves. In an era of increasingly stretched local and state budgets, privatization of public assets may be so tempting to local politicians that the trend seems unstoppable. Yet, public outrage has stopped and slowed a number of initiatives.

“While there are no televised debates around this issue, there is no polling, and there are no elections, who wins it will determine the literal shape of modern America. The Dylan Ratigan showis teaming up with the Huffington Post to do a three part series called “America for Sale”, showing the pros and cons, and the politics and economics, of a new and far more privatized government.”

Read full article here.

Who is Bud Nip?

The question is not “Who is Bud Nip?”

The question is “What is Bud Nip, and why shouldn’t you eat it?”

Watch and learn!

Don’t Think About Climate Change

Here San Francisco filmmaker Stephen Thomson uses the bitterly sarcastic words of Bill McKibben in his recent op-ed in the Washington Post, to show the connection between this year’s extreme weather events and human-caused climate change.

His words are a scathing indictment of climate-change deniers.

Are We Entering the Second Great Depression?

Reprinted from the Center for Economic and Policy Research (CEPR) under a Creative Commons License.

by Dean Baker

When the financial system was on the edge of melting down back in the fall of 2008, there was much talk in the punditocracy of a second Great Depression. The story was that we risked repeating the mistake at the onset of the first Great Depression: allowing a cascade of bank failures that both destroyed much of the country’s wealth and left the financial system badly crippled. Instead, however, we acted, and these days the accepted wisdom is that the TARP and other special lending facilities created by the Federal Reserve Board prevented a similar collapse that saved us from a second Great Depression. But this view badly misunderstands the nature of the first Great Depression—and may, in fact, result in the country suffering the second Great Depression that the pundits claim we have averted.

Allowing the cascade of financial collapses at the start of the first Great Depression was a mistake. However, there was nothing about this initial collapse that necessitated the decade of double-digit unemployment that was the central tragedy of the Great Depression. This was the result of the failure of the federal government to respond with sufficient vigor to mass unemployment. Indeed, the economy only broke out of the Depression when the federal government undertook massive deficit spending to fight World War II. Deficits peaked at more than 25 percent of GDP. This would be the equivalent, in today’s economy, of runningannual deficits of $4 trillion.

There was no economic reason that the government could not have spent on this scale in 1931, as opposed to 1941; the obstacles were political. Then, as now, politicians in Washington were obsessed with the budget deficit. They never would have countenanced such spending, apart from the threat to the nation posed by Hitler and the Axis powers. The New Deal deficit spending helped boost the economy and bring the unemployment rate down to single-digit levels, but fear of deficits limited the scale of New Deal programs and caused Roosevelt to reverse course and cut back on spending in 1937, just as the economy was gaining momentum.

Unfortunately, the country seems destined to follow the same course in the current slump as it did in the 30s. The May jobs report should have provided the sort of stiff kick that is needed to revive discussion of additional stimulus. Instead, it seems to have barely shaken Washington’s ongoing obsession with deficits.

In policy circles, there seems to be an absurd faith that demand in the economy will arise out of nowhere if we are just virtuous enough in reducing the deficit. That is not the way the economy works. Demand must come from some discrete source, and it is very difficult to see where that might be if the country continues on a path of deficit reduction.

To see why this is the case, first note that nearly 70 percent of demand in our economy is from consumption, but consumption has been growing slowly for two reasons. The first is that the economy has been creating few jobs. Furthermore, in a weak labor market workers do not have the bargaining power to push up their wages. The slow growth in jobs and stagnant wages mean that most families, who get nearly all their income from working, are seeing little growth in income. Slow growth in income means slow growth in consumption.

The second factor depressing consumption has been the continuing deflation of the housing bubble. To date, the decline in house prices has destroyed nearly $7 trillion in housing equity. And prices are still falling. Homeowners are likely to see another $1 trillion in equity disappear over the next year. The loss of this wealth will lead homeowners to cut back their consumption further in order to rebuild their savings.

Beyond the decline in consumption, the overbuilding in both residential and non-residential real estate during the bubble years ensures that construction will also remain weak at least through 2012. Firms could invest more in equipment and software, but this component of the economy is already surprisingly strong. This type of investment is close to its pre-recession level, in spite of the fact that most industries have large amounts of excess capacity.

Trade could also provide a boost, but this would require either extraordinarily rapid growth in demand from our trading partners or a sharp decline in the dollar that would make our goods more competitive. With most of our major trading partners also mired in stagnation, a rescue by fast-growing trading partners can be ruled out. Similarly, a lower-valued dollar is providing some benefits, but not of the magnitude needed to restore the economy to anything close to full employment.

With these other sectors accounted for, this leaves the government as the only remaining candidate for boosting the economy. But additional stimulus is not even on the agenda in Washington. Instead, we are seeing cutbacks at all levels of government. These cutbacks led to a loss of 29,000 jobs in May. The pace of job loss is only likely to increase when states impose another round of cuts on July 1, the beginning of a new fiscal year for most of them.

All of this suggests a bleak picture for the unemployed. The economy must create 90,000 jobs a month just to keep even with the growth of the labor force. To be sure, the dismal 54,000 job performance for May was partly an issue of timing, with jobs showing up in April instead of May. But even taking the last three months together yields an average growth rate of just 160,000. At this pace, it would take more than a decade to get back to normal levels of unemployment.

Moreover, there are more factors pointing to slower growth than faster growth going forward. In addition to the state and local cuts kicking in next month, the new fiscal year for the federal government begins Oct. 1. This is also likely to involve further cuts in spending. And the payroll tax cut is scheduled to end three months later, as is the extension of unemployment benefits. At some point, the pain of high unemployment across the country may lead to some new thinking in Washington, but until that time, welcome to the second Great Depression.


Dean Baker is the co-director of the Center for Economic and Policy Research (CEPR). He is the author of False Profits: Recovering from the Bubble Economy. He also has a blog, “Beat the Press,” where he discusses the media’s coverage of economic issues.

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