As Friedman sees it, the root of this problem isn’t solely with current government policies:

We don’t just need better government, we need better citizens….We need to make leaders understand you can ask me to something hard.

Friedman see much of the anger at our current predicament as “unfocused” and an unwillingness to make a shift away from the familiar but unsustainable practices that have lead to the current difficulties. Friedman says we are following situational values instead of sustainable values.

Goldman has been the poster boy for banks behaving by “situational values” - exploiting whatever the situation, or rules that it helped to write, allowed.–NY Times News Service

Now brace yourself, because here is an example of the type of immediate change that he thinks we should be willing to make for the long-term benefit: A dollar gas tax.

Forty cents would go to deficit reduction, 40 cents to health care (which would also help to reduce the deficit), 10 cents to subsidize those who can’t afford health care, and 10 cents to those who have to drive long distances.

As Friedman sees it, these measures would help to reduce the deficit, improve the health of the dollar because we won’t be sending $250 billion overseas, and correct an energy policy that is currently empowering some of the most corrupt leaders in the world.

OK, I know that a gas tax is a third rail in politics, and I imagine some of you are muttering some unpleasant words just at the mention of a gas tax. But as Friedman sees it, we cannot continue with an economy based on the expectation of continuous withdrawals without deposits.

Here are some other solutions that Friedman thinks will help our economy:

• Health care reform will allow us to compete globally.
• Investment in energy technology will allow us to compete in the predominant job markets of the not-to-distance future.
• Education in energy technology will allow us to build a better economy.

Sources:

• http://www.nytimes.com/2009/11/22/opinion/22friedman.html?_r=1&em
• http://www.charlierose.com/ (under Web Exclusives)

“Daedalus fashioned two pairs of wings out of wax and feathers for himself and his son. Before they took off from the island, Daedalus warned his son not to fly too close to the sun, nor too close to the sea. Overcome by the giddiness that flying lent him, Icarus soared through the sky curiously, but in the process he came too close to the sun, which melted the wax. Icarus kept flapping his wings but soon realized that he had no feathers left and that he was only flapping his bare arms.”—the story of Icarus as told in Wikipedia

Summer started this week. On June 20th at 10:45 pm, we left the new-beginnings season of spring and entered the long-days, abundant-light, and easy-living season of summer. On the first day of summer, also known as summer solstice or midsummer’s day, we can enjoy the longest day of the year when we have more sunlight hours than on any of the other 364 days of the year.

Each day after this first day of summer, we will have fewer minutes of sunlight than we had the previous day. This will continue until we reach the first day of winter (winter solstice, usually December 21). The first day of winter is the shortest and, therefore, darkest day of the year. So even in the full light of that first summer’s day, we were entering “The true beginning of our end” (William Shakespeare, A Midsummer’s Night Dream).

For a while, we thought that we had found the formula for an endless summer. At least we did when it came to our economy. But everything has it’s time and place. Summer has no depth of meaning without the fall, winter and spring. Each of these seasons has their own worth that must be respected. And like Icarus flying to close to the sun, we found that any attempt at achieving an endless summer must be paid for eventually.

So our endless summer is gone, but that is OK. Summer is here, and that is enough. Enjoy!

THEATRICAL RELEASE POSTER IMAGE COURTESY WIKIPEDIA

“The mortgage load of Californians was unusually heavy, and with deflation it became unbearable. Bank failures and the collapse of security values impoverished many retired people who had previously supplied buying power without competing for jobs.”

Where do you think this statement comes from? Maybe an article in the Orange County Business Journal, a recent post in the business section of The Orange County Register, or a comment made on the Inside OC with Rick Reiff broadcast?

No. This reprint of a statement made about the 1930s, when our economy was in a deep depression, can be found in a book written in 1970.*

Hope springs eternal that we will learn from past mistakes, but, as this statement shows, we missed it in a big way this time around.

So here is hoping that when we recover from this recession (which we will eventually), we will decide that we can do without the manic highs that are based on false illusions and will eventually lead to depressing lows.

Well, I can hope!

*Quote source: A Slice of Orange; the History of Costa Mesa

Theatrical poster courtesy Drew Stuzan via Wikipedia

In some ways, this will be a continuation of my past life as a Redfin blogger. In that life, I wrote about development in Irvine and Costa Mesa, and I gained some insight into these two cities. During my Redfin days, when I was writing about Irvine and Costa Mesa, I noticed how very different these two Orange County cities are. However, in spite of that, they are also very much the same in some basic Orange County sort of way. I wanted to follow through with these two cities to see what these different-but-the-same cities might tell us about what makes a city what it is.

Another reason that I decided to continue with both the Irvine and Costa Mesa development news instead of concentrating on just one or the other brings me to another insight I gained from my Redfin blogging day: At times, these different-but-the-same cities give a view into Orange County as a whole and the country at large. The reverse is also true: what happens at the Orange County and national level can affects what happens in Irvine and Costa Mesa. For example, the crash of AIG is having financial consequences for Orange County, including Irvine and Costa Mesa, and the crash of the subprime mortgage industry in Orange County had national consequences.

I want to follow through with what I was learning about the interconnection between what happens in one location or part of the economy affecting what happens in another location or part of the economy. Therefore, that will all be in the mix on this blog. (Here are two examples that show that what happens locally and nationally are interconnected: “Good O.C. borrowers brought down by bank’s bad loans” and “Bear Stearns Wraps Buy of Subprime Lender.”)

Time to wrap up this introduction and start squeezing the housing numbers. So until tomorrow…