Playhouse mansions

As the real estate market for adults is in shambles, the market for playhouses is booming.  Some of them cost as much as a real house:

APART from the open bar by the swimming pool, the main attraction at parties held at the Houston home of John Schiller, an oil company executive, and his wife, Kristi, a Playboy model turned blogger, is the $50,000 playhouse the couple had custom-built two years ago for their daughter, Sinclair, now 4.

Cocktails in hand, guests duck to enter through the 4 ½-foot door. Once inside, they could be forgiven for feeling as if they’ve fallen down the rabbit hole.

Built in the same Cape Cod style as the Schillers’ expansive main house, the two-story 170-square-foot playhouse has vaulted ceilings that rise from five to eight feet tall, furnishings scaled down to two-thirds of normal size, hardwood floors and a faux fireplace with a fanciful mosaic mantel.

The little stainless-steel sink in the kitchen has running water, and the matching stainless-steel mini fridge and freezer are stocked with juice boxes and Popsicles. Upstairs is a sitting area with a child-size sofa and chairs for watching DVDs on the 32-inch flat-screen TV. The windows, which all open, have screens to keep out mosquitoes, and there are begonias in the window boxes. And, of course, the playhouse is air-conditioned. This is Texas, after all.

“I think of it as bling for the yard,” said Ms. Schiller, 40.

Some people might consider it “obnoxious” for a child to have a playhouse that costs more and has more amenities than some real houses, she conceded. But she sees it as an extension of the family home. “My daughter loves it,” she said. “And it’s certainly a conversation piece.”

Even in a troubled economy, it seems, some parents of means are willing to spend significant (if not eye-popping) sums on playhouses for their children that also function as a kind of backyard installation art.

There are a number of companies and independent craftsmen that make high-end playhouses, which can cost as much as $200,000, and come in a variety of styles, including replicas of real houses, like the Schillers’, and more-fantastical creations like pirate ships, treetop hideouts and fairy tale cottages. And many of these manufacturers report that despite the economic downturn, they are as busy as ever.

Barbara Butler, an artist and playhouse builder in San Francisco, said her sales are up 40 percent this year, and she has twice as many future commissions lined up as she did this time last year. Not only that, but the average price of the structures she is being hired to build has more than doubled, from $26,000 to $54,000.

“Childhood is a precious and finite thing,” Ms. Butler said. “And a special playhouse is not the sort of thing you can put off until the economy gets better.”

via Playhouses – Child’s Play, Grown-Up Cash –

An interesting example of over-the-top parenting.   How does this manifest itself among us less affluent family-values types?

The two debt-reduction plans

So House Majority Leader John Boehner has a debt reduction plan on the table.  It is competing with Senate Majority Leader Harry Reid’s plan.  (Notice how both sides are cutting President Obama out of the discussion.)  Both plans cut spending by $1.2 trillion.  Neither plan involves a tax increase.  In fact, the two plans are extremely similar.  Philip Klein gives us a useful comparison:


– Both plans claim to reduce discretionary spending by $1.2 trillion.

–Both plans create a joint, bipartisan, Congressional committee to find future savings.

– Neither plan includes specific entitlement reform.

–Neither plan includes specific tax increases.


– Reid’s plan wants to raise the debt ceiling all in one chunk (and boosts the claimed deficit reduction number by relying on savings from the expected wind down of the wars in Iraq and Afghanistan), but Boehner it raised in two parts.

– While both plans endorse a joint committee, the Boehner plan makes the second debt limit increase contingent on Congress passing $1.8 trillion in additional deficit-reduction based on its recommendations.

– Boehner plan would ensure a vote in both chambers on a Balanced Budget Amendment.

– Boehner proposes caps to future spending.

Possibilities for compromise:

– It would be easy for Reid to allow a vote on the Balanced Budget Amendment.

– The differences over whether the debt limit increase should be short-term or last through the 2012 election is not an ideological-based disagreement, so it seems either side could give way on that one.

– Depending on the level of the spending cap, there may be some compromise there.

via Boehner and Reid plans aren’t that different: a comparison | Philip Klein | Beltway Confidential | Washington Examiner.

And yet, for all of the similarities, both sides are still at each other’s throats. Not only that, Boehner’s own party is in revolt against his plan.   I’m not sure why.  Surely the Republicans are getting what they want, over a trillion dollars in cuts and no new taxes.  The main issue now is political:   Reid is proposing a two year package, tiding things over until after the 2012 elections, while Boehner wants to go through all of this again in a year.

Meanwhile, the country faces default and probably worldwide economic collapse if the debt ceiling isn’t raised by August 2.

Under President Clinton, the ascendant Republicans  in Congress shut down the government, sparking a popular backlash that re-elected the unpopular president.  I suspect the same thing will happen again:  Today’s ascendant Republicans, giddy with having taken the House of Representatives, will show themselves willing to shut down the economy, sparking a popular backlash that will re-elect President Obama.

The 19th Century Depression

Canadian historian Francois Furstenberg reminds us of the economic depression that America had to struggle through in the 19th century:

Much like our time, the Gilded Age was an era of economic booms and busts. None was greater than the financial crisis that began in September 1873 with the collapse of Jay Cooke & Co., the nation’s premier investment bank. Like many other firms, Cooke & Co. overextended itself by offering risky loans based on overvalued real estate.

Cooke’s collapse launched the first economic crisis of the Industrial Age. For 65 straight months, the U.S. economy shrank — the longest such stretch in U.S. history. America’s industrial base ground to a near halt: By 1876, half of the nation’s railroads had declared bankruptcy, almost half of the country’s iron furnaces were shut and coal production collapsed. Until the 1930s, it would be known as the Great Depression.

In the face of economic calamity and skyrocketing unemployment, the government did, well, nothing. No federal unemployment insurance eased families’ suffering and kept a floor on demand. No central bank existed to fight deflation. Large-scale government stimulus was a thing of the distant future.

As demand collapsed, businesses slashed payrolls and reduced wages, and a ruinous period of deflation began. By 1879, wholesale prices had declined 30 percent. The consequences were catastrophic for the nation’s many debtors and set off a vicious economic cycle. When economic growth eventually began, progress was slow, with periodic crises plaguing the economy through the end of the century.

Neither political party offered genuine solutions. As historian Richard Hofstadter put it, political parties during the Gilded Age “divided over spoils, not issues,” and neither Democrats nor Republicans were inclined to challenge their corporate masters. . . .

With laissez-faire ideas dominant and the political system in stasis, economic decline persisted. The collapse in tax revenue only strengthened calls for fiscal retrenchment. Government at all levels cut spending. Congress returned the country to the gold standard for the first time since the Civil War: “hard money” policies that favored Eastern financiers over indebted farmers and workers.

With neither major party responding to the crisis, new insurgent movements arose: antimonopoly coalitions, reform parties and labor candidates all began to attract support.

via What history teaches us about the welfare state – The Washington Post.

Prof. Furstenberg goes on to cite the violent strikes of the growing labor movement and the prospect of social unrest–similar to what was happening in Europe that would spark the Marxist revolutions–that, according to him, encouraged even capitalists by the time of FDR to support social reforms and a welfare state, so as to promote social stability.  He then warns us about cutting the social safety net as we try to deal with today’s economic problems.

Since among my readers are experts in just about everything, I ask you, is Prof. Furstenberg’s account correct, or is it a leftist reading of a  history that is open to other interpretations?  Are there things we can learn from what happened in the Gilded Age?

HT:  Frank Sonnek

Spelling and the internet

The BBC reports that Great Britain’s online economy is harmed by bad spelling:

An online entrepreneur says that poor spelling is costing the UK millions of pounds in lost revenue for internet businesses.

Charles Duncombe says an analysis of website figures shows a single spelling mistake can cut online sales in half.

Mr Duncombe says when recruiting staff he has been “shocked at the poor quality of written English”.

He says the big problem for online firms isn’t technology but finding staff who can spell.

The concerns were echoed by the CBI whose head of education and skills warned that too many employers were having to invest in remedial literacy lessons for their staff.

Mr Duncombe, who runs travel, mobile phones and clothing websites, says that poor spelling is a serious problem for the online economy.

Charles Duncombe says poor spelling is costing the economy millions

“Often these cutting-edge companies depend upon old-fashioned skills,” says Mr Duncombe.

And he says that the struggle to recruit enough staff who can spell means that this sector of the economy is not as efficient as it might be.

Figures from the Office for National Statistics published last month showed internet sales in the UK running at £527m per week.

“I know that industry bemoaning the education system is nothing new but it is becoming more and more of a problem with more companies going online.

“This is because when you sell or communicate on the internet 99% of the time it is done by the written word.”

Mr Duncombe says that it is possible to identify the specific impact of a spelling mistake on sales.

He says he measured the revenue per visitor to the website and found that the revenue was twice as high after an error was corrected.

“If you project this across the whole of internet retail then millions of pounds worth of business is probably being lost each week due to simple spelling mistakes,” says Mr Duncombe, director of the Just Say Please group.

Spelling is important to the credibility of a website, he says. When there are underlying concerns about fraud and safety, then getting the basics right is essential.

via BBC News – Spelling mistakes ‘cost millions’ in lost online sales.

This reminds us that information technology still communicates most of that information by language and therefore the classic skills of writing and reading well are still necessary.

Are there other cues that make you not trust an internet site?

The McConnell plan

It’s hard to  decipher what Mitch McConnell’s plan to deal with the debt ceiling even is, if you just go by the vague news reports and the wildly opposed or enthusiastic descriptions of it by both advocates and foes, both of whom exist among both Republicans and Democrats.  Essentially, as I understand it, McConnell’s plan is for Congress to pass a resolution that will put the onus of requesting debt hikes, which must be accompanied by spending cuts, onto the President.  Here is a relatively lucid explanation of what it is:

The McConnell approach is convoluted because it is intended to allow Republicans to avoid bringing down the U.S. economy without having to cast politically unpopular votes to raise the debt ceiling. Mr. McConnell proposes a series of maneuvers that would end up authorizing a $2.5 trillion increase in the debt limit, enough to take the country past the 2012 election. He contemplates that President Obama will seek an increase in three installments — $700 billion, $900 billion and $900 billion. Congress would have a chance to vote against each of these. The president would, presumably, veto those resolutions of disapproval and, presumably, enough Democrats would stand by him to uphold the vetoes.

Meanwhile, the president would have to specify — although he wouldn’t be required to implement — spending cuts equivalent to the amount of increase requested in the debt ceiling. It’s not hard to imagine Republicans putting this list of cuts to good political use. However, the political sting is softened by the fact that Senate Majority Leader Harry Reid would not need the votes of the most endangered members of his caucus to sustain the president’s vetoes, which may explain some of his expressions of interest in the arrangement.

Here is how conservative blogger Jennifer Rubin explains the measure and the controversies:

If you go onto Twitter or check some Web sites (right and left) you will find loads of chatter about the McConnell debt disapproval plan. Most of it is wrong. Members of the chattering class are so anxious to chatter that they feel compelled to do so without understanding the subject matter at hand. Throw in some bad faith (certain right-wing bloggers would declare the GOP leadership traitors if they proposed only $4 trillion in cuts and got President Obama to decline to run for reelection), add in some liberal suspicion (warranted since this is not the first time that Senate Minority Leader Mitch McConnell (R-Ky.) has eaten their lunch), and presto: You get some of the worst “reporting” in recent memory.

The concept isn’t that hard to understand. 1. McConnell had enough of the phony White House talks. The White House offered a paltry $2 billion in actual, immediate cuts. 2. McConnell gave a speech to make clear that wasn’t enough and that the debt limit would be raised only with real cuts and without tax hikes. 3. McConnell could sit back and wait for default. 4. But he comes up with a mechanism to force Obama to put up cuts, send them to Congress and face “default” if the president’s cuts don’t get through. 5. In the process he makes 34 Democratic senators vote over and over again on cuts. (The sound you hear in the background is the conga line at the Senate Republican Committee headquarters.)

There are no tax increases in the plan. The onus is on the president to send a request for a debt-ceiling increase and the cuts to go along with it. If he doesn’t do it or if the Congress disapproves of what he sends up (and sustains a veto) the debt ceiling remains in place. But the Senate Democrats will have the power to sustain a veto (and thereby allow phony cuts to be used to raise the debt ceiling), right? Which 34 senators exactly are going to do this? Certainly not the ones in unsafe seats with voters clamoring for real spending cuts.

The critics who dimly understand the plan forget that the alternatives are limited. What are the alternatives? Default. Or accept the tax hike offer from the White House. Or maybe Obama will cave. McConnell is more than happy to keep on trying to get rid of the tax hikes and get the White House to cough up real spending cuts.

But if there is no deal (grand or otherwise) then the default will not be on the shoulders of the Republicans. McConnell is providing them with a backstop to avoid default.

via McConnell’s plan confuses the chattering class – Right Turn – The Washington Post.

The plan gives up on trying to get spending cuts without tax hikes from the President, but it also attempts a kind of political jui  jitzu, by which Republicans will be put in the position of opposing higher debt and Democrats will shoulder all of the blame.   Indeed, it seems, as things now stand, that these negotiations and every possible outcome will make the Republicans look bad.  If the compromises go through, they will be blamed for cutting spending on popular programs, such as Medicare, while also being blamed for obstructionist tactics that put the country on the edge of default.  McConnell would seem to get the Republicans out of that mess, but now he is being accused of blowing the chance to cut spending and caving in to the Democrats, who, suspiciously, are voicing support for the plan.

What is your analysis?

National debt impasse

So President Obama offered $4 trillion in budgetary cuts if the Republicans would accept a tax increase on the higher brackets.  House Speaker Boehner rejected increasing anyone’s taxes, indicating that he would accept a $ 2.4 trillion trim in cuts alone.

Talks between President Obama and congressional Republicans grew increasingly contentious on Monday, as GOP leaders flatly rejected his call to raise taxes on the wealthy as part of a bipartisan agreement to restrain the nation’s mounting debt.

Dueling news conferences by Obama and House Speaker John A. Boehner (R-Ohio) served as a testy prelude to an afternoon bargaining session that only emphasized the partisan divide, according to people on both sides with knowledge of the closed-door discussions.

During the meeting, Obama challenged Boehner to buck the anti-tax hard-liners in his party, who, the president suggested, are blocking the path to a landmark compromise to reduce borrowing by as much as $4 trillion over the next decade. Boehner and House Majority Leader Eric Cantor (R-Va.) responded by urging Democrats to settle for a more modest reductions-only deal that would save $2.4 trillion but would not touch tax breaks for the nation’s richest households.

In addition to major cuts to domestic agencies, the House GOP proposal calls for slicing about $250 billion from Medicare over the next decade by asking well-off seniors to pay more for health coverage, placing new restrictions on Medigap policies and putting in place new co-payments and cost-sharing provisions for home health care, among other changes. Those reductions would come on top of about $500 billion in Medicare savings previously enacted as part of Obama’s overhaul of the health-care system — cuts Republicans denounced during last fall’s midterm campaign.

via Debt talks between Obama, Republican leaders grow more contentious – The Washington Post.

Isn’t it better to have a $4 trillion cut than a $2.4 trillion cut?  And wouldn’t a tax increase cut the deficit even more, on top of that?  Isn’t the deficit such a huge problem that we need to attack it both by cutting spending and by increasing revenues somehow?  Given that Democrats don’t want to cut entitlements and Republicans don’t want to increase taxes, do you see any way out of this impasse?