Last year on Memorial Day weekend I wrote an impassioned article in support of our Veterans. If you haven’t read it, it is worth reading and can be found at: www.donsalyards.com/index.php?entry=entry070527-010000

My admiration and respect for our veterans, past and present, will never waiver. I’m not a veteran, mostly because of a lucky draw in a draft lottery during the Vietnam War, but as a civilian I know full well that I have inherited this land of opportunity only because of their sacrifice for me.

Today I wish to focus my praise on those who are currently enlisted in our armed forces, whether it is regular army, navy, marines, air force, coast guard, or the National Guard. These active participants of our military have volunteered to serve their country. Many of them have done two or three deployments in Iraq or Afghanistan, where their lives are constantly in jeopardy. Most have returned unscathed, but some have been viciously injured and over 4,000 have died. No matter what one’s opinion of the Iraq war is, we know we’ve sent our heroes there to fight it.

If I can impart just one suggestion to you this week, it would be that each of us can give a gift to a Veteran every day! This gift won’t cost you a dime. It is easy to give, can be given almost anywhere, is a personal gift, and will be gratefully appreciated by our women and men in military service. The gift is your personal thanks to a man or woman in military uniform. You and I see young men and women dressed in military uniforms all the time. It might be a young man at a convenience store that just filled his car with gas on the way to a National Guard meeting. He’s dressed in his camouflage fatigues and is pouring himself a cup of coffee. Approach him, look him in the eye, and thank him for “serving our country”. You don’t need to prepare a speech or come up with some elegant phrase; just “thank you” will be enough. He will respond in kind, with a respectful thank you!

It could be a young woman in her Navy uniform shopping at Gurnee Mills Mall while stationed at the Great Lakes Naval Station. It doesn’t matter which branch of the armed services they represent, if you spot these young people in uniform, please don’t deny them the appreciation they deserve. If you’ve never thanked a soldier before, just give it a try today or tomorrow. It may seem a bit awkward to approach a stranger at first, but it will get easier each time you do it, and you will never receive an impolite response! And remember, while you may not know their names, they are not strangers. They embody every good and decent thing that America represents. They may be black, white, Hispanic, Asian, male, or female, but they are your brothers and sisters in the most practical sense, for if need be, they will give their very lives for you. Do me a favor…thank them today!

When I was a kid there was an active “Keep America Beautiful Campaign” that featured the crying Indian. If you’ve never seen this commercial or want to resort to nostalgia, I’ve got a link to that actual 1971 commercial at the end of this article.

Throwing trash out of car windows was a national obsession prior to the 1970’s. In the 60’s I can remember road ditches lined with paper bags, tires, and almost everything else that could be thrown from a car or truck. Those 1970’s commercials instilled a sense of social conscience in the United States. Littering became “bad” and average citizens started to openly criticize fellow citizens who littered. As a result, we’ve got a country that’s a lot cleaner, with one exception!

If someone throws a McDonalds wrapper on the sidewalk, it’s officially litter. The same is true for a plastic bag, paper cups, plastic spoons, etc. However, cigarette butts apparently don’t count. For smokers, butts simply aren’t perceived as litter. People who instinctively flick a cigarette butt on the sidewalk would never do the same with a food container or a plastic coffee cup.

For non-smokers, cigarette butts are not only officially considered litter, but they’re litter of the most offensive kind. They’re unsightly, difficult to pick up, and appear often in the hundreds or thousands; one wonders if they don’t actually breed and multiply!

Now that smoking is banned in most restaurants and bars, the unseemly habit is practiced outside these establishments on the sidewalks, making sidewalk and street litter even worse in entertainment districts. On the north side of Chicago the recent banning of interior smoking has lead to incredible cigarette litter; there are so many butts that it is sometimes hard to see the pavement as the night wears on. I’m sure this is true for similar neighborhoods in most other cities. Large cities pay millions of dollars a year cleaning up litter; it’s no laughing matter.

I don’t have a solution for butt litter, except that perhaps cops could more actively enforce the anti-littering ordinances. A cop standing on the corner of Clark and Eddy streets in Chicago or Hennepin and Lake Streets in Minneapolis could make a lot of money for the his/her city between 9pm and 2pm! Hummm…higher city tax revenues and cleaner sidewalks, without increasing taxes! Not a bad idea!

Link to Crying Indian Video…circa 1971:

http://www.youtube.com/watch?v=m4ozVMxzNAA

Hillary Clinton and John McCain have both advocated that the federal fuel tax (18.4 cents per gallon) should be suspended during the summer. McCain says the suspension of the gas tax will “help spread relief across the American economy.” Clinton has called for a windfall profits tax on oil companies to pay for the gas tax holiday. The gas tax holiday is poor public policy; here’s why.

First, without the gas tax revenue the Highway Trust Fund will be without billions of dollars that are needed for highway work at a time when our crumbling infrastructure needs attention. It would be irresponsible to delay these projects. A consumer who fills his/her tank once a week will save, on average, a total of $33.12 during the entire summer holiday.

Second, the “holiday” price reduction would be temporary at best. If prices actually were to fall by 18.4 cents per gallon, Americans would be encouraged to drive more, which does little to conserve fuel. However, I find it much more likely that the 18.4 cent per gallon fall in prices would be quickly offset by a rise in producer (Oil Company) prices. I’ll bet that within two weeks from the beginning of the “holiday” the price would have risen by more than the 18.4 cents anyway, padding profits and leaving the Highway Trust Fund broke.

Third, even if Hillary got her way and we levied a “windfall profits” tax on oil companies to pay for the revenue lost by the Highway Trust Fund, those taxes would soon be passed on to consumers via higher prices. Besides, who is Hillary to determine when profits are too high? Is she the new “profits Czar?” Do business owners have to clear their prices with her before raising them?

The federal tax for automobile fuel is a “good” tax because it is based on the “benefits received” principle. People who use the roads are the same people who drive cars, so it is only fair that they should pay for road repair via a gasoline tax. On the other hand, people who live in cities and use public transportation don’t directly use cars or roads and shouldn’t have to pay the gasoline tax. Of course, all of us depend on highways to get our merchandise delivered to retailers by truck, but these costs are mostly passed on in the form of higher consumer prices.

When I was in middle school some kid running for class office promised (with a wink) to get pop piped into the drinking fountains if elected. The middle school kid knew that the pop promise was a sham for getting votes, and was making light of it. Unfortunately, McCain and Hillary aren’t winking as they attempt to buy gullible voters with this silly tax holiday.

According to the Bureau of Labor Statistics (BLS), for the first three months of 2008, consumer prices increased at the seasonally adjusted annual rate of 3.1%. The unadjusted 12 month rate of inflation as of March, 2008 is 4.0%. In other words, the Federal Government is telling the American people that our “inflation rate” is somewhere between 3 and 4 percent. Anyone who fills the car with gas or walks up to the check-out counter at the grocery store has to believe that these statistics are a bold faced lie. In this article I’ll explain why those inflation numbers are suspect.

What is inflation? Inflation describes a rising GENERAL level of prices; in other words, when the prices of almost everything go up. Inflation occurs when the federal government “prints” money at a faster rate than the growth of real goods and services. When you have too many dollars chasing too few goods, prices rise. By the way, the Federal Reserve System runs the currency and credit “print shop”, and is solely responsible for inflation.

At the risk of boring you completely (which we economists do well), let me say that there is no method to measure inflation that is without problems. In 1978 the BLS started using the Consumer Price Index (CPI) to measure inflation. The BLS had a “market basket” of specific products and services which included food items, gasoline, and durable goods. They would measure the month by month changes in the prices of the items in the market basket and thereby determine by how much prices changed over time. The problem with the CPI is that the items in the “market basket” needed to stay the same for measurement purposes, but items such as personal computers, which didn’t exist in 1978, were not part of the market basket. Other items (slide rules and 8-track tape players) needed to be excluded. This necessitated an ever-changing market basket, adding some items and subtracting others.

Since February, 2000 the Federal Reserve System has utilized a concept called “core inflation”, which is widely used for political purposes. Core inflation is most often calculated by taking the Consumer Price Index and excluding certain items from the index, most notably energy and food! The obvious problem is that energy and food prices are increasing rapidly and impact the average American family the most, yet they are not calculated as part of “core inflation”.

Economist John Williams says the only reason the inflation rate is so low is because the Reagan and Clinton administrations rewrote the way the CPI is calculated. In his monthly online newsletter Shadow Government Statistics, Williams has attempted to recreate the inflation rate using its older guidelines. Under his calculations, inflation is actually running at an annualized rate of around 10 percent.

The Federal government has a motive to understate the inflation rate. Welfare payments and social security payments are tied to the CPI, where even a one percent rise in the index can lead to hundreds of millions of dollars of increased Federal expenditures.

To conclude, inflation is not easy to measure, yet there is little question that a 4% number severely understates the pain that is now felt by the American consumer.