The power of other people’s money (Five by 8 – 8/27/10)

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This is my last day of posting for a week. I’m taking a week’s vacation to work at the MPR booth at the State Fair next week. It’s not any sort of promotional thing — that’s for the stars. But I had so much fun last year — I was a cashier — that it seemed wrong to be using work time to do it. So come buy some MPR trinket, but be prepared to tell me where you’re from and how you ended up in Minnesota, who’s the best teacher you ever had, what’s the funniest thing anyone ever said to you etc. You know, the typical News Cut-type stuff. I’ll be there Tues 8:30-5, Weds 12:30-9, Thurs 112:30-9 and Friday 8:30 to 5. And be sure to double-check that I gave your credit card back to you.

1) In the course of about 10 seconds last evening, American Public Media’s Marketplace explained everything you need to know about why the government’s attempts to give banks free money to stimulate lending and, hence, the economy has backfired, and backfired badly.

It came from Ellen Zentner, senior economist at the Bank of Tokyo-Mitsubishi.


There’s just disincentive for banks to lend when the banks can borrow from the Fed at a quarter percent interest and dump it into treasuries at 2.5 to 3 percent. They get a nice tidy gain, risk-free return. And essentially, it’s been tying up about $1 trillion in available credit. So in a sense, the Fed has been causing part of the problem by leaving rates so low.

Translation: The banks are getting money from the government to lend to people — you and me, maybe to buy a house — but instead of lending it to people, they’re using the government money to buy the government’s treasury notes and getting a 2.5 to 3 percent return. They’re using the government’s money to get more of the government’s money. Some deal. It beats lending it.

The Federal Reserve’s governors are meeting this week and, according to Marketplace, there’s quite a brouhaha developing over this problem and whether it makes any sense to keep giving money to banks as an incentive for them to get more money.

We’ll find out today. Fed Chair Ben Bernanke has a major speech to give to announce a new attempt to get the money into the economy, and out of the bank vault.

2) MPR has another Poligraph fact-check out today after GOP gubernatorial candidate Tom Emmer took aim at public employees, during a debate yesterday.

“On average, a person who works in the private sector in a job similar to that of somebody who’s working in the [public] sector is making on average 30 to 40 less,” Emmer said.

True? Yes, sort of.

3) Jim Johnson of Redwood Falls has retired from the funeral home business. If there’s one person everyone in a smallish community knows, it’s the local undertaker. The Redwood Gazette has a snappy profile of Johnson. It’s funny how many people who got into the funeral home business didn’t start out that way.

Funeral home directors are loaded with great stories:


“At one funeral in Wisconsin, they brought in the son in leg chains and wrist chains, and accompanied by two armed guards. The daughter sat on the other side of the church; she hadn’t talked to her brother in maybe 15 years. The minister started his sermon with the story of the prodigal son, and I thought, ‘Oh no. Does he know what he’s doing?’

“The pastor said if the father could see his two children sitting in the same room, it would mean so much to him. “After the service, the daughter went over and hugged her brother. To this day, I remember that sermon more than any other I’ve heard.”

Great stories, indeed. I’m seeing possibilities here for a News Cut series. Any funeral home directors in the audience?

4) It’s Minnesota Day at the Proms. The Minnesota Orchestra is playing the first of two concerts at Royal Albert Hall in London today at 1:30 p.m. MPR is providing the concert live on its classical music stations.

Michael Gast, the principal horn player provides a nice glimpse into the life or an orchestra member:

Sam Bergman of the Minnesota Orchestra is blogging about the trip:


I’m guessing that we’ll spend the bulk of our time on the Bruckner this morning, though we’ll probably have to save enough minutes for a nearly full run-through of Alisa Weilerstein’s Shostakovich concerto. Mainly, this rehearsal will be about re-familiarizing ourselves with the acoustics of the massive performance space, and also reconnecting with each other after nearly a full week apart. (Because of the hectic schedule of the Proms – a new orchestra every single night of the week – our stage crew couldn’t load our gear into the backstage area until early this morning, so even if we’d wanted to rehearse yesterday, there would have been nowhere for us to do so.)

Ah, the stage crew! The unsung and often unrecognized heroes of live performances. We know all about them and it’s one of the sad realities that you don’t. It takes a lot of people whose names and pictures aren’t on Web sites to pull off a live broadcast from London. At the same time , MPR is providing hours of live performances and programming from the State Fair.

Want to meet a star at the Fair? Stop by the MPR booth. And while you’re watching the live music or interview, look to the side of the stage, and spot the person who did the heavy lifting — the audio engineer, or the stage manager, or the I.T. guy, all of whom are walking the tightrope without a net. Ask for their autograph.

Here’s today’s schedule:

11am – 1 pm:Classical Live Performance

11 am: VocalEssence live performance with Classical MPR’s John Birge

12 noon: Trombone Choir live performance with Classical MPR’s John Birge

3 – 6 pm:

The Current live broadcast with Mary Lucia

3 pm: Carolina Chocolate Drops performance

6 – 9 pm:

The Current live broadcast with Mark Wheat

5) The curse of high expectations. Commentator Kathleen Hirsch says we don’t allow enough room for “failure” when we’re raising our kids. But they’re not failures at all. They’re our kids telling us “who they really are.”


In fact, there are many ways of being in the world, and of being in love with the world. Many of these won’t easily be discovered in a traditional academic setting. Because I teach at a university, I see that academic excellence does not necessarily require a lot of empathy, compassion, social skill, or altruism. Often, it simply rewards the ability to play by rules that will equip students for life in bureaucracies: how to follow instructions, conform to outside expectations, hone competitive skills, and not question the terms of the game.

Many, it is true, make the most of higher education. But it is the other ones, those who don’t play by the rules of the game, who have so much to teach us. There is the prep school graduate who is setting out this fall to become an actor, and the one who has opted to give the world his music. There’s the Ivy League grad who returned to his family home in New Hampshire to restore a long-defunct farm. These are goods that can’t be measured by the standards of college acceptance.

Today’s discussion point: Did you find your calling in spite of different expectations for you?

Bonus: An MPR reporter covers the egg salmonella story, then gets salmonella from her eggs.

TODAY’S QUESTION

More than a dozen people in Minnesota have gotten sick from eating eggs tainted with salmonella, despite a national recall. Have you changed your behavior in response to the egg recall?

WHAT WE’RE DOING

Midmorning (9-11 a.m.) – First hour: Economists have discovered that the earning gap for college is even bigger because students are investing fewer hours into their studying. Are students going to college better prepared or are the universities are complicit in lowering standards?

Second hour: World traveller, culinary chef, and Minnesota resident Andrew Zimmern, fresh from his recent escapades for the fourth season of his Travel Channel show “Bizarre Foods with Andrew Zimmern.”

Midday (11 a.m. – 1 p.m.) – First hour: Economist Ed Lotterman discusses the condition of the U.S. and Minnesota economies.

Second hour: From the Aspen Institute: T. Boone Pickens and Ted Turner discuss alternative energy with Thomas Friedman of the New York Times

Science Friday (1-3 p.m.) – First hour: Last year President Obama loosened restrictions on embryonic stem cell research. Now a federal judge has said “not so fast.” Will it stick?

Second hour: Life imitating art, the science of smell, and a new species of bacteria that is eating up the oil in the Gulf of Mexico.

All Things Considered (3-6:30 p.m.) - The U of M wants to renovate Northrup Auditorium on the Twin Cities campus. They’re hoping to change it from a hulking, uninviting, rarely-used structure, to a vibrant, well-used facility. It’s going to be costly, well over $200 million, nearly as much as the U spent on the TCF Bank football stadium. MPR Tim Post wll have the story.