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1979 “We Will Still Come Thru In the Long Run”

Forty years ago at the beginning of 1979, I was hard at work at Stanford Business School finishing up the first-year core curriculum. ( ‘Cost Accounting’ ugh!). Meanwhile in 1979, popular music still was dominated by disco particularly in the first half of 1979 including the  The BeeGees “Tragedy” (#1 Mar.) and “Love You Inside Out” (#1 Jun), Rod Stewart “Do Ya Think I’m Sexy” (#1 Feb.), Gloria Gaynor “I Will Survive” (#1 Mar.), Anita Ward‘s “Ring My Bell” (#1 Jun.) Amii Stewart‘s “Knock on Wood” (#1 Apr.), and disco queen Donna Summer “Hot Stuff” (#1 Jun.) and “Bad Girls (#1 Jul.). Though some of these songs were OK when the mood was right, I definitely preferred rock music. (Only the Village People‘s “In the Navy” (#3 Jun.) and “YMCA” (#2 Feb.) were remotely fun to listen to.)

Rock had inauspicious beginnings in 1979. It was to be an off-year for the Who and the Rolling Stones after successful albums in 1978. The four former Beatles had no new albums. Likewise there was nothing new from the Moody Blues or Yes which might have been a good development given how inadequate their 1978 albums were. Bruce Springsteen, Billy Joel and Steely Dan were also on studio hiatus.

In fact there was really only one rock album (released at the very end of 1978) that dominated my attention in early 1979, the Doobie BrothersMinute by Minute (Dec. ’78). But it was an album that I had decidedly mixed feelings about. The Doobies had evolved considerably since the early to mid 1970s and was no longer the group that produced such brilliant songs as “China Grove”, “Listen to the Music” or “Black Water”. Founder, lead singer and major songwriter Tom Johnston was forced to quit the group in 1975 owing to health problems and former Steely Dan member Michael McDonald became his replacement. In the 1976 album Taking it to the Streets the Doobies sound changed radically as the two hit songs from the album: the title track and “It Keeps You Running” – were both soulful songs by McDonald. With Minute by Minute this transformation was virtually complete. The album was dominated by Michael McDonald’s blue-eyed soul with six of the ten songs written by McDonald and most of them with his lead vocals.

The most famous track on the album “What a Fool Believes” (#1 Apr.) later won the Grammy for song and record of the year in 1979. It was an outstanding song, perhaps the best of the year. However, lyrically, it became a centerpiece of my bouts of temporary depression in early 1979 as the newness and excitement of California and new friends/classmates had worn off to some degree and my loneliness and yearning for my lost love only a year or so earlier. Lyrics such as “She had a place in his life, he never made her think twice. As he rises to her apology, anybody else would surely know. He’s watching her go”. spoke to my yearning for what had come and gone. Fortunately, this winter blues was quite temporary and other songs on the album did not evoke such memories. The whole first side of the record was quite good with “Here to Love You” a nice opening track, the aforementioned “What a Fool Believes”, the very interesting and soulful “Minute by Minute” (#14 Jul.), and more traditional sounding Doobies hit song “Depending on You” (#25 Sep.) a shared McDonald-Patrick Simmons composition and Simmons “Don’t Stop To Watch the Wheels”. Side 2 was not as strong but still included an excellent bluegrass instrumental composition by Simmons “Steamer Lane Breakdown” and another strong McDonald lead vocal “How Do Fools Survive?” co-written by Carole Bayer Sayer.

Fortunately, there were at least a few other rock and pop songs that were good as well that winter:

  • “Hold the Line”- Toto (#5 Jan.) – released in late 1978, a new group from LA had their first single be a major success with this catchy rocker.
  • Robert Palmer– “Bad Case of Loving You (Doctor, Doctor)” (#13 Mar.)was the first Robert Palmer song I can remember hearing and a pretty good start to his career.
  • The Babys had their first hit since 1977’s “Isn’t it Time” with “Every Time I Think of You (#13 Mar.) a nice soft rock ballad.

Summer in DC

By the late Spring/early summer, rock albums improved immensely as did my outlook and mood. One of my favorites was The Cars Candy O (June 1979). Though not quite as good as the group’s outstanding debut album in 1978, Candy O was still one of the best rock albums of the year. Side One of the album starts off with a bang fittingly with the excellent techno-rocker “Lets Go” (#14 Sep.) (“I like the night life baby”). The pace diminishes (but not the quality) with the next two yearning love songs  “Since I Held You” (“It’s been a long time”) and the outstanding “It’s All I Can Do” (#41 Nov.) (“To keep waiting for you”). The pace quickens again with another good song, the lyrically interesting “Double Life” (“It takes a fast car lady to lead a double life“). “Shoo-Be-Doo” livens things up further and nicely leads into the title track, the up tempo “Candy-O”. Side Two is not as good as Side One but still include three very strong tracks “You Can’t Hold Out Too Long” , the frenetic “Got a Lot on My Head” and closing with my favorite song on the album “Dangerous Type” (“She’s a lot like you“). Candy-0 was one of the first albums I bought when returning to Stanford/ Palo Alto in the fall. I eventually recorded the album onto cassette and it became a staple on my drive with my friend Kirk to and from Oregon on a short-lived ski trip ( I broke my leg on the first run down Bachelor Mt.) in early December of that year.

Breakfast in America (March 1979) by Supertramp was also all over the airwaves by the summer of 1979, a summer which I spent commuting by car from our group house rental in Chevy Chase, MD to US EPA headquarters in Southwest DC (401 M Street) for my internship for the Chief of the Economic Analysis Division. Thirty minutes in the car both directions meant I spent considerable time listening to DC 101 and other FM rock stations in DC and three songs in particular were played constantly “The Logical Song” (#6 June), “Goodbye Stranger” (#15 Aug.) and my favorite on the album and one of my favorites of the year “Take the Long Way Home” (#10 Dec.). In addition, another favorite “Breakfast in America” (“take a jumbo across the water, going to see America“) received significant airplay. Supertramp’s sound was pretty unique but unfortunately wore thin over time. This was to be their peak of popularity. Roger Hodgson (lead singer and group leader) left the group in 1983 and by the mid-1980s Supertramp was done.

Meanwhile, James TaylorFlag (June) was also on the airwaves during that DC summer.  An enjoyable album by Taylor featured one of my all-time favorite covers “Up on the Roof”(#28 July) and two “lively” rockers (by Taylor standards) “Brother Trucker” (“You got to roll, roll, roll Brother Trucker”) and “Johnny Come Back”. Also of note were the two more conventional folk rock songs “I Will Not Lie for You” and “Rainy Day Man”.

By the end of the summer Led Zeppelin returned with a new studio album, their first in almost 3 1/2 years, – In Through the Out Door (Aug. ’79). It was to be the group’s final studio album. (In 1980, John Bonham the group’s drummer died and Led Zeppelin officially called it quits. ) While not quite up to the standards of the group’s early 1970s albums (and particularly the superb Led Zeppelin IV), it still boasted three excellent Zeppelin songs: (1) the hard rocking “In the Evening” (in which Jimmy Page plays his guitar with a violin bow making that unique sound in the opening part of the song) (2) “All My Love” and (3) the calypso sounding “Fool in the Rain” (#21 Jan. ’80) which employs Samba rhythms. I never bought the album, but heard these three songs on the progressive rock station by late that summer in DC and then more often back in Palo Alto in the fall.

Neil Young and Crazy HorseRust Never Sleeps (June ’79) was most noteworthy for two excellent tracks recorded live and overdubbed in the studio: the acoustic “My, My, Hey, Hey” (“Out of the Blue”)  and the lengthier hard rocking’ version of the same song “Hey, Hey, My My” (“Into the Black”)(#79 Oct.).

Meanwhile, the summer boasted a number of other very good rock and pop singles:

  • “Dance the Night Away” (#15 Jul.)by Van Halen was one of my favorites by the group from the group’s highly successful Van Halen II album.
  • Bad Company “Rock N Roll Fantasy” (#13 Jun.) was another solid rock song from this British quartet and their biggest single since their 1975 smash “Feel Like Makin’ Love”.
  • Bob Seger “Old Time Rock N’ Roll” (#28 June) was a nice up tempo rocker much like “Hollywood Nights” from the year earlier (both from Seger’s  highly popular “78 album Stranger in Town ). 
  • Cheap Trick had their first big hit with the excellent live rocker “I Want You to Want Me” (#7 Jul.). Later in the year, two more trademark songs were to reach the top 40, the unique cover of Fats Domino‘s “Ain’t That Shame” (#35 Sep.) and the interesting “Dream Police” (#26 Nov.).
  • The most popular rock hit of the summer and the year was “My Sharona” (#1 Aug.) by The Knack.  Like many, I tired quickly of the song as it was played constantly, but it was catchy tune and had a nice rock beat ( Hmm. Its sounds like I am one of those teenage reviewers on Dick Clark’s American Bandstand in the 1960s).
  • In the more jazzy realm, Ricky Lee Jones‘ “Chuck E’s in Love” (#4 Jul.) was a nice mellow tune which seemed to be played often in the various DC bars I visited during that summer (of course only occasionally :) ).
  • “We Are Family” (#3 Jun.) Sister Sledge was also a favorite. Perhaps this was because it was more of dance song than disco. Or more likely, it was because it became the theme song for the Pittsburg Pirates winning the pennant and World Series, then my favorite NL team.

By early September, I gathered my belongings and headed back across country in my Toyota Corolla and unlike my previous two trips when I shared the driving with two different friends from Brown (Dave Dorsey Summer ’78, John Lum June ’79), this trip was a solo expedition. I stopped in Shaker Heights, Ohio where I had dinner with my eventual stepfather Ted Frost. Two nights later I stopped in Lincoln, Nebraska staying overnight with my friend Marty Michael’s parents (from the Stanford GSB). I remember going out for a run when I arrived despite the 98 degree heat. (Marty’s parents correctly thought that I was completely insane!). Next it was on to Denver visiting with the Grant family (second cousins of my mother’s side of the family) and then a special treat to go up and stay at their cabin at the edge of the Rocky Mountain National Forest the next night on my own.

After an interesting and harrowing back-road drive thru the Mountains the next day, (the map did say it was the most direct route!) and eventually a reconnection to Highway 70, I arrived in Glenwood Springs to stay two nights with classmate and friend K.C. Branscomb and her parents at their home about 20 miles from Aspen. This included an interesting hike to the summit of 12965 ft. Mt. Sopris with KC the next day, where I stupidly (in retrospect) pushed on to the open rock summit (leaving KC some 500 ft. below in the woods) during a sudden afternoon thunderstorm. This included my unintentional attempt at replicating Benjamin Franklin’s famous kite experiments by carrying my ice ax sticking straight out of the top of my day pack.

My trip finished with two more marathon drives from Glenwood Springs, CO to Ely, Nevada and from Ely all the way to Palo Alto. Throughout these last two long driving days, my tape deck was up at full volume – blaring out songs from the rock panoply of hits and artists from the 60s and 70s.

In addition to a happy social life in the Fall of ’79, Stanford GSB work was much more enjoyable as the core curriculum courses were largely over and I could focus on what I really liked Economics, Investments, Public Policy etc. Meanwhile, several of the best albums of the year were released during the fall of 1979.

  • Eagles –The Long Run (Sep. 1979)- represented the sixth and last studio album by the group (until 2007) with the group breaking up in 1980 and not reforming until 1994. It was the first new album by the group in almost 3 years since Hotel California (Dec. ’76). Though not as good as the stellar Hotel California, it still boasted three very good songs: the rocking Heartache Tonight (#1 Dec.), The Long Run (#8 Feb. ’80) and the sad love song, “I Can’t Tell You Why” (#8 May ’80). Two other strong rockers Joe Walsh’s “In the City” and Henley-Frey-Felder’s “Those Shoes” nicely round out the album.
  • Tom PettyDamn the Torpedos (Oct. 1979) was also an excellent album and was Petty’s best until he released Full Moon Fever a decade later. It contains four of Petty’s best songs with “Refugee” (#15 Apr. ’80) “Even the Losers” ‘Here Comes My Girl’ (#59 June ’80) “Don’t Do Me Like That” (#10 Jan. ’80).
  • Though not as good as their first album, the PoliceRegatta de Blanc (Oct. 1979) was still not bad. The highlights were the US single  “Message in a Bottle” (#74 Dec.) (“I’ll send my SOS to you“) and the UK single “Walking on the Moon”.

The fall of 1979 also saw the release of another memorable album Fleetwood MacTusk (October 1979). I’ll admit that this album became a favorite because it coincided with beginning of my now almost 40-year relationship with the love-of-my-life Anne.  I met her thru my condo mate Steve’s girlfriend Maureen who just happened to live with Anne in the same condominium complex in Palo Alto. Songs such as “Sara” (“Drowning in the sea of love”) became synonymous with my relationship with Anne and create fond romantic memories to this day. Having said this, Tusk still paled in comparison to Fleetwood Mac’s two previous stellar albums. Like many successful rock groups, Fleetwood Mac suffered from the dreaded disease, “double-album-itis”. The double album really contained about a single album’s worth of good songs, with the other half the album mediocre to bad. This was exacerbated by the fact that Lindsay Buckingham wanted to make the album very “experimental” and a bit more like the new wave/punk sound. Unfortunately like many research experiments, there were many bad results as a consequence. The exception is the excellent and totally fun “Tusk” (#8 Dec.) which even features the USC marching band. However, none of Buckingham’s other eight compositions are particularly noteworthy and only “The Ledge” is good.

Fortunately, the double album is bailed out to a degree by some excellent compositions and singing by Christine McVie and several very good songs by Stevie Nicks. Side One was the best and not coincidentally contains the most clicks and scratches on my vinyl version. “Over and Over” was a nice mellow McVie composition featuring her beautiful soothing voice to start the side. Next up is “The Ledge” Buckingham’s first experimental composition, and it works mostly this time. The third track is a stellar McVie composition “Think About Me” ( #20 May ’80) which is one of the three best tracks on the album. “Save Me a Place” another Buckingham composition is mediocre but fortunately short. The final track is the Stevie Nicks’ beautiful “Sara” (#7 Feb. ’80) which nicely rounds out Side 1. Side 4 is also good with “Honey Hi” and “Never Forget” both nice tracks from McVie and “Beautiful Child” an OK track from Nicks and Buckingham’s best composition the aforementioned “Tusk”.

Just in time for Christmas shopping season, Pink Floyd released their double album The Wall (November 1979). Unlike Tusk however, the album is still very good despite it’s one hour and twenty-minute length. The album’s tells the semi-autobiographical story  of a rocker named Pink (based in part on group leader Roger Waters early life as well as former Floyd member Syd Barrett). Pink loses his father during WWII, deals with abuse by teachers and an overprotective mother and eventually becomes isolated from society as signified by the Wall (“just another brick in the wall“). While many of the tracks are designed to tell this story including dialogue interspersed with music, the album is anchored by several outstanding rock compositions starting on Side One– “In the Flesh?” “Another Brick in the Wall Pt. 1” a nice linkage with “The Happiest Days of Our Lives’ and then “Another Brick in the Wall Pt 2” (#1 Mar. ’80)(“We don’t need no education“), Side Two is not as strong but does have one of my favorite tracks on the album the rare Gilmour composition “Young Lust” (“Oooh I need a dirty woman”) as well as the very moody, acoustic and interesting “Goodbye Blue Sky”. Side Three starts off with the brilliant and eerie rocker “Hey You” (“Out there in the cold, getting lonely, getting old, can you feel me?“), the nice acoustic, mostly instrumental  “Is There Anybody Out There?” and the sad “Nobody Home”. The side finishes with the outstanding “Comfortably Numb” (“Hello, Hello. Is there anybody in there? Just nod if you can hear me”) perhaps one of the best progressive rock songs of all time and certainly one of the most popular among progressive rock listeners. Side 4 features a lengthier reprise of “In the Flesh” which nicely leads into to the excellent rocker “Run Like Hell” (#53 Jun ’80).

The fall/early winter also featured a number of very good rock songs:

  • While ELO’s new album Discovery was heavily influenced by disco much to its detriment, it did boast one excellent song, one of my favorites of the year “Don’t Bring Me Down” (#4 Sep.). (I’ll admit I might be biased because it is one of those rare songs that constantly mentions my first name. “Don’t bring me down, Bruce!”).
  • Jefferson Starship– Jane (#14 Dec.) was the group’s first hit featuring new lead singer Mickey Thomas after Marty Balin left the group in late 1978. Though certainly not a work of art, it is very catchy, uptempo rocker and became one of my favorites of the year.
  • Styx had their first and only #1 hit, the ballad “Babe” (#1 Dec.), but I liked their earlier in the year rocker “Renegade” (#16 Jun.) even better.
  • Journey– “Lovin’, Touchin’ and Squeezin'” (#16 Oct.) was the first top twenty hit for this San Francisco group that would become a mainstay of early ’80s rock music featuring the soaring and unique vocals of Steve Perry.
  • John Mellencamp “I Need a Lover” (#28 Dec.)was the Indiana native’s first single and a pretty good one at that. Dubbed “John Cougar’ by David Bowie’s manager David DeFries, he recorded under that name until the mid-1980s.
  • Though AC/DC album Highway to Hell came out in the summer, I don’t remember hearing the interesting hard rocking title track “Highway to Hell”(#47 Dec.) until later in the year when the single was released. Too bad as it would have been a perfect driving song thru the very hot and humid Midwest late that summer. (“I’m on a highway to hell!”)
  • “This is It” (#11 Dec.) was Kenny Loggins best solo effort to date, though he would surpass it during the 1980s with “I’m Alright”, “Footloose” and “Danger Zone”.
  • Queen “A Crazy Little Thing Called Love” (#1 Feb. 80) was initially released in October 1979 and became the first Queen song to hit number one in the US. This is just another of the many excellent Queen rock songs beginning with “Killer Queen” in 1975. (As well documented in the wonderful 2018 film “Bohemian Rhapsody“). Queen had many more to come with the release of the The Game in 1980 and its second #1 single “Another One Bites the Dust”.
  • London new wave rockers The Clash released the London Calling double album in December 1979. While I wasn’t much of a fan of their brand of new wave at the time, I did like two songs from the album the title track “London Calling” and my favorite “Train in Vain” (#23 May ’80) (“Did you stand by me. No, not at all“).
  • Fear of Music Talking Heads new album featured very unique rhythms and yes even weird sounds, but had one stellar song “Life During Wartime” (#80 Nov.).
  • Soft rockers, Little River Band had two nice pop hits “Lonesome Loser” (#6 Oct.) as well as earlier in the year, “Lady” (#10 Apr.).

R&B, Jazz and Country

While I largely listened to rock, there were some excellent R&B, jazz and even country music that also commanded my attention during 1979:

  • Earth, Wind and Fire had two great songs during 1979 with the up tempo and lively “Boogie Wonderland” (#6 July) and the slow soulful ballad “After the Love Has Gone”(#2 Sept.).
  • Michael Jackson – began his independent solo career with the release of Off the Wall ( Aug.) and its first two singles the dance songs “Don’t Stop Til You Get Enough” (#1 Oct.) (which Michael wrote), and “Rock with You” (#1 Jan. ’80). While this wasn’t his first solo album, (he had four previous albums with Motown under the Jackson V franchise), it was the first released under the Epic record label where he had true creative control. Michael wrote three of the songs himself (including “Don’t Stop Til You Get Enough”) and co-produced them with Quincy Jones.
  • Charlie Daniels Band had the country song of the year with “The Devil Went Down to Georgia” (#3 Sep.). Even though I wasn’t much of a country music fan, it was hard not to like the up-tempo fiddling and instrumentation and of course the interesting lyrics.
  • The jazzy “Rise” (#1 Nov.) by Herb Alpert was the best instrumental of the year.

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While 1979 was not one of the better years for rock music, it did close out nicely with the Eagles, Tom Petty, the Police, Fleetwood Mac and Pink Floyd among others contributing some excellent new material. And 1980 was to bring my graduation and the beginning of my 16 year consulting career at ICF in Washington, DC. It also ushered in some interesting new music and artists. As always, rock and pop music were evolving and I was happy to go along for the ride.

 

Not Another Auld Lang Syne Redux

For many January is the time of the year for New Year’s Resolutions. Last year, I was derailed from my traditional New Year’s blog post by a bad case of the flu ( See my thebrainetrust.com post from one year ago “Not Another Auld Lang Syne…Because “In-Flew-Enza”  January 2018) but this year I have no such excuse. Instead, I merely note that every year that I have made resolutions, no matter how low I set the bar, I end up not keeping them.

So instead of foolishly listing a series of resolutions that won’t be kept, I thought I’d mirror what I did last year  which is to pull together a list of good things about the month of February (instead of January as I did last year) since we are only about one week away.

#10 The days are getting longer and the sun is setting later. By the end of January the sun sets at 5:49 PM in Columbus (or 30 minutes later than Jan. 1) BUT by the end of February it sets at 6:22 PM which means for those of us in the geriatric set its sets during or even after dinner!.

#9 In Columbus, on average, there are fewer cloudy days in February (18 out of 28) vs  January (21 out of 31 days). Makes you want to break out the sunglasses!

#8 George Washington’s Birthday is in February –“George Washington, George Washington… He Was a Great Man”

#7 Abraham Lincoln’s Birthday is also in February – sadly they now combine the two birthdays together into a “President’s Day” kind of a rip off for our two greatest Presidents.

#6 My Mom’s Birthday is in February (note it is higher up on my list that either Lincoln or Washington as it is clearly the most important of the February Birthdays). Happy Birthday Mom!

#5 Groundhog Day is in February. This “CAN” be good if the Groundhog doesn’t see his shadow and therefore Spring is coming. If he does see his shadow then we have six more weeks of winter, per the poem below:

“If ground-hog day was bright and fair,
The beast came forth, but not to stay;
His shadow turned him to his lair,
Where six weeks more, he dormant lay
Secure in subterranean hold—
So wondrous weatherwise was he—
Against six weeks of ice and cold,
Which, very certain, there would be…
~H.L. Fisher, “Popular Superstitions,” Olden Times: or, Pennsylvania Rural Life, Some Fifty Years Ago, and Other Poems, 1888

I guess this always confuses me. If it is sunny and he sees his shadow wouldn’t any self-respecting groundhog say to himself “Hmm its sunny and nice out here. I think I am staying outside!”

#4 Feb-BREW-ary is a month for beer lovers. Made that one up, but count me in!

#3 Febru-AIRY is a light and “airy” month when we all feel relaxed and free. JanNOAIRY is the opposite.

#2 Febulous February! Febtastic February! 

#1 By the end of February, March 21 the Spring Equinox is only three weeks away. This is the official beginning of Spring HOORAY!

So enjoy the rest of January and look forward to February. To quote those wise prophets of Fleetwood Mac “It’ll be here better than before, yesterday’s gone, yesterday’s gone”.

The Twelve Days of Christmas Redux

Hard to believe I haven’t posted in 6 months, but I plead being too busy in “retirement”. But now that the papers and exams have all been graded and the final grades have been posted , I thought I’d get back to blogging again. My last post was on the debt and the need to reform Social Security as one part of avoid economic Armageddon. Pt. 2 was to be about Medicaid, Medicare and other government health expenditures and taxes. However, with the holiday season upon us, I thought this would be a bit too dreary a topic.

Instead, in the spirit of Christmas, I started thinking about the famous and interminably repetitive song “The Twelve Days of Christmas”. The earliest known version of the lyrics was published in London under the title “The Twelve Days of Christmas sung at King Pepin’s Ball”, as part of a 1780 children’s book, Mirth without Mischief. (My source is “Wikipedia”). To those who have forgotten or have understandably tried to block it out, the current version of the last verse of the Twelve Days of Christmas is as follows:

“On the twelfth day of Christmas, my true love gave to me:

12 drummers drumming

11 pipers piping

10 lords a leaping

9 ladies dancing

8 maids a-milking

7 swans a-swimming

6 geese a-laying

5 GOLD RINGS

4 calling birds

3 french hens

2 turtle doves 

And a partridge in a pear tree. “

This is not only repetitive but pretty ancient circa 18th/19th century England. So in the spirit of improving this age old classic, I have updated the lyrics for the 21st century with a set of lyrics focused around food which we usually eat to excess around the holiday season:

On the twelfth day of Christmas, 

12 Chocolate Candies

11 Lady Fingers

10 gallons ice cream

9 shrimps a sizzling

8 burgers broiling

7 steaks a searing

6 cheeses in bacon

5 COLD WINGS

4 roasting hens

3 French Fries

2 Turtle Soups

And a kilo of a rare brie.

 

So the next time, you are listening to the Twelve Days of Christmas imagine you are listening to these delicious food lyrics instead.

Merry Christmas and Happy Holidays to All!

 

“How Long to the Point of Know Return?”

Can we finally talk about the $21 Trillion Elephant in the Room? I know its been an entertaining/incredible/painful/awful (pick your adjective) l7 months since Trump office between the Russia investigation, immigration dysfunction, the hush money payouts to a former porn star, the trade wars, the interminable tweets from the White House etc. But maybe we can actually do something that will shape this country’s future– whether marked by a worldwide depression of unprecedented levels or one where at least there continues to be improving growth in incomes and employment.? Federal debt outstanding totals an eye-popping $21.2 trillion with state and local debt totaling an additional $3.1 trillion.

In addition, total debt in the US has soared to over $70 trillion (almost 3 times the debt burden in 2000). which includes federal debt at $21 trillion, state and local debt at $3 trillion, personal debt (mortgage/ credit card/student loans primarily) of $19 trillion. In other words as bad as the government being awash in red ink is–and it is clearly our worst financial problem–individual debt is also soaring.

The US debt time bomb is still ticking. In fact now it is ticking even louder and faster, but is still silent to most Americans, Congress and the Presidency. The CBO released its ten-year budget projections in April which included the new tax law enacted by Congress at the end of 2017.

  • On the positive side, the projections show a steady growth in tax revenues from $3.33 trillion in 2018 to $5.52 trillion in 2028 or an average of 5.2% per year.
  • On the negative side, total government spending or outlays will grow much faster from $4.1 trillion in 2018 to more than $7 trillion in 2028! 
  • As a result, the projections show the annual budget deficit growing once again from our current estimated “low” levels of about $665 billion  in 2017 to about $1 trillion in 2020 and $1.4 trillion by 2027.
  • The national  debt is currently $21.2 trillion or 105% of US GDP. (See usdebtclock.org if you really want to get depressed!). According to CBO figures, this debt burden will grow to approximately $24 trillion by 2022 and to about $32 Trillion by the end of 2028 or a growth in our US debt of about 50% in the next decade. This means that the total US debt will more than triple in the 20 years between 2007 and 2027 ($31 Trillion vs. $9 trillion in US debt in 2007) and will more than quintuple from 2000 to 2027 ( $31 Trillion vs. $5.6 Trillion in 2000).
  • In a few cases, the CBO projections are overly pessimistic. For example, while real GDP grows at about a 3% rate during 2018 and 2019, it falls to 2% in 2020 and grows only 1.5% to 1.8% thereafter. With the stimulus of the tax cuts and particularly the likely capital spending and associated productivity gains associated with allowing expensing of capital investment under tax reform, along with the large deficit spending projected for a number of years in the future, I think real GDP will probably grow faster than this and this means tax revenues should also grow faster.
  • On the other hand, on the spending side, the CBO projections are in my view VERY optimistic. They assume almost no increase in inflation from current roughly 2% levels. (CPI grows to 2.4% from current levels of 2.2% per year). They also assume that the interest on long-term treasury debt will only increase to about 3.7% (from today’s 3.0%) in the next 10 years which is still well-below normal levels. This assumption is particularly important as federal outlays on just paying interest on debt are very likely to exceed $1 trillion per year by the middle of next decade assuming we move to more “normal” interest rates. Even the CBO’s conservative interest assumptions result in it reaching $0.9 trillion in 2028  ( I would estimate about $1.3 Trillion in 2028). Still even with CBO’s comparatively low-interest rate assumptions interest on the debt will become the 3rd largest budget item for the federal government, passing defense spending of $0.8 trillion and after Social Security $1.8 Trillion and Medicare’s $1.5 Trillion in 2028.

So why doesn’t anybody seem to care?

First, there is the ridiculous misnomer of comparing our total GDP to total federal debt as if this comparison is meaningful. The comparison suggests that somehow we have “covered” our debt with our total economic output. But as economist and investment advisor Bob Wiedemer points out, the correct comparison is annual federal revenues vs total federal debt. Thus our true debt coverage ratio is much scarier –only 15%. (vs the roughly 100% coverage using the fallacious GDP to total debt ratio). To put this into perspective, imagine someone who makes $60,000 per year deciding to go on a luxury 6 month around-the-world vacation costing $400,000 and trying to do so with no money down thru a $400,000 unsecured loan. Would any banker or finance company make this loan?

Of course, our federal debt situation is a bit better because the federal government controls the printing of money which means as we did during most of the Obama years we can monetize the debt. The Fed buys treasury bonds by printing money, simultaneously keeping interest rates lower and financing some of the debt. But printing money is a temporary solution at best and one that is fraught with risk (most notably much higher inflation) that we have managed to dodge at least for now. But greater and greater debt levels and rising interest rates likely will have even more dire consequences for the economy and the deficit in the future, making even more money printing likely and rapid inflation/economic depression a very likely consequence.

Second, there is a political situation in this country that is unprecedented. We have a two-party system where neither party seems to be able to even agree on the most basic of economic issues. Republicans generally believe that greater economic growth will lead to increasing tax revenues which will eventually allow deficits to disappear or at least diminish its significance. Tax cuts and reform (i.e. the Tax Reform Act of 2017) and reduced regulations are the Republican “Supply-Siders” main methods for increasing growth. Also, Republicans view that discretionary non-Defense domestic spending  can be reined in and cut to help control the long-term spending. In contrast, Democrats are generally against spending cuts, except for Defense, and Democrats are also for tax increases (though mostly on the wealthy few) and are generally against tax cuts. My own view is that to get us out of this mess we need to take the best of both sets of solutions in order to get us out of this mess.

Third, with elections in November and the polarized political environment NO ONE is willing to talk about either Social Security or Medicare (or for that matter Medicaid). Excluding interest on the debt, in 2028, CBO projects $4.5 trillion of the $6.1 trillion of government expenditures or nearly THREE QUARTERS of all government expenditures will be spent on Social Security ($1.8 Trillion), Medicare ($1.5 Trillion) and Medicaid ($0.6 Trillion) or other government/veterans retirement and income programs ($0.6 Trillion). But any Republican who dares talk about possible cuts or changes in these programs will be almost certainly punished in the elections, while any Democrat who talks about payroll or other tax increases to fund the difference fears the same retribution from voters.

Bottom line, I don’t see any current actions that will change the CBO dire forecast very much and if anything I think the situation will likely be even worse, when you factor the strong likelihood of a recession and perhaps a major depression in the next 3-5 years. The problem of course is the greater the debt the more likely we will see increases in inflation, interest rates and ultimately a major stock market decline and crash, which will in turn will result in a major decline in the dollar value, further increase $ inflation, further exacerbating the deficit and debt problems greatly increasing unemployment, and lowering incomes.

So what do we do to prevent this nightmare from coming true? Clearly, we must start doing something NOW to deal with our burgeoning deficit and debt to give the markets some assurance that the US will eventually pay down some of its large federal debt, BEFORE the markets lose confidence in US treasuries and the stock market. I have in mind a multi-faceted strategy on Social Security, Medicare/Medicaid and discretionary government spending. For this blog, I will post about the “easiest” to deal with Social Security and leave the more difficult Medicare/Medicaid discussion for later.

Social Security

Social Security is inherently the most fixable of our current bankrupt government programs and it can be done by spreading the pain across a few of the main categories of funding and benefits. I believe it can also be done without changing the monthly benefits that current and future retirees are depending on, though it would mean somewhat more taxes on current workers and retirees as well as a delay of the official retirement age:

  • Raise the Full Benefit Retirement Age – With Americans who make it to their 60s increasing living past age 90, Currently the last Social Security law (passed in 1983) is gradually increasing the full benefit retirement age from 66 years gradually to 67 years over the next few years but this still means that Social Security is being paid to many for 20-25 years or even more. This of course is far longer than originally intended with the law designed to cover the last 10-15 years of life. Notably, more Americans are working into their late 60s and even their 70s than ever before. One possible change would be to accelerate full retirement age to 70 in five years and to 72 in 10 years.
  • Increase Taxation of Social Security Benefits for middle and upper-middle income retirees. – Currently, social security income is tax exempt for lower-income recipients(for married couples those whose “other income” totals less than $32,000 and 50% of benefits are taxable for those with “other income” between $32,000 and $44000. Above $44000, 85% of Social security benefits are taxable. (The actual formulas are actually more complicated than this….hey its the IRS!…but this gives you the general idea.) Because the new tax law significantly reduces the tax rates for lower and middle-income brackets, this means there will be less revenue from federal income taxes on social security benefits. One way to raise back some of these lost revenues is to make 100% of benefits taxable at the $44,000 threshold.
  • Increase Payroll Tax Limits for Social Security -In 2018, there is a 6.2% payroll tax for employees and employers for the first $128,400 in income with this income limit rising by inflation every year. Clearly, this is no longer enough to fund social security recipients as it once was, particularly with the increasing retirement of baby boomers over the next decade. One way to plug this gap would be to raise the tax limit to $150,000 in 2020 and then by $20,000 per year between 2020-25 until one reaches $250,000 in 2025. These tax limits would be indexed to inflation per the current law.

In 2018, Social Security Tax Receipts are estimated at about $0.9 trillion which are already less than  $1.0 trillion in total Soc. Security outlays. But without changes in the system, tax receipts in 2028 will total $1.4 trillion while outlays will swell to over $1.8 trillion in 2028 – a funding gap of more than $0.4 Trillion. I estimate that the changes noted above would eliminate this future funding gap by reducing outlays (due to fewer recipients in 2028 by raising the retirement age) paid to $1.6 trillion and increase tax receipts to $1.6- $1.7 trillion. (NOTE: My estimates are very rough because I don’t have access to all the data the CBO or the Administration has in making their projections, however, they are accurate enough I believe). Further they can be fine tuned to those actually doing detailed studies of the data. In addition, there are other levers at our disposal that I haven’t included above. For example, one would be to raise the payroll tax % on all income (say from 6.2% to 8% on both employees and employers), another would involve reducing future benefits slightly by using CPI inflation -1% for indexing. The point is there are a number of solutions that can spread the burden across younger workers and retirees and put the Social Security system back on a financially viable footing.

Though politically difficult, I actually believe Social Security is the best program to tackle first for Congress. For one, reasonable things can be done to bring the system in balance and have it start building up a trust fund again. And just getting SOMETHING done on the long-term budget and debt issue will hopefully be enough to settle (for a time) the increasing concerns of the markets over the total burgeoning US debt. In other words, it’s a good place to start. Will we? I think it depends not on Congress but the voters. If we demand a bipartisan solution now, we are much more likely to see one in the foreseeable future. Lets hope so, because we are getting closer to the “point of know (no) return”.

 

1978 “Don’t Look Back”

Forty years ago, I had one of the best years of my life. 1978 was a year of change and excitement. It didn’t start out that way with a brutally cold and snowy winter in New York City and still mourning the end of my two-year relationship with my college girlfriend. But as Spring and early Summer arrived, I began to prepare for my escape from New York and my future at Stanford Business School.

In late June, I bought my first car– a Toyota Corolla, two-door sedan (only a 1.1 liter engine, with no AC and manual transmission to save money, but naturally a tape deck and stereo!).Then in August, I drove cross-country with my friend Dave Dorsey with all my possessions crammed in the small back seat and trunk of my car. Our trip was mostly on Route 80 across the GW Bridge thru the Delaware Water Gap, to Cleveland/Shaker Heights (my future stepfather’s home) to Buffalo Grove,IL (Dave’s parents house) to Sioux City, Iowa (friend of my mom’s) to Buffalo, Wyoming (Vassar classmate of my mom) to the Wind River Mts. for 3-4 days of hiking, to Elko, Nevada (first gambling experience) to Yosemite (another 3-4 days of hiking) to my final destination in Palo Alto, Ca. Within a day of moving into/renting a room in a condo in Palo Alto, I was off to San Fransisco with my new roommates to see the punk rock group The Dead Kennedys.

Disco Still Rules

Rock music was also undergoing significant change as well and mostly for the better,but like my personal life, music in 1978 did not start out that way. Saturday Night Fever, the soundtrack from the movie of the same name was atop the album charts for the first six months of 1978. Meanwhile, disco singles from the album dominated the charts. These included “How Deep is Your Love”(#1 Jan.), “Stayin’ Alive” (#1 Feb.) and “Night Fever” (#1 Mar.- May) by the Bee Gees, as well as “If I Can’t Have You” (#1 May) by Yvonne Elliman and Disco Inferno (#11 Apr.) by the Trammps.

I’ll admit “good” disco songs were catchy, generally upbeat and occasionally fun (“Stayin’ Alive” and “Disco Inferno” definitely fell into this category), but I found myself quickly yearning for rock music particularly after repeated listenings of these hit singles. But “Saturday Night Fever” had swept up America at least thru the Spring of 1978.

Rock Renaissance

However, rock was to rebound by the second half of 1978 with many of the best albums out in the summer of ’78. It was fitting as I enjoyed these songs while approaching the Rockies for the first time driving 75-80 MPH in states where speed limits were high and/or seldom enforced. (I would have driven faster but it was all my Toyota could physically muster unless heading downhill after mountain passes.)

Four albums emerged as standouts for the year. All were released during June-August of 1978:

My favorite album of the year was The Cars (June 1978) by The Cars. The debut album by this Boston area group is without question their best and perhaps the best album of the entire “new wave” of the late 1970s. It was my first purchase upon arriving in California just prior to my first year at Stanford Business School. I played it incessantly.

Side 1 begins with three superb tracks “Good Times Roll” (#41 Apr. ’79) , “My Best Friend’s Girl” (#35 Dec.)  and “Just What I Needed” (#27 Sep.) which not surprisingly were all released as singles. “Good Times Roll” signals that this album was going to be VERY DIFFERENT with a rock song melded into interesting techno-rock instrumentation and a slow driving rhythm. The pace picks up with the utterly fun “My Best Friends Girl” (“and she used to be mine, she’s so fine“) which immediately segues to the interesting rhythmic intro to the lively “Just What I Needed” (“I don’t mind you coming here and wasting all my time“). Wow! “”I’m in Touch With Your World” is next and although the weakest track on the album at least it provides a welcome respite. “Don’t Cha Stop” the most uptempo song on the album is just a pure rocker, not as interesting as the other songs on the album, but good nonetheless.

Side 2 is even better because ALL four songs are superb, while flowing together musically and lyrically which adds to their overall appeal. “You’re All I’ve Got Tonight” features a great new edgy techno-rock sound primarily using guitars and keyboards. Ironically, it ends lyrically with “I need you tonight” and then a six-note musical/lyrical reversal into the second track, “Bye Bye Love”, with bassist Benjamin Orr now singing lead “always with some other guy, it’s just a broken lullaby”, another great techno rocker. (I confess that for years I thought Orr was saying “always with some other guy, it’s just a fucking alibi”, which would have been a better line, but might NOT have been approved by the record company in the 1970s.) The crescendo of techno-rock ends with the same six-note sequence and moves more softly into “Moving in Stereo”, another great song that lyrically belies classification (“life’s the same I’m moving in stereo, except for my shoes”). The last song, another great tune, “All Mixed Up” fittingly provides at least some resolution of the tenuous, tempestuous relationship begun with “You’re All I’ve Got Tonight” (“she’s always out the window, when it comes to making dreams. It’s all mixed up”) but then it finishes (“she says to leave it to me, everything’ll be all right”).

Another excellent album was Who Are You? (August 1978) by the Who. The title track “Who Are You” (#14 Oct.) was the best song recorded by the group since 1971’s “Won’t Get Fooled Again” and in many ways was a throwback to that song’s style and message. It was a lengthy song, containing angry lyrics about fighting (allegedly an incident with the Sex Pistols at CBGBs ) and a hard rock style with an irresistible chorus and guitar hooks. Six and a half minutes of music heaven! But the album boasted much more. The self-deprecating rocker, “New Song” (“I write the same old song with a few new lines and everybody wants to cheer it….We sing the same old song  just like a vintage car, you can look but you never can drive it“) perhaps fittingly became an instant classic for Who fans. “Had Enough” was another excellent angry Who rocker in the mode in “Who Are You” but written by bass player, John Entwistle. (Entwistle wrote two other solid tracks on the album “Trick of the Light” and “905” ). “Guitar and Pen” was my second favorite song on the album, an autobiographical look at Pete Townshend life as songwriter and guitarist, as well as being an excellent catchy rocker. “Sister Disco” (“Goodbye Sister Disco with your flashy bright pants“) was also catchy, seemingly an homage to disco or an indictment, but according to Townshend, it was his view that the Who would never be part of the Bee Gees wave of disco popularity but instead remain British “old farts”. I choose to believe it was Townshend’s prescient belief that disco with Saturday Night Fever has peaked and would never be the same again.

Another favorite and also from the summer of rock heaven in 1978 was Some Girls  (June 1978) by the Rolling Stones. This was the Stones best single album since 1971 Sticky Fingers. The centerpiece was the disco influenced “Miss You” (#1 Jul.)  an excellent rock-disco song but my favorite was “Beast of Burden” (#8 Nov.) a song that reminded me of the rock-bluesy “Wild Horses” with Keith Richard’s ever extraordinary guitar work most evident. But the album had much more ranging from an excellent rock cover “Imagination” of the Temptations soul ballad “Just My Imagination”, a Jagger rock-rap “Shattered” (#31 Jan. ’79), and three more traditional but excellent rockers “Respectable”, “Lies” and “When the Whip Comes Down”. In fact, there was not a weak track on the album.

After three years, Bruce Springsteen emerged from his contract war with former manager Rick Appel with a new album Darkness on the Edge of Town  (June 1978). Though the album was not as good as Born to Run  (my favorite and arguably the best of Springsteen’s entire career), it was still quite good. The album was highlighted by the lively “Badlands” (#42 Sep.) and the rocker love ballad “Prove it All Night” (#33 Jul.). But “Adam Raised a Cain”, “Something in Night”, “The Promised Land” and “Darkness on the Edge of Town” were also very good songs. Springsteen with “Darkness…” continued to prove that you didn’t need to be a great (or even a very good vocalist) to produce excellent songs.

Boston‘s second album Don’t Look Back (August 1978) was not up to the standards of their superb first album. Nonetheless the album did boast several very good tracks: “Feelin’ Satisfied” (#46 Apr. ’79), “Party” and “A Man I’ll Never Be” (#31 Jan. ’79) all had nice tunes, strong vocals from Brad Delp and excellent, albeit very familiar, guitar licks from Tom Scholz. However, it was the more original and brilliant title track “Don’t Look Back”(#4 Oct.) that truly soared. Perhaps my favorite of all Boston songs, “Don’t Look Back” also had simple but very relevant lyrics to someone who was in the process of moving across country to where he knew absolutely no one. (“A new day is breaking. It’s been too long since I felt this way. I don’t mind where I get taken, the road is calling today’s the day”)

Foreigner‘s second album Double Vision (June 1978) was good as well, mostly due to the three excellent hit singles from the album. “Hot Blooded” (#3  Sep.) (“I’ve got a fever of 103“) , “Double Vision”(#2 Nov.) and “Blue Morning, Blue Day” (#15 Feb. “79)

By the fall, Billy Joel had a trio of excellent songs from his 52nd Street (October 1978) album including the catchy hit “My Life” (#3 Dec.), my favorite, the rocker “Big Shot” (#14 Mar. ’79) and the soft ballad “Honesty” (#24 Jun. ’79). 52nd Street went on to win the Grammy for album of the year in 1979.

New Groups and New Wave

In addition to the Cars, eight other new artists emerged or became popular in 1978 with the release of excellent albums and/or songs.

Outlandos D’Amour  (Nov. ’78) was the Police’s debut album and another headline of the new wave movement in 1978. All the songs on the album are interesting with “Truth Hits Everybody’ , “Next To You” and “Peanuts” particularly lively new wave rockers, with Police’s unique reggae-rock sound featured. However, three were standouts. “Roxanne” (#32 Apr. ’79) was the group’s first American hit and both “I Can’t Stand Losing You” and “So Lonely” should have been hit singles.  While “Roxanne” is perhaps the group’s most famous song from the first album, my favorite was “So Lonely”.

After two commercially unsuccessful albums, the New York city group, Blondie released Parallel Lines (Sep. ’78). The album spawned their first two hits in the US – the disco oriented “Heart of Glass” (#1 Apr. ’79) and my favorite, a pure rocker “One Way or Another” (#24 Jul. ’79) (“I’m gonna find you, I’m gonna getcha, getcha, getcha”). Blondie featured blond and beautiful, lead-singer Debra Harry whose soaring rock vocals continued a new trend started by Heart a couple of years earlier. Both a new wave and a pop-rock group, the group featured songs co-written by Harry and lead guitarist Chris Stein with several others from the album – “Picture This” “Sunday Girl”, “I’m Gonna Love You To” and “Hangin’ On the Telephone” – enjoying international success as singles.

While definitely NOT “new wave”, Dire Straits self-titled first album Dire Straits (Oct. ’78) first album demonstrated a unique rock style. The London-based group was described by Rolling Stone as “a groove band” with “low-key country blues rhythms”. I would describe Dire Straits as an all-guitar/ bass-rhythm section band with a very cool, mellow and unique rock sound.  It didn’t hurt that the group’s founder and lead Mark Knopfler was a great guitarist.  The album featured many good songs – no throwaway tracks on this album! I particularly liked “Down to Waterline” and “Southbound Again” and of course the best song on the album which put the group on the map  “Sultans of Swing”(#4 Apr. ’79).

A hard-rock party band from California, Van Halen burst onto the scene with their self-titled first album Van Halen (Feb. ’78)The album featured many of the groups most famous songs (though mostly in retrospect). These included most notably—“You Really Got Me” (#36 Mar.) a successful cover of the Kinks hit, “Runnin’ With the Devil” (#84 May), “Janie’s Cryin'” “Ain’t Talkin’ Bout Love” as well as the Eddie Van Halen electric guitar solo “Eruption”. I’ll admit it took until 1984’s “Jump” for me to become a full-fledged fan of the group, but it was their first album that remains their best.

“Surrender” (#62 Aug.) (“Mommies alright, daddy’s alright, they just seem a little weird”) was Cheap Trick‘s  first charting single and one of their best songs. The Illinois based new wave/rock group was to remain popular for much of the next dozen years.

Though Genesis had been around for about a decade, “Follow You, Follow Me” (#23 Jun.) was their first top 40 song in the US and a nice rock ballad at that.

Likewise, Warren Zevon had been working as a singer/songwriter/pianist since the mid-sixties but finally had a popular hit with the thoroughly enjoyable and catchy “Werewolves of London” (#21 May). I was learn more than a year later that this was one of Anne’s (my future wife) favorite songs. (“I saw a werewolf with a Chinese menu in his hands….Little old lady got mutilated late last night. werewolves of London again… Ah-hoo werewolves of London!” )

Scotsman Gerry Rafferty (former member of Stealers Wheel) released his second solo album City to City (Jan. 1978) which was his first popular album and rose to #1 on the US album charts. It also spawned a nice trio of mellow rock hits “Baker Street” (#2 Jul.)  , “Right on Down the Line” (#15 Oct.) and Home and Dry (#28 Feb. ’79).

Other Rock Hits

The Street Survivors (Oct. 1977) album was released Lynyrd Skynyrd in late 1977 just days before the plane crash on Oct. 20th that took the lives of 3 band members included leader and lead vocalist Ronnie Van Zant. In addition to the group’s standards “Free Bird” and “Sweet Home Alabama”, three excellent songs from this album–“What’s Your Name” (#13 Mar.),  “That Smell”, and “You Got that Right” (#69 Apr.) – were receiving tons of air play on FM progressive stations during 1978.

Joe Walsh had his best solo effort (and most popular) with the utterly fun and at least partly autobiographical rocker “Life’s Been Good” (#15 Aug.) (“My maserati goes 185, I lost my license now I don’t drive” ).

Heart had another hit single with the rousing “Straight On” (#15 Nov.). Unfortunately the album Dog and Butterfly (October ’78) had little else to offer.

The comeback hit “A Rock n Roll Fantasy” (#30 Sep.) by the Kinks was the group’s first top 40 hit since 1970’s “Lola”. The lyrically interesting song (“He just spends life living on the edge of reality. He just spends his life living in a rock n’ roll fantasy“) contains nice vocals and a good rock tune.

New wave’s Talking Heads released their second album More Songs About Buildings and Food (July ’78) which contained a superb cover of Al Green’s song “Take Me to the River” (#26 Feb. ’79).

Styx  had two more catchy rock singles in 1978 –“Fooling Yourself (The Angry Young Man)” (#29 Apr.) and “Blue Collar Man (Long Nights)” (#21 Nov.).

Unlike many, I did not enjoy Bob Seger’s slow ballads  “Still the Same” (#4 Jul.) and  “We’ve Got Tonite” (#13 Jan. ’79) but I did like his hard rockin’ “Hollywood Nights” (#12 Oct.).

Soft Rock and Pop

While harder rock and new wave definitely were my favorite genres in 1978, several softer rock and pop songs were good as well:

  • “Time Passages” (#7 Dec.) by Al Stewart was not as good as Stewart’s previous extraordinary hit “Year of the Cat” but a nice ballad nonetheless.
  • “Feels So Good” (#4 Jun.) by trumpet player and band leader Chuck Mangione was definitely the instrumental of the year and spawned a popular career for Mangione which included some memorable “Is it live or is it Memorex (tape) ?” ads.
  • “Whenever I Call You Friend” (#5 Oct.) by Kenny Loggins  was Loggins first solo top 40 hit and a very good tune at that, with a nice assist from Stevie Nicks singing harmony.
  • “Ebony Eyes” (#14 Apr.) by Bob Welch – Though not as good as his earlier 1977 hit “Sentimental Lady”, Welch’s second hit song was still a nice pop tune.
  • “Thunder Island” (#9 Mar.) – Jay Ferguson. Ferguson was the former leader of the band Spirit and his first solo hit was his best
  • “Back in the USA” (#16 Oct.) was the highlight of Linda Ronstadt‘s new album Living in the USA. A nice up tempo version of Chuck Berry’s song which featured Ronstadt’s great voice.
  • Kansas Point of Know Return (Oct. ‘77) album spawned the slow rock ballad  “Dust in the Wind” (#6 Apr.). A good song, but hopelessly overplayed on the radio and very difficult to hear when getting up in the morning (“All we are is dust in the wind”)
  • John Travolta and Olivia Newton-John had a huge hit from the movie Grease “You’re the One that I Want” (#1 Jun.) which was definitely the movie’s musical highlight, though Frankie Valli‘s “Grease” (#1 Aug.) wasn’t bad either.

Rock and Pop “Misses”

Though most of rock and new wave music was excellent  in ’78, there were also several major disappointments. One of my favorite groups, the Moody Blues FINALLY put out their next album Octave (June ’78) after a more than 5 year hiatus. I couldn’t bring myself to buy it since it had nothing of consequence other than the modestly interesting “Steppin’ in a Slide Zone” (#39 Aug.) and paled in comparison to the Moodies previous 7 studio albums. Another favorite group of mine, Yes released Tormato (Sep. 1978). Though it contained two pretty good songs “Don’t Kill the Whale” and “Release, Release”, the album was a last gasp for the group and not as good as their previous effort Going for the One the year earlier. This was to be the last studio album for founder and lead singer Jon Anderson and organist Rick Wakeman until their comeback album 90125 five years later.

Meanwhile, Rod Stewart continued to veer far away from rock with the disco song “Do Ya Think I’m Sexy” (#1 Feb ’79) which was on the charts for 21 excruciating weeks. Elton John had fallen even further off the tracks releasing A Single Man (October 1978) (minus Bernie Taupin as lyricist)  which though commercially successful was a critical bomb. I honestly don’t remember listening to a single song from the album at the time.

Paul McCartney and Wings London Town received decent critical reviews but unlike ALL of McCartney or Wings previous albums, I didn’t buy it (or for that matter ever listen to it). The headline song from the album “With a Little Luck” (#1 May) was a decent song, but nothing like past stellar McCartney songs such as “Band on the Run”, “Uncle Albert”, “Maybe I’m Amazed” etc.

Meanwhile, Neil Diamond and Barbra Streisand “You Don’t Bring Me Flowers” (#1 Dec.) was so cloying it made me yearn for the early 70s Diamond and Streisand.

Disco, R&B and Funk

Quite a bit of R&B music seemed to be subsumed in disco music, of note was the newly crowned Queen of Disco Donna Summer “Last Dance” (#3 Aug.) and her first #1, the remake of Richard Harris’ “MacArthur Park” (#1 Nov.), though I can’t say I liked either song very much.

In contrast, Earth, Wind and Fire continued to put out excellent songs with 1978 being a particularly stellar year. It began with the lively and brilliant “Fantasy” (#32 Apr.) (“Our voices will ring together, until the 12th of never“)  which somehow only managed to barely make the top 40. Next there was the great jazzy remake of the Beatles “Got to Get You Into My Life” (#9 Sep.). Last the superb “September” (#8 Feb. ’79) (“Ba de ya, say do you remember, ba de ya, dancing in September“) closed out the year. EWF combination of a great funk rhythm section, a superb horn section, wonderful high harmonies and many excellent tunes made them the best R&B group of the late 1970s (and early 1980s) bar none.

Meanwhile, the Pointer Sisters had their biggest hit and first top ten with the slow, soulful “Fire” (#2 Feb. ’79), a Bruce Springsteen composition. But my favorite popular R&B song of the year was the lively disco/funk song “Le Freak” (#1 Dec.) by Chic which could even get me dancing.

Completely under the radar, a new promising 20-year-old artist from Minneapolis released his first album and charted his first single “Soft and Wet”(#92 Nov.) to little critical acclaim. But for Prince it was to be the beginning of a recording career which spanned almost four decades.

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1978 remains one of my favorite years for rock music, perhaps it was the mostly good memories the music evoked, or that the music was in many cases new and different. In either case, it was a nice revival for rock music which had been in the doldrums since the advent of disco in the mid-1970s.

“I’ve Got the Music in Me” on Sirius XM radio

 

Full Picture of Book

“The First Cut is the Deepest?” Redux

I have been waiting for the CBO to update their long-term budget projections before I blog next about our debt, deficit and what we need to do in order to avoid an impending collapse of the US and world economies when the debt and money bubbles burst. (Hint: it’s called putting Social Security, Medicare and Medicaid on a viable financial footing!). In the meantime, I thought I would do a “replay” of a post from almost exactly five years ago, which is eerily prescient (and who doesn’t love patting themselves on the back!). In the post, I predicted that US federal debt would “swell to near $25 trillion by the end of the decade”. Given that we will be at almost $22 trillion by the end of 2018, it seems likely that we will be nearly there in 2020. I also correctly noted that the CBO was on drugs when they predicted that GDP growth would be about 4% per year during 2013-2017 (it turned out to be only 2%) and that tax revenues would almost double during this period. (They fell short of CBO’s estimate by $0.6 trillion or 20%!). My main prediction of higher inflation and more normal interest rates (which will exacerbate our deficit and debt) hasn’t come true yet, but it is moving in that direction. And lets not forget that while the tax reform law won’t change net government revenues probably much either way, the Faustian bargain of the Trump Administration seems to be to remove the sequester, allow Defense to grow a lot in exchange for allowing domestic spending and infrastructure spending to grow as well. This is not a pretty picture in the longer term.

Anyway, because I am inherently lazy, here’s what I said some five years ago:

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“The First Cut is the Deepest?”

The day of reckoning for sequestration has come and gone and the small cuts have started to go into effect. To hear some of the rhetoric coming from the President and some of our other political leaders, you would have thought  that we are now facing an economic Armageddon. I believe these fears amount to “inside the beltway” exaggerated concern over the importance of government spending to the economy. After all, the cuts of $85 billion (and only $43 billion this fiscal year) are still very small relative to the amount of federal spending (only about 2 percent of total federal spending in 2013) and only about 0.5% of total US GDP. More importantly, they pale in comparison to what will be needed to ultimately to balance the budget which will require budget cuts below current levels ( not the “fake” future cuts below inflated future levels that are often cited by many politicians as if they were “real” cuts) of on the order of $500 billion per year.  (See “Let’s Get Fis-i-cal” post and early last year posts for more info on what we need to do.)

But somehow the thought of the ghastly sequester has had many leaders in Congress pretty confused. Consider the following dim-witted remarks in the past couple of weeks:

“It’s almost a false argument to say we have a spending problem” …Nancy Pelosi(D-CA)

” Is it a spending problem? No” …Senator Harkin (D-IA)

So since we seem to have two senior members of Congress having a “senior” moment, let me make this crystal clear . Our federal spending hasn’t just grown rapidly, it has literally exploded. In 2007, we spent $2.7 trillion and by 2011 we have spent $3.6 trillion or an eye-popping 30 percent growth in federal spending in only 4 years in a period when personal income growth was flat and inflation was very low.  And in the spirit of bipartisanship, we have been growing the federal budget almost as fast during the Bush years from $1.7 trillion in 2000 to $2.7 trillion in 2007. The only good news seems to be that we actually cut outlays slightly (by $60 billion) between 2011 and 2012 ( the limited “real” cuts that occurred as a result of the 2011 budget deal plus lower interest costs due to the Fed’s huge monetary stimulus). However, by and large, this has been an aberration in a very long-term pattern. Spending also has grown across the board. Discretionary non-defense spending has grown 31 percent between 2007-11 , with defense growing 28 percent during the same period. Between 2000-07, defense spending grew the most rapidly due to the Iraq war and new homeland security expenditures, but discretionary non-defense spending also rose rapidly by about 54% during this period.

The consequences of these large spending increases is well documented. Tax revenues grew enough prior to the 2008 recession to keep the deficit from growing much (i.e. in fact, we managed to get the deficit down to about $200 billion in 2007). However, after the recession and the major increase in government stimulus, the annual deficit exploded and reached $1.3 trillion in 2010 and 2011. As a result, we are now saddled with more than $16.5 trillion in federal government debt which is more than 100% of the US GDP, an already dangerous level. And this doesn’t even count on the order of $100 trillion of unfunded liabilities for social security and medicare and other government pensions.

The complete denial of the magnitude, scope and real danger associated with the US debt on the part of some of our politicians means we are in more serious trouble than even I realized. Further, the complaining and moaning on the part of many politicians over a tiny cut in the federal budget does not bode well for the future where we will need to do much more to get our fiscal house in order. Unfortunately, we also have enablers of this fallacy such as Paul Krugman, Ben Bernanke and other Neo-Keynesian economists who insist that we should postpone any further cuts far into the future, allowing politicians to “kick the can down the road” in good conscience. We also have the supposedly unbiased, Congressional Budget Office issuing projections for the future which even though they show continued large deficits, use ridiculously optimistic assumptions such as more than 4 percent real GDP growth between 2014-17, interest rates that don’t really rise significantly until 2016 (and remain moderate throughout the period) and inflation remaining at 2 percent virtually forever.  (and “forever” is a very long time!). These assumptions drive a very rosy picture of tax revenues almost doubling in just the next 5 years, while expenditures grow by only a bit more than 20% in the same period.

PUH-Leese! ….I went thru the CBO estimates and adjusted the costs for higher likely inflation and interest rates as well as lower likely growth in the economy. These more realistic assumptions suggest that we will continue to have deficits of about $0.8- $1 trillion per year or more and that our debt will swell to close to $25 trillion by the end of this decade. And probably several years before that, the US will learn what REAL ECONOMIC ARMAGEDDON means. Just remember, if we don’t cut our spending substantially (along with really reforming tax code to make it more revenue efficient) and really close our annual deficits to near zero, the markets will eventually come to the conclusion that the “full faith and credit” of the US no longer means much. Foreigners will sell their holdings of US treasuries, and the dollar will tank. To make matters worse, this will occur at the same time inflation and interest rates and interest costs are rising significantly (Thanks to the Fed’s policy of the last 4 years). As a result, we will probably go into default (though we won’t call it that) and there will very large layoffs in the government, along with massive cutbacks in social security and medicare payments when the government can no longer effectively borrow. You think it can’t happen? If we continue down our current path, I am quite confident it WILL happen.

So Rod Stewart didn’t really have it right after all, the first cut may seem like the deepest to some but it probably will be the “last” cut that is the deepest.

Next blog post, I will be more upbeat. I promise! But our not so fearless leaders, gave me no choice this time.