Fletcher: Enough to cause head scratching
Lewis Carroll’s Alice of Alice’s Adventures in Wonderland murmured: “Curiouser and curiouser.” Dr Bill Nesbitt used to say: “I love these goin’s on.” My English professor at Cornell used the phrase: “Jackassery of a high degree.”
All three are an expression of incredulity as to what was happening around them. Alice couldn’t understand her circumstance, Nesbitt understood and was laughing at human foibles and Professor Healy was a little incensed at poor thinking or unusual behavior.
While looking at the banking situation in Cyprus, I’m more in line with Alice. Cyprus, as a nation, made banking laws very lenient. It was common knowledge that the island country was the banker for the Russian mafia. The Cypriots had a “Don’t ask, don’t tell” policy about banking and the financial industry was bigger than the government. The island became a great place to convert rubles into euros.
Some banks were handling so much money that they had to invest in some risky assets to make a return on their deposits and they invested mostly in Euro Bloc nations. Europe went into the financial hopper, taking Cyprus with it.
There are two interesting twists to this story. The first is that the European Union insisted the bank depositors take the hit for the banks’ losses. This would be the same as the FDIC saying that it really doesn’t insure deposits.
This begs the question “Are our checking and savings accounts safe from government seizure?” We saw it in Cyprus. In North America, Canada has a similar policy. Is our money safe?
The second twist is more about concern – Cyprus bankers and legislators just expropriated cash from some of the most amoral and violent men on the planet. Can they survive this action?
Switching gears, let’s talk water. Last fall municipal council entered into an arrangement with a company to supply new electronic wiz-bang water meters for all accounts. The rationale was that the old meters were not accurate and were under reading usage. The installation of the new meters would correct all of the under reporting and the increased revenue would pay for system improvements. Fast forward 16 weeks.
The Alpena News recently reported the whole system is in bad shape and what now is being recommended is a rate increase in order to fund an undisclosed number of as yet un-engineered projects on an aging water system. About a year ago I offered to buy the system but never got a reply from the city. It looks like I lucked out.
If you think about a water system, it’s really pretty simple stuff from a technical perspective. You pump water from the lake, purify it, and distribute it through many miles of pipe to the end user. When I was mayor, then City Manager Al Green told me the city did not have a meter test program for checking the accuracy of the water meters. Typically, every utility regulated by the Michigan Public Utility Commission tests its electric or gas meters on a rotating random testing program to ensure accuracy. At that time meters were purchased and installed with only the manufacturer’s assurance they were accurate. The city couldn’t verify it.
The advice of the first consultant was to replace the meters. The advice of the new consultant is to replace the piping. I have to wonder if the third consultant will advise the replacement of the sewer and water plants as that will be all that is left. I’m more with Professor Healy on this one.