Arizona

The Arizona Republic reports today that Barry Goldwater, Jr., son of the famed Arizona Senator and himself a former California Congressman, is a director of a company that sells “non-monetary” commemorative coins. Goldwater is a director at National Collector’s Mint, Inc., and allows his name and likeness to be used to promote their coins. Last year, the company paid over $2 million in restitution to customers who purchased its “Freedom Tower Silver Dollar,” after being sued by NY Attorney General Eliot Spitzer. They also paid $370,000 in civil penalties. The company had claimed that it was a “government issued” silver dollar and a “U.S. territorial minting” from the Commonwealth of the Northern Mariana Islands. The islands use U.S. currency and are not authorized to mint their own. Perhaps not by coincidence, these islands were a client of Jack Abramoff which brought out Tom Delay on junkets to play golf. Congressman George Miller (D-CA) has said this about the Commonwealth of the Northern Mariana Islands: “Let’s remember what they paid for: a protection racket that sheltered a sweatshop industry that systematically exploited tens of thousands of impoverished foreign workers – mostly Asian women – who were little better than indentured servants; a sweatshop industry that earned some of the heaviest fines in U.S. history for violating labor laws; an industry repeatedly cited by the Departments of Justice, Interior and other federal agencies. They were defending a corrupt immigration system that regularly approved visas for non-existent jobs, resulting in hundreds of women being forced into the sex trade, including prostitution. ...

A 10-inch rattlesnake was found in a hallway at the AMC Desert Ridge 18 theaters at Tatum and Loop 101 in Scottsdale on Friday. This led to a rumor that “rattlesnakes were let loose during a showing of Snakes on a Plane." A security guard swept the snake outside and trapped it in a Tupperware container until the Arizona Herpetological Association could come and get it. Apparently the theater had earlier called about a rattlesnake outside the building. This led to the wildly exaggerated claim that: Two live rattlesnakes were released in an Arizona theater during a showing of the new film, ‘Snakes on a Plane.’ The snakes were released after the film began rolling in the dark theater at the AMC Desert Ridge multi-plex at Tatum and the 101 in north Phoenix.Good story, but it’s not true.

I live in a heavily Democratic district of Arizona, in South Phoenix. Last election, the Republicans didn’t even bother to field candidates. This year, however, Daniel Coleman of Laveen is seeking one of the two House seats as a Republican. In 1997, Coleman was arrested for DUI and convicted. In 2003, he was living in the very tiny southeastern town of Portal, Arizona (the location of Crystal Cave–I’ve camped and done some spelunking there). He went with his date Gail Chalker, her two sisters Annette and Carol, and Annette’s fiance, Colby Rawson to the nearby town of Rodeo, New Mexico, for an evening of drinking at the Rodeo Tavern. Annette and Gail got into an argument over an air compressor that Annette wanted to borrow. Coleman and Gail and Carol Chalker returned to Portal at 10:30 p.m., and Rawson and Annette Chalker and her two children drove up to Coleman’s home shortly before midnight to pick up the air compressor that was kept on the porch. She opened the door and called to her sister, and when the screen door slammed shut, Coleman and Gail Chalker were awakened. Coleman grabbed his .38 pistol, and the two of them left the bedroom and saw Annette Chalker in the entryway. Gail Chalker says that Annette charged them and was trying to grab her by the throat, and Coleman’s gun fired, shooting a bullet into Annette’s face below her left eye, killing her. Coleman said it was an accident, and Gail Chalker corroborated his story. Coleman was indicted on charges of first-degree murder but was never prosecuted for lack of evidence. He was sued by the Chalker family for wrongful death, which was settled. When asked about Coleman, Arizona Republican Party chairman Matt Salmon said, “I’ve never met the guy. This is the first time I’ve even heard about this guy. … The Republican Party did not recruit him to run. … I’m very discouraged about anybody who has a DUI in their background." Coleman is a 1993 Rutgers University graduate who has worked in the Phoenix area since 1997 as a computer contractor for the state Department of Economic Security. He runs a consulting company called Candia Systems Associates. He grew up in Cochise County, where his family had a ranch. His stepfather was Wyatt Earp researcher Glenn Boyer, an amateur historian who has been charged with fabricating material in the book I Married Wyatt Earp, which billed Josephine Earp as the author and Boyer as the editor. That scandal first came to public view as a result of investigation by Tony Ortega, then of Phoenix’s weekly New Times. Ortega went on to work at the Los Angeles New Times (now defunct) and has written several in-depth investigative pieces about the Church of Scientology. Coleman’s mother (and Boyer’s wife) is Western novelist Jane Candia Coleman. (Most of the above is from the Arizona Republic story on Coleman.)

Phoenix cracked the top ten for the first time in Forbes magazine’s best metropolitan areas for business (at #6); Arizona is down at #15 in the list of best states for business. Tucson ranks #77. Phoenix scored high for colleges, cost of doing business, culture and leisure, job growth, and net migration; it scored poorly for cost of living, and crime rate, and was somewhere in the middle on educational attainment, cost of doing business, and income growth. Tucson scores better than Phoenix on educational attainment and income growth, but is worse on every other measure. Arizona was ranked highly for labor costs (#7), economic climate (#1), and growth prospects (#13), poorly for regulatory environment (#36) and quality of life (#43), and in the middle for business costs (#24). Arizona has four billionaires–John Sperling and his son Peter of the Apollo Group (and University of Phoenix and Kronos Group), Campbell Soup heir Bennett Dorrance, and Arturo Moreno of Outdoor Systems. An interesting point in the summary is that the United States now has the highest corporate taxes of any OECD nation. UPDATE (March 9, 2007): Forbes has updated its billionaire list for 2007, and there are no changes for Arizona–the same four Arizonans are billionaires, with none dropping off the list and no new ones showing up. Bennett Dorrance is at #432, Arturo Moreno, John Sperling, and Peter Sperling are all tied at #799. Last year the list was much smaller–Bennett Dorrance was at #153, John and Peter Sperling were tied at #297, and Arturo Moreno was at #354. ...

The Arizona Republic prints a story on some housing speculators now being burned: Two houses on the same north Valley street, similar in size and age, are for sale. One lists for $749,000 and the other for $775,000. A third house came on the market on the same street a few doors from the other two. The new listing was similar to the others in size and age but priced at $659,000. Reaction: outrage. “The neighbors were really mad,” said Thomas Stornelli, principal of Global Network of Homes in Scottsdale. “They knocked on the door and asked, ‘What are you thinking?’ For a lot of people, their home equity is their bank. It’s like taking money out of someone’s bank, their retirement account. People (future buyers) are going to use that house as a comp, even if it doesn’t have the same upgrades. It’s going to leave a mark." The owners of the least- expensive home were equally upset. They were in the midst of a corporate relocation and wanted to sell quickly. Suddenly, angry neighbors were confronting them. One night, someone tore down their for-sale sign. Stornelli is the listing agent for one of the higher-priced homes. His approach is to try for the higher prices, which he believes are justified in Scottsdale. “Whenever you mix emotion and finance, there’s going to be stress,” he said. “As a Realtor, we deal with that every day." The market has proven everyone wrong. None of the houses had sold as of the third week of this month.Another account in the same story: A woman walked into Barry’s Realty Executives office about nine weeks ago, sat down and began crying. She said she bought two houses last year, fixed them up and quickly sold them, making a $50,000 profit on each. She was a novice investor, but it all looked easy. She took her profits, threw in some extra money and bought five more houses. She spent money fixing them up, but when she put the houses on the market, she realized she had bought at the peak, Barry said. “Her eyes just started to well up, and she just started bawling,” Barry said. “She said she couldn’t sell them for what she bought them for. She said her monthly payments were about $20,000." Barry suggested turning them into rentals. She told him she couldn’t get enough rent to make it worthwhile. “She was expecting to flip them,” he said. “The market flipped her. She was devastated. People have forgotten that houses are not a liquid asset. They never were meant to be."There are a few others in the report. I expect we’ll see more stories like this over the next couple of years as ARMs reset on people who are unable to sell or refinance. Also check out the comments on this story at The Housing Bubble Blog. ...

The U.S. House of Representatives has voted to ban Internet gambling (HR 4411) by imposing new requirements on banks and credit card processors to prohibit them from transferring money to offshore online gambling companies. This will drive up their costs, which they will pass along to consumers. The online gambling companies will set up shell companies to accept the payments, and it will be a never-ending arms race that will not stop online gambling. The bill that passed was not consistent from a moral basis for banning gambling, as it carved out exceptions for horse racing and state lotteries. In other words–this was a bill that Jack Abramoff would have loved. Arizona’s Representatives voting in favor of the ban: Trent Franks, J.D. Hayworth, Rick Renzi, John Shadegg (all Republicans). Arizona’s Representatives voting against the ban: Jeff Flake (R), Raul Grijalva (D), Jim Kolbe (R), Ed Pastor (D). (Hat tip to The Agitator. I second his question about why the heck the Washington Post gives a vote breakdown by Representative’s astrological sign.)

Last week, the U.S. House of Representatives voted in favor of House Joint Resolution 10 to amend the U.S. Constitution to limit the scope of the First Amendment by banning the desecration of the flag. The resolution passed, 286-130, with 18 not voting. The voting went more-or-less along party lines, with Republicans going 209-12-10, Democrats 77-117-8, and Independents 0-1-0. The Senate has yet to vote on it. To their credit, three of Arizona’s Republican Representatives showed a willingness to buck the party line, accounting for a quarter of the Republicans who opposed the measure. Their votes went as follows: In favor: Franks (R), Hayworth (R), Renzi (R) Opposed: Flake (R), Grijalva (D), Kolbe (R), Pastor (D), Shadegg (R). In a recent post at Dispatches from the Culture Wars, Ed Brayton quoted from and commented on an essay from Jonathan Alter: I inherited my one litmus test from my father, Jim Alter, who flew 33 harrowing missions over Nazi Germany during World War II. My father is not just a veteran who by all odds should not have survived. He is a true patriot. His litmus test is the proposal to amend the Constitution to ban flag burning, which will come up for a vote next week in the U.S. Senate. For dad–and me–any member of Congress who supports amending the Bill of Rights for the first time in the history of this country for a nonproblem like flag burning is showing serious disrespect for our Constitution and for the values for which brave Americans gave their lives. Such disrespect is a much more serious threat than the random idiots who once every decade or so try (often unsuccessfully) to burn a flag. I’ll go even further than that. Hell, I’ll go a lot further than that. If you’re the kind of person who supports a ban on flag burning, that fact alone is enough to brand you, in my view, as either a demagogue or someone weak-minded enough to be led by demagogues who play on your most shallow and childish emotional responses. Like the flag itself, the flag burning amendment is purely symbolic. And anyone who would throw away free speech rights for symbolic achievement has no business being in any political office in this country. ...

I plugged all the previous data into Excel and generated this graph: I wonder what happened in December and early January. The trend is amazingly linear, otherwise. When do we start considering Phoenix a buyer’s market? Now? When inventory hits 6oK? When the trend shows clear signs it has reversed? As I said in the comments to the previous housing inventory post, I think I want to start making lowball offers when I get back there!

It’s been a while since I gave an update on the number of homes for sale in Phoenix–the inventory has continued to balloon since the last report on March 10: 3/7/2006 36953 3/8/2006 37487 3/9/2006 37626 3/10/2006 37531 3/11/2006 38011 3/12/2006 38184 3/13/2006 38169 3/14/2006 38003 3/15/2006 38197 3/16/2006 38574 3/17/2006 38602 3/18/2006 39074 3/19/2006 38972 3/20/2006 38822 3/21/2006 39159 3/22/2006 38982 3/23/2006 39043 3/24/2006 39271 3/25/2006 39381 3/26/2006 39504 3/27/2006 39817 3/28/2006 39784 3/29/2006 39765 3/30/2006 39948 3/31/2006 40192 4/1/2006 40177 4/2/2006 40182 4/3/2006 40012 4/4/2006 40050 4/5/2006 40332 4/6/2006 40739 4/7/2006 40612 4/8/2006 41124 4/9/2006 41393 4/10/2006 41018 4/11/2006 42266 4/12/2006 42327 4/13/2006 42257 4/14/2006 42561 4/15/2006 42592 4/16/2006 42775 4/17/2006 42874 4/18/2006 42523 4/19/2006 42840 4/20/2006 43017 4/21/2006 43236 4/22/2006 43385 4/23/2006 43502 4/24/2006 43697 4/25/2006 43344 4/26/2006 43427 4/27/2006 44024 4/28/2006 43886 4/29/2006 44022 4/30/2006 44290 5/1/2006 44229 5/2/2006 43900 5/3/2006 43966 5/4/2006 44162 5/5/2006 44422 5/6/2006 44094 5/7/2006 44575 5/8/2006 44777 5/9/2006 44609 5/10/2006 44898 5/11/2006 45097 5/12/2006 45356 5/13/2006 45502 5/14/2006 45619 5/15/2006 45697 5/16/2006 45705 5/17/2006 45675 5/18/2006 46064 5/19/2006 46189 5/20/2006 46049 5/21/2006 46734 5/22/2006 46753 5/23/2006 46965 5/24/2006 46856 5/25/2006 47133 5/26/2006 47225 5/27/2006 47582 5/28/2006 47591 5/29/2006 47633 5/30/2006 47722 5/31/2006 47542 6/1/2006 47187 6/2/2006 47191 6/3/2006 47848 6/4/2006 47877 6/5/2006 47979 6/6/2006 48218 6/7/2006 48106 6/8/2006 48365 6/9/2006 48579 6/10/2006 48870 6/11/2006 48889 6/12/2006 49040 6/13/2006 49132 6/14/2006 49237 6/15/2006 49052 6/16/2006 49435 My first report, last October, showed an increase in inventory from 10,748 homes on July 20, 2005 to 19,254 on October 2. We’re now at a 459% increase in inventory in the just under 11 months. (But see Einzige’s comment on what counts as evidence of a housing bubble…) ...

Despite the attempted astro-turfing by beverage distributors, Arizona Senate Bill 1276 has passed. Actually, the wholesalers agreed to a compromise–the bill only allows shipping by wineries that produce less then 20,000 gallons of wine per year (and which obtain an Arizona domestic farm winery license and pay state taxes). The fact that the wholesalers agreed to a compromise based on wine production shows that they didn’t really believe their own arguments that this created a new risk of underage drinking.