Trans Fats: When Zero Plus Zero Equals Heart Disease

Eliminating trans fats from food seemed to be the ‘big thing’ at the end of the 2000’s and the first part of the 2010’s.  And, if you look at most labels, you’d think that we were fairly successful at this.

Except you would be wrong.  Read on.

What Are Trans Fats?

mb-201311nutritionTrans fats are produced by hydrogenation, which is the process of adding hydrogen to vegetable oil.  The reason for doing this is to make the oil last longer.  Without hydrogenation, the oil would break down sooner, meaning the products in which it’s contained would not last as long.  So, the long and short is that hydrogenation was a pretty standard practice.

Why They’re Bad

This didn’t seem like any big deal except when it was discovered that hydrogenation was directly responsible for increased levels of LDL (bad) cholesterol and heart disease.  Long story short, trans fats are terrible for you.

Where were they?

Pretty much everywhere.  Cookies, baked goods, chips, really anything containing oil that had a long shelf life were all fair game.  In addition, fried foods were often culprits,

Once this correlation was discovered and the alarm was sounded, there was a big wave to get rid of them.  Cities started banning them in foods.  Article after article was written.  The FDA even got in on the game and changed product labeling standards so that trans fat contents were disclosed as part of the standard nutrition label.

The FDA to the rescue…or not?

The new labeling went into effect a few years back and made ‘Trans Fat’ one of the items that was required in addition to calories, fat calories, sodium, and other items which are pretty standard.

I remember seeing a lot of the new labels and noticing that items contained trans fats.  Then, it seemed, one by one, products started getting re-formulated to where the Trans Fat listing was 0g (zero grams).

Understandably, they’d even tout this on the front of their product ‘Now Trans Fat Free!’

Except in many cases it’s not true.

See, the FDA allowed rounding.  And, they allow rounding down, so that if a serving of food contains anywhere less than 0.5 grams of trans fat, they can say that it has none.

What’s the big deal?

The big deal is that any amount of trans fat is bad.  It’s not like you can consume 10 grams per day before it starts being bad.  Even a gram or two per day increases the bodies chances of having higher cholesterol and heart disease.

Meaning, it doesn’t take long for a few servings of food that each have, say, 0.4 grams of trans fat, to add up into unhealthy levels.

All the while, people are eating them, oblivious to the fact that they’re harming their bodies.

What To Do?

Right now, you can see through the lies by looking at the ingredients list.  If you see anything that contains the word ‘Hydrogenated’ in any form, then there are trans fats in that product, regardless of what it says on the nutrition label.

You should probably assume that most fried food contains trans fats as well.  Even though many fast food makers ‘eliminated’ trans fats from their fries and other foods, they still contain enough trace amounts that it should be assumed you’re eating them.

How This Should Be Fixed

I believe that the FDA made a big error when they allowed for this loophole, especially given how little it takes for trans fats to cause health problems.  Honestly, the only way a product should be allowed to have a 0 g (zero gram) listing is if it contains none at all.  If it’s anything less than the 0.5 gram threshold, then it should have to be noted as such.  Manufacturers will complain that it’s hard to measure with accuracy at those levels, but even if the label read <0.5 grams (less than 0.5 grams), it still alerts the consumer that there are trans fats in the product.

This is important.  While I believe that every individual is responsible for their own health and understanding the things that they put into their body, this is so important that I don’t think that the current standards are inadequate for this product.

Think of it this way

Trans fats are a problem.  If they eliminated 90% of the problem but the other 10% is still causing problems, then the labeling should not allow the 10% remaining to stay in existence.

I’m making up those numbers, but I hope I’m also making my point.

Readers, do you look beyond the Trans Fat listing on the nutrition labels and into the ingredients list to get the true reading?  Did you know that this loophole is out there?

Copyright 2017 Original content authorized only to appear on Money Beagle. Please subscribe via RSS, follow me on Twitter, Facebook, or receive e-mail updates. Thank you for reading.

The Most Surprising Thing About Detroit’s Bankruptcy

As I think about the city of Detroit and the recent decision to file for chapter 9 bankruptcy, my thoughts return to my grandparents.

I was born in 1974.  When I was young, I spent many weekends at my grandparents house.  They lived in Detroit, in the house where they’d lived since the 1950’s.  I spent a lot of time there.  I got to hear about the decline of Detroit, and how things were getting worse, not better.

I have these memories from the early 1980s.  That was thirty years ago.

For many, those times would likely be considered good days compared to where things stand today.

1950’s – The Decline Begins

mb-201307detroitThe city of Detroit started to decline in the 1950’s if many reports are to be believed.  That’s when population started to decline, as the suburbs started to rapidly expand, and the postwar boom saw many people leave the city for the ‘new’ suburbs.

1960’s – City In Flames

The 1967 Detroit race riots defined that decade.  I’ve read many books, both fiction and non-fiction, centered around this event.  The common theme among every one is that a slow trickle of decline turned into a burst pipe overnight.  After that, people could not leave the city fast enough.  I’ve seen stories of rioting and such during my lifetime.  In many cases, the affected areas suffered an immediate decline and eventually stabilized.

Detroit did not.

1970’s – Building Walls

The 1970’s saw the election of Coleman Young, the first black mayor of Detroit.  He was, at the time, and still is a polarizing figure.  Proponents argue that he brought together black citizens and gave them a voice that had previously fallen on deaf ears.  His detractors felt that he was combative toward white citizens, business owners, and fellow politicians, all but asking them to turn their back on the city, furthering its decline.

By this point there was little investment in the city.  The major image of the Detroit skyline is the Renaissance Center, which is a beautiful set of buildings, but did not live up to its name, and was built in such in a fortress type fashion that separated it from the city beyond.  It was not until the early 2000’s when General Motors purchased the city that they rebuilt the entire exterior, back and front, to integrate it into the streetscape and the riverfront.

1980’s – Cracked To Pieces

The 1980’s saw the crack cocaine epidemic hit Detroit as hard, as if not harder, than any other city.  The cheap drug claimed many lives and sent crime rates soaring and unemployment soared, while education suffered.  It was around this time that Detroit started seeing major declines in revenue, and services were cut.

It didn’t help that this period saw the major decline of market share for the domestic automakers.  Some of my earliest memories of reading the newspaper always include hearing about plants in and around the city that were shutting down.

Opening?  Not really so much.

1990’s – Steps and Missteps

After 20 years, Detroit elected its first new mayor in 1993 with Dennis Archer.  He was black, but was seen by many as someone who looked out for businesses over citizens.  Thus, he never formed a close bond, though he did lay the groundwork for major projects that reversed the downward trend of some of the areas downtown, namely two  new sports stadiums.  Some of the surrounding areas are now thriving.  The 1990’s served as the turnaround point for downtown, which has been growing fairly steadily since, but unfortunately, the neighborhoods did not participate in this turnaround and have continued to steadily decline.

Unfortunately, Archer also cleared a path for a casino district that never materialized.  A big portion of space along the Detroit River was leveled in anticipation of building three new casinos in a cluster along the riverfront.  That plan never materialized.  The three casinos are now dispersed elsewhere in the downtown area, and to date, the never-built casino district sits deserted.

2000’s -Corruption and Recession

In 2001, Kwame Kilpatrick was elected mayor.  Deemed the ‘hip-hop’ mayor, he was young, full of energy, and brought new energy to the citizens.  He talked a big game.

He’s currently in federal prison on corruption and embezzlement charges.

The United States hit a recession in 2008.  In Michigan, that started a couple of years before that.  In Detroit, a couple of years even before that.

I worked for GM at the RenCen in 2005-06, and the industry was in horrible shape by then.  Companies were losing billions of dollars every quarter with no end in sight.  This decline had already started, and it was taking its toll on Detroit.

By this point, neighborhoods were largely shells of themselves.

Every day, houses burnt down.

Nobody built new ones.

Expenses Rise, Revenues Fall

Say your household budget has you breaking even today. You spend what you bring in.  No problems, right?

Then, expenses go up. Gas prices spike.  New cars cost more.  Food goes up.  You have to start charging money.

Then, you get hit with a pay cut at work.  So, you have to start charging more as the gap grows between what you’re bringing in.

You try cutting here and there, which keeps the gap growing.  At least for a little while.

Costs still go up, and even though you cut to the bone, you still get less and less in your paycheck.

The gap widens.

Your credit card companies start cutting you off.  Or demanding a higher interest rate to keep using their money.

You keep floating the minimum payments and keep adding to the balance.

It’s all still working.

But not really.

That’s how the city of Detroit has been working.

For six decades.

The tax base has been eroding slowly for years.  But, how do you cut costs?

It’s not as easy as it looks.

If you have a street that used to have 50 homes, you had to keep that up. You had to plow the street in the winter, maintain the water and sewage lines underneath it, send garbage trucks to pick it up.

So what happens when you have 4 homes left?  The other 46 have burned down or been torn down or sit boarded up.   What happens?

Well, you still have to keep it up.  You still have to keep up the water lines, the gas lines, the street.  You lost over 90% of your revenues on that street, but your costs, they stay the same.

This is the story of street after street.

And, it isn’t just streets.

Schools.  Detroit had hundreds of schools with hundreds of thousands of kids.  Now, they have a fraction of students that they used to, but schools sized for educating the amount of kids they had in the past.

With a lot less money to support these schools.

So education declines.  Less money is brought in because the tax base is eroding.  More costs go to keep up buildings that get old and fall apart, all with less kids to use them.

They close some.  Oh, do they close some.  Do you know the last time they opened a new school because it was needed?

I have no idea.  The only construction of schools I’ve seen in the school is to replace a couple of buildings here and there.

Police and fire.  Crime goes up.  Homes and buildings burn..  But, when you have over a million less citizens here, and a lot of them aren’t paying their taxes, guess what happens?

They get laid off.  Officers retire and don’t get rehired.  Crime rises. It takes longer for firefighters to arrive to put out a fire.  If you call for police, it can take over an hour for them to arrive.  If they show up at all.  And, they’re not sitting around eating donuts.  There are just too many calls and not enough officers.  Yet, when budget time comes, there are pink slips.

The endless cycle

All of these things have led to an endless cycle.  People see their neighborhoods emptying out, so they leave.  Cops get laid off, crime goes up, and people leave.  Education funding keeps falling and falling, leading to one of the worst public school systems in the country, so people take their kids and leave.

And it hasn’t gotten better.

It can’t get better without something big happening.

Kicking the can

For 60 years, the ‘leaders’ have been kicking the can, not addressing the fundamental problems that have led to us getting where we are today.  They kick the can down the road.  They borrow here, cut some services there, try raising taxes there, and look what we have?  The city has the highest tax rate of any city anywhere close to where we are, and provides the worst services.  Over half the population has left.  Entire neighborhoods are slowly being reclaimed by nature.

All because the fundamental problems haven’t been fixed.

Many out there say that Detroit has an obligation to pay it’s debts.  They can’t.  Thirty years ago when my grandparents couldn’t imagine it any worse, they were probably unable to then.  Through smoke, mirrors, and lots of borrowing, they’ve kept the charade going.

What About A Bailout?

Many out there say that the state of Michigan, which is currently running a budget surplus, should step in and provide money to avoid bankruptcy.  Or, how about the federal government, since, after all, they did bail out the auto companies?

The problem here is that this wouldn’t make any sense right now.  We have sixty years of decline and bad decisions to unwind.  Even if the money fairy came and dropped every dollar that the city owes and allowed debt to get to zero, that wouldn’t solve anything, because the structural and underlying problems would still be there.

I believe that bankruptcy is a chance for Detroit to wipe the slate clean and start over.  For decades, the ‘leaders’ of this city have budgeted and acted as if the decline were going to stop any day.  It’s not.  Right now, almost half the revenues collected (which continue to decline, by the way), go toward debt payments.   Every year the pot gets smaller and smaller.

A new budget needs to be developed from scratch.  A new plan on how to provide education and services needs to be developed.  A new roadmap needs to be charted and a path developed.  Goals need to be set.  Realities need to be faced.

These things can all happen, but only if the city is given the chance to get out from under the weight of where they are today.

I believe this is a defining opportunity for the city.  I believe that this can be the turnaround that citizens of Detroit and Michigan have longed for.  I’ve heard stories that in the 1970’s, New York City was in a dark place.  Things didn’t get bad enough to go into bankruptcy, but big changes were made and the city turned around.

I believe in my heart that this can be the catalyst for Detroit to finally turn around.  Detroit is tired of being the butt of jokes.  Tired of high crime and poor education.  Tired of dragging down the reputation of the entire state of Michigan.

It’s time to allow Detroit to start over and do something that it’s never done in my lifetime, and probably not something that many people can remember: Prosper.

Grow.

Renew.

Things my grandparents once saw in Detroit, and I saw the pain in their faces as they saw their city fall.  If they thought it was bad in the 1980’s, I can only imagine what they would say if they saw it now.  My guess is that it would be unimaginable.

Bankruptcy is not pretty but I believe it’s necessary, and the only question remains: What took so long?

Readers, what do you think about the Detroit bankruptcy?

Copyright 2017 Original content authorized only to appear on Money Beagle. Please subscribe via RSS, follow me on Twitter, Facebook, or receive e-mail updates. Thank you for reading.

Suing S&P Over The Mortgage Crisis Is Crazy

I often laugh at news stories over at The Onion, which is a news site full of satire.  The headlines and stories are presented as real, but you usually find that they’re written to bring out laughs and are not based in fact.

mb-gavel201302I thought I had to be reading a story on The Onion when I recently saw that the United States of America is planning on suing Standard & Poors for up to $5 billion dollars due to the credit ratings issued by the ratings company on mortgage backed securities prior to the housing crash.

Basically, they’re faulting S&P for giving high credit ratings, which made them seem like good investments, accusing S&P of giving these high ratings even though there was evidence that the underlying mortgages were quickly degenerating into riskier and riskier assets.

I get that, and I have no doubt that the lawsuit is based in some fact, but I still maintain it’s absolutely ridiculous if for one reason: The United States government is suing S&P, but who is suing the United States government?

See, you have to think that if the United States is suing S&P, that they had some misgivings about their ratings at the time.  So, I did some digging and found that they issued no warnings about the ratings that I could find as S&P was issuing the ratings.

But, then, they must have issued some sort of warning about the housing market in general, right?  You’d think so, but once again you’d be pretty much wrong.  Yes, there were some people here and there who warned about such things, but leaders in either party did nothing to address the issue.  The Fed practically said ‘No worries, everything is good’ just months before the entire mess came crashing down.

So why don’t they get sued?  Why does the government, who did absolutely nothing, get to come out now and start suing companies for five billion dollars?  Granted, from my personal perspective, S&P did have some responsibility, but what absolutely kills me is that so did the United States government, yet they get to go out, file a lawsuit, and drag out a mess that I think most people would just now soon put in the past.

It seems that the strategy for dealing with this problem is to continue to file lawsuits.  Let’s sue as many banks as we can.  Let’s sue the ratings agency.  Let’s figure out who else we can sue.

I’m sure the thought is that getting sued will teach these institutions a lesson.  That they will pay for their mistakes.  That they won’t ever do it again.

I think that’s fairly inaccurate on all counts.

One reason: Turnover.  Lets’ face it, most of the leaders at a lot of these institutions are no longer in place.  So, what this means is that the current leadership is having to answer for the mistakes of their predecessors.   They’ve having to institute changes and policy and strategy based on things that they probably have already tried to deal with in some fashion, but are now having to deal with again and again.

What this does is it holds up progress.

I don’t think banks and ratings institutions have fixed everything as far as the  mistakes that they’ve made, but if you look at all of them, there are policies and things that they now do which are designed to prevent such a crisis from occurring.

Can the government say the same thing?  What changes have they made?  Banks have tightened their lending policies.  Ratings agencies have created additional due diligence procedures tied to their ratings and tightened standards.

The government has done virtually nothing.  Oh, except to file a bunch of lawsuits.

Great strategy.  Really.

Don’t get me wrong.  I’m not about letting the banks and ratings agencies off the hook.  I just think that the strategy here needs to concentrate on moving forward.  It’s not 2007 and we can’t go back and undo the mistakes that were made which led to the problems of the next few years.  What’s done is done, so what we need to do is make sure it never happens again.

Is the government filing a federal lawsuit or twenty federal lawsuits or two hundred federal lawsuits, or however many they decide is the ‘magic’ number, going to accomplish that?

No.

Instead of allowing these companies to work toward strengthening their balance sheets, reduce costs, and work toward a better future, the government has effectively committed these companies to diverting massive amounts of resources toward these lawsuits.  Do you think S&P is not going to dedicate millions and millions of dollars and time of their leadership to these lawsuits? Money and time that could be spent bettering the company will instead be spent looking to the past.

And for what?

I don’t know, I guess I equate it to someone coming home from work and finding that their dog has pooped in the living room.  They go and get the dog and rub its nose in the poop.  It might make the owner feel better and the dog is sure going to feel bad about it, but if the dog pooped hours and hours ago, is he really going to learn anything?  Oh, and what if the owner gave the dog a bunch of junk food the night before, which was likely responsible for the dogs digestive issues that day?  What should happen then?

In this case, the government is sitting there trying to rub the banks and agencies nose in the proverbial poop left on the floor.  If that’s their strategy, don’t you think it’s time for them to get on their hands and knees and rub their own nose in it?

Only in America.

Readers, what do you think about the lawsuits?  Do you agree that these companies need to be punished?  What about the government?  And, if you do agree that punishment is in order, do you think that punishment is the best method to prevent the same mistakes from happening in the future?

Copyright 2017 Original content authorized only to appear on Money Beagle. Please subscribe via RSS, follow me on Twitter, Facebook, or receive e-mail updates. Thank you for reading.

5 Things Republicans Need To Do To Get Back In The Game

It’s been a week since the election and I thought I’d give a little bit of closure to the whole thing by looking at what Republicans need to do to get back on the upswing over the next 2-4 years.

I will go in saying that I identify as Republican though I don’t push my ideology on people nor do I try to talk people who aren’t Republicans into changing their views.  All I ask is the same.

Even though the Republicans kept control of the House of Representatives, I think last Tuesday was a very disappointing day for the Republican party.  They had hoped for Mitt Romney to win the presidency, of course, and had hoped to, at the very least, not lose ground in the Senate, where there is a Democratic majority.

Neither of these things happened.

Never a chance

I had felt all along that a Romney win was out of grasp.  Even after the debate and even when various polls leading up to the election were showing that a Romney win was possible, I wasn’t buying it.  I wasn’t as confident as Sam over at Financial Samurai who actually had some bets going (bets which he won, but later donated the proceeds to charity), but I stuck to my conviction that Romney didn’t have a prayer, and once the results started coming in, I knew early on that he would lose.  I figured that he would have to pull off at least one upset even before the battleground states came into play.  Once I started seeing that the states that were supposed to go to Obama were all going to Obama, and by a large margin, it seemed only a matter of time.  And it was.

Why Was I So Confident?

I was confident that Romney would lose based on a couple of different accounts, and they tie back to numbers.

Here are the things that I think doomed Romey and the Republicans that they need to take some serious looks at between now and 2014 (the next Senate and House elections) and 2016 (when the Presidency is back in play):

  1. Anger – Every candidate is going to anger people in some fashion.  The fact is that Romney angered a whole ton of people when the video came out about 47% of the people taking from the government.  Even taking that aside, Obama’s plan to tax the wealthy angered the wealthy, but that’s a smaller subset of the population than can angered by traditional Republican policies.  One example of this would be immigration.  Republicans have made a lot of statement about immigration reform, which angers a great deal of the Latino population.  Adding up the number of people that Romney/Republicans angered during the election cycle, and it was a very tough uphill battle right from the get-go. They need to stop being the party that polarizes and be the party that…
  2. Compromises – As much as many Republicans aren’t going to want to compromise about issues relating to taxes and other policy, the fact is that gridlock is good for nobody.  The gridlock we’ve seen over the last couple of years has made the most recent Senate and Congress among the most unproductive, ever.  Continuing to stand their ground and give nothing might make the party backers happy, but if that wasn’t enough to win the election, maybe that’s not such a great strategy.  Wouldn’t it be great to be able to go into 2014 and 2016 able to deliver the message that it was the Republicans that allowed for gridlock to be broken, for the fiscal cliff to be avoided, and for other issues.  I actually think Romney had a good track record during his time as governor, and he would have been somewhat successful in ‘reaching across the aisle’, so hopefully his Republican counterparts take a lesson and actually follow through.
  3. Appeal to minorities – Republicans have, nearly without fail, been able to count on the white vote.  But, look at the census readings over the past few decades.  Minority population is growing at faster rates than that of whites, meaning that whites represent an ever smaller portion of the electorate.  Polls also show that most minorities vote overwhelmingly with the Democrats.  The study of these numbers could take an entire college course, so I won’t even attempt to touch more than to say that if the Republicans do not find away to capture some of the minority vote that they don’t have today, they are going to continue to fight an uphill battle.
  4. Groom someone now – Obama won’t be able to run again in 2016, so while he had it easy this year in not having to wage a primary battle, the Republican primary battle was a mess.  Many candidates that were expected to run didn’t, and it was pretty late in the game before they actually decided (reluctantly) that Romney was their guy. I think party leadership has been completely disorganized, and they need to find one or two people and start grooming them now (similar to how I think Obama was groomed the second after he nailed his speech at the 2004 convention).
  5. Don’t assume Obama will be Bush 2.0 – Obama’s first victory in 2008 was a no-brainer, and a good chunk of that was because the American people had soured so much on the Republican party largely because of the devastation of Bush’s second term.  John McCain (or anybody else) was simply not electable that year.  My fear is that the Republicans will simply count on the same thing happening in Obama’s second term, and will count on his failure that would provide a clear path to a 2016 victory.  Which could happen, but that’s a big risk to take if you ask me.  If it doesn’t, they’ll be left in no better position than they were this election.  And look where that got them.

At some point in time, another Republican will be elected to fill the Oval Office.  Though I’m sure many diehard Democrats would hope against it, the numbers make it a guarantee.  The above ideas are just some of the few things that I believe the Republican party must do if they want that to happen in the 2010’s (because they only have one shot left).

Copyright 2017 Original content authorized only to appear on Money Beagle. Please subscribe via RSS, follow me on Twitter, Facebook, or receive e-mail updates. Thank you for reading.