Monday, April 26, 2010

Home economics: Sarah Palin and Barack Obama

On Friday morning, July 3, 2009 [Sarah] Palin called her cameraman to her house in Wasilla and asked him to be on hand to record a prepared speech. Around noon, in front of a throng of national reporters, she announced that she was stepping down as governor. To many, it seemed a mysterious move, defying the logic of a potential presidential candidate, and possibly reflecting some hidden scandal—but in fact the choice may have been as easy as balancing a checkbook.
Over the past year, Palin has amassed a $12 million fortune and shows no sign of slowing down.
But it’s not yet been shown that Palin needs any specifically political organization, or that she has to kowtow to any gatekeeper to get where she wants to go. In fact, she and her new network have themselves become the gatekeepers. It’s very hard to get anywhere in Republican politics without going past them. And the gate also happens to be a tollbooth.
Palin’s torrid book sales are the single biggest reason HarperCollins returned to profitability last year. When Palin sat down to promote Going Rogue with Oprah in November, she boosted Oprah’s ratings to the highest level in two years.
From Buffalo Bill to the Marlboro Man, the self-reliant frontiersman has always been an image with mass appeal. Palin has managed to graft this rugged Western myth onto a beauty-pageant face and a counterpunching, don’t-tread-on-me verbal style—a new kind of character, and a remarkably compelling one.
This reminds me of this*:

In April 1999, [Barack and Michelle Obama] purchased a Chicago condo and obtained a mortgage for $159,250. In May 1999, they took out a line of credit for $20,750. Then, in 2002, they refinanced the condo with a $210,000 mortgage, which means they took out about $50,000 in equity. Finally, in 2004, they took out another line of credit for $100,000 on top of the mortgage.

Tax returns for 2004 reveal $14,395 in mortgage deductions. If we assume an effective interest rate of 6%, then they owed about $240,000 on a home they purchased for about $159,250.

This means they spent perhaps $80,000 beyond their income from 1999 to 2004.
But in 2005, Obama's book sales soared and the royalties poured in. Michelle explained, "It was like Jack and his magic beans." Without those magic beans, the Obama family would have eventually suffered the consequences of too much debt.

*I should take a crack at a Predicted Similarities Between Obama and Palin List. (I did the Bush-Obama List was done on Election Day 2008 here, and more than half have been fulfilled).

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