Sunday, January 22, 2012

The Gazoo Government

I happened to stumble across Turner Hall's 4th Street Forum this morning while flipping through the channels. Eric Isbister, CEO Gen Met Manufacturing, was part of a panel discussing Wisconsin's "business climate." Mr. Isbister obviously read his Republican business climate talking-points before going on the show. Government needs to get out of the way, government needs to regulate less, taxes need to be lowered...but the government should be training people and providing an educated workforce for the private sector and helping to fill positions for these private sector companies when needed.

Despite decades of evidence to the contrary, Isbister believes Repulican policies are better for small business in the long-term. Jon Perr elaborates on the failure of Republicans policies over the years, based on numerous economic indicators.

It's as if private-sector CEOs see the government as Gazoo, from the Flintstones. A magical entity that can appear only when you want and whom will make whatever you need happen and then go away.

The Fiscal Policy Institute has found, States with minimum wages above the Federal level have had faster small business and retail job growth. Raise The Minimum Wage has more on wages across the country. One would hope the U.S. would be trying to increase the wages, and thus the quality of life, for it's citizens.

Public sector compensation was a convenient scapegoat of the right-wing to blame for our recession. But, as the Center for American Progress has shown, State budget deficits are not an employee compensation problem. The Great Recession has crushed budgets all around. The busting of the bubble and subsequent lack of demand are the real culprits.

Empirical evidence has been quite clear - cutting taxes does not lead to economic, income or wage growth, nor does it lead to job creation. Lane Kenworthy has done international comparisons and found higher taxes aren't necessarily bad for the economy. Kenworthy has also discovered that the tax burden on the top 1% is lower now than it was in the 1970s. Alejandro Reuss also explains that lower tax rates do not increase government revenue, as conservatives illogically claim. The Center on Budget and Policy Priorities reports that higher state taxes bring more revenue, not more migration.

The "business climate" talking-point is merely an extension of the mythology that is trickle-down, neoliberal, supply-side economics. Another fable the conservatives can spin to claim regulation is burdensome, taxes are too high, and government is always to blame. People need to, finally, realize the right-wing has basically made this stuff up. The real world just doesn't match up with the stories Republicans are selling.

Looking at the evidence, reality does appear to have a liberal bias. It's time for all of us to stop giving equal time, equal weight, or the benefit of believing their views are based on rational or reasoned analysis, to these Republicans fairytales of how the world works and what helps it work best.

Saturday, January 21, 2012

The Money Shot


An Ode To Vulture Capitalists Like Mitt Romney

Weekend Reading

Obama Sings "Let's Stay Together"
Government Bonds Will Disappear
Are The Wealthy Paying Too Much In Taxes?
Tax Rate For Richest 400 Has Plummeted
Mitt Romney To Occupy Protestor: Love It Or Leave It

I'm Rubber You're Glue

Bill Clinton's marriage was fair game for Republicans. His marriage infidelity was front page fodder and the Holy Grail in Republican attempts at total government control. Newt Gingrich rode the "Clinton was a bad boy" train all the way to shutting down the government. Republicans, to this day, still mention Clinton with a wink and a smirk.

Now that Newt has pushed himself onto the center stage, he is upset that his own infidelity is front page news. Is he upset because once conservatives actually hear the story of his not only infidelity, but selfish and, what some feel, despicable behavior, it will put and end to his campaign, and lay bear the mythology of the righteous, noble, church-going right-wing man who can save the day?

Newt's feigned outrage is yet another reason he is obviously too shallow, inept, and corrupt to be president. It's not the media's job to have a public hearings on celebrity marriages. So, he is right that real news should leave the tabloid stories to the National Enquirer. But the hypocrisy is that Newt was more than willing to judge Clinton in the court of public opinion, using the media to vilify and crucify him. And, if you're going to play that game, what's good for the goose is good for the big fat gander.

Update:


Friday, January 20, 2012

Economic Indicators

Civilian Labor Force: Milwaukee County



Consumer Price Index: Fuel Oil and Other Fuels; Water, Sewer & Trash
Fuel prices started to spike around 2002-2003.



Consumer Price Index: Housing; Rent of Primary Residence



Consumer Price Index: Medical Care
Medical costs began their exponential rise during the mid-1980s.



Consumer Price Index: Transportation
Transportation costs accelerated with the oil embargo of the 1970s. They've been on that elevated trajectory ever since.



Health Insurance: Not Covered



Home Prices



Light Weight Vehicle Sales



Manufacturing Durable Goods Sector: Output Per Hour
Output per hour has steadily increased.



Manufacturing Durable Goods Sector: Real Hourly Compensation
Compensation increased during the Clinton, late 1990s, boom years, but has stagnated since.



Resident Population: Milwaukee County



Nonfarm Business Sector: Labor Share; Output Per Hour
Output per hour has increased steadily, while the share going to labor has stagnated.



Nonfinancial Corporations Sector: Output Per Hour; Labor Share
Output per hour has increased steadily, while the share going to labor has stagnated.



Nonfinancial Corporations Sector: Profits; Real Hourly Compensation
Profits have been on an overall upward trajectory. Compensation hasn't kept up.



Total Construction Spending: Residential; Commercial



Unemployment Rate: Milwaukee County

Colbert Frightening Mainstream Media

Chuck Todd whines about Stephen Colbert making a mockery of our democracy, media, and legislative system. I guess he's upset that Colbert is exposing this corrupt, inequitable sham (which we propagandize as something fair and noble and in the best interests of the people) for what it truly is.

 

Stephen Colbert's mockery of elections, campaign finance, super PACs, politics, media coverage, and our legal system has been brilliant. He's merely shining a light on the scandal that is big business, political power, and the media that spoon-feeds their storyline.

Sunday, January 15, 2012

The Stuff of (False) Legends

Now that the Tim Tebow saturation has, hopefully, ended, it's time to take a look back at how the "Tebow miracle" was pure public relations, selling a story, hero-making in the most nefariously deceptive form. The latest media blitz to sell advertising, tickets, jerseys, and magazines.

The Denver Broncos were 8 and 8 in the NFL 2011 regular season. A team that won the same amount of games that they lost. Hardly impressive.

The storyline goes - Tim Tebow was responsible for 7 of those victories, almost single-handedly as the legend would have it. But the effectiveness of the Broncos' offense, under the helm of Tebow, has some serious questions. Another example of correlation rather than causation masquerading as serious analysis and fact.

The Broncos had the 25th ranked offense (by points per game, out of 32 total teams) in the NFL, averaging 19 points per game. The Green Bay Packers were the highest scoring offense at 35 points per game. Tim Tebow was the 27th ranked quarterback based on passer rating at 73. Aaron Rodgers was the highest ranked quarterback with a 123 passer rating. Tim Tebow only completed 47 percent of his passes, ranking last in the league. Tom Brady, the leader in this category, completed 71 percent. Tebow also averaged the least amount of passing yards per game (124) in the league. Which also explains Tebow's low average of  6 yards per completion, ranking 26th in the NFL.

This is not to say Tebow has no future as a quarterback, that he can't improve, or that, someday, he might be one of the best quarterbacks in the NFL. But, based on the numbers, Tebow has neither deserved the accolades being poured upon him nor would it be logical to claim he is among the league's elite quarterbacks.

Let's hope Tebow was taking notes on the quarterback clinic Tom Brady put on in the New England Patriots 45-10 route of Tebow's Denver Broncos on Saturday. That was the type of performance expected of NFL elite quarterbacks, and deserving of praise and envy.

A Manufactured Paradox

The chief executive of the Wisconsin Economic Development Corporation and the secretary of the state Department of Workforce took to the Journal Sentinel to "inform" readers of a workforce paradox in Wisconsin. Or, to at least lay the groundwork for such a talking-point to help move forward more legislation which will supposedly address this manufactured paradox.

It's amazing when similar-minded people whom have advocated less regulation, lower taxes, and the general expansion of service industry jobs over the past three decades suddenly decide manufacturing is a crucial sector and that we must have a renewed focus on industrial policy.

Nevermind that the typical economic policies they've pushed over the past few decades have decimated manufacturing employment. Policies that have weakened unions, driven down wages, and outsourced many of the good-paying manufacturing jobs to low-wage countries. [The combination of low-road economic development and neoliberal policies.]

Now the government must rework the educational system's curriculum, provide more job training, and provide tax credits and relocation incentives to improve the same manufacturing employment that past policies decimated. Regardless of the fact that, "There is little evidence of absolute declines in cognitive or hard skills in the United States or generally poor performance relative to other advanced industrialized countries," as reported by associate professor Michael Handel.

The writers engage is some fairytales to make their point in the article. They claim part of the reason manufacturing employment and jobs have declined is because we haven't talked about them enough as being desirable employment. They also regurgitate the well-worn idea of structural employment - matching people who can do the jobs with where the jobs are needed. [As Rortybomb informs, "A report the IMF put out - The Great Recession and Structural Unemployment - which found find that structural unemployment is 1%-1.75% nationwide, with skills being 0.5%."]

People have chosen service jobs over manufacturing because of the diminished wages offered by the manufacturing jobs. The manufacturing jobs today have lower wages, reduced health care and slim to non-existent retirement packages. Why would a worker chose a challenging, skilled manufacturing job under such circumstances when they could just as easily take a similarly compensating service industry job, which is often, also, much less physically demanding?

If the writers were serious they would be addressing trade agreements, tax-policy toward outsourcing firms, and discussing the need for a comprehensive industrial policy focused on America's need for a strong manufacturing sector and it's link to our infrastructure and self-sustainability. Instead we get more apologetics and scapegoating. Like most businesses these days, the manufacturers want the inflated profits, but none of the social responsibility of good wages and a secure retirement for their workers.

It's not that we don't have workers who can do these jobs, it's just easier [cheaper] for the well-represented [lobbyists] manufacturing companies to appeal for government hand-outs than to pay wages necessary for the work. Thus, a whole cottage industry of cranks has arisen to create this fantasy of structural unemployment and skills mismatch.

Rather, this is simply a story of supply and demand. Until the manufacturers are willing to pay respectable wages to attract workers to these jobs, the manufacturers will continue claiming the educational system must be failing, the government isn't doing enough, and everyone but the manufacturers are responsible for these supposedly unfilled jobs.

For Further Reading:
Has The Great Recession Raised Structural Unemployment?
Latest in (Lack of) Structural Employment

Monday, January 9, 2012

Amnesia Appointments

President Obama's recess appointments - Richard Cordray to the Consumer Financial Protection Bureau and filling three vacancies on the National Labor Relations Board - have caused outrage among Republicans.

Although I don't recall Republicans being upset by the 171 recess appointments George W. Bush made during his administration.

And, I definitely don't remember Republicans complaining when Ronald Reagan made 240 recess appointments.





Wisconsin Economic Indicators

Government Employment in Wisconsin (WIGOVT)


Health Insurance Coverage: Coverage Rate in Wisconsin (WIHICCOVPCT)


Home Ownership Rate for Wisconsin (WIHOWN)


Manufacturing Employment in Wisconsin (WIMFG)


Employees on Nonfarm Payrolls in Wisconsin (WINA)


Total Gross Domestic Product by State for Wisconsin (WINGSP)


Rental Vacancy Rate for Wisconsin (WIRVAC)


House Price Index for Wisconsin (WISTHPI)


Unemployment Rate in Wisconsin (WIUR)

Sunday, January 8, 2012

Trickle Down Tricks

With election season heating up, the usual right-wing talking-heads are spouting the usual right-wing misinformation. They claim uncertainty, taxes, and the possibility of a Scott Walker recall (specifically here in Wisconsin), are the culprits behind businesses not investing and their threats of moving to a location with a more friendly business climate.

Jared Bernstein and Lawrence Mishel have dispelled the "uncertainty" talking point, "First, 'uncertainty' in this context refers to the Republicans argument that it's government and central bank actions -- taxes, regulation, fiscal/monetary policy, health care/financial regulation reforms -- that are holding back the economy, not any of that ill-begotten Keynesian stuff, like lack of customers, orders, investors. So how might you test for something like that? Well, what about actual investment? Investment in the current recovery has increased more than in it had at the same time period in the prior two recoveries and roughly the same as it did during the 1980s recovery. In other words, this recovery is far more investment-led than the recovery under the pro-deregulation George W. Bush administration. Private sector jobs, you ask? ...private sector job growth in this recovery looks much like job growth in recent recoveries, suggesting that businesses are not reacting to a new threat of potential regulations and taxes (the difference with this recovery is actually the loss of public sector jobs. And then, of course, there's what the business folks, as opposed to their DC reps, actually say about what's bugging them: ...the regular National Federation of Independent Business (NFIB) surveys of small businesses found that the most common answer to the question, "what is the single most important problem your business faces?" was 'poor sales.' And while a number of businesses also cited regulation, the numbers were not substantially higher than under Presidents George W. Bush or Ronald Reagan and were lower than under Presidents Bill Clinton and George H.W. Bush. None of this is to say 'uncertainty' is not a problem. But while conservative politicians are busy jamming their perennial tax cut/deregulate agenda into the current context, the thing that businesses are truly uncertain about is when they're going to start seeing some customers again."

Numerous sources have debunked the 'burdensome tax climate' drum the Republicans continually pound.

As David Kocieniewski notes, "But by taking advantage of myriad breaks and loopholes that other countries generally do not offer, United States corporations pay only slightly more on average than their counterparts in other industrial countries. And some American corporations use aggressive strategies to pay less — often far less — than their competitors abroad and at home. A Government Accountability Office study released in 2008 found that 55 percent of United States companies paid no federal income taxes during at least one year in a seven-year period it studied."

The Institute for Wisconsin's Future has a series, Who Does Not Pay Taxes?, which details the numerous Wisconsin businesses that are paying little to nothing in taxes. Kimberly-Clark, Brunswick, Rockwell Automation, Snap-On and S.C. Johnson are but a few on the list.

Citizens for Tax Justice (CTJ), in their latest research spanning 2008-2010, has uncovered that the 280 most profitable corporation shelter half of their profits from taxes. "The average effective tax rate for all 280 companies in the study over the three year period was 18.5 percent; for the period 2009-2010 it was 17.3 percent, less than half the statutory rate of 35 percent." "30 Companies average less than zero tax bill in the last three years, 78 had at least one no-tax year."

CTJ has also discovered that the U.S. is one of the least taxed developed countries. U.S. taxes are the third lowest among OECD nations. "In 2009, total federal, state and local taxes in the United States were 22.6 percent of our gross domestic product, ranking 26th among the 28 OECD countries for which data are available. Only Chile (18.2 percent) and Mexico (17.5 percent) had lower taxes."

And, as the Center on Budget and Policy Priorities has found, "Government and independent researchers have long pointed out that the top statutory corporate tax rate is an incomplete measure at best of the burden of corporate taxes. It does not take into account the generous depreciation rules, exemptions, deductions, and credits (some of which are sometimes termed “loopholes”) that corporations may be eligible for. Those special provisions lower corporations’ effective tax rate, or the share of their profits they actually pay in taxes, and do so in a way that creates different tax rates for different industries. These differential tax rates across industries are generally regarded as more harmful to economic efficiency than any burden due to the current top statutory rate."

Business basics - inputs, suppliers, customers, labor, transportation - are much more important for a business in their site location decision. Republicans continually push for lower taxes because it benefits their favored constituents - the top 1 percent. But these policies actually have hurt the rest of us.

If we've learned anything from the Great Recession it should be that companies can get too big...and then we're stuck preventing their failure. Do we want such monopolistically large companies having such sway and getting such favors from state governments? Due to this war among the states (the competition for jobs) the ante keeps increasing with every business threatening their current host state for subsidies with the threat to move their jobs to another state.

Taxpayers are being asked to cover the bills for big business (by allowing them to pay less in taxes alongside receiving billions in subsidies) whilst being asked to take lower pay, less health care, and to fund their own retirement. And taxes and regulations are never little enough for these right-wing freeloaders. They want more and more breaks while they expect workers to sacrifice more and earn less. At the same time, corporations are making record profits.

Here's hoping voters don't buy the Republicans' snake-oil at the next election and we continue righting the wrongs initiated by the Reagan revolution.

For Further Reading:
America's Corporate Tax Obscenity
Blackmailed Into Oblivion
Doing Development Right
Insincere Revenue Barons
Misdirection & Ulterior Motives
Taken For A Ride
WalMart Propaganda & Media Lapdogs
We Have A Revenue Problem

Sunday Reading

The Book Of Jobs
Corporate Profits Up. Taxes Not.
Fannie And Freddie Fantasies
Top 5 Tax Myths of The GOP Spin Machine
How Many Colberts Are There?
Structural Adjustment For The Middle Class?
The City Solution
Urban Development Legends
What Is The Contribution Of The Financial Sector?
What Is The Real Unemployment Rate, And How Could We Tell?

Crazy Nastyass Honey Badger

Saturday, January 7, 2012

Wrong-To-Work

The latest research concerning the right-wing's continued attack on collective bargaining and living wages; the so-called "right-to-work" legislation:

Working Hard To Make Indiana Look Bad
"Right To Work" Lowers Wages - And That's A Fact!