Another example of the double-standard our country and economic system has between labor and capital. The auto industry better beg, grovel, and whimper for the $28 billion they received. Wall Street can have their $5.7 trillion without stipulations, no questions asked. WTF?!
Let's not forget about our, what seems to be, never-ending $5 trillion war(s).
For Further Reading:
Class Warfare
Correction To The $70-Per-Hour Myth
Failure Bonuses
Foreign-owned: Yes. American-owned: No.
Republican War Against U.S. Workers
Sunday, March 29, 2009
Taking A Healthy Approach To Health Care
John Torinus, Milwaukee Journal-Sentinel and WMC propagandist, predictably feels the answer to our health care system concerns should come from business. And from a subsidiary of a magazine printing company no less. I am not saying they may not have good ideas and some good suggestions regarding the matter, but the delivery and implementation issues of health care are just as important as the management. A profit-driven, cost-cutting, avoid-the-sick mentality does not fit well into health care. It's not just about the cost, it's about the quality and access of the care given.
How about we allow the input of doctors, physicians, nurses, et al in determining our health care system? How about you "business" guys stick to running your companies into the ground, begging for trillions in bailouts, crashing the financial system, and exploding the world economy.
In the last few decades we've turned health care over to the insurance companies with "managed" care -- and this has led to disastrous results. Now Torinus, never one to contradict his unwavering belief in corporate omnipotence, would like to see things turned over to corporate clinics opertating at business sites. This plan seems as though it would be replacing one greedy overlord (HMOs) with another. Neither of which care about health care, but rather see this as another business opportunity...another avenue toward profit.
As business has played a larger part in politics and policy-making, the U.S. has seen itself become a debtor rather than creditor nation, wages for the majority of workers have stagnated, the environment has been ravaged, economic periods of boom and bust have become more frequent, pensions are a thing of the past, social services have been continually dismantled, and the numbers of uninsured keep increasing. Sorry, but I just dont trust these same selfish, short-sighted know-nothings to "manage" my health care.
How about we allow the input of doctors, physicians, nurses, et al in determining our health care system? How about you "business" guys stick to running your companies into the ground, begging for trillions in bailouts, crashing the financial system, and exploding the world economy.
In the last few decades we've turned health care over to the insurance companies with "managed" care -- and this has led to disastrous results. Now Torinus, never one to contradict his unwavering belief in corporate omnipotence, would like to see things turned over to corporate clinics opertating at business sites. This plan seems as though it would be replacing one greedy overlord (HMOs) with another. Neither of which care about health care, but rather see this as another business opportunity...another avenue toward profit.
As business has played a larger part in politics and policy-making, the U.S. has seen itself become a debtor rather than creditor nation, wages for the majority of workers have stagnated, the environment has been ravaged, economic periods of boom and bust have become more frequent, pensions are a thing of the past, social services have been continually dismantled, and the numbers of uninsured keep increasing. Sorry, but I just dont trust these same selfish, short-sighted know-nothings to "manage" my health care.
Saturday, March 28, 2009
Housing Is A National Decision
Patrick McIlheran at the Milwaukee Journal-Sentinel pontificates on housing and how it must remain in the realm of individual decision-making. Somehow property and housing - wherever a person wants to build and live - is a right. There shall be no input from government, no growth boundaries, no planning involved in how we create our built environment, house our citizens, and construct our society and communities.
This McIlheran-thinking is really just another stunning example of selfish, greedy, base-instincts at their worst. These are some of the same driving forces and impulses that led to the current economic mess we're in.
Is McIlheran really that uninformed regarding the many environmental and economic issues involved in sprawling development? The upkeep of the new roads, additional sewer and water issues, policing, electrical grid infrastructure, commuter pollution, paved land, among many others. There are ecosystems, food sources, natural resources, animals, wet lands, and other natural systems that are destroyed in our continually destructive "build wherever land is cheapest and construct a highway out to it" mentality.
Can we all also agree on the point that just because we desire something or would like things to be a certain way, this does not mean that we automatically get what we want, nor does it mean that things should be our way, nor does it imply things will turn out a certain way? There are larger societal issues here than just each individuals wants and desires.
Although the advertisers and public relations hucksters may want it this way, we should not be aspiring to be a nation of hedonistic gluttons. Just because some developers want to sell the "American Dream" as a McMansion on 5 acres an hour out in the middle of nowhere doesn't make it so and it doesn't make it the most highly productive, efficient, or beneficial housing or development policy. It's a way to make a quick buck for the developers, while the negative externalities are passed on the public.
It's time for us to be more responsible to the environment and more sustainable in our development decisions. It's time to realize that what is right and just is not always cheap and easy.
Chris Caldwell, of the Financial Times, gives a nice primer on highway building, suburban sprawl, and the many negative consequences of both here.
This McIlheran-thinking is really just another stunning example of selfish, greedy, base-instincts at their worst. These are some of the same driving forces and impulses that led to the current economic mess we're in.
Is McIlheran really that uninformed regarding the many environmental and economic issues involved in sprawling development? The upkeep of the new roads, additional sewer and water issues, policing, electrical grid infrastructure, commuter pollution, paved land, among many others. There are ecosystems, food sources, natural resources, animals, wet lands, and other natural systems that are destroyed in our continually destructive "build wherever land is cheapest and construct a highway out to it" mentality.
Can we all also agree on the point that just because we desire something or would like things to be a certain way, this does not mean that we automatically get what we want, nor does it mean that things should be our way, nor does it imply things will turn out a certain way? There are larger societal issues here than just each individuals wants and desires.
Although the advertisers and public relations hucksters may want it this way, we should not be aspiring to be a nation of hedonistic gluttons. Just because some developers want to sell the "American Dream" as a McMansion on 5 acres an hour out in the middle of nowhere doesn't make it so and it doesn't make it the most highly productive, efficient, or beneficial housing or development policy. It's a way to make a quick buck for the developers, while the negative externalities are passed on the public.
It's time for us to be more responsible to the environment and more sustainable in our development decisions. It's time to realize that what is right and just is not always cheap and easy.
Chris Caldwell, of the Financial Times, gives a nice primer on highway building, suburban sprawl, and the many negative consequences of both here.
Commercial Real Estate Is Next
It appears that in 2009 we will see commercial real estate face the same precipitous decline as we've seen in residential real estate over the last few years. Some of which, in certain areas, has already started in 2008.
Many banks are facing loan defaults on commercial mortgages. Lingling Wei, of the Wall Street Journal, explains, "The delinquency rate on about $700 billion in securitized loans backed by office buildings, hotels, stores, and other investment property has more than doubled since September to 1.8 percent this month."
U.S. commercial sales volume fell 70 percent in 2008. Prices are down 20 percent.
We can see this decline coming over the horizon and like the residential market, some areas are being hit earlier and harder. As Earl Webb, chief executive of Lang LaSalle Capital Markets, commented, "It may take another three or four quarters for broad based distress to reach the sales market."
So, the commercial collapse (alongside the residential) will add to the tough times in 2009 and probably hamper economic growth until late 2010 at best.
Many banks are facing loan defaults on commercial mortgages. Lingling Wei, of the Wall Street Journal, explains, "The delinquency rate on about $700 billion in securitized loans backed by office buildings, hotels, stores, and other investment property has more than doubled since September to 1.8 percent this month."
U.S. commercial sales volume fell 70 percent in 2008. Prices are down 20 percent.
We can see this decline coming over the horizon and like the residential market, some areas are being hit earlier and harder. As Earl Webb, chief executive of Lang LaSalle Capital Markets, commented, "It may take another three or four quarters for broad based distress to reach the sales market."
So, the commercial collapse (alongside the residential) will add to the tough times in 2009 and probably hamper economic growth until late 2010 at best.
Tuesday, March 24, 2009
Class Warfare
So...A.I.G. (and their ilk) needs "retention" bonuses to keep such skilled workers at the company, even though these are the same employees that ran everything into the ground?
One can only assume that it would be perfectly fine for the auto industry to lavish lucrative bonuses on their workers, too. They also need to keep their skilled employees happy and productive in these hard times. Right?
Or does this simple question of logic and fairness cross over into the gist (and idiocy) of our modern-day bizarro world?
One where the wealthiest are subsidized, given tax breaks, and have all their risk insured by taxpayers. While the majority of Americans, everyday workers, are told to go without - where their wages stagnate, where their health care premiums continue to skyrocket, where pensions are a thing of the past, and where retirement is now having a job working the counter at Walgreens for many in their golden years.
The auto workers (along with all unions workers) have seen their wages and rights steadily dismantled over the last thirty years. They have taken pay, health care, and pension cuts. They have continually renegotiated their contracts cycle after cycle.
I haven't heard someone demanding setting limits on executive compensation (other than a few mumblings and labor advocates), yet they are the ones responsible.
Auto workers don't design vehicles. They don't make the company's investment decisions. Plus, executive labor costs, proportionally speaking, cost these companies a lot more than the assembly line workers (if it's just labor cost we're supposedly irked about). It's these higher-ups whose reckless greed and poor management destroyed the economy and their companies.
This is class warfare. The Haves are continuing to pick our pockets. We need some Change to believe in more so than ever.
One can only assume that it would be perfectly fine for the auto industry to lavish lucrative bonuses on their workers, too. They also need to keep their skilled employees happy and productive in these hard times. Right?
Or does this simple question of logic and fairness cross over into the gist (and idiocy) of our modern-day bizarro world?
One where the wealthiest are subsidized, given tax breaks, and have all their risk insured by taxpayers. While the majority of Americans, everyday workers, are told to go without - where their wages stagnate, where their health care premiums continue to skyrocket, where pensions are a thing of the past, and where retirement is now having a job working the counter at Walgreens for many in their golden years.
The auto workers (along with all unions workers) have seen their wages and rights steadily dismantled over the last thirty years. They have taken pay, health care, and pension cuts. They have continually renegotiated their contracts cycle after cycle.
I haven't heard someone demanding setting limits on executive compensation (other than a few mumblings and labor advocates), yet they are the ones responsible.
Auto workers don't design vehicles. They don't make the company's investment decisions. Plus, executive labor costs, proportionally speaking, cost these companies a lot more than the assembly line workers (if it's just labor cost we're supposedly irked about). It's these higher-ups whose reckless greed and poor management destroyed the economy and their companies.
This is class warfare. The Haves are continuing to pick our pockets. We need some Change to believe in more so than ever.
Wednesday, March 18, 2009
Failure Bonuses
Andrew Ross Sorkin has an article in the March 17, 2009 New York Times, The Case for Paying AIG Bonuses. Here’s an excerpt from the piece:
Pearl Meyer, a compensation consultant at Steven Hall & Partners, says it would put American business on a worse slippery slope than it already is. Business agreements of other companies that have taken taxpayer money might fall into question. Even companies that have not turned to Washington might seize the opportunity to break inconvenient contracts.
If government officials were to break the contracts, they would be “breaking a bond,” Ms. Meyer says. “They are raising a whole new question about the trust and commitment organizations have to their employees.” (The auto industry unions are facing a similar issue — but the big difference is that there is a negotiation; no one is unilaterally tearing up contracts.)
When it’s a union contract, it “must” be broken. That is just the way of the world today. We must keep our competitive edge, or so the story goes.
When white-collar executives and/or management at some of the largest and wealthiest companies mismanage, lose the company money, oversee stock devaluation, or steer the entire economy off a cliff, we must just give in to their demands. Just hand over the money, bail them out, no questions asked, no stipulations. And we wouldn't think of breaking those sacred contracts with them. (Give me a break!)
From a recent Economic Policy Institute report, Squandering the Blue-collar Advantage:
Of the 20 richest countries tracked by the U.S. Bureau of Labor Statistics, the United States ranks 17th in hourly pay for production workers in manufacturing.
Of the 16 nations with higher compensation for production workers in manufacturing, the United States ranks behind only Ireland (a nation with a manufacturing workforce less than 2% as large as that of the United States) in terms of “value-added per employee” (a rough measure of productivity).
The combination of relatively low compensation and high productivity means that U.S. manufacturing leads the world in terms of competitiveness of per unit costs of manufacturing output.
If the wages claimed by managerial and non-supervisory labor in the United States were the same as the median of comparable countries, U.S. manufacturing would have a 6.4% cost advantage over major trading partners.
But somehow we weren’t competitive because the auto workers made too much money. The workers' gargantuan paychecks somehow led to the auto industry’s downfall. People were buying Japanese cars because Japanese workers are, supposedly, being paid less? Yet, it actually appears, competitively-speaking, U.S. manufactures are some of the most productive and competitive in the world.
According to a report by the Center for American Progress, Supersize This, CEO pay in other industrialized countries is about one-third of what American CEOs make. U.S. CEOs make two-thirds more than similar CEOs in other countries. Yet, U.S. executives have destroyed the world economy. And, therefore, they should be able to get bonuses? And keep their jobs? And we are unable to break the fragile bond we have with these malevolent overlords? Our present debacle seems to affirm the notion that the supposed experts, the executives, are at fault. What were they being paid all that money for anyways?
As we can see, it’s not that the wage-laborers are commanding too much in pay and this is causing the U.S. to be less competitive. It’s short-term, risky decision-making by greedy CEOs leading to the decline. It’s the focus on casino capitalism and making money by short selling instead of concentrating on the real economy. Any bond or contract we have with these financial hucksters should be torn up.
Let’s remove corporate charters, let’s institute a 100 percent surcharge on bonuses, let’s make the capital gains tax equivalent to the marginal tax rate, or just get rid of the capital gains tax and charge it as income, let’s also raise the marginal tax rate, and let’s prosecute.
These traders, executives, and financiers were criminals writing checks they knew were no good, in a manner of speaking. These people should be out of their jobs, their wealth/wages should be seized or garnished, and they should be brought to court.
From Sorkin’s article, Edward M. Liddy, A.I.G.s chief executive, claims “We cannot attract and retain the best and brightest talent to lead and staff if employees believe that their compensation is subject to continued and arbitrary adjustment by the U.S. Treasury.”
These stellar staffers are the same ones that blew up the economy. Maybe you need to look for more diligent workers concerned with doing good work rather than just making a quick ill-gotten dollar.
All of this is causing the free market myth to collapse right before the very eyes of the same snake-oil salesmen who’ve been selling/pushing it on us the last 30 years and they don’t know what to do. The curtain has been pulled back…the emperor has no clothes.
Pearl Meyer, a compensation consultant at Steven Hall & Partners, says it would put American business on a worse slippery slope than it already is. Business agreements of other companies that have taken taxpayer money might fall into question. Even companies that have not turned to Washington might seize the opportunity to break inconvenient contracts.
If government officials were to break the contracts, they would be “breaking a bond,” Ms. Meyer says. “They are raising a whole new question about the trust and commitment organizations have to their employees.” (The auto industry unions are facing a similar issue — but the big difference is that there is a negotiation; no one is unilaterally tearing up contracts.)
When it’s a union contract, it “must” be broken. That is just the way of the world today. We must keep our competitive edge, or so the story goes.
When white-collar executives and/or management at some of the largest and wealthiest companies mismanage, lose the company money, oversee stock devaluation, or steer the entire economy off a cliff, we must just give in to their demands. Just hand over the money, bail them out, no questions asked, no stipulations. And we wouldn't think of breaking those sacred contracts with them. (Give me a break!)
From a recent Economic Policy Institute report, Squandering the Blue-collar Advantage:
Of the 20 richest countries tracked by the U.S. Bureau of Labor Statistics, the United States ranks 17th in hourly pay for production workers in manufacturing.
Of the 16 nations with higher compensation for production workers in manufacturing, the United States ranks behind only Ireland (a nation with a manufacturing workforce less than 2% as large as that of the United States) in terms of “value-added per employee” (a rough measure of productivity).
The combination of relatively low compensation and high productivity means that U.S. manufacturing leads the world in terms of competitiveness of per unit costs of manufacturing output.
If the wages claimed by managerial and non-supervisory labor in the United States were the same as the median of comparable countries, U.S. manufacturing would have a 6.4% cost advantage over major trading partners.
But somehow we weren’t competitive because the auto workers made too much money. The workers' gargantuan paychecks somehow led to the auto industry’s downfall. People were buying Japanese cars because Japanese workers are, supposedly, being paid less? Yet, it actually appears, competitively-speaking, U.S. manufactures are some of the most productive and competitive in the world.
According to a report by the Center for American Progress, Supersize This, CEO pay in other industrialized countries is about one-third of what American CEOs make. U.S. CEOs make two-thirds more than similar CEOs in other countries. Yet, U.S. executives have destroyed the world economy. And, therefore, they should be able to get bonuses? And keep their jobs? And we are unable to break the fragile bond we have with these malevolent overlords? Our present debacle seems to affirm the notion that the supposed experts, the executives, are at fault. What were they being paid all that money for anyways?
As we can see, it’s not that the wage-laborers are commanding too much in pay and this is causing the U.S. to be less competitive. It’s short-term, risky decision-making by greedy CEOs leading to the decline. It’s the focus on casino capitalism and making money by short selling instead of concentrating on the real economy. Any bond or contract we have with these financial hucksters should be torn up.
Let’s remove corporate charters, let’s institute a 100 percent surcharge on bonuses, let’s make the capital gains tax equivalent to the marginal tax rate, or just get rid of the capital gains tax and charge it as income, let’s also raise the marginal tax rate, and let’s prosecute.
These traders, executives, and financiers were criminals writing checks they knew were no good, in a manner of speaking. These people should be out of their jobs, their wealth/wages should be seized or garnished, and they should be brought to court.
From Sorkin’s article, Edward M. Liddy, A.I.G.s chief executive, claims “We cannot attract and retain the best and brightest talent to lead and staff if employees believe that their compensation is subject to continued and arbitrary adjustment by the U.S. Treasury.”
These stellar staffers are the same ones that blew up the economy. Maybe you need to look for more diligent workers concerned with doing good work rather than just making a quick ill-gotten dollar.
All of this is causing the free market myth to collapse right before the very eyes of the same snake-oil salesmen who’ve been selling/pushing it on us the last 30 years and they don’t know what to do. The curtain has been pulled back…the emperor has no clothes.
Financial “Innovation”
Monday, March 16, 2009
Stop The Insanity!
I'm assuming since Tucker Carlson doesn't have the stage he's had in the past, he must be trying to pick a fight with Jon Stewart, who has been in the news lately. Or, is he holding a grudge from Stewart's appearance on Crossfire, where Stewart evicerated co-host Paul Begala and Carlson?
This backlash scenario the Republicans are trying to dream up here, to get some badmouthing of Jon Stewart, all starts with the idea that - Jon Stewart ["partisan hack", "pompous jerk"] began his criticism of Santelli, CNBC, and Cramer because Obama's budget was criticized.
This is classic Republican diversionism. They steer the story away from policy decisions, the stimulus, etc. They invoke wedge-issue personal attacks and character assassinations. Now we've got a media meme going around, "Those mean Democrats", "They're bullies." And the chance to make the money we're spending go toward investments in the future of our country could be drowned out by this tabloid-style yammering.
The President needs a counter-insurgency operation to give an ass-whoopin' to some business reporters, financial advisers, and television financial shows, by questioning their poor management and choices, if not corruption.
And the implication that - the obvious choice is Jon Stewart?
I mean...really...I thought Keith Olbermann was the partisan hack bully? Oh, I guess it's just anyone who points out that CNBC-et al spewings are garabge and not backed-up by anything tangible, those people are partisan hack bullies.
I've seen Sean Hannity insult Robert Kuttner, Bill O'Reilly insult Barney Frank, and many members of the punditocracy leveling ridiculous and false accusations at anyone brave enough to speak truth to power. If anyone understands mean-spirited, guttersnipe, bullying, it's definitely the right-wingers.
This is how low the Republicans have sunk this quickly. Disgraceful. This isn't even an adult conversation. What in our empirical-data-measured reality do Republicans have to support any of the crap they've been spouting for 30 years?
Nada. They got nothin'! Stop the insanity!
This backlash scenario the Republicans are trying to dream up here, to get some badmouthing of Jon Stewart, all starts with the idea that - Jon Stewart ["partisan hack", "pompous jerk"] began his criticism of Santelli, CNBC, and Cramer because Obama's budget was criticized.
This is classic Republican diversionism. They steer the story away from policy decisions, the stimulus, etc. They invoke wedge-issue personal attacks and character assassinations. Now we've got a media meme going around, "Those mean Democrats", "They're bullies." And the chance to make the money we're spending go toward investments in the future of our country could be drowned out by this tabloid-style yammering.
The President needs a counter-insurgency operation to give an ass-whoopin' to some business reporters, financial advisers, and television financial shows, by questioning their poor management and choices, if not corruption.
And the implication that - the obvious choice is Jon Stewart?
I mean...really...I thought Keith Olbermann was the partisan hack bully? Oh, I guess it's just anyone who points out that CNBC-et al spewings are garabge and not backed-up by anything tangible, those people are partisan hack bullies.
I've seen Sean Hannity insult Robert Kuttner, Bill O'Reilly insult Barney Frank, and many members of the punditocracy leveling ridiculous and false accusations at anyone brave enough to speak truth to power. If anyone understands mean-spirited, guttersnipe, bullying, it's definitely the right-wingers.
This is how low the Republicans have sunk this quickly. Disgraceful. This isn't even an adult conversation. What in our empirical-data-measured reality do Republicans have to support any of the crap they've been spouting for 30 years?
Nada. They got nothin'! Stop the insanity!
Sunday, March 15, 2009
The Penquin Talks
Why is the Bush Administration, according to Dick Cheney, not responsible for any of the catastrophes caused/ignored/exacerbated under it's watch?
Wait for it ...
9-11, of course, duh!
Wait for it ...
9-11, of course, duh!
The EFCA Truth
More Water Wars
Are we going to get serious about energy, water, conservation, sprawl, and sustainability?
Stop Making Sense
A peculiar notion I've seen since Jon Stewart spanked Jim Cramer, a glaringly ridiculous critique aimed at Stewart is that,“Stewart didn't do himself any favors by coming off as overly serious and not very funny.”
Because a comedy show host has to do a journalist's job and ask the tough questions…because he wants to get to the bottom of this mess and hold accountable those who drove us off a cliff…because Jon was serious…somehow this didn’t do him any favors?
WTF?!?!
Memo to Stewart: You are a monkey. Just make us laugh. We don't like to think. We don't want this Ponzi economy exposed. Shut up unless you're making jokes.
If Joe Weisenthal and other supposed business reporters did their jobs Stewart wouldn't have to do it. Maybe we just need to be watching Comedy Central for our business news, and the supposed experts need to find new work.
Lessons In Greed
A nice synopsis is given here by Keith Olbermann showing Wall Street is primarily to blame for our current catastrophe.
Stimulus Sanity
So, will all the pundits be saying this upsurge in the stock indices is all due to Obama? Since the downturn was all somehow his fault. Now that improvement has been seen, doesn’t that imply the stimulus and the Obama's policies must be partly responsible? Is this still the "Obama Economy"?
Menard's Machinations
A New Wall In (New) Berlin
Isn’t it time that business started showing they are community-friendly, living wage friendly, long-term sustainability friendly?
New Berlin has passed a ban on government-mandated wages and benefits for private employers.
"Ald. Dave Ament said the ordinance was needed 'to send a message' to existing and potential city businesses that the city is business-friendly."
So it seems being "business-friendly" is at odds with being worker-friendly. Can a business be good for a community if it's not good for it's workers?
As usual (and part of what got us into our present mess), government should not regulate anything. We all need to bend over (as Rush Limbaugh would say) and take it from our unregulated, free market master.
New Berlin has passed a ban on government-mandated wages and benefits for private employers.
"Ald. Dave Ament said the ordinance was needed 'to send a message' to existing and potential city businesses that the city is business-friendly."
So it seems being "business-friendly" is at odds with being worker-friendly. Can a business be good for a community if it's not good for it's workers?
As usual (and part of what got us into our present mess), government should not regulate anything. We all need to bend over (as Rush Limbaugh would say) and take it from our unregulated, free market master.
Media Are Corporations Too
In yet more sloppy writing by the Journal Sentinel, Marie Rhode, in her article Appellate Court Rules For City In Dispute Over Value of Parking Lot Near Airport, implies that the City tried to reopen a case after learning of a sale higher than the assessed value. I can only guess (much like Ms. Rhode must have done for her reporting) that she did not bother to read the court decision.
They way the article is written, it insinuates that after learning about a 2007 sale, the City tried to go back and increase the assessed values on a property for 2004 and 2005.
In late 2006, the City was merely presenting their case for their assessed value ($10,115,000) for 2004 and 2005 on a parking lot near the airport, to which Allright Properties was objecting. The court ruled in Allright's favor, the City appealed.
In 2007, "After post trial briefing, but prior to the trial court issuing it's decision [Court of Appeals #2008AP510]," the City learned that the Allright Properties parking lot had been sold for $12.3 million dollars (May 22, 2007); over $2 million more than the assessed value. This seems a pretty good indicator that not only was the City closer to the correct valuation on the property, they may have actually been low. The City asked that the record be reopened to allow this evidence. The City just wanted to use this evidence to support their case, not to punitively increase the assessment.
Sloppy reporting like this only continues the myth that the City (and government in general) is bad, corrupt, out to get people, and unfairly taking our money. None of that is true.
The real story should have highlighted the fact Allright Properties was claiming the City had overvalued their property by two-thirds at the same time the company was selling the property for even more than the assessment. This could have been an in-depth analysis of the avoidance schemes corporations use to escape taxation and cause regular homeowners to pay more. But instead, as usual, the media chose the false "government is bad...those poor businesses" perspective. Inexcusable!
Secondly, this story could have highlighted how bad court case law can be instituted when judges unfamiliar with assessment practices and real estate try to grasp and rule on cases they don't fully comprehend (luckily, the City appealed). Just another business-friendly judge doing crappy work? Who knows? The Court of Appeals judge reversed and remanded the judgment of the Circuit Court judge. Which implies that the Circuit Court judge did a disservice to the law and to taxpayers in reaching a decision, siding with Allright Properties, the first time.
They way the article is written, it insinuates that after learning about a 2007 sale, the City tried to go back and increase the assessed values on a property for 2004 and 2005.
In late 2006, the City was merely presenting their case for their assessed value ($10,115,000) for 2004 and 2005 on a parking lot near the airport, to which Allright Properties was objecting. The court ruled in Allright's favor, the City appealed.
In 2007, "After post trial briefing, but prior to the trial court issuing it's decision [Court of Appeals #2008AP510]," the City learned that the Allright Properties parking lot had been sold for $12.3 million dollars (May 22, 2007); over $2 million more than the assessed value. This seems a pretty good indicator that not only was the City closer to the correct valuation on the property, they may have actually been low. The City asked that the record be reopened to allow this evidence. The City just wanted to use this evidence to support their case, not to punitively increase the assessment.
Sloppy reporting like this only continues the myth that the City (and government in general) is bad, corrupt, out to get people, and unfairly taking our money. None of that is true.
The real story should have highlighted the fact Allright Properties was claiming the City had overvalued their property by two-thirds at the same time the company was selling the property for even more than the assessment. This could have been an in-depth analysis of the avoidance schemes corporations use to escape taxation and cause regular homeowners to pay more. But instead, as usual, the media chose the false "government is bad...those poor businesses" perspective. Inexcusable!
Secondly, this story could have highlighted how bad court case law can be instituted when judges unfamiliar with assessment practices and real estate try to grasp and rule on cases they don't fully comprehend (luckily, the City appealed). Just another business-friendly judge doing crappy work? Who knows? The Court of Appeals judge reversed and remanded the judgment of the Circuit Court judge. Which implies that the Circuit Court judge did a disservice to the law and to taxpayers in reaching a decision, siding with Allright Properties, the first time.
The Great Duplication
Our present economic bust was predicted by some, had clear indicators to anyone willing to rationally assess them, and was an all too familiar scenario to students of our economic history.
These are some quotes I’ve come across which seem quite applicable:
“A country without a memory is a country of madmen.” ~ George Santayana
“Those who don’t learn history are destined to repeat it.” ~ Edmund Burke
“We learn from history that we learn nothing from history.” George Bernard Shaw
“History is a race between education and catastrophe.” ~ H.G. Wells
“History repeats itself, first as tragedy, second as farce.” ~ Karl Marx
“One faces the future with one’s past.” ~ Pearl S. Buck
Robert Kuttner’s The Alarming Parallels between 1929 and 2007 is a must-read synopsis of our Pollyanna-ish disregard for historical lessons, how we dropped (knowingly and unknowingly) the ball, and how we can fix things.
Although this is definitely a gruelingly torturous recession…The Great Recession, as some have coined, just won't do. I find it more fitting to call this period in American history, shamefully, The Great Duplication. The only thing that prevented us from catching/correcting it was our hubris and greed.
These are some quotes I’ve come across which seem quite applicable:
“A country without a memory is a country of madmen.” ~ George Santayana
“Those who don’t learn history are destined to repeat it.” ~ Edmund Burke
“We learn from history that we learn nothing from history.” George Bernard Shaw
“History is a race between education and catastrophe.” ~ H.G. Wells
“History repeats itself, first as tragedy, second as farce.” ~ Karl Marx
“One faces the future with one’s past.” ~ Pearl S. Buck
Robert Kuttner’s The Alarming Parallels between 1929 and 2007 is a must-read synopsis of our Pollyanna-ish disregard for historical lessons, how we dropped (knowingly and unknowingly) the ball, and how we can fix things.
Although this is definitely a gruelingly torturous recession…The Great Recession, as some have coined, just won't do. I find it more fitting to call this period in American history, shamefully, The Great Duplication. The only thing that prevented us from catching/correcting it was our hubris and greed.
Making The Maestro Look Amateurish
Since Jon Stewart is being hailed as our modern-day Edward Murrow, I thought I'd give the link and abridged transcript (below) to his interview with Alan Greenspan. Stewart deftly dissects how the Fed, traders, hedge fund managers, et al, game the system for the benefit of a few. I've taken the liberty of putting Stewart's most insightful questions/comments in italics and bold type. Enjoy.
Stewart: (after Greenspan’s explanation that the market moves on expectations of the Fed move, not the fundamentals of it) So the Fed, or whoever’s leading it, if they wanted to could in fact “goof” on all of us...
Greenspan: (smiles) You wouldn’t want to.
Stewart: When you say “Open Market,” I always wonder... Why do we have a Fed? Wouldn’t the market take care of interest rates and all that? Why do we have someone adjusting rates if we are a free market society?
Greenspan: We didn’t need a central bank when we were on the Gold Standard . . . [Conspiracy theorists note- the Fed was created 20 years BEFORE we decoupled from the Gold Std] . . . people would buy and sell gold and the markets would do what the Fed does now. . . but by the 1930s most everybody in the world decided that the Gold Standard was strangling the economy and universally the Gold Standard was abandoned...you need somebody out there or some mechanism to determine how much money is out there because the amount of money in an economy relates to the amount of inflation...
Stewart: So we’re not a free market then - there is an invisible...a “benevolent” hand that touches us...
Greenspan: Absolutely, you are quite correct. To the extent that there is a central bank governing the amount of money in the system, that is not a Free Market, and most people call it regulation.
Stewart: When you lower interest rates, it drives money to stocks and lowers the return people get on savings.
Greenspan: Yes, indeed.
Stewart: So they’ve made a choice - “We would like to favor those who invest in the stock market and not those who [save]”...
Greenspan: That’s the way it comes out, but that’s not the way we think about it.
Stewart: Explain that to me. It seems to me that we favor investment, but we don’t favor work. The vast majority of people work, they pay payroll taxes, and they use banks. And then there’s this whole other world of hedge funds and short betting... y’know, it seems like craps. And they keep saying, “No no no, don’t worry about it, it’s Free Market, that’s why we live in much bigger houses.” But it really is, it’s the Fed, or some other thing, no?
Greenspan: I think you’d better re-read my book.
Stewart: Am I wrong that we penalize work by not making the choice to...
Greenspan: No, what a sound money system does is to stabilize the elements in it and reduce the uncertainty that people confront, and when people confront uncertainty they withdraw and it reduces economic activity...
Stewart: So it’s all about perception then. It’s about making people believe the system is sound. If the stock market is high, people feel confident in spending, and if it lowers, they feel less confident?
Greenspan: Well...uh...I think you have to realize, there are certain aspects of human nature, which move exactly the way you defined it. The problem is, periodically we all go a little bit euphoric until we are assuming with confidence that everything is terrific, there will be no problems, nothing will ever happen, and then it dawns on us- NO!
Stewart: And then it goes the other way.
Greenspan: Exactly.
Stewart: Huge Fear.
Greenspan: I was telling my colleagues the other day...I’d been dealing with these big mathematical models for forecasting the economy, and I’m looking at what’s going on the last few weeks and I say, “Y’know, if I could figure out a way to determine whether or not people are more fearful, or changing to euphoric... I don’t need any of this other stuff. I could forecast the economy better than any way I know. The trouble is, we can’t figure that out. I’ve been in the forecasting business for 50 years, and I’m no better than I ever was, and nobody else is either.”
Stewart: (Leans back in chair)...You just bummed the sh*t outta me!
Stewart: (after Greenspan’s explanation that the market moves on expectations of the Fed move, not the fundamentals of it) So the Fed, or whoever’s leading it, if they wanted to could in fact “goof” on all of us...
Greenspan: (smiles) You wouldn’t want to.
Stewart: When you say “Open Market,” I always wonder... Why do we have a Fed? Wouldn’t the market take care of interest rates and all that? Why do we have someone adjusting rates if we are a free market society?
Greenspan: We didn’t need a central bank when we were on the Gold Standard . . . [Conspiracy theorists note- the Fed was created 20 years BEFORE we decoupled from the Gold Std] . . . people would buy and sell gold and the markets would do what the Fed does now. . . but by the 1930s most everybody in the world decided that the Gold Standard was strangling the economy and universally the Gold Standard was abandoned...you need somebody out there or some mechanism to determine how much money is out there because the amount of money in an economy relates to the amount of inflation...
Stewart: So we’re not a free market then - there is an invisible...a “benevolent” hand that touches us...
Greenspan: Absolutely, you are quite correct. To the extent that there is a central bank governing the amount of money in the system, that is not a Free Market, and most people call it regulation.
Stewart: When you lower interest rates, it drives money to stocks and lowers the return people get on savings.
Greenspan: Yes, indeed.
Stewart: So they’ve made a choice - “We would like to favor those who invest in the stock market and not those who [save]”...
Greenspan: That’s the way it comes out, but that’s not the way we think about it.
Stewart: Explain that to me. It seems to me that we favor investment, but we don’t favor work. The vast majority of people work, they pay payroll taxes, and they use banks. And then there’s this whole other world of hedge funds and short betting... y’know, it seems like craps. And they keep saying, “No no no, don’t worry about it, it’s Free Market, that’s why we live in much bigger houses.” But it really is, it’s the Fed, or some other thing, no?
Greenspan: I think you’d better re-read my book.
Stewart: Am I wrong that we penalize work by not making the choice to...
Greenspan: No, what a sound money system does is to stabilize the elements in it and reduce the uncertainty that people confront, and when people confront uncertainty they withdraw and it reduces economic activity...
Stewart: So it’s all about perception then. It’s about making people believe the system is sound. If the stock market is high, people feel confident in spending, and if it lowers, they feel less confident?
Greenspan: Well...uh...I think you have to realize, there are certain aspects of human nature, which move exactly the way you defined it. The problem is, periodically we all go a little bit euphoric until we are assuming with confidence that everything is terrific, there will be no problems, nothing will ever happen, and then it dawns on us- NO!
Stewart: And then it goes the other way.
Greenspan: Exactly.
Stewart: Huge Fear.
Greenspan: I was telling my colleagues the other day...I’d been dealing with these big mathematical models for forecasting the economy, and I’m looking at what’s going on the last few weeks and I say, “Y’know, if I could figure out a way to determine whether or not people are more fearful, or changing to euphoric... I don’t need any of this other stuff. I could forecast the economy better than any way I know. The trouble is, we can’t figure that out. I’ve been in the forecasting business for 50 years, and I’m no better than I ever was, and nobody else is either.”
Stewart: (Leans back in chair)...You just bummed the sh*t outta me!
Saturday, March 14, 2009
A Streetcar Named Insufficient
This is a nice start, but why not just begin with a light-rail system. Come on! Let's be bold. This is no time for trepidation. We need leaders willing to take on vested interests and get big projects done for the sake of our citizens (creating jobs) and our region's future (competitive infrastructure).
What About Us?
We have to bail out banks, we have to bail out insurers of bad bank bets, and on and on.
Why can't the "bailout" money be used to insure most Americans in a simple, straightforward manner? Couldn't we just insure pension and retirement plans (to cover loses), nationalize banks to get lending going again, and employee people with government programs to repair infrastructure during this period of depressed demand?
How about we garnish or seize the ill-gotten gains of all these trouble-makers? This really isn't their money and they shouldn't be allowed to keep it.
Also, there better be plenty more following Madoff to jail.
Let the bankers, the hedge fund managers, the AIGs, all of them, let them go down. Get the regulations back in place and the institutional capacity back up to snuff so we have transparency and lawful, efficiently operating markets. There will be plenty of smart entrepreneurs willing to step in to fill the void and do things legally.
As Ralph Nader has said, "Sometimes you have to prune the tree for it to grow healthy."
We talk about this using rhetoric -- concern for the unemployed and the American workers -- but our actions are the most roundabout way to relieving their troubles. Why can't we use a more direct approach as mentioned above? I still haven't heard an answer to this.
Why can't the "bailout" money be used to insure most Americans in a simple, straightforward manner? Couldn't we just insure pension and retirement plans (to cover loses), nationalize banks to get lending going again, and employee people with government programs to repair infrastructure during this period of depressed demand?
How about we garnish or seize the ill-gotten gains of all these trouble-makers? This really isn't their money and they shouldn't be allowed to keep it.
Also, there better be plenty more following Madoff to jail.
Let the bankers, the hedge fund managers, the AIGs, all of them, let them go down. Get the regulations back in place and the institutional capacity back up to snuff so we have transparency and lawful, efficiently operating markets. There will be plenty of smart entrepreneurs willing to step in to fill the void and do things legally.
As Ralph Nader has said, "Sometimes you have to prune the tree for it to grow healthy."
We talk about this using rhetoric -- concern for the unemployed and the American workers -- but our actions are the most roundabout way to relieving their troubles. Why can't we use a more direct approach as mentioned above? I still haven't heard an answer to this.
Unnecessary Economic Complications
You've got to love economic theories. Cute perfect-world scenarios wrapped up nicely in elegant algorithms. The problem is much of the assumptions are pure drivel.
I've always found that historical trend analysis seems to offer the most insight into where we've been and how to handle challenges presently and in the future. History is a wonderful guide in locating the norm (mean reversion) of whatever it is we're measuring. By just looking at how inflated the price-to-income and price-to-rent ratios had become towards the late 1990s, a few of our better economists were able to call the housing bubble back in 2002. They didn't have to dress-up the obvious in fancy mathematical models to show what was plain as day.
One particular Homo Economicus assumption I've seen popping up lately is the idea that people are averse to working more if they know it will lead them into a higher tax bracket. Of course this argument was brought out by conservatives as a warning against President Obama's plan to raise taxes on the wealthiest amongst us. [By the way, during our most robust period of growth from the late 40s to the late 60s our highest marginal tax rate varied from 90 to 70 percent.] It may be true that higher taxes lead millionaires to find more and more clever ways to avoid taxation, but regardless of the amount they are making, they always seem to be trying to avoid taxes. And, let's face it, can we really say many of these people are "working" that hard? Avoiding taxation isn't the same as doing less. This has more to do with profit and greed than some efficient decision about taxes and time worked.
This is especially true for the 85 percent of the population earning under $100,000. Most people work as much as they can for as long as they can. Which is why even though our productivity per hour has increased, so has our number of hours worked.
But I guess when our economic system is constructed toward rewarding the Haves every example displayed and the indicators used to explain what's going on will no doubt be more geared to their wealth -- the S&P, the Dow, Russell, Nasdaq, Goldman, etc. These have become the markers we all watch and live by. Yet the wealthiest control nearly all of the stock market. This misdirection is comparable to tracking sales at Neiman Marcus as a guide for the shopping patterns of average Americans.
I've always found that historical trend analysis seems to offer the most insight into where we've been and how to handle challenges presently and in the future. History is a wonderful guide in locating the norm (mean reversion) of whatever it is we're measuring. By just looking at how inflated the price-to-income and price-to-rent ratios had become towards the late 1990s, a few of our better economists were able to call the housing bubble back in 2002. They didn't have to dress-up the obvious in fancy mathematical models to show what was plain as day.
One particular Homo Economicus assumption I've seen popping up lately is the idea that people are averse to working more if they know it will lead them into a higher tax bracket. Of course this argument was brought out by conservatives as a warning against President Obama's plan to raise taxes on the wealthiest amongst us. [By the way, during our most robust period of growth from the late 40s to the late 60s our highest marginal tax rate varied from 90 to 70 percent.] It may be true that higher taxes lead millionaires to find more and more clever ways to avoid taxation, but regardless of the amount they are making, they always seem to be trying to avoid taxes. And, let's face it, can we really say many of these people are "working" that hard? Avoiding taxation isn't the same as doing less. This has more to do with profit and greed than some efficient decision about taxes and time worked.
This is especially true for the 85 percent of the population earning under $100,000. Most people work as much as they can for as long as they can. Which is why even though our productivity per hour has increased, so has our number of hours worked.
But I guess when our economic system is constructed toward rewarding the Haves every example displayed and the indicators used to explain what's going on will no doubt be more geared to their wealth -- the S&P, the Dow, Russell, Nasdaq, Goldman, etc. These have become the markers we all watch and live by. Yet the wealthiest control nearly all of the stock market. This misdirection is comparable to tracking sales at Neiman Marcus as a guide for the shopping patterns of average Americans.
Road To Nowhere
James Rowen has rightfully been all over and against the push for more highway construction using stimulus dollars. He points the finger at the road-building lobby. More of the same wasteful, sprawl-style development.
Here's an excellent article from the Financial Times illuminating the long, misguided history of highway building.
Here's an excellent article from the Financial Times illuminating the long, misguided history of highway building.
Sunday, March 8, 2009
Water
Is it only me or does anyone else feel the New Berlin one-time payment of $1.5 million for the diversion of Lake Michigan water is borderline robbery?
I'm continually amazed at the naivete of the City in believing this will somehow make its way, economically (by fostering continued growth in New Berlin), back to the City. (Or that we need to be the bigger men and work with the suburbs. If that's the case, why not make some sort of regional governance and tax sharing measure part of the water diversion compact.) If there's one thing we should have learned by now from the last 50 or so years, it's that the suburbs don't understand how intimately connected to the City they are, and that the suburbs have continually, through policy and politics, shown a dislike - borderline hatred - for the City.
Let's add up the costs of the damage done by the "hollowing out" over the past few decades from white flight to the suburbs. Let's get a number to represent the fact that the City has to house and provide services for most of the poor. Let's put together some figures on the cost for added clinics, police, food pantries, etc. And, we can't forget to try and get some idea of the cost in decreased productive capacity in human capital from segregating the poorest. If New Berlin, or any other sprawling community wants water, I think all these factors should be included in the final price they pay.
Putting aside the economics, maybe, based purely on environmental concerns, this water diversion just shouldn't be done. Maybe this is Nature's way of saying, "Sorry. You're not supposed to be here." Maybe their only option is to shrink or halt growth. The law of diminishing returns comes to mind. Suburbs and sprawling growth are unsustainable. It's time people face reality and accept this. Sometimes we have to accept limitations and work within those boundaries.
Such as the City having to accept responsibility for the poor, and the associated costs, while the suburbs refused to help educate and care for the poor, and refused to institute transit options to help employ the people in the jobs popping up in the suburbs.
It seems the City should now be adopting the NIMBY perspective and returning the screw-you attitude. Unless of course you can pay us gobs and gobs of money. Because it's all about the money. Isn't that right O' land of strip malls, industrial parks, and retail wonderlands (aka - the suburbs)?
Water is the next oil. We are decades late in realizing our mistakes regarding oil. We can't afford to do the same with water.
For Further Reading:
Climate Change Requires Human Adaptation
Coping With Water Scarcity
Development, Sprawl and Water
Drowning In Delusions
Is Water The Next Oil?
Nobody Knows How Dry We Are
Severe Water Shortages By 2080
Sprawl And Sewer Overflows
The Politics of Water
Water For Profit
Water Wars
I'm continually amazed at the naivete of the City in believing this will somehow make its way, economically (by fostering continued growth in New Berlin), back to the City. (Or that we need to be the bigger men and work with the suburbs. If that's the case, why not make some sort of regional governance and tax sharing measure part of the water diversion compact.) If there's one thing we should have learned by now from the last 50 or so years, it's that the suburbs don't understand how intimately connected to the City they are, and that the suburbs have continually, through policy and politics, shown a dislike - borderline hatred - for the City.
Let's add up the costs of the damage done by the "hollowing out" over the past few decades from white flight to the suburbs. Let's get a number to represent the fact that the City has to house and provide services for most of the poor. Let's put together some figures on the cost for added clinics, police, food pantries, etc. And, we can't forget to try and get some idea of the cost in decreased productive capacity in human capital from segregating the poorest. If New Berlin, or any other sprawling community wants water, I think all these factors should be included in the final price they pay.
Putting aside the economics, maybe, based purely on environmental concerns, this water diversion just shouldn't be done. Maybe this is Nature's way of saying, "Sorry. You're not supposed to be here." Maybe their only option is to shrink or halt growth. The law of diminishing returns comes to mind. Suburbs and sprawling growth are unsustainable. It's time people face reality and accept this. Sometimes we have to accept limitations and work within those boundaries.
Such as the City having to accept responsibility for the poor, and the associated costs, while the suburbs refused to help educate and care for the poor, and refused to institute transit options to help employ the people in the jobs popping up in the suburbs.
It seems the City should now be adopting the NIMBY perspective and returning the screw-you attitude. Unless of course you can pay us gobs and gobs of money. Because it's all about the money. Isn't that right O' land of strip malls, industrial parks, and retail wonderlands (aka - the suburbs)?
Water is the next oil. We are decades late in realizing our mistakes regarding oil. We can't afford to do the same with water.
For Further Reading:
Climate Change Requires Human Adaptation
Coping With Water Scarcity
Development, Sprawl and Water
Drowning In Delusions
Is Water The Next Oil?
Nobody Knows How Dry We Are
Severe Water Shortages By 2080
Sprawl And Sewer Overflows
The Politics of Water
Water For Profit
Water Wars
You Want Them To Look Like The Post Office?
Bill Maher in his final New Rule of the night nails the Republicans on their consistently dishonest trashing of the government. A must see.
Saturday, March 7, 2009
Dow In The Dumps
Jon Stewart gives some much-needed perspective on our 'stock-market-as-barometer-of-all-things-good' illusion.
Labor Mania
Nudging Away Nonsense
Patrick McIlheran, conservative ideologue and propagandist of the Milwaukee-Journal Sentinel, has yet another infuriatingly misinformed (as usual) screed pertaining to a government mandate - when taxpayers fund over a million dollars of a private project, decent wages must be paid to the workers of the project.
Seems rational. Oh, but not in McIlheran's race-to-the-bottom model of development.
How dare the government demand that there be labor standards in projects where they're paying over a millions dollars! By now, we know the drill: give our tax dollars to the private sector, let them do what they wish, expect nothing, and shut our collective mouth. Sounds like a great investment - because I believe in corporations and the free markets and I know, deep down in my heart, that somehow it'll all work out best for all of us, gosh golly. [Please excuse the dripping sarcasm.]
By the way, how are all those privatization schemes, private sector financial innovations, and deregulatory initiatives working out?
From the article: "If we have a problem with people getting jobs," said Council President Willie Hines, an ordinance opponent, "the solution can't be to increase wages." The "increase" in wages is better thought of as the interest paid by the private developer on the risk assumed by the government in helping to fund/start the project.
A business is choosing to develop a site because of the income stream, the cash flow, that can be generated from that site. Every site is not duplicable anywhere we'd like. Certain spots have better exposure and demand, and that's why those sites are chosen for whatever project may be planned (except of course when "subsidies" - bribery or pay-off is a better descriptor - distort the market by courting a business to move with tax breaks and exemptions to what could be considered a comparatively less than optimal site). This fact squashes the claim that a developer can just go anywhere else they want. Cheapness is not a comparative advantage. And, as has been repeatedly found in numerous studies, labor cost is not the boogey-man the race-to-the-bottom cabal claims it to be [see For Further Reading below].
For McIlheran, being paid an honest days wage for an honest days work is "suspect." Our labor laws and standards, the labor movement in general, all part of a nefarious conspiracy. Luckily McIlheran, Mr. Consistency, doesn't have any type of representation in his profession of journalism. Oh, wait, I almost forgot about the Newspaper Guild, the International Federation of Journalists, the International Press Institute, the Society of Professional Journalists, and the National Writers Union.
He also shows another glaringly uninformed - regarding sprawl and the environment - viewpoint, "You see buildings rising, instead, out where the parking is free and the costs are lower. Developers and their tenants have choices." It doesn't even cross his mind that there might be negative economic and environmental issues with this type of development. More on this obliviousness here and here.
He also then tries to take a shot at the sick day ordinance and the 'tax hell' (as some falsely try to claim) that oppresses business here, "This sick leave outrage is part of a continuum. From high taxes to a weird fee on going out of business to a general feeling that they're seen as the class enemy, businesses aren't finding our city a welcoming place. Why, then, would leaders want to give entrepreneurs one more reason to leave?"
As 9 to 5 has noted, "Since enactment of paid sick time on February 5, 2007, San Francisco has maintained a competitive job growth rate that has exceeded the average growth rate of nearby counties without paid sick days. Likely benefits include improved health outcomes, speedier recoveries for workers and their families, and greater family economic stability with more consistent employment tenure." Another no-brainer with a case study for evidence. But that doesn't jibe with the McIlheran narrative, so forget it.
[Michael Rosen, of Midcoast Views, has an interesting post about Milwaukee developers and their lobbying efforts to undermine the ordinance.]
The problem is, most of what the McIlherans of the world think, most of the policies they push, have no grounding in solid empirical data. It's an ad hoc paradigm they operate from where they mold reality to fit into their narrow worldview. They imagine it, therefore it must be so.
But keep railing for the interests of the powerful at the expense of the many, Mr. McIlheran. Big Business will always be eager to pay for shills willing to present their propaganda to the public.
For Further Reading:
A New Development Paradigm
Attracting Economic Development - At What Cost?
Beginner's Guide to Accountable Development
Building Good Jobs & Strong Communities
Economic Benefits of Union Membership
How Unions Help All Workers
NAFTA: Still Not Working
Shielding Public Incentives for Corporate Relocations from Public Scrutiny
The Economic Civil War
Union Advantage By The Numbers
Union Wage Advantage for Low-wage Workers
Want Change?
Seems rational. Oh, but not in McIlheran's race-to-the-bottom model of development.
How dare the government demand that there be labor standards in projects where they're paying over a millions dollars! By now, we know the drill: give our tax dollars to the private sector, let them do what they wish, expect nothing, and shut our collective mouth. Sounds like a great investment - because I believe in corporations and the free markets and I know, deep down in my heart, that somehow it'll all work out best for all of us, gosh golly. [Please excuse the dripping sarcasm.]
By the way, how are all those privatization schemes, private sector financial innovations, and deregulatory initiatives working out?
From the article: "If we have a problem with people getting jobs," said Council President Willie Hines, an ordinance opponent, "the solution can't be to increase wages." The "increase" in wages is better thought of as the interest paid by the private developer on the risk assumed by the government in helping to fund/start the project.
A business is choosing to develop a site because of the income stream, the cash flow, that can be generated from that site. Every site is not duplicable anywhere we'd like. Certain spots have better exposure and demand, and that's why those sites are chosen for whatever project may be planned (except of course when "subsidies" - bribery or pay-off is a better descriptor - distort the market by courting a business to move with tax breaks and exemptions to what could be considered a comparatively less than optimal site). This fact squashes the claim that a developer can just go anywhere else they want. Cheapness is not a comparative advantage. And, as has been repeatedly found in numerous studies, labor cost is not the boogey-man the race-to-the-bottom cabal claims it to be [see For Further Reading below].
For McIlheran, being paid an honest days wage for an honest days work is "suspect." Our labor laws and standards, the labor movement in general, all part of a nefarious conspiracy. Luckily McIlheran, Mr. Consistency, doesn't have any type of representation in his profession of journalism. Oh, wait, I almost forgot about the Newspaper Guild, the International Federation of Journalists, the International Press Institute, the Society of Professional Journalists, and the National Writers Union.
He also shows another glaringly uninformed - regarding sprawl and the environment - viewpoint, "You see buildings rising, instead, out where the parking is free and the costs are lower. Developers and their tenants have choices." It doesn't even cross his mind that there might be negative economic and environmental issues with this type of development. More on this obliviousness here and here.
He also then tries to take a shot at the sick day ordinance and the 'tax hell' (as some falsely try to claim) that oppresses business here, "This sick leave outrage is part of a continuum. From high taxes to a weird fee on going out of business to a general feeling that they're seen as the class enemy, businesses aren't finding our city a welcoming place. Why, then, would leaders want to give entrepreneurs one more reason to leave?"
As 9 to 5 has noted, "Since enactment of paid sick time on February 5, 2007, San Francisco has maintained a competitive job growth rate that has exceeded the average growth rate of nearby counties without paid sick days. Likely benefits include improved health outcomes, speedier recoveries for workers and their families, and greater family economic stability with more consistent employment tenure." Another no-brainer with a case study for evidence. But that doesn't jibe with the McIlheran narrative, so forget it.
[Michael Rosen, of Midcoast Views, has an interesting post about Milwaukee developers and their lobbying efforts to undermine the ordinance.]
The problem is, most of what the McIlherans of the world think, most of the policies they push, have no grounding in solid empirical data. It's an ad hoc paradigm they operate from where they mold reality to fit into their narrow worldview. They imagine it, therefore it must be so.
But keep railing for the interests of the powerful at the expense of the many, Mr. McIlheran. Big Business will always be eager to pay for shills willing to present their propaganda to the public.
For Further Reading:
A New Development Paradigm
Attracting Economic Development - At What Cost?
Beginner's Guide to Accountable Development
Building Good Jobs & Strong Communities
Economic Benefits of Union Membership
How Unions Help All Workers
NAFTA: Still Not Working
Shielding Public Incentives for Corporate Relocations from Public Scrutiny
The Economic Civil War
Union Advantage By The Numbers
Union Wage Advantage for Low-wage Workers
Want Change?
Benedict Arnolds
Sunday, March 1, 2009
Hey, Private Sector, Get Away From My Health Care
Torinus is at it again.
The public sector can't do health care right and is at fault for high costs, yet the private sector (as usual) is a bastion of efficiency.
Just a curious aside ... Has Torinus ever mentioned Serigraph's lack of paying taxes in his column? As I have noted in an earlier post, "He is the chairman of Serigraph Inc., which paid nothing in Wisconsin corporate taxes in 2003 and 2004. He is also a board member of Wisconsin Manufacturers & Commerce (the lobby for Wisconsin big business), an organization where even when it's members pay no taxes at all still feel taxation is too high." Anyways...
The ever-increasing cost of health care has nothing to do with inflated Medicare charges by private insurers? Nor does it have anything to do with the ridiculous gouged prices charged by pharmaceutical companies? As I expanded upon previously (here and here), "Medicare is a quandary, but not because of it’s entitlement issue. It’s because of managed care and the pharmaceutical industries skyrocketing profits. Seniors consume the most medical care and prescriptions -- private companies are gouging the government through Medicare reimbursement with inflated charges (yet another, in essence, subsidy to big business). We don’t even use our numbers to negotiate prescription drug-price deals for buying in volume (in fact, this was strictly prohibited in Bush’s Medicare bill)."
Public sector costs do not, as Torinus implies, "demonstrate the inability of public sector payers to purchase health care effectively." The public sector tries to pay the cost rather than passing it onto it's employees or making them go without, which happens to be the private model. So much for actually respecting and valuing your workforce.
Nowhere does he mention the overcharges and fraud taking place at the Medicare/caid systems expense (private insurers falsifying documents to steal from the government). Nowhere does he mention the inflated charges the pharmaceutical companies demand and how this inflates our overall medical costs. Both of these factors add billions to the cost of our medical care each year.
Torinus, regarding the private sector, states, "...employees are offered plans with high deductibles and offsetting personal accounts by employers. It becomes their money." This is the grand ole trick - it's your money (except when it's needed to bailout AIG, Citibank, et al). Employers are going to pay less and cover you less, but you can use your money to find health care, and because we're so nice we've gathered a few options for you to choose from. Again, by extension, playing up the ownership society and pretending every American is an actuarial/investment wizard, which is delusional. This is similar to the arguments we've heard about privatizing Social Security. The same thing that would happend to retirees 401Ks during a bust in the market is exactly the type of care we could expect from this private sector model.
And, for Torinus to have this holier-than-thou preachy tone about the efficiency and accountability of the corporate community and the private sector is laughable. These guys just drove the economy off a cliff, and now they have the audacity to try and tell us how to put things back together. Since we've adopted managed care, medical costs have exploded. Since we've adopted defined-contribution (rather then defined-benefit) retirements plans, our retirements have become more volatile.
The private sector is based on profits. They make those profits by only insuring the healthiest people and denying care to the others. Health care is a right not something to be rationed by the dictates of monied interests. We should not be moving toward a caste system of health care in America.
Until federal restrictions cap cost growth, until the government reestablishes its control over the health care system, more money will be needed. Making workers pay more or going without can hardly be considered sound management.
We have deregulated and privatized up the wazoo in this country. It hasn't worked. It's time to have some other motives driving our public policy rather than just profit and greed by private companies.
The public sector can't do health care right and is at fault for high costs, yet the private sector (as usual) is a bastion of efficiency.
Just a curious aside ... Has Torinus ever mentioned Serigraph's lack of paying taxes in his column? As I have noted in an earlier post, "He is the chairman of Serigraph Inc., which paid nothing in Wisconsin corporate taxes in 2003 and 2004. He is also a board member of Wisconsin Manufacturers & Commerce (the lobby for Wisconsin big business), an organization where even when it's members pay no taxes at all still feel taxation is too high." Anyways...
The ever-increasing cost of health care has nothing to do with inflated Medicare charges by private insurers? Nor does it have anything to do with the ridiculous gouged prices charged by pharmaceutical companies? As I expanded upon previously (here and here), "Medicare is a quandary, but not because of it’s entitlement issue. It’s because of managed care and the pharmaceutical industries skyrocketing profits. Seniors consume the most medical care and prescriptions -- private companies are gouging the government through Medicare reimbursement with inflated charges (yet another, in essence, subsidy to big business). We don’t even use our numbers to negotiate prescription drug-price deals for buying in volume (in fact, this was strictly prohibited in Bush’s Medicare bill)."
Public sector costs do not, as Torinus implies, "demonstrate the inability of public sector payers to purchase health care effectively." The public sector tries to pay the cost rather than passing it onto it's employees or making them go without, which happens to be the private model. So much for actually respecting and valuing your workforce.
Nowhere does he mention the overcharges and fraud taking place at the Medicare/caid systems expense (private insurers falsifying documents to steal from the government). Nowhere does he mention the inflated charges the pharmaceutical companies demand and how this inflates our overall medical costs. Both of these factors add billions to the cost of our medical care each year.
Torinus, regarding the private sector, states, "...employees are offered plans with high deductibles and offsetting personal accounts by employers. It becomes their money." This is the grand ole trick - it's your money (except when it's needed to bailout AIG, Citibank, et al). Employers are going to pay less and cover you less, but you can use your money to find health care, and because we're so nice we've gathered a few options for you to choose from. Again, by extension, playing up the ownership society and pretending every American is an actuarial/investment wizard, which is delusional. This is similar to the arguments we've heard about privatizing Social Security. The same thing that would happend to retirees 401Ks during a bust in the market is exactly the type of care we could expect from this private sector model.
And, for Torinus to have this holier-than-thou preachy tone about the efficiency and accountability of the corporate community and the private sector is laughable. These guys just drove the economy off a cliff, and now they have the audacity to try and tell us how to put things back together. Since we've adopted managed care, medical costs have exploded. Since we've adopted defined-contribution (rather then defined-benefit) retirements plans, our retirements have become more volatile.
The private sector is based on profits. They make those profits by only insuring the healthiest people and denying care to the others. Health care is a right not something to be rationed by the dictates of monied interests. We should not be moving toward a caste system of health care in America.
Until federal restrictions cap cost growth, until the government reestablishes its control over the health care system, more money will be needed. Making workers pay more or going without can hardly be considered sound management.
We have deregulated and privatized up the wazoo in this country. It hasn't worked. It's time to have some other motives driving our public policy rather than just profit and greed by private companies.
Saturday, February 28, 2009
Mortgage Deduction Inefficiency
Awhile back I linked to an article by Peter Dreier about the mortgage interest deduction.
President Obama has proposed to cap the mortgage interest deduction for high-income taxpayers.
The National Association of Home Builders (NAHB) and the National Association of Realtors (NAR) oppose this purely out of self-interest. They also felt there wasn't a housing bubble. No doubt their self-interest in continuing to build an sell price-inflated homes led them to believe such. So, at this point, their opinions can be discarded.
As many unbiased sources have stated, some other nations don't have this silly high-income homeowner subsidy and we would probably be better off discarding the deduction altogether.
President Obama has proposed to cap the mortgage interest deduction for high-income taxpayers.
The National Association of Home Builders (NAHB) and the National Association of Realtors (NAR) oppose this purely out of self-interest. They also felt there wasn't a housing bubble. No doubt their self-interest in continuing to build an sell price-inflated homes led them to believe such. So, at this point, their opinions can be discarded.
As many unbiased sources have stated, some other nations don't have this silly high-income homeowner subsidy and we would probably be better off discarding the deduction altogether.
Pabst Farms Pork
Can we end the push for Pabst Farms already? [Hat tip to James Rowen]
Kudos to Mayor Barrett for telling the state to put the kaibash on this project and use the money to repair roads and accomplish more urgent needs.
This last thing we need right now, especially in this economy, where retail sales have fallen off a cliff, is another retail wonderland.
Kudos to Mayor Barrett for telling the state to put the kaibash on this project and use the money to repair roads and accomplish more urgent needs.
This last thing we need right now, especially in this economy, where retail sales have fallen off a cliff, is another retail wonderland.
Media Are People Too
WOW! Sorry to get caught up on Megan McArdle in the last few posts, but WOW! Her delusions of grandeur are overwhelming.
She “debates” Glenn Greenwald on the media, often lecturing him on legal issues and the constitution (which she obviously has little knowledge, other than her usual anecdotal examples, which she seems to feel makes her an expert). But what does he know? He’s only a constitutional lawyer.
Typical Megan, just ranting on and on, never admitting ignorance.
One can always notice a running theme in her work – defending the status quo.
The bankers aren’t to blame, the Fed isn’t to blame, the media isn’t to blame, etc.One funny thing about her style – she goes off on these tangents where she doesn’t even have a total grasp of that which she is talking about or criticizing. When official unemployment stats started being recorded, laws instructing journalism standards, etc.
Quite a bit of arrogance on display.Regarding why the media can’t get more into detail on important topics and talk to people like adults:
“People are tired when they get home. They don’t want to hear lectures.” So therefore we can only discuss fluff, and we can’t really get into any detail or history.
So Megan is an inquisitive intellect yet most American people are just uninterested drones whom she assumes are too tired or too stupid to want to get better information provided to them by their media.
She really does like to have it both ways.
Thursday, February 26, 2009
Bankers v Citizens
Whose side is Geithner on?
For Further Reading:
Banking On The Brink
Nationalize Insolvent Banks
Nationalize The Banks
The Banks Have Stolen Enough
For Further Reading:
Banking On The Brink
Nationalize Insolvent Banks
Nationalize The Banks
The Banks Have Stolen Enough
Wednesday, February 25, 2009
Pushing On A String
Dean Baker tries to discuss the stimulus plan, the housing bubble, and the Federal Reserve, among other issues, with Megan McArdle (conservative/libertarian propagandist).
Megan 'seems' like a very bright person, and she even raises some good points (for the first few minutes). But too often she cuts Dean Baker off or uses deflectors like, "well, the real question is" or, "anyways, what really matters is." And sometimes she just doesn't seem to have a grasp of the facts or just won't admit that she doesn't, whereby she then rambles and morphs the discussion into a new argument.
She goes on and on about “make-work” jobs. Saying the WPA wouldn’t have been created if there was full employment. Duh! That is the purpose of demand-side stimulus. The government steps in to do that which the private sector will not or can not.
But nonetheless, it's a good informative hour...at least when Dean is allowed to speak.
Megan 'seems' like a very bright person, and she even raises some good points (for the first few minutes). But too often she cuts Dean Baker off or uses deflectors like, "well, the real question is" or, "anyways, what really matters is." And sometimes she just doesn't seem to have a grasp of the facts or just won't admit that she doesn't, whereby she then rambles and morphs the discussion into a new argument.
She goes on and on about “make-work” jobs. Saying the WPA wouldn’t have been created if there was full employment. Duh! That is the purpose of demand-side stimulus. The government steps in to do that which the private sector will not or can not.
Megan implies that workers in the WPA program just recorded oral histories and painted murals. And, also (latter) in a rather immature quip she compares it to hiring people to mow their lawns. Ridiculous! She conveniently sweeps past Dr. Baker’s evidence of roads and bridges. As if to imply, the work being done added no long-term value, built nothing of value, created no jobs, nor helped the economy recover. The GDP and employment indicators of the time tell a different story.
She then goes on to say how proxies, ways of measuring, are imperfect…as if, there’s just no good way to measure anything, so therefore, we really don’t know anything, what works, or what doesn’t. But, stupendously, somehow she knows.And, also, she makes the distinction between good and bad “make-work” jobs – if she doesn’t like the project or thinks it's wasteful, then it’s bad “make-work.”
Next, she explains how a son-in-law being hired because of nepotism is a “make-work” job. Huh, that’s an interesting one. The old saying, “it’s who you know, not what you know” didn’t come about for just any reason. So all the people who knew someone whom helped you obtain a job, because of that connection your job isn’t real. Wow, the unemployment rate is going to rise spectacularly under Megan’s new way of measuring.
To her this is all most likely bad debt. She feels we can't borrow and spend and have any good come from it. But that train of thought is debunked here, here and here.
I also was really 'charmed' by her use of phrases like “everyone knows,” implying everyone but Dr. Baker knows and he’s an idiot to even be debating her on this particular point. Or when he would squash her weak argument, she would then say, “we’re arguing about two different things,” or “that’s neither here nor there.” The only thing she seems to have done successfully here is muddle the discussion into the realm of incoherence (which is Republicans' want).
Or when she tries to sound academic and says things like the marginal product of labor ("if we value what they are creating more than we are paying them" - her definition). But this concept really supports the notion that productivity rather than debt is a better indicator of our growth and quality of life. That is, looking back years from now, even if we are paying off debt, yet we have increased our productivity (more so than we otherwise would have), the stimulus plan will have been successful.
Her whole argument also has an underlying assumption - there is no waste in the private sector. Which, if the last eight (or, for that matter, twenty-eight) years have shown us anything, this is definitely not the case. She appears to be nothing other than an enraptured ideologue.
One can only conclude Megan McArdle is a train-wreck.
During a few spots I was hoping Dean would just say, "OK. Next topic." Since it was obvious Megan only wanted to hear herself pontificate and bloviate.But nonetheless, it's a good informative hour...at least when Dean is allowed to speak.
Saturday, February 21, 2009
(More) Republican & Media Double Standards
Another double standard I happen to see running almost daily on television is the notion that Obama is talking down the economy. By being honest and truthful with citizens - we are facing a downturn that could be almost as devastating as the Great Depression - Obama is the cause of the downturn in the economy and also making it worse.
Yet, for years, the Republicans were the masters of the fear card. A terrorist here, a mushroom cloud there...be very afraid. The only thing that will save us is reckless signing statements, rash executive orders, and, as always, tax cuts. Bush served up the combo platter - bad policy, bad appointments, and talking everything down.
Yet, for years, the Republicans were the masters of the fear card. A terrorist here, a mushroom cloud there...be very afraid. The only thing that will save us is reckless signing statements, rash executive orders, and, as always, tax cuts. Bush served up the combo platter - bad policy, bad appointments, and talking everything down.
Double Standard
Opportunity Cost
How can it be that increasing our deficit for Iraq (which will cost approximately $3 trillion) is good policy - even though it has worsened national security and weakened our standing in the world - when it has not won over any hearts or minds?
Yet, deficit spending as proposed in the recently passed stimulus bill - with increased unemployment insurance, infrastructure construction projects, among other initiatives - which actually puts people who otherwise would not be working back to work, while addressing needed repairs and improvements all over the country, is bad debt.
Even when Republicans are not in power they still seem to have the ability to frame the debate and to have all the parrots on TV and radio regurgitating their nonsense.
Which would you prefer we be spending money on: Iraq or investing in long-term infrastructure projects that put people back to work now and also prepare our country for future growth?
Yet, deficit spending as proposed in the recently passed stimulus bill - with increased unemployment insurance, infrastructure construction projects, among other initiatives - which actually puts people who otherwise would not be working back to work, while addressing needed repairs and improvements all over the country, is bad debt.
Even when Republicans are not in power they still seem to have the ability to frame the debate and to have all the parrots on TV and radio regurgitating their nonsense.
Which would you prefer we be spending money on: Iraq or investing in long-term infrastructure projects that put people back to work now and also prepare our country for future growth?
Tuesday, February 17, 2009
Buying The Law
Sunday, February 15, 2009
Perspective On The Crisis
Dean Baker, in a great interview here, gives a harsh scolding to the ruling elite whom drove us off a cliff.
Development Needs Research
In Sunday's Journal-Sentinel, John Torinus has a bullet-pointed, long-winded sermon on the beauty and stimulative-nature of entrepreneurship (whatever that means). Even his title has it backwards.
There is a tone when he states, "...a heavy dependence on its historic manufacturing sector." As if we should divest ourselves of our large market share, our competitive advantage, and a continued focus of the success of one of our most lucrative sectors. Manufacturing is generally a higher paying, high value-added industry. This should be a prime focus of our research and development efforts. The hits to employment in this industry over the last few decades have more to do with trade politics (and slave labor) than with efficiency or productivity.
He also feels we should capitalize on our research and development capabilities and stengthen them. OK. Sounds good. Although, typically this type of activity is either heavily subsized by the government, or directly funded by the government through the university system and organizations such as the National Institutes of Health. Has Torinus suddenly become a tax-and-spender? Or is he just citing another example of where government and bureaucrats can be highly effective and actually improve society?
Much of his opinions regarding UWM -- it's construction projects, and it's innovative leadership, and the giant strides it has made in recent years -- are spot on. And, hopefully UWM will choose a downtown rather than a suburban location. As a former student and employee at UWM, I'm proud of their progress and their scholarship.
[Mr. Torinus mentions, "The R&D has to be turned into patents, licenses, and start-up companies." Here are numerous articles by Dean Baker that disprove the economic efficiency of patents: A, B, C, D, E, and F. The money is made being the first to create the idea, not holding that creative capacity from others to build upon it. That causes long-term inefficiency.]
But after the public sector nurtures these industries and ideas, Torinus feels we should, "...transferring the basic technology to commercial applications in the real world of business." If public entities are producing technologies and products the market wants, aren't they applying their know-how in the real world of business? And, competing quite effectively it seems. We should turn over the innovative capacity to the private sector so they can make highly leveraged bets, create gains for a select few, watch them mismanage and corrupt the endeavor, and see the whole thing collapse...to then have to be cleaned up by taxpayers (the public sector)?
It seems taxpayers' money is actually better managed and spent by the government than the private sector. The Republican propaganda campaign over the last 35 years to dispute this fact and muddle the discussion about such seems impervious to reason and clear-thinking. We'd all be better if we just ignored them.
Other than that, I'm all for Torinus' bullet-pointed research spending ideas. But, lets keep them state- or local(ly)-run centers, having well-paid jobs with health care and funded retirement plans.
"Sharing is caring," as Mr. Rogers said. If a select few would share just a minuscule amount (pay their fair share of taxes), they could initiate massive change and end the impoverished conditions of the majority on this planet. The only thing standing in the way of this is political cover, masking greed and entrenched interests.
Obviously all the ideas Mr. Torinus feels should be funded would have to be public programs. If this was "easy money" wouldn't private corporations already be making the investment? Of course, they only care about short-term gains. How we fund our societal institutions and the priorities of such, how we reach for sustainability and prosperity, these are long-term policy issues. Concerns rightfully addressed and managed by the public sector.
But WMCers and the right-wing bow to a different savior. They must keep their shareholders happy. You don't want to piss off Wall Street. Wall Street it now seems has become our defacto government. How about the change we believe in is taking our government back.
With some populist spin struggling to conceal the underlying conservative positions and giveaways to the private sector, this piece seems nothing more than typical WMC rhetoric from Torinus.
There is a tone when he states, "...a heavy dependence on its historic manufacturing sector." As if we should divest ourselves of our large market share, our competitive advantage, and a continued focus of the success of one of our most lucrative sectors. Manufacturing is generally a higher paying, high value-added industry. This should be a prime focus of our research and development efforts. The hits to employment in this industry over the last few decades have more to do with trade politics (and slave labor) than with efficiency or productivity.
He also feels we should capitalize on our research and development capabilities and stengthen them. OK. Sounds good. Although, typically this type of activity is either heavily subsized by the government, or directly funded by the government through the university system and organizations such as the National Institutes of Health. Has Torinus suddenly become a tax-and-spender? Or is he just citing another example of where government and bureaucrats can be highly effective and actually improve society?
Much of his opinions regarding UWM -- it's construction projects, and it's innovative leadership, and the giant strides it has made in recent years -- are spot on. And, hopefully UWM will choose a downtown rather than a suburban location. As a former student and employee at UWM, I'm proud of their progress and their scholarship.
[Mr. Torinus mentions, "The R&D has to be turned into patents, licenses, and start-up companies." Here are numerous articles by Dean Baker that disprove the economic efficiency of patents: A, B, C, D, E, and F. The money is made being the first to create the idea, not holding that creative capacity from others to build upon it. That causes long-term inefficiency.]
But after the public sector nurtures these industries and ideas, Torinus feels we should, "...transferring the basic technology to commercial applications in the real world of business." If public entities are producing technologies and products the market wants, aren't they applying their know-how in the real world of business? And, competing quite effectively it seems. We should turn over the innovative capacity to the private sector so they can make highly leveraged bets, create gains for a select few, watch them mismanage and corrupt the endeavor, and see the whole thing collapse...to then have to be cleaned up by taxpayers (the public sector)?
It seems taxpayers' money is actually better managed and spent by the government than the private sector. The Republican propaganda campaign over the last 35 years to dispute this fact and muddle the discussion about such seems impervious to reason and clear-thinking. We'd all be better if we just ignored them.
Other than that, I'm all for Torinus' bullet-pointed research spending ideas. But, lets keep them state- or local(ly)-run centers, having well-paid jobs with health care and funded retirement plans.
"Sharing is caring," as Mr. Rogers said. If a select few would share just a minuscule amount (pay their fair share of taxes), they could initiate massive change and end the impoverished conditions of the majority on this planet. The only thing standing in the way of this is political cover, masking greed and entrenched interests.
Obviously all the ideas Mr. Torinus feels should be funded would have to be public programs. If this was "easy money" wouldn't private corporations already be making the investment? Of course, they only care about short-term gains. How we fund our societal institutions and the priorities of such, how we reach for sustainability and prosperity, these are long-term policy issues. Concerns rightfully addressed and managed by the public sector.
But WMCers and the right-wing bow to a different savior. They must keep their shareholders happy. You don't want to piss off Wall Street. Wall Street it now seems has become our defacto government. How about the change we believe in is taking our government back.
With some populist spin struggling to conceal the underlying conservative positions and giveaways to the private sector, this piece seems nothing more than typical WMC rhetoric from Torinus.
Saturday, February 14, 2009
Sunday, February 8, 2009
![[bushthen+and+now.jpg]](https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgeqUnGId2TjmU51qWRsIIfQTrEWTTM1RRNdUf3NSI26Yy0JoQXo3V2Q5N-u3az4CTBElXLtLFuGCfuPw0pfqJDjVLIEMEby4C_JjQC-EYhoOofM_ALw3D-PsaICLeqsltjFhiBtOjZvhw/s1600/bushthen+and+now.jpg)
Plunder & Blunder
This is the title of Dean Baker's new book. He was one of the first over the last two decades to get it right about the stock, dollar, and housing bubbles. His new book should be an interesting and illuminating read.
Homebuyer Tax Credit
Calculated Risk has been all over this proposal, in the stimulus bill, to give homebuyers a tax credit of 10% of the purchase price up to $15,000.
Saturday, January 24, 2009
Wisconsin Courts (Again) Rule for Business
Wisconsin courts have again sided with business and have taken a blow at fair tax collection and a fair tax burden.
Marie Rohde of the Milwaukee Journal-Sentinel reported, with stunning lack of breadth and diveristy of opinion, on a Milwaukee property assessment ordinance that was ruled unconstitutional.
The article had the old worn out tone of "government can't do anything right or efficiently" running through it. And, to prove such, they spoke with business and industry lobbyists directly affected. Hardly an objective analysis. Insinuating that the City of Milwaukee pushed for an ordinance that would, "...deprive citizens of equal protection of the law." Big bad nefarious government is at it again, trying to take away your money and rights.
The basic story of the ordinance is this: when a property owner decides to object to the valuation of his/her property, the first time they present/argue their case (in front of a Board of Review; a quasi-legal authority, a grade below a circuit court) they must make the full effort to totally explain their position and introduce all evidence to substantiate their opinion.
Milwaukee Circuit Court Judge Jean DiMotto's ruling statement, "The law created favored and disfavored classes by allowing municipalities to enact ordinances that limit taxpayers' rights to the court," is wildly misguided and disingenuous. First, the law applies the same to all in a municipality. There are different laws, exemptions, tax rates, among other variances, between municipalities and states all over the country. Let's use the tax rate for an example: if a company feels the taxes are onerous, they will relocate their business. Would we instead say that an increased tax rate is unconstitutional because it would put more of a burden on the company than if they were located in Town X? Of course not. And, secondly, it doesn't limit rights, it sets the boundaries by which assessment disputes can be solved in an efficient and timely manner.
If a property owner feels an assessment is wrong, by objecting they are forcing the assessor to make a full case to support their opinion of value...why shouldn't the taxpayer have to do the same? No Board of Review case is scheduled before all the evidence is on the table and the assessor and property owner have gone back and forth exchanging information. The ordinance was an attempt to make business think equitably, with forethought, and pertinently. As property owners divulge more income and expense information, assessors correct errors and make any necessary adjustments to valuation. In this process, oftentimes going before a Board of Review will be unnecessary.
Basically, private enterprises want to give away as little actual information as possible, whilst getting complete information from the City supporting their case. The private actors then try to use this information to mold, mask, and artificially conceal their liabilities. Step-by-step through the court system (the Board of Review, the Circuit Court, the Court of Appeals) their objective is to continually raise doubt and muddle the discussion regarding the evidence presented by the City, whilst being able to introduce (new) doctored evidence to support their valuation. It's kind of like having the ability to change the rules as the game is being played. The ordinance was an attempt to end such.
But, if the case must be heard before the Board of Review, the assessor comes fully prepared with his/her report supporting the valuation. Why can't the taxpayer do the same? Time isn't an issue (within reason). Cases can be postponed, allowing plenty of time for a taxpayer to prepare. (Objections are filed in May. Cases are usually, at the earliest, heard in September. Four to five months of preparatory time is not enough?) But one must also feel that if someone objects, before doing so this person would have some evidence, comparable sales, or some other information which leads them to believe the assessment is wrong. After all, as chapter seventy of the Wisconsin State Statutes make clear, the burden of proof is on the taxpayer not the assessor. The Manual also makes clear the heirarchy for valuing property. Nebulous claims about "the market" and weak comparisons to the neighbor's recently sold (although completely different style home) dwelling will not do.
Oftentimes objections are filed just for the sake of objecting. It's part of some business accounting strategies. And this is an extreme waste of time and resources for all concerned.
Are you objecting because you studiously follow market trends and because you've crunched the numbers? Or, are you objecting just to drag it out in the hopes of some type of settlement, some type of break? Too often the latter is the case.
It's also laughable that this ruling is portrayed as being about fairness and protecting equal rights for taxpayers. This is about corporate and business interests. They want every legal advantage they can get in the tax code so they can pay less. Considering corporate taxation has been dwindling over the last thirty years (corporate taxes used to represent 25-30 percent of state income, now it's down to 5-10 percent) and the tax burden is being pushed more and more onto homeowners, this ruling adds insult to injury for residential homeowners.
Marie Rohde of the Milwaukee Journal-Sentinel reported, with stunning lack of breadth and diveristy of opinion, on a Milwaukee property assessment ordinance that was ruled unconstitutional.
The article had the old worn out tone of "government can't do anything right or efficiently" running through it. And, to prove such, they spoke with business and industry lobbyists directly affected. Hardly an objective analysis. Insinuating that the City of Milwaukee pushed for an ordinance that would, "...deprive citizens of equal protection of the law." Big bad nefarious government is at it again, trying to take away your money and rights.
The basic story of the ordinance is this: when a property owner decides to object to the valuation of his/her property, the first time they present/argue their case (in front of a Board of Review; a quasi-legal authority, a grade below a circuit court) they must make the full effort to totally explain their position and introduce all evidence to substantiate their opinion.
Milwaukee Circuit Court Judge Jean DiMotto's ruling statement, "The law created favored and disfavored classes by allowing municipalities to enact ordinances that limit taxpayers' rights to the court," is wildly misguided and disingenuous. First, the law applies the same to all in a municipality. There are different laws, exemptions, tax rates, among other variances, between municipalities and states all over the country. Let's use the tax rate for an example: if a company feels the taxes are onerous, they will relocate their business. Would we instead say that an increased tax rate is unconstitutional because it would put more of a burden on the company than if they were located in Town X? Of course not. And, secondly, it doesn't limit rights, it sets the boundaries by which assessment disputes can be solved in an efficient and timely manner.
If a property owner feels an assessment is wrong, by objecting they are forcing the assessor to make a full case to support their opinion of value...why shouldn't the taxpayer have to do the same? No Board of Review case is scheduled before all the evidence is on the table and the assessor and property owner have gone back and forth exchanging information. The ordinance was an attempt to make business think equitably, with forethought, and pertinently. As property owners divulge more income and expense information, assessors correct errors and make any necessary adjustments to valuation. In this process, oftentimes going before a Board of Review will be unnecessary.
Basically, private enterprises want to give away as little actual information as possible, whilst getting complete information from the City supporting their case. The private actors then try to use this information to mold, mask, and artificially conceal their liabilities. Step-by-step through the court system (the Board of Review, the Circuit Court, the Court of Appeals) their objective is to continually raise doubt and muddle the discussion regarding the evidence presented by the City, whilst being able to introduce (new) doctored evidence to support their valuation. It's kind of like having the ability to change the rules as the game is being played. The ordinance was an attempt to end such.
But, if the case must be heard before the Board of Review, the assessor comes fully prepared with his/her report supporting the valuation. Why can't the taxpayer do the same? Time isn't an issue (within reason). Cases can be postponed, allowing plenty of time for a taxpayer to prepare. (Objections are filed in May. Cases are usually, at the earliest, heard in September. Four to five months of preparatory time is not enough?) But one must also feel that if someone objects, before doing so this person would have some evidence, comparable sales, or some other information which leads them to believe the assessment is wrong. After all, as chapter seventy of the Wisconsin State Statutes make clear, the burden of proof is on the taxpayer not the assessor. The Manual also makes clear the heirarchy for valuing property. Nebulous claims about "the market" and weak comparisons to the neighbor's recently sold (although completely different style home) dwelling will not do.
Oftentimes objections are filed just for the sake of objecting. It's part of some business accounting strategies. And this is an extreme waste of time and resources for all concerned.
Are you objecting because you studiously follow market trends and because you've crunched the numbers? Or, are you objecting just to drag it out in the hopes of some type of settlement, some type of break? Too often the latter is the case.
It's also laughable that this ruling is portrayed as being about fairness and protecting equal rights for taxpayers. This is about corporate and business interests. They want every legal advantage they can get in the tax code so they can pay less. Considering corporate taxation has been dwindling over the last thirty years (corporate taxes used to represent 25-30 percent of state income, now it's down to 5-10 percent) and the tax burden is being pushed more and more onto homeowners, this ruling adds insult to injury for residential homeowners.
Sunday, January 11, 2009
The Day The Laughter Died
Wednesday, December 31, 2008
Assessment vs. Property Tax
It's tax season. People are receiving their property tax bills for the January 1st, 2008 assessment. So there is a lot of chatter about values, property assessments, budgets, and the like. A common complaint I hear is, "I couldn't get that value if I tried to sell it now." This may be true. But the value is of January 1st, not as of the day you received the bill. The assessed values are produced early in the year. Assessors analyze data (sales) from the previous year to see where the market is trending. They arrive at a value for January 1st of the year. Property owners receive a notice in late April, they then have the first three weeks in May to formally object to this value. This seems to be ample notification and time given to homeowners for them to present their case for a discrepancy in the assessed value to the local assessor’s office.
[Since 2008 saw a national slowdown in economic activity during the last quarter, assessors may weigh sales during that period more heavily in their analysis to reflect such for their January 1st, 2009 assessment.]
By state statute, assessments are conducted to determine the fair market value of a property as of January 1st. It’s “as of” such a date because of the complexities and vagaries of the market place. Stability for this municipality revenue-producer, as with any operation, is needed for budgetary and planning constraints. Having some type of moving-target date would allow endless arbitration, court costs, and gridlock.
If a compelling case can be made by a property owner for much-needed repairs (provide a written estimate for the repair), an adverse adjacent influence, or other encumbrances that may detrimentally affect the value of the property, I don’t know of an assessor who wouldn’t make the adjustment to the property value to reflect these negatives.
But the usual thing I hear is “the market.” The market is bad and the property owner wouldn’t receive the assessed value if he tried to sell it. As if assessors aren’t paying attention to the market. Sale of the subject property, or a comparable property, gives the best indicator of the market value of a property (also by state statute). An assessor wouldn’t believe the value of your property either if he or she didn’t have the sales of that property or other similar properties indicating the value.
Assessors follow sales throughout the year. They can see trends, increases and/or decreases. They can see if recent purchases are the same, higher, or lower than the present assessment. If most valid, arms-length sales of a specific type of property in a specific area of a city are moving in one direction or another, it’s relatively easy to see.
Too often homeowners use anecdotal and incomplete information to jump to conclusions from one market to another. Yes, a housing bubble popped. But, as with all bubbles, some areas are affected more than others. Wisconsin towns and cities did not see the stratospheric rise in prices that was witnessed on the Coasts. Also, Wisconsin banks, in general, were nowhere near as invested into the Ponzi-schemes that the financial industry created over the last few decades. Arizona, California, Florida, and Nevada are taking most of the hard hits in the deflation of the housing bubble. Does that mean we won’t experience any aftershocks? Of course not. But it also means that thirty-five percent declines in the Las Vegas property market do not equate to thirty-five percent loses in the Milwaukee property market.
Valid, open-market, arms-length sales are the number one indicator of value. And, the sales must be comparable. Don't reference the homes in bad condition, that are one-thousand square feet smaller than your home, that just sold for a lower amount than your assessment. This isn't a comparable home. Compare apples to apples. Don't just search for homes that sold at lower values than your assessment and reason that your home is only worth that much.
The assessed value is used in your property tax equation. But what you’re assessed at matters much less than what the needs of the locality are, and the budget to fund such operations, in determining what your tax bill will be each year. Your assessment may go down, your tax bill can still increase. Alongside budgetary downturns are usually increased needs for public provisions – food pantry, shelter, etc – which increases city, county, and state budgets. Also, the public (MPS) and technical schools (MATC) need funding, the State takes a share to redistribute to areas of the state where the funds are needed even more, the County uses part of this money to fund it’s operations, MMSD gets part of the money to manage our sewage, and the City uses the rest for it’s day-to-day functions.
The bill for the total of these budgets is divided by the total assessed value of all the parcels in the city to determine a mill rate. Your property’s assessed value divided by one thousand, then multiplied by the mill rate will give you your property tax bill.
The bottom line comes down to: what kind of a society do we want, with what kind of quality-of-life, and what is the fair distribution of the tax burden to provide such an existence. The total bill is quite a bargain for all it provides. I would even like to see it increased so we can provide an infrastructure spending plan and create jobs, and also to provide a heightened quality of service provision throughout the state. But, I also feel that the bill does impose too heavy a burden on working and middle class families as a percentage of their income.
Making corporations pay their fair share and getting rid of many exemptions, tax breaks, depreciation schedules, and other pointless giveaways to the well-to-do would balance the budget and provide the long-term funds and infrastructure needed to attract and maintain business and assure a good quality of life that Wisconsinites have come to expect.
[Since 2008 saw a national slowdown in economic activity during the last quarter, assessors may weigh sales during that period more heavily in their analysis to reflect such for their January 1st, 2009 assessment.]
By state statute, assessments are conducted to determine the fair market value of a property as of January 1st. It’s “as of” such a date because of the complexities and vagaries of the market place. Stability for this municipality revenue-producer, as with any operation, is needed for budgetary and planning constraints. Having some type of moving-target date would allow endless arbitration, court costs, and gridlock.
If a compelling case can be made by a property owner for much-needed repairs (provide a written estimate for the repair), an adverse adjacent influence, or other encumbrances that may detrimentally affect the value of the property, I don’t know of an assessor who wouldn’t make the adjustment to the property value to reflect these negatives.
But the usual thing I hear is “the market.” The market is bad and the property owner wouldn’t receive the assessed value if he tried to sell it. As if assessors aren’t paying attention to the market. Sale of the subject property, or a comparable property, gives the best indicator of the market value of a property (also by state statute). An assessor wouldn’t believe the value of your property either if he or she didn’t have the sales of that property or other similar properties indicating the value.
Assessors follow sales throughout the year. They can see trends, increases and/or decreases. They can see if recent purchases are the same, higher, or lower than the present assessment. If most valid, arms-length sales of a specific type of property in a specific area of a city are moving in one direction or another, it’s relatively easy to see.
Too often homeowners use anecdotal and incomplete information to jump to conclusions from one market to another. Yes, a housing bubble popped. But, as with all bubbles, some areas are affected more than others. Wisconsin towns and cities did not see the stratospheric rise in prices that was witnessed on the Coasts. Also, Wisconsin banks, in general, were nowhere near as invested into the Ponzi-schemes that the financial industry created over the last few decades. Arizona, California, Florida, and Nevada are taking most of the hard hits in the deflation of the housing bubble. Does that mean we won’t experience any aftershocks? Of course not. But it also means that thirty-five percent declines in the Las Vegas property market do not equate to thirty-five percent loses in the Milwaukee property market.
Valid, open-market, arms-length sales are the number one indicator of value. And, the sales must be comparable. Don't reference the homes in bad condition, that are one-thousand square feet smaller than your home, that just sold for a lower amount than your assessment. This isn't a comparable home. Compare apples to apples. Don't just search for homes that sold at lower values than your assessment and reason that your home is only worth that much.
The assessed value is used in your property tax equation. But what you’re assessed at matters much less than what the needs of the locality are, and the budget to fund such operations, in determining what your tax bill will be each year. Your assessment may go down, your tax bill can still increase. Alongside budgetary downturns are usually increased needs for public provisions – food pantry, shelter, etc – which increases city, county, and state budgets. Also, the public (MPS) and technical schools (MATC) need funding, the State takes a share to redistribute to areas of the state where the funds are needed even more, the County uses part of this money to fund it’s operations, MMSD gets part of the money to manage our sewage, and the City uses the rest for it’s day-to-day functions.
The bill for the total of these budgets is divided by the total assessed value of all the parcels in the city to determine a mill rate. Your property’s assessed value divided by one thousand, then multiplied by the mill rate will give you your property tax bill.
The bottom line comes down to: what kind of a society do we want, with what kind of quality-of-life, and what is the fair distribution of the tax burden to provide such an existence. The total bill is quite a bargain for all it provides. I would even like to see it increased so we can provide an infrastructure spending plan and create jobs, and also to provide a heightened quality of service provision throughout the state. But, I also feel that the bill does impose too heavy a burden on working and middle class families as a percentage of their income.
Making corporations pay their fair share and getting rid of many exemptions, tax breaks, depreciation schedules, and other pointless giveaways to the well-to-do would balance the budget and provide the long-term funds and infrastructure needed to attract and maintain business and assure a good quality of life that Wisconsinites have come to expect.
Wednesday, December 24, 2008
Bailout Bewilderment
Rachel Maddow explains more on the double-standard of the bailouts and exposes the backroom shenanigans whereby Wall Street is stealing, in collusion with the Treasury, more of our money. Laura D'Andrea Tyson, in usual economic jargon, tries to placate Rachel's questions/concerns. It was the usual - don't worry, we've gotten everyone into this mess, we know the best way out, there should be some strings attached, but we must lend billions quickly without too many questions. Tyson learned all too well, during her time in the Clinton administration how to appease the bond traders.
Maddow follows up on her discussion with Laura D'Andrea Tyson (whom provided excuses for the firms involved and blamed the Treasury for the lack of transparency) the next day. As a professor she knows about ethics in disclosure and research. Her action would be similar to a journalist writing a glowing piece on Apple without disclosing that he/she has millions in that company's stock. The problem isn't that she didn't know enough to disclose the connection. The problem is that all the major players in our society have entanglements and connections, which rarely any of them reveal, nor are there legal repercussions for such indiscretions. This cronyism and opaqueness throughout the system are glaring factors in the culmination of the current crisis (and throughout our country's history of class warfare).
The Treasury assuredly deserves some blame. But when all we've heard for the last thirty years is, "leave he market alone" and "the market knows best," it's difficult not to fall back on those bad habits, give firms the money they claim they need, and believe they can straighten up the mess. It's especially hard when the characters running the Treasury and their advisers are former investment bankers, Wall-Streeters, and hedge fund managers.
The CEOs, managers, brokers, and their ilk should be stripped of a major percentage of their assets (which are ill-gotten gains) to help pay for their mess. The private jets should be sold and their options given to the Treasury (to cash-in when the companies stock prices increase). Salaries and bonuses, going back years, will be automatically turned over to the Treasury.
If this were Joe Sixpack caught in illegal activities swindling money in nefarious ways, he would, no doubt, be stripped of all of his assets and face jail time. Just for good behavioral economics sake, the fine should fit the crime. Removing even ninety percent of hedge fund managers, and the other bozos, wealth still leaves them with an absurd amount of wealth to operate from...when they get out of jail.
Maddow follows up on her discussion with Laura D'Andrea Tyson (whom provided excuses for the firms involved and blamed the Treasury for the lack of transparency) the next day. As a professor she knows about ethics in disclosure and research. Her action would be similar to a journalist writing a glowing piece on Apple without disclosing that he/she has millions in that company's stock. The problem isn't that she didn't know enough to disclose the connection. The problem is that all the major players in our society have entanglements and connections, which rarely any of them reveal, nor are there legal repercussions for such indiscretions. This cronyism and opaqueness throughout the system are glaring factors in the culmination of the current crisis (and throughout our country's history of class warfare).
The Treasury assuredly deserves some blame. But when all we've heard for the last thirty years is, "leave he market alone" and "the market knows best," it's difficult not to fall back on those bad habits, give firms the money they claim they need, and believe they can straighten up the mess. It's especially hard when the characters running the Treasury and their advisers are former investment bankers, Wall-Streeters, and hedge fund managers.
The CEOs, managers, brokers, and their ilk should be stripped of a major percentage of their assets (which are ill-gotten gains) to help pay for their mess. The private jets should be sold and their options given to the Treasury (to cash-in when the companies stock prices increase). Salaries and bonuses, going back years, will be automatically turned over to the Treasury.
If this were Joe Sixpack caught in illegal activities swindling money in nefarious ways, he would, no doubt, be stripped of all of his assets and face jail time. Just for good behavioral economics sake, the fine should fit the crime. Removing even ninety percent of hedge fund managers, and the other bozos, wealth still leaves them with an absurd amount of wealth to operate from...when they get out of jail.
Tuesday, December 23, 2008
Free Market Collapses (Again)
Within the last century our economy has experienced peaks and valleys punctuated by (now) two depressions. Presently, we're not (neither, officially, is the NBER) yet referring to what we're experiencing as a depression. Although, if we add together the list of things we need to accomplish and/or repair - unemployment, poverty, educational inadequacies, health care, housing, financial regulation, manufacturing, farming, needed infrastructure maintenance, climate change, to name just a few - it is a daunting task, and nothing but "depression" can describe it.
It's also interesting to note that both of the worst economic times in our recent history occurred after bouts of, what I like to call, "free market flu." The belief that the market is somehow a lone, all-knowing entity. That it is not somehow merely a creation of, or lack thereof, laws and regulations and societal institutions (laws and regulations are kind of like the game-board upon which our actual lives are played). Each time we've allowed ourselves to reach a fever pitch of the ole' laissez-faire attitude - culminating in 1929 & 2008 - we've collectively destroyed far more wealth with our greed (once the bubble pops) than we gained from the short-sighted speculation beforehand.
Let's also keep in mind that the gains go to mostly a top, select few. "Free" market practices as preached by it's disciples have never produced the gains, growth, or shared prosperity that they claim. Our employment is basically the financial speculators' insurance plan. Keep enough rats running on the wheel so that we can still provide something worthwhile to sell in the global market, just to keep up enough credit-worthiness for Wall Street's movers-and-shakers to get Chinese loans to make highly-leveraged and risky financial bets on everything under the sun. But then everything blows up. The managers and brokers keep their bonuses, salaries, and options. The loses incurred because of their poor management are paid by the U.S. Government (us). They get a meal. We're just left with the bill. This is criminal.
This is what happens when a country believes a bit too much in it's own hype, and forgets to give respect to the professions that provide the real long-term capabilities for the Country to do quality research and development, to manufacture it's own necessities, to provide for it's own energy and transportation needs, and to have the intellectual capacities to make technological innovation possible. This isn't just economic security, it's national security.
When the shit hits the fan, everyone comes with their hand out to Uncle Sam. (Suddenly socialism and redistribution aren't such dirty words.) The U.S. Government is supposed to sit idly by while the Masters of the Universe * (aka The Fortune 500 & Wall Street) pontificate about how they can create financial innovations to reduce risk, increase credit, provide high-yield returns, and make everything it's utmost efficient because of a magic place called the market, where everything is Utopian if you just leave it alone.
But when you leave the market alone, if it should happen to destroy retirement accounts, pensions, jobs, or employment opportunities, you must simply step in to cover the market's debts (aka private speculators loses) and leave it be. If you try to regulate, the next time will only be worse. Even though the market is supposedly somehow always moving toward an optimal state without regulation. Supply-side economics: one incorrect economic assumption after another in circularly infuriating logic.
It's been the cause of two depressions. The effects of the misguided supply-side theories have impoverished generations. Can we please let go of the chatter as if this is some sort of credible economic theory? We know what works. We know what gives modest returns, predictable growth, and stability. Can't we just do that and stop appeasing the discredited free-marketeers?
It's also interesting to note that both of the worst economic times in our recent history occurred after bouts of, what I like to call, "free market flu." The belief that the market is somehow a lone, all-knowing entity. That it is not somehow merely a creation of, or lack thereof, laws and regulations and societal institutions (laws and regulations are kind of like the game-board upon which our actual lives are played). Each time we've allowed ourselves to reach a fever pitch of the ole' laissez-faire attitude - culminating in 1929 & 2008 - we've collectively destroyed far more wealth with our greed (once the bubble pops) than we gained from the short-sighted speculation beforehand.
Let's also keep in mind that the gains go to mostly a top, select few. "Free" market practices as preached by it's disciples have never produced the gains, growth, or shared prosperity that they claim. Our employment is basically the financial speculators' insurance plan. Keep enough rats running on the wheel so that we can still provide something worthwhile to sell in the global market, just to keep up enough credit-worthiness for Wall Street's movers-and-shakers to get Chinese loans to make highly-leveraged and risky financial bets on everything under the sun. But then everything blows up. The managers and brokers keep their bonuses, salaries, and options. The loses incurred because of their poor management are paid by the U.S. Government (us). They get a meal. We're just left with the bill. This is criminal.
This is what happens when a country believes a bit too much in it's own hype, and forgets to give respect to the professions that provide the real long-term capabilities for the Country to do quality research and development, to manufacture it's own necessities, to provide for it's own energy and transportation needs, and to have the intellectual capacities to make technological innovation possible. This isn't just economic security, it's national security.
When the shit hits the fan, everyone comes with their hand out to Uncle Sam. (Suddenly socialism and redistribution aren't such dirty words.) The U.S. Government is supposed to sit idly by while the Masters of the Universe * (aka The Fortune 500 & Wall Street) pontificate about how they can create financial innovations to reduce risk, increase credit, provide high-yield returns, and make everything it's utmost efficient because of a magic place called the market, where everything is Utopian if you just leave it alone.
But when you leave the market alone, if it should happen to destroy retirement accounts, pensions, jobs, or employment opportunities, you must simply step in to cover the market's debts (aka private speculators loses) and leave it be. If you try to regulate, the next time will only be worse. Even though the market is supposedly somehow always moving toward an optimal state without regulation. Supply-side economics: one incorrect economic assumption after another in circularly infuriating logic.
It's been the cause of two depressions. The effects of the misguided supply-side theories have impoverished generations. Can we please let go of the chatter as if this is some sort of credible economic theory? We know what works. We know what gives modest returns, predictable growth, and stability. Can't we just do that and stop appeasing the discredited free-marketeers?
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