Questions and Observations

Free Markets, Free People

It’s Bush’s Fault Obama Is Traveling So Much

Dana Milbank does a pre-emptive strike on possible criticism of Obama’s globe trotting during a time of domestic economic woe.  He notes that the “normally querulous opposition” hasn’t said a word about the fact that he’s spent 12% of his presidency outside the country and has more trips planned before the end of the year – a record unsurpassed by any president.

Why no criticism per Milbank? Heh … why do you think?

Normally, Obama’s wanderlust would be a liability, because Americans care more about the economy than foreign affairs. But the normal rules don’t seem to apply this year, largely because Obama’s predecessor left the nation’s world standing in a shambles. While Republicans may be tempted to criticize Obama for being “intercontinental,” as Bush would have put it, “the ability to change the way America is viewed is powerful,” a senior Obama adviser said Thursday, “and they are afraid of looking petty.”

Polling by the Pew Research Center at the end of Bush’s presidency found that 70 percent of Americans thought the country had become less respected in the world (only 5 percent said “more respected”), and most of them thought the decline in standing was a major problem.

“Repairing our image overseas was an important consideration for the public,” said Andrew Kohut, the poll’s director. Americans have given Obama credit for a “dramatic improvement” in the nation’s standing, he said.

Here’s an alternative thought for Milbank to consider. The reason the “normally querulous opposition” isn’t saying much, and, in fact, is complaining he isn’t gone enough (fall of the Berlin wall) is when he’s gone he isn’t here mucking things up. Or more succinctly, it’s to their advantage to have him gone.

On a separate subject, my theory as to why he’s going so much has to do with his realization that he is in over his head and as his poll numbers and popularity sink here, he seeks a narcissistic boost elsewhere. One of the main reasons, as some have theorized, he didn’t go to Berlin is there wasn’t enough about him in the program. Of course that didn’t stop him from inserting a totally irrelevant fact that when the wall fell those there at the time wouldn’t have imagined the US would have a president of “African descent” in office in his two minutes speech. What that had to do with anything is beyond me but it is another indicator of how self-absorbed the man is. On his Asian swing, as with his other visits to foreign countries, he will indeed be the center of attention. And, of course, issuing apologies as for the US as is his want, he can’t help but be more popular than a predecessor who didn’t do that sort of thing.

Whether the new “standing” we supposedly enjoy means anything at all really isn’t explored in the Milbank column. Apparently if that new standing is based on contempt (and the popularity of a US leader who panders too it) rather than respect, that’s fine – just so the numbers are “better” than they were previously. Because that means all kinds of important things to America – like more jobs, a better economy, a resolution on Afghanistan and much, much more.

~McQ

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Tax Facts

Some tax facts from the Tax Foundation [pdf]to ponder while you work toward paying off the government’s first claim on your paycheck today.

Fact 1: Not everyone is doing that.

Today, 46 million tax filers have no income tax liability after taking advantage of all of the credits and deductions in the tax code—one-third of all tax filers. Obama’s tax polices, such as the “Making Work Pay” tax credit, will increase the number of non-payers to more than 63 million.

Or 63 million won’t , as Scott Hodge of the Tax Foundation says, have any “skin in the game”. Why should they care about tax policy or how tax money is spent?

Fact 2: Not all tax cuts/credits are good.

[T]he most politically popular tax cuts actually give the government more control over the economy rather than less. Even the credits enacted with the best of intentions—such as the $1,000 child credit, hybrid vehicle credit, or adoption credit—are bad tax policy because they attempt to induce people to make choices politicians think are right while rewarding select industries at the expense of others.

Or said another way, we again have government picking winners and losers, which few people would accept as something it should be doing. Politicians use their first claim on what you earn to reward you by not taking it if you do what they want. Is that your idea of the function of government?

Fact 3: High corporate taxes punish workers.

As the new study explains, there is a growing body of evidence that a large share of corporate taxes is really borne by workers—most of whom are not wealthy. Using statistical methods, the new study found that for every $1 rise in state and local corporate tax collections, real wages in that area fell by $2.50 five years later. The reverse is also true: wages rose by $2.50 for every $1 reduction in state and local corporate income taxes.

If wages are depressed in your particular state or locality, check out the corporate tax rate – as we’ve pointed out for years, corporations don’t pay taxes, they pass them on.

Fact 4: US corporate taxes are high.

Average OECD top corporate tax rate: 26.29 percent. Average U.S. top rate: 39.1 percent.

And of course after spending time demonizing corporations as rich and greedy, the present administration and Congress want to raise these taxes even higher. Then they’ll have another job summit and wonder why unemployment continues to get worse and wages are stagnant.

Fact 5: The rich actually pay more than their “fair share”.

Share of federal income tax paid by top 1 percent: 40.4 percent. Share paid by bottom 95 percent: 39.4 percent.

In fact, the rich pay more than 95% of the taxpayers out there – and the plan is to tap them for even more. Because, of course, they’re rich, and that automatically makes them “greedy”. Not in the plan is how the government will make up the revenue it plans on collecting with this new tax when the rich do what is necessary to protect what is theirs from the increased government looting.

Fact 6: Tax increases cost nearly twice the revenue raised.

“With every dollar of revenue, the proposed tax hikes cost the economy an extra 86 cents.”

Called “deadweight loss” high taxes distort the economy by artificially affecting decisions, such as:

…how much people choose to work by decreasing the financial reward to labor. High tax rates also may discourage savings, affect investment choices, and change the way households spend their money. For these reasons, economists recommend low tax rates and broad tax bases.

But that’s not at all what we now have – 63 million projected to be paying no taxes at all, corporate taxes higher than the OECD average and going higher and 1% of the population paying more in taxes than 95%?

If you can’t see what’s wrong with this picture and where it portends to leave us as we try to “recover” from the recession, then you’re being willfully blind. And, if some of this isn’t addressed and changed in the upcoming jobs summit, nothing is going to change to improve the employment situation. We have a tax structure that is anti-growth, anti-business and anti-liberty. The unfortunate thing is the present administration and Congress are working on legislation right now which will actually increase the tax burden exponentially and have projected trillion dollar budget deficits for the next 10 years.

How, given the above and the inevitable result of their unconscionable planned government spending spree (and taxes to support it) are we going to “grow” our way out of this?

~McQ

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Is The Locomotive Of “Chavismo” Losing Steam In Venezuela?

Gallup’s latest poll says it is:

President Hugo Chavez’s popularity among Venezuelans has waned in recent years. Less than half of Venezuelans (47%) in August 2009 said they approved of Chavez’ job performance — down from 61% in late 2006 when he was elected to a second six-year term.

That’s not a good sign for a dictator “president for life”. And what’s even worse is his inability to do much about what is causing that decline but attempt to distract attention by stirring up an existential threat (Colombia).

The reasons for this decline in popularity aren’t hard to figure out. Again, Gallup:

This year, 30% of Venezuelans said economic conditions in their city or area are improving, down from 47% in 2008 and 63% in 2007. Electricity and water shortages have become frequent, and violent crime is rampant in much of the country. This year, 23% of Venezuelans said they feel safe walking alone in their areas at night, the second-lowest figure among the 67 countries in which Gallup asked the question.

Politicians, whether socialist or capitalist, are held responsible for their country’s ability to provide the basics in life – especially when in the past those basics were cheap and plentiful. And, politicians are also held responsible for providing basic security. In all areas the socialist “Bolivarian revolution” is failing. And, because of actions by Chavez over the years to nationalize many industries, Venezuelans who supported Chavez are now beginning to see his government as more of a threat to them:

Conversely, concern about the heavy hand Chavez has demonstrated in the recent wave of nationalizations may be growing. The proportion of Venezuelans who said people in the country can feel very confident their private property will be respected by the government has dropped to 40% this year, from 52% in 2007. And 44% of Venezuelans currently agree that life is very hard for those who oppose the government, up from 36% in 2008.

As Megan McArdle points out, Chavez was able to paper over much of this when the price of oil was high and revenue plentiful, but at the present price and faced with the fact that because he diverted money from the state run oil company PDVSA to fund social programs, his golden goose is on life support. And Chavez has been forced to impose some unpopular restrictions:

President Hugo Chávez has been facing a public outcry in recent weeks over power failures that, after six nationwide blackouts in the last two years, are cutting electricity for hours each day in rural areas and in industrial cities like Valencia and Ciudad Guayana. Now, water rationing has been introduced here in the capital.

The deterioration of services is perplexing to many here, especially because the country had grown used to cheap, plentiful electricity and water in recent decades. But even as the oil boom was enriching his government and Mr. Chávez asserted greater control over utilities and other industries in this decade, public services seemed only to decay, adding to residents’ frustrations.

With oil revenues declining and the economy slowing, the shortages may have no quick fixes in sight. The government announced some emergency measures this week, including limits on imports of air-conditioning systems, rate increases for consumers of large amounts of power and the building of new gas-fired power plants, which would not be completed until the middle of the next decade.

Combine that with growing food shortages and rampant inflation and the picture is not pretty for our boy Hugo.  And while his popularity remains slightly north of the critical 50% mark, his job approval rating of 46% portends a fall for that as well.  Chavez, like all socialists,  is finding out the hard way that they call them the laws of economics for a reason.  You just wonder if we’ll learn something from his inevitable decline.

~McQ

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Ft. Hood, Hasan And Some On The Left’s Tone Deafness

You can’t beat the left for not getting the message or understanding the problem, can you:

[Montel Williams, on his Air America program] suggested on Monday that the Fort Hood backlash against Muslims could be so great we would put Muslims in internment camps like the Japanese under Franklin Roosevelt:

WILLIAMS: We pulled something like this back in World War II when we decided to round up all Japanese Americans and put them in internment camps. This is something that I think before we can blink, the [anti-Muslim] rhetoric, Doc, could get out of hand. What do you think?

FRANK FARLEY, psychologist, Temple University: I agree totally. I mean, the possibilities of prejudice and racism and so on are incredible here. You know, we should be treating this as a unique incident and look at the factors involved in this very unique and specific incident, and not overgeneralize. Unfortunately, we tend to overgeneralize all the time. The idea that all Muslims are the same is ridiculous….

Everybody’s got their own personal qualities and individual differences and let’s just treat this as a very specific incident and try to figure out why this particular person did this particular thing.

WILLIAMS: Absolutely. No matter what it comes out to, at the end of the day, even if it comes out in the last five months and all his anxiety around his impending deployment, he decided his frame of reference was his religion and that was what was giving him, you know, the power within himself to make his stand, that doesn’t mean that the religion is to blame.

FARLEY: Absolutely, it’s his interpretation of everything, and his interpretation [of Islam] may vary dramatically from his fellow Muslims.

Wow. As much as I cautioned people to give the facts a chance to come out before coming to conclusions about Hasan, this is just an example of some incredible denial going on here. We now have facts – lots of facts – and informed conclusions can be drawn.

And let’s deal with the internment camp nonsense. That happened because a liberal Democratic president signed an Executive Order (Executive Order 9066 on February 19, 1942) which enabled US citizens of a particular national background to be interned (a total violation of their civil rights). Is he really suggesting that because we have a liberal Democrat president again in the White House that history may repeat itself. Or is he as ignorant of history as most and assuming it was done by mean, nasty right-wing types?

Something else that sort of hits me here – if there was no “backlash” against muslims after 9/11, why do these yahoos think there will be one now? Who is it who will be involved in this backlash and why is this incident so different from 9/11 that it will spark the backlash 9/11 didn’t?  I don’t know.  But I would think that the American people, who sorted that out the last time, will sort it out this time as well.

Are there prudent steps to be taken in light of what has happened at Ft. Hood as concerns muslim soldiers? Yes. Given Ft. Hood, the Little Rock incident and the fragging incident in Iraq, all involving muslim soldiers or muslims attacking soldiers, I’d say that it would be prudent to screen the reported 3,500 muslim military members (discretely and unobtrusively as possible) given the deadly action of two (as I recall, the left was all for a purge of the military to look for neo-nazis and white supremacists) . And yes that means, given the unique situation our military is in (fighting in two muslim countries) and the possible conflict that may bring to the minds of some who are of the dominant religion of those two countries – that we’re “profiling”. But then, while it is the antithesis of political correctness, it is the smart thing to do.  Show me a compelling reason to screen the rest of the military for those who might be in a similar situation and I’d be for that as well.

Should there be procedures put in place that would encourage the reporting of language or actions that appear to support a radicalized person – be it through religion or ideology? Yes, there should. And the chain of command must be made to take such reports seriously, investigate them thoroughly and act if necessary. Or said another way, political correctness and the fear of being censured if you do report such utterances or actions, must be banned from the military.

Finally, people like Williams and Farley must be pointed out and ridiculed because it is their sort of denial which leads to incidents like Ft. Hood. We all need to grow up a bit, quit taking everything as an insult and understand that your feelings don’t take precedence over someone else’s life. Yes, we’re diverse. Yes, we’re an amalgamation of peoples.

However, if you are consistently being bitten on the leg by dogs, you don’t go looking for cats or chickens. We have to learn to honestly and forthrightly address the threat.  Radical Islam has been attacking us since the embassy takeover in Iran 30 years ago.  They are the ones we should be looking for right now – and you’re not going to find them among Christian, atheist or Jewish military personnel.

The threat appears to be a segment of Islam that becomes violently radicalized and strikes out at those it considers “infidels”. In the case of Hasan that was obviously anyone within reach.  And, as experts say, self-generated jihadis are not unusual and are, as we’ve found out, more dangerous than those with organized connections (those with organized connections are easier to find and track). Given all I’ve read about Hasan – and it has been a lot – that’s what I believe he is. A self-generated jihadi who became increasingly radicalized over the years to the point that he finally decided he must act.

I understand and appreciate the attempts to warn us off of using too broad a brush.  That was one of the points of my previous post that generated so much discussion. But it is no longer a secret that there are radicals among the religion of Islam who find it to be their duty to do similar acts to those of Hasan. Pretending Hasan wasn’t one of those stretches credulity to the max. The first day of the shootings – yes, a perfectly acceptable argument. We had few facts and much of what was reported we subsequently found out was wrong.  However now, given the veritable avalanche of information which has been provided about this man and verified, it is more than a little lame to pretend he might have been something our experience and the facts tell us he’s not.

Willams and Farley do a disservice to us all by claiming those who have concluded his religion radicalized him and was the reason he did what he did are “overgeneralizing”. Not anymore. Sure it was a “specific incident” as Farley claims, but so was 9/11. And after we learned about each of the radicals who committed that atrocity we found men not unlike Nadal Malik Hasan, didn’t we?

~McQ

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What? No Jobs? Let’s Talk About It!

Apparently the Obama administration had discovered, 10 months into the presidency, that perhaps jobs are the highest priority for most Americans.

So? So they’re going to have a “jobs summit”. Yes sir, they’re going to get together and talk about it! Because, you know, talking about something always is better than not talking about it, I suppose.

Uh, but not till next month. You know – it’s not that important.

And sure while doing something about a problem is much better than talking about it, talking is what this administration does best.

Look at Afghanistan. They’ve been talking about that for almost 3 months since the commander has made his request. And he’s still talking about it.

But back to jobs:

“Hiring often takes time to catch up to economic growth,” Mr. Obama said. “Given the magnitude of the economic turmoil we’ve experienced, employers are reluctant to hire.”

Of course they’re reluctant to hire – health care is up in the air, cap-and-trade is on the horizon, the government is spending like a drunken sailor on shore leave in Shanghai, it has inserted itself into the business and financial markets to an unprecedented degree and there is no question that taxes are going up – some think dramatically. Why would any business worth their salt be considering taking on new employees or expanding at a time with the future as unsettled as it is?

“We all know there are limits to what government can and should do, even during such difficult times,” Mr. Obama said, “but we have an obligation to consider every additional and responsible step that we can to encourage and accelerate job creation in this country.”

This said by the same guy who assured us that his “stimulus” package would absolutely cap unemployment at 8%. We’re at 10.2% and rising and he’s reduced to pretending a smaller number of unemployed submitting applications for unemployment benefits than did last week is “progress”.  Oh, and using fake “saved and created” numbers.

Of course there are things the government can do to “encourage and accelerate job creation” that have absolutely nothing to do with more spending or extending unemployment benefits. But my guess is those won’t even be brought up much less considered. In fact my guess is the cry, led by Paul Krugman and others, is going to be “mo money”.

But hey, jobless folks, take heart. They’re going to talk about it. Next month. Right before Christmas I assume. Which will naturally delay anything being done till about the anniversary of his 1st year in office [if then]. And frankly, I wouldn’t be surprised if we were still waiting on an Afghanistan decision then as well.

~McQ

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Lies, Damn Lies And Government Statistics

Dale brings you up to date on what we’re facing on the employment front below.  Meanwhile the dissembling about what government is doing continues.  The farce of “saved or created” jobs announced by the various government’s and agencies as a result of “stimulus” money continues to unravel with “Sheriff Joe” Biden nowhere in sight to call them out on it:

While Massachusetts recipients of federal stimulus money collectively report 12,374 jobs saved or created, a Globe review shows that number is wildly exaggerated. Organizations that received stimulus money miscounted jobs, filed erroneous figures, or claimed jobs for work that has not yet started.

Yes, the “Globe” in question is the decidedly liberal Boston Globe, and even it couldn’t countenance the nonsense that has been paraded as “fact” in the administration’s spin on how well the pork-laden stimulus is working. Some of the specifics it found:

One of the largest reported jobs figures comes from Bridgewater State College, which is listed as using $77,181 in stimulus money for 160 full-time work-study jobs for students. But Bridgewater State spokesman Bryan Baldwin said the college made a mistake and the actual number of new jobs was “almost nothing.’’ Bridgewater has submitted a correction, but it is not yet reflected in the report.

In other cases, federal money that recipients already receive annually – subsidies for affordable housing, for example – was reclassified this year as stimulus spending, and the existing jobs already supported by those programs were credited to stimulus spending. Some of these recipients said they did not even know the money they were getting was classified as stimulus funds until September, when federal officials told them they had to file reports.

There were no jobs created. It was just shuffling around of the funds,’’ said Susan Kelly, director of property management for Boston Land Co., which reported retaining 26 jobs with $2.7 million in rental subsidies for its affordable housing developments in Waltham. “It’s hard to figure out if you did the paperwork right. We never asked for this.’’

In reality, much of the funding has been used for existing projects (and jobs) and to cover state and local government budget shortfalls. But jobs? Not much. And those reporting jobs created? Well many don’t stand up to scrutiny:

The community action agency based in Greenfield reported 90 full-time jobs associated with the $245,000 it got for its preschool Head Start program. That averages out to just $2,700 per full-time job. The agency said it used the money to give roughly 150 staffers cost-of-living raises. The figure reported on the federal report was a mistake, a result of a staffer’s misunderstanding of the filing instructions, said executive director Jane Sanders.

And the federal agency collecting and reporting all this data? Well they’re sure it’s just the result of “innocent mistakes”. But do they scrub the data in any way before reporting it (i.e. verify if the data received is correct?)? Uh, no. That would actually entail work and the Orwellian sounding Recovery Accountability and Transparency Board would much rather produce positive numbers – unvetted.

Remember this was the administration which promised to make government “cool” again. Well, thankfully, it hasn’t. In fact, it is piling up examples of why government is uncool at an amazing rate. And this is just one of many. Its “saved and created” jobs numbers are pure unadulterated propaganda with, as should be obvious by now, no basis in fact. What numbers it has, given what investigations around the country have turned up, are pure fantasy. That, however, hasn’t stopped them from issuing them as gospel.

So given that, why again should we trust their numbers on health care or cap-and-trade or just about anything?

Well, we shouldn’t – not without a proper look and a sound vetting. But we just don’t have time for that, do we? Anyone figuring out why yet?

~McQ

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Why The GOP Remains A Minority

About a week ago, amidst all the hoopla about the health care bill and then missed when the atrocity of Ft. Hood occurred, was this:

Even as a Senate global-warming bill remained in limbo with Democrats refusing to delay a committee vote until an economic analysis was completed, hopes rose for a potential bipartisan compromise.

The Senate, meanwhile, appears to be moving away from the bill, authored by Sen. Barbara Boxer, D-Calif., and Sen. John Kerry, D-Mass., which would require a 20 percent reduction in carbon emissions by 2020 and would have the government sell the right to emit carbon dioxide.

Even as Boxer conducted an unusual one-sided hearing on her bill in the Environment and Public Works Committee, Kerry, Sen. Lindsey Graham, R-S.C. and Sen. Joe Lieberman, I-Conn., held a news conference to announce they are working on a compromise that might attract GOP votes and has earned a tentative endorsement from the U.S. Chamber of Commerce.

So, here we have a Republican, sort of, lending a hand to the Democrats and buying into the premise that a) this cap-and-trade economy killer of a tax is valid and b) needed. He just wants to modify it a bit:

Kerry, Lieberman and Graham released few details about the new bill, but said it would include a cap and trade proposal. They said it would also address increasing nuclear energy, more drilling and clean coal technology, all initiatives that are high on the wish list of Republicans willing to work on a climate change compromise.

Of course this is the sort of legislative formula which is killing our country. This is exactly how the lousy legislation gets through the system. Republicans like Graham buy into the premise of cap-and-trade, try to get it reduced just a little bit to make it more palatable, and then  attempts to sell it by including things that Republicans want – more drilling, nukes and clean coal.

The problem, of course, is with Democrats in charge, you can count on cap-and-trade being implemented, but for some reason, you can bet that more drilling, nuclear power and clean coal just won’t see the same urgency to implement found among majority Democrats. So in essence, what Graham is proposing is tantamount to selling out the GOP’s principled position for the 30 pieces of silver offered in promises for things Republicans want.

You’d think by now, having watched the Democratic shenanigans with drilling (are we doing so yet or are they still “slow-walking” the process) they’d know better.

The Graham capitulation has been noticed by his home state party.

The Charleston County Republican Party’s executive committee took the unusual step Monday night of censuring U.S. Sen. Lindsey Graham for stepping across the GOP party line.

County Chairwoman Lin Bennett said the unanimous vote “is an effort to get his attention. They (party leaders) are just fed up, and they want him to know they’re fed up.”

The resolution mentions Graham’s cooperation with U.S. Sen. John Kerry, D-Mass., on a bipartisan energy bill, and his support for the $700 billion Troubled Asset Relief Program and the time he called some opponents of immigration reform “bigots.”

Sure it’s only one county doing so, but it is an unusual step. And frankly, I think it is a long overdue one. Graham’s actions, as far as I’m concerned, are one of the main reasons the GOP is in the shape it is in. There is a time to work in a bi-partisan manner and there is a time to stand on principle. The GOP supposedly believes we’re over taxed, a position I happen to support as well. So why is a member of that party stepping across party lines and lending support to what everyone, even Democrats, acknowledge is a new huge and burdensome tax?

Why should anyone ever believe Lindsey Graham again when he says he’s against new taxes when he’s involved with Democrats proposing one? Why should anyone ever believe Lindsey Graham when he says he’s against excessive spending when he voted for TARP?

The answers to those two questions tell you precisely why even the GOP’s base doesn’t trust Republican legislators and why their collective poll numbers remain dismal. Calling Graham to account for his position is both healthy and necessary if, in fact, the GOP is serious about its principles. And, if the Tea Parties are any indication, it is clear the base is. And apparently the GOP’s grass-roots are willing to stand up as well as indicated by this county organization’s censure of Graham.

I wonder if Graham will get the message or arrogantly dismiss it as he’s been known to do in the past? The reason the GOP is in the minority right now isn’t because it is a conservative organization that appeals only to old white men in the South. It’s a minority organization because its own base doesn’t trust it to live up to its own principles. How do you generate the enthusiasm necessary to turn out the vote if what the base is left to vote for is a version of Lindsey Graham’s Democrat lite?

~McQ

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Depression-Era Unemployment Looms

Since the Great Depression, the peak unemployment rate was 10.8% in November, 1982.  We will, in all likelihood, set a significantly higher record for the unemployment rate in the next 12 months. Here are 12 reasons why the unemployment rate will reach at least 12%.

I would also remind you that if we currently reported the unemployment rate as they did in the 1930’s, our current rate of unemployment would be around 17.2%  In any event, here are just two of the most compelling reasons why the job picture is going to remain very cloudy:

For the first time in at least six decades, private sector employment is negative on a 10-year basis (first turned negative in August). Hence, the changes are not merely cyclical or short-term in nature. Many of the jobs created between the 2001 and 2008 recessions were related either directly or indirectly to the parabolic extension of credit…

But when we do start to see the economic clouds part in a more decisive fashion, what are employers likely to do first? Well, naturally they will begin to boost the workweek and just getting back to pre-recession levels would be the same as hiring more than two million people. Then there are the record number of people who got furloughed into part-time work and again, they total over nine million, and these folks are not counted as unemployed even if they are working considerably fewer days than they were before the credit crunch began…So the business sector has a vast pool of resources to draw from before they start tapping into the ranks of the unemployed or the typical 100,000-125,000 new entrants into the labour force when the economy turns the corner. Hence the unemployment rate is going to very likely be making new highs long after the recession is over — perhaps even years.

There are other compelling reasons at the link, but the two above are enough to ensure that the unemployment rate will remain high for quite some time.

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That Was Then. This Is Now.

So, the deal was supposed to work like this: The government takes over Chrysler, then sells a big chunk of it to Fiat.  In return, Chrysler would give us all these cool, American-made electric cars that would turn the planet sparkly, and make the unicorns smile.

6 April 2009:

If you’re tooling around in a Chrysler electric vehicle in a few years, you’ll still be driving an American car.

While some other companies are looking to foreign battery suppliers, Chrysler said Monday that it’s going to stay all-American. It announced it is choosing A123 Systems, a Massachusetts company, as its battery supplier. A123 will make the battery packs for Chrysler’s wave of electric vehicles at a new plant in Michigan. The first will hit the streets in 2010, says Lou Rhodes, vice president of advanced vehicle engineering for Chrysler. With Monday’s announcement, Chrysler is “that much closer” to getting its vehicle on the road.

Of course, the news that it could generate more American jobs could play well in Washington, D.C., where Chrysler is under the gun from the Obama administration to close its deal with Italy’s Fiat and take other drastic steps if it wants up to $6 billion in additional government loans.

How’s that working out for us?

11 November, 2009:

Chrysler has disbanded the engineering team that was trying to bring three electric models to market as a rush job, Automotive News reports today. Chrysler cited its devotion to electric vehicles as one of the key reasons why the Obama administration and Congress needed to give it $12.5 billion in bailout money, the News points out.

The change of heart on electric vehicles has come under Fiat. At a marathon presentation of Chrysler’s five-year strategy, CEO Sergio Marchionne talked about just about everything on Chrysler’s plate last week except its earlier electric-car plans. With the group’s disbanding, Chrysler’s electric plans will be melded into Fiat’s. Marchionne is apparently no fan of electric power:

He says electrics will only make up 1% or 2% of Fiat sales by 2014 and that he doesn’t put a lot of faith in the technology until battery developments are pushed forward.

Now, the unicorns are crying.  And considering the money we shelled out, we should be, too.

If you’re tooling around in a Chrysler electric vehicle in a few years, you’ll still be driving an American car.

While some other companies are looking to foreign battery suppliers, Chrysler said Monday that it’s going to stay all-American. It announced it is choosing A123 Systems, a Massachusetts company, as its battery supplier. A123 will make the battery packs for Chrysler’s wave of electric vehicles at a new plant in Michigan. The first will hit the streets in 2010, says Lou Rhodes, vice president of advanced vehicle engineering for Chrysler. With Monday’s announcement, Chrysler is “that much closer” to getting its vehicle on the road.

Of course, the news that it could generate more American jobs could play well in Washington, D.C., where Chrysler is under the gun from the Obama administration to close its deal with Italy’s Fiat and take other drastic steps if it wants up to $6 billion in additional government loans.

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