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Be careful what you wish for: While D.C. politicians harden their positions on spending and...

Be careful what you wish for: While D.C. politicians harden their positions on spending and taxes, austerity has already taken root in state governments, and it's killing the recovery. Daniel Indiviglio says cuts on the state and local level have knocked $8.8B off GDP and thrown 326,000 people out of work.
Comments (151)
  • EMS
    , contributor
    Comments (582) | Send Message
     
    Recession commeth...get ready folks.
    24 Jun 2011, 06:18 PM Reply Like
  • Joe Morgan
    , contributor
    Comments (1561) | Send Message
     
    I can't see a double dip coming when Fedex raises guidance on the year and reports good numbers in a quarter that goes from March to May, exactly at the peak of oil prices....

     

    The democrats are trying to instill fear that a double dip is coming if we cut spending... They want a blank check.....
    24 Jun 2011, 07:45 PM Reply Like
  • 1980XLS
    , contributor
    Comments (3333) | Send Message
     
    Joe,

     

    Those were my same thoughts re FEDX, especially at the peak of prices. One could only imagine how they would have done with a 20% pullback in energy prices.

     

    It was reassuring, but unfortunately only lasted about a day with so many other headlines offsetting it.

     

    Hopefully will will get some clarity with some positive guidance from some other Blellweather Companies.

     

    As far as your other theory, I believe you may be onto something there.
    24 Jun 2011, 07:57 PM Reply Like
  • Tack
    , contributor
    Comments (14420) | Send Message
     
    Joe & 1980:

     

    There's one risk:

     

    If the hysteria about European debt (pick your country and associated Moody's downgrade) gets enough momemntum, then, the portfolios of those top 20% who provide 90% of U.S. spending will wilt, as they pull in their horns, as their monthly portfolio statements arise. This is exact how recessions start, when fear overrides data, and then the fear becomes self-fulfilling in creating further negative data.

     

    We're not there yet, but don't get too comfy just yet. If SPX breaks 1250 in a confirmed way, we're headed down significantly. I'm not forecasting it, per se, but I reluctantly acknowledge the power of the same bond raters --Moody's, S&P, et al-- that brought us the last swan dive. And, right now, they have a smörgåsbord of choices to instill fear, a raft of European countries or even the U.S, itself.
    24 Jun 2011, 08:24 PM Reply Like
  • Tack
    , contributor
    Comments (14420) | Send Message
     
    Please excuse my failure to spellcheck and proof read.
    24 Jun 2011, 08:33 PM Reply Like
  • 1980XLS
    , contributor
    Comments (3333) | Send Message
     
    Tack,
    I agree. I will need to see more data, but we are at an inflection point.

     

    Once irrational selling starts, it takes on a life of it's own.

     

    Then deleveraging, etc, and before you know it they start selling things with complete disregard to value.

     

    I'll never forget watching CHK go down back in the fall of 2008, while Aubrey McClendon was getting Margin calls right after a ton of insider buying.

     

    Fortunately I was watching from the sidelines albeit with amazement

     

    Hopefully we never have to live those days again.
    24 Jun 2011, 08:37 PM Reply Like
  • Bill S. Friend
    , contributor
    Comments (715) | Send Message
     
    Irrational selling? There are plenty of reasons for rational selling! That $800 billion bump in the graph is not going to be repeated, so get ready for reality *smack* to hit. If you havent noticed, the Euro is on the ropes, employment is stagnant, and housing is on a downward trajectory. If your expecting the Fed to start tightening you will have a long wait! Fed-X is probably reaping the rewards of all the legal documents being overnighted regarding foreclosures.
    25 Jun 2011, 01:18 PM Reply Like
  • coddy0
    , contributor
    Comments (1182) | Send Message
     
    Daniel Indiviglio has discovered that gum surgery is indeed very painful process

     

    Would this discovery came earlier, regular tooth brush combined with flossing could be prescription Dr. Shapiro usually recommend

     

    Alas, current choice is between decisive gum cutting and seduction by money till the bitter end

     

    Pain is Great
    Amen

     

    ----------------------...

     

    says cuts on the state and local level have knocked $8.8B off GDP and thrown 326,000 people out of work.
    25 Jun 2011, 02:16 PM Reply Like
  • AnchorMan
    , contributor
    Comments (115) | Send Message
     
    last time I checked Fedex was a global operation. Did something change? Or is it possible their great numbers are because of the 100 other countries they operate in and if broken down, the returns here in the US were not so great? I looked for that type of detail but could not find anything, so if anyone does please post.
    25 Jun 2011, 04:37 PM Reply Like
  • 1980XLS
    , contributor
    Comments (3333) | Send Message
     
    AnchorMan,

     

    Agree that data would be interesting to see.

     

    But one must also understand S&P 500 companies are somewhat global themselves, along with the equity markets associated with them as well.
    25 Jun 2011, 04:42 PM Reply Like
  • bob adamson
    , contributor
    Comments (4559) | Send Message
     
    Tack -

     

    From one viewpoint North American stock markets are oversold in the short run and (provided there is no disruptive development such as a sovereign debt default by the US (caused by an impasse over the raising of the Federal debt ceiling) or by one of the EU peripheral States etc.) there should be a modest near term short duration rally.

     

    On the other hand, you are quite correct that confidence is currently very fragile and a significant negative occurrence, especially if it is caused by some event not on the short list endlessly discussed of late, could trigger a deeper correction.

     

    It is worth noting that since the recovery in stock prices since the firts quarter of 2009 we have not experienced a correction until that of the past couple of months.

     

    25 Jun 2011, 05:08 PM Reply Like
  • 1980XLS
    , contributor
    Comments (3333) | Send Message
     
    BobAdamson,

     

    Were were you between Mar thru Aug 2010?
    25 Jun 2011, 05:14 PM Reply Like
  • Windsun33
    , contributor
    Comments (4308) | Send Message
     
    A "correction" implies that something needs to be corrected, and maybe that long held assumption is dead wrong.
    25 Jun 2011, 08:41 PM Reply Like
  • Windsun33
    , contributor
    Comments (4308) | Send Message
     
    "The Ground segment had revenue of $2.26 billion for the three months ended May 31, which marks the end of the company’s fiscal year. That’s up from $1.96 billion during the same period last year..."

     

    GROUND is pretty much USA and Canada only in their report.
    25 Jun 2011, 08:43 PM Reply Like
  • WMARKW
    , contributor
    Comments (10700) | Send Message
     
    Sorry guys below....I read what you are saying, but I don't see anything being "fixed" in the economy. We have just learned how to make profits with fewer employees. We'll do the same at State and Federal level --- oops no profits...just fewer people. Fed and State account for 37% of GDP. State is 15%. If states reduce 10% then thats 1.5% of GDP. Somewhere at the Fed level there will be nominal cuts. If not....just kiss it goodbye, 5 years from now we'll be $20 Trillion in debt and interest will cost $1 Trillion a year.
    26 Jun 2011, 05:50 AM Reply Like
  • bob adamson
    , contributor
    Comments (4559) | Send Message
     
    1980XLS -

     

    You are correct. The markets moved down through that period. But were they down sufficiently to constitute a correction? I thought not.
    26 Jun 2011, 12:06 PM Reply Like
  • Tricky
    , contributor
    Comments (1590) | Send Message
     
    I don't doubt it. But this is what happens when you run irresponsible fiscal paths that have *already* created massive debt -- all your choices are terrible and have nasty consequences.
    24 Jun 2011, 06:24 PM Reply Like
  • mike8599
    , contributor
    Comments (594) | Send Message
     
    Your choices don't change.... good sound policy is always just that. Disturbances will always be out there, and tweaks and compensation to the degree in which move forward are always necessary.

     

    The problem is that we can't agree and establish a policy in which to call the base - so we are going to bounce while we fight it out.

     

    It is always an obvious and historical fact that socialistic policies don't survive without strong sponsorship and community support and that capitalistic policies are much easier and less costly to implement.

     

    Given that there is no "community support" you must implement policies that are capitalistic (less regulation, lower taxes, minimal government spending etc). If people want a socialistic society do it on a state / local level.
    25 Jun 2011, 09:15 AM Reply Like
  • Windsun33
    , contributor
    Comments (4308) | Send Message
     
    While this may be partly true, a lot of that loss is bloat and a result of government eating way too many fries and milkshakes when times were good and now being put on a diet.

     

    The alternative is to keep feeding the patient buttered chocolate muffins until it finally gets a heart attack and goes belly up. You don't cure a problem or an addiction by feeding it.

     

    But there is some truth to the idea that it is not the fall that kills you, it is the sudden stop, so a lot of the needed federal cuts will have to be phased in.
    24 Jun 2011, 06:26 PM Reply Like
  • SlingWing9
    , contributor
    Comments (508) | Send Message
     
    It's not a function of wishing for anything as though that comment suggested taxpayers are demanding something unreasonable. It is reality. Public workers can come down to earth on their salaries and fund their own damn retirements. If that brings a recession, it's just more reality. And don't raise my taxes.
    24 Jun 2011, 06:27 PM Reply Like
  • Tack
    , contributor
    Comments (14420) | Send Message
     
    Gosh, must be a far better idea to just keep millions of Government drones "employed," but not really contributing diddly to the economy; in fact, depressing it by sucking up capital and tax dollars that would otherwise be employed fruitfully by the private sector. Does anybody, but a life-long committed socialist really think that a country can prosper with legions of regulators, supervisors, "czars," administrators, licensors, inspectors, and every other make-work specialty in existence, none of whom contribute a single tangible product or any service that a consumer would purchase of his/her own free will?

     

    We don't need to have a recession, if proper tax-incentives and red-tape cutting were offered to private companies, and Government would just get out of the way, but, if the choice is recession or ever-expanding, economy-sapping, freedom-crimping do-gooders, then, bring it on. It will be most enjoyable watching the "nannyfied" actually have to go look for work in a real job for a change.
    24 Jun 2011, 06:32 PM Reply Like
  • Poor Texan
    , contributor
    Comments (3533) | Send Message
     
    Oh Tack! Don't you know that all government programs are necessary and all government employees are indispensable? :-(
    I mean, look how the Department of Education has produced a nation of scholars. And the Department of Energy has achieved its mandate of energy self-sufficiency.
    24 Jun 2011, 06:37 PM Reply Like
  • mattyw
    , contributor
    Comments (125) | Send Message
     
    As a government employee, I could not disagree more with your views. It's exactly why we got into this mess in the first place, not enough government involvement. How else can you explain the big subprime meltdown? The government is now getting more involved in every aspect of business and our lives, as this meltdown has shown that people cannot be trusted to make the right decision. Now give your head a shake!
    24 Jun 2011, 06:40 PM Reply Like
  • Good Captain
    , contributor
    Comments (456) | Send Message
     
    If you are suggesting government is the answer, I will do just what you said and give my head a shake and throw in a good laugh to boot. Government created the whole premise for the sub-prime mess in its "wonderfully" intentioned plans to limit and even eliminate credit checks to open up the "American dream" to all Americans. It's a nice thought but it prepared the way for disaster that ultimately followed.
    24 Jun 2011, 06:47 PM Reply Like
  • wyostocks
    , contributor
    Comments (9051) | Send Message
     
    mattw:
    "people cannot be trusted to make the right decision"

     

    Just call in the KGB and all will be well. The "people" can't make a good decision for themselves, but morons like you can do it for us.

     

    The problem is people who think like you working for the government.
    24 Jun 2011, 06:58 PM Reply Like
  • Duude
    , contributor
    Comments (3398) | Send Message
     
    More government involvement wasn't the solution when in 2004 a congressional banking committee absolutely refused to accept a regulator whistleblower's call to look into the financial health of Fannie and Freddie. It wasn't that the Congressional committee didn't have staff enough to investigate. They already knew the truth. It was the best corruption money could buy.
    Expanding government services will never bring economic recovery to the private sector. It doesn't bring any value to the table, just expanding deficits.
    24 Jun 2011, 06:59 PM Reply Like
  • 1980XLS
    , contributor
    Comments (3333) | Send Message
     
    mattyw,

     

    Perhaps your job is one of the half or so that are not a total waste
    of taxpayers money.

     

    Then again perhaps not, given your viewpoint, or lack of understanding of the perspective of the private sector that feeds you.

     

    Government action and/or policy is equally to blame for the crisis
    as is any inaction you may be refferring to.
    24 Jun 2011, 07:03 PM Reply Like
  • Joe Morgan
    , contributor
    Comments (1561) | Send Message
     
    If you think Government is our savior, why don't you just donate some money to Pay.gov and then find the "Gifts to Reduce the Public Debt" page. Making the donation takes a couple minutes.

     

    No one is restricting anybody to pay more to the treasury, just stay away from my money, enough of incentivizing the parasites, enough of putting the weight of the debt in the middle class and the drivers of jobs: small businesses....

     

    By the way, freezing spending to 2010 levels thru 2014 gets a Balanced Budget.....so we can surely reduce the deficit without affecting growth too much......
    24 Jun 2011, 07:20 PM Reply Like
  • halconnoche
    , contributor
    Comments (68) | Send Message
     
    Govt even threatened lenders who thought credit checks were a good idea. That was condisered profiling.
    24 Jun 2011, 07:21 PM Reply Like
  • 2PP
    , contributor
    Comments (352) | Send Message
     
    C'mon Tack, I am not a Fed but I know quite a few. The majority of the government employees I personally know are lifelong, hardworking professional IT people. The bulk of the bloat (bad employees) are political appointees and EEOC promotions that literally retire on the job because they're untouchable once they win an EEOC complaint. I'm a die hard conservative with a lot of friends that don't like my opinions because I support Paul Ryan's budget. Our country is sick and the medicine is going to be bitter, but to blame hardworking career Federal workers for what their bosses policies do is just plain wrong.
    24 Jun 2011, 07:45 PM Reply Like
  • losbronces
    , contributor
    Comments (793) | Send Message
     
    I think he was being sarcastic. At least I hope so.
    24 Jun 2011, 08:11 PM Reply Like
  • TomasViewPoint
    , contributor
    Comments (4845) | Send Message
     
    matt

     

    You said "people cannot be trusted to make the right decision"

     

    So people in government can? Are they breathing different air?

     

    We have soldiers in cemeteries because people in government could not make the right decision. Let's not go down the road of exploring all the waste and corruption in government.
    24 Jun 2011, 08:56 PM Reply Like
  • TomasViewPoint
    , contributor
    Comments (4845) | Send Message
     
    2PP

     

    Assuming your assertion is accurate then how do we solve for the bums in government besides just throwing everyone out?
    24 Jun 2011, 08:59 PM Reply Like
  • Poor Texan
    , contributor
    Comments (3533) | Send Message
     
    There is a story, may be apocryphal, that Caesar ordered his engineers to do a project he needed for a battle. When they claimed they couldn't do it, he had half the engineers killed. The remainder accomplished the project. If headcount is reduced in a government agency, the better workers, with the support of their superiors, will cull the poorer performers, one way or another, in order to keep their own jobs.
    24 Jun 2011, 09:23 PM Reply Like
  • 1980XLS
    , contributor
    Comments (3333) | Send Message
     
    PoorTexan,

     

    Interesting.

     

    I would add,

     

    That by eliminating public sector unions, we could cut the labor force in half.

     

    Then applying Caeser's tactics, should enable us to cut in half yet again.

     

    And so it is and shall be. We can in fact get by with a 75% reduction in the Government workforce, and still have the truly necessary services.

     

    Hail Caeser!
    24 Jun 2011, 09:34 PM Reply Like
  • 2PP
    , contributor
    Comments (352) | Send Message
     
    The government is doing that right now, offering early retirement with no cash payment. This will not work as there is no incentive to leave without a cash buyout($25,000 is the standard offer). There is no answer, people either choose to work hard on principal and contribute or they just do nothing and collect a paycheck. That is the problem with a unionized govt workforce, once "in" it is for a lifetime. The employee rating system for Feds changes like I change socks, the old system, the (PIP) Performance Improvement Plan was a 1-5 rating, grade 5 being the best average being 3. A 2 or 1 grade required a buttload of paperwork and written justification by a supervisor, which in reality made all supervisors rate the employees a 3 or better. Now there is a pass/fail rating system, and bad workers love this system. Good workers love the 1-5 system, so it is extremely difficult to get rid of a bad Fed. Excluding theft, porn on their PC or some other grievous offense, Feds are very difficult to fire.
    24 Jun 2011, 09:38 PM Reply Like
  • TomasViewPoint
    , contributor
    Comments (4845) | Send Message
     
    They should be "at will" employees and fired for any reason and then they can get another job. Too much "nesting and vesting."
    24 Jun 2011, 09:41 PM Reply Like
  • faustius
    , contributor
    Comments (486) | Send Message
     
    A while back when California was going through it's latest round of "layoff all the teachers", I decided to take a stab at finding out how much non-teacher payroll the California education system burns in a year.

     

    Its not very easy to do, and I wasn't able to come up with an answer. There are detailed public reports on everyone in the K-12 system, but once you get to the bureaucrats, nothing. I did however find a government job site that listed over 1,500 different job titles, virtually none of which involve teaching.

     

    I'd still like to know how many "Assistant Deputy Directors of Educational Services", or "Associate Nutrition Coordinators" lost their jobs when California was laying off its teachers. I suspect the answer is 0.
    24 Jun 2011, 09:54 PM Reply Like
  • Poormansgold
    , contributor
    Comments (35) | Send Message
     
    There were plenty of government regulators not doing their job prior to the melt dowm. The key here is governemnt not doing its job. As stated above, cut government jobs, make those slackers get real jobs and stop bleeding the tax payers.
    25 Jun 2011, 07:37 AM Reply Like
  • American in Paris
    , contributor
    Comments (5504) | Send Message
     
    Tack,

     

    I worked at some of the biggest companies in the world. There are lot of corporate drones doing meaningless work for mid-level managers.

     

    A lot of the conservative rhetoric is based on 'fact immunology'.

     

    Compare country A, which produces high quality manufacturing products and whose GDP is 32% manufacturing. Government spending equals 43% of GDP. This country is the second largest exporter in the world. It's economy is booming.

     

    Country B, which produces some high quality manufacturing, but only 12% of its economy is manufacturing. Government spending equals 38% of GDP, but is highly skewed to defense. So civilian government spending is fairly low. It's economy is struggling.

     

    Country A is German and Country B is the US.

     

    So how does Germany do so well when it should be staggering under the burden of government spending?
    25 Jun 2011, 10:10 AM Reply Like
  • American in Paris
    , contributor
    Comments (5504) | Send Message
     
    Good Captain,

     

    Show us the government regulation which forbade companies to do credit checks when granting mortgages.

     

    You can't provide the reference. You're perpetuating a Republic urban myth.
    25 Jun 2011, 10:14 AM Reply Like
  • American in Paris
    , contributor
    Comments (5504) | Send Message
     
    That's a lie.

     

    The key to understanding the credit crisis is that the Wall Street banks strong armed the ratings agencies into giving garbage subprime mortgages good credit ratings. That allowed the banks to sell the mortgages to Wall Street, which packaged them into mortgage backed securities and then sold them.

     

    You're living in a fantasy land if you think government agencies strong armed the banks into making loans against their better judgment.

     

    The banks did not have a strong incentive to consider credit worthiness because they could securitize the loans and thereby take them off their balance sheets. They sold the subprime mortgages to Wall Street because the ratings agency rated them as low risk.

     

    By the way, a lot of the mortgage defaults involved houses valued at over $600K. Las Vegas is full of empty mansions. Even Nicholas Cage defaulted on his Las Vegas mansion. It was repossessed.

     

    You are trying to tell me that the government pressured the banks to give Nicholas Cage a mortgage?

     

    Fantasy land ... Fantasy land ...
    25 Jun 2011, 10:25 AM Reply Like
  • American in Paris
    , contributor
    Comments (5504) | Send Message
     
    Really, so the American system is so superior to the European system?

     

    As I recollect, your country engaged in torture for 8 years under George Bush and intercepted phone calls and email without getting warrants even though the US has a secret court for approving terrorist related inquiries.

     

    And you are talking about the KGB? Look in a mirror, you're lost.
    25 Jun 2011, 10:29 AM Reply Like
  • American in Paris
    , contributor
    Comments (5504) | Send Message
     
    Yes, and Ireland followed the American model and the result was a catastrophic real estate bubble.

     

    The Irish made all the American mistakes - zero down payment loans, negative amortization loans.

     

    The Power of Capitalism ...
    25 Jun 2011, 10:30 AM Reply Like
  • American in Paris
    , contributor
    Comments (5504) | Send Message
     
    Really, who built the interstate high way system or secured the rights of way for the first continental railroad?

     

    By the way, why is Germany doing better than the US despite much higher social spending?
    25 Jun 2011, 10:32 AM Reply Like
  • American in Paris
    , contributor
    Comments (5504) | Send Message
     
    No, the private sector is primarily responsible for the credit crisis. It was greed. Manipulated credit ratings combined with securitization.

     

    I feel sorry for guys like you because you're mentally constipated you can't see the world without open eyes. You need to let go of the ideological crap that you are so desperately to retain.
    25 Jun 2011, 10:34 AM Reply Like
  • American in Paris
    , contributor
    Comments (5504) | Send Message
     
    How about the waste and corruption in American business? The lobbying for tax subsidies. The empty offices in Bermude to reduce taxes. The endless middle management bureaucrats.

     

    I doubt you have ever worked for a big corporation. Mighty open your naive eyes ...
    25 Jun 2011, 10:36 AM Reply Like
  • HiSpeed
    , contributor
    Comments (1179) | Send Message
     
    Wow, "most ignorant post of the day" award!
    25 Jun 2011, 10:37 AM Reply Like
  • American in Paris
    , contributor
    Comments (5504) | Send Message
     
    Texan,

     

    Your comment is irrelevant. Government administration, if it was totally eliminated, would not solve the budget deficit nor make a significant impact. Take social security. The administrative overhead is less than 1%. Quite a bit less than the insurance companies ...

     

    The US Federal deficit cannot eliminated without touching social security and other entitlement programs that are highly popular. And defense at 600 billion a year is obviously too high as well.

     

    Taking cheap shots at government workers when bureaucracy is a disease affecting all organizations, including corporations, simply discredits yourself.
    25 Jun 2011, 10:39 AM Reply Like
  • American in Paris
    , contributor
    Comments (5504) | Send Message
     
    'At will' would mean the politicization of the civil service and that is definitely a bad thing.

     

    It's too bad many of you simply use this board to get your daily dose of ideological venting (it's an addiction) instead of thoughtfully considering the issues.
    25 Jun 2011, 10:41 AM Reply Like
  • kcr357
    , contributor
    Comments (567) | Send Message
     
    So what you're saying is the banks knew which mortgages were likely to default, got rid of them via MBS's, and jettisoned all their risk to securities buyers? Didn't the banks LOSE hundreds of billions? Didn't the banks receive hundred of billions to recapitalize the money you are saying they never lost?
    25 Jun 2011, 10:51 AM Reply Like
  • Windsun33
    , contributor
    Comments (4308) | Send Message
     
    You're the same guy that said a few weeks back that Europe had no problems with food safety, right?

     

    "France's president has gone quiet following speculation it was a French missile that killed civilians in a Tripoli housing block..." www.guardian.co.uk/com...

     

    Glass houses and all that.
    25 Jun 2011, 11:27 AM Reply Like
  • Windsun33
    , contributor
    Comments (4308) | Send Message
     
    On the other hand, France ranks 64th in economic freedom in the 2011 Index of Economic Freedom www.heritage.org/Index...
    25 Jun 2011, 11:39 AM Reply Like
  • Windsun33
    , contributor
    Comments (4308) | Send Message
     
    You really really should look a little closer of the history of the continental railroad. The government gave away millions of acres of free land - some of it not even theirs to give away - to the railroads. It is still considered one of the biggest boondoggles in history. In total, just in the West alone, they received over 1 BILLION acres of free land. "Total land granted or sold
    1,144,380,000.." www.landgrant.org/forf...

     

    And that was ALL government run.
    25 Jun 2011, 11:46 AM Reply Like
  • Windsun33
    , contributor
    Comments (4308) | Send Message
     
    ".. You need to let go of the ideological crap that you are so desperately to retain..."

     

    Pot.. Kettle.. Black...
    25 Jun 2011, 11:48 AM Reply Like
  • Windsun33
    , contributor
    Comments (4308) | Send Message
     
    Those in government get these special "smart" pills that make them better than us common folks at making decisions. Everyone knows that.
    25 Jun 2011, 11:50 AM Reply Like
  • Windsun33
    , contributor
    Comments (4308) | Send Message
     
    Nothing on earth can possibly equal the waste and corruption in government. I have worked for both government - state, local, and federal - and in large and small corporations. I have yet to see anything equal the waste in the Federal Government.

     

    "In all, 47 people from across the political spectrum, including four former government ministers, could face up to 10 years' jail on charges of awarding public works contracts from City Hall in Paris in exchange for kickbacks worth tens of millions of pounds. The money was used to line party coffers, it is alleged..."

     

    While we are at it, let's take a look at French and other European arms sales to Libya. I find it ironic that France is now bombing helicopters and Mirage jets it sold just 3-4 years ago to Libya.
    25 Jun 2011, 12:02 PM Reply Like
  • The Geoffster
    , contributor
    Comments (4138) | Send Message
     
    The interstate highway system was proposed by President Eisenhower to provide rapid mobilization of the military. Many argue that the money would have been better spent on a rail system. GM and Esso (now Exxon) were natural supporters as well. It used to be said that what's good for GM is good for America. How ironic.
    25 Jun 2011, 12:43 PM Reply Like
  • The Geoffster
    , contributor
    Comments (4138) | Send Message
     
    It looks like the frogs have found a new way to "build in" obsolescence in their products.
    25 Jun 2011, 01:00 PM Reply Like
  • The Geoffster
    , contributor
    Comments (4138) | Send Message
     
    "The US Federal deficit cannot eliminated without touching social security and other entitlement programs that are highly popular. And defense at 600 billion a year is obviously too high as well."
    Your comment perfectly explains why default is inevitable.
    25 Jun 2011, 01:03 PM Reply Like
  • Mad_Max_A_Million
    , contributor
    Comments (1175) | Send Message
     
    Fact: Fanny Mae Hired every lobbyist they could dig up to stop the government from putting the brakes on the Sub-prime frenzy. It worked.

     

    Some government huh?

     

    Fact: They hired the rest to sit on their hands just so they would not be lobbying for the opposition. Some real sick behavior.
    25 Jun 2011, 01:28 PM Reply Like
  • bob adamson
    , contributor
    Comments (4559) | Send Message
     
    American in Paris -

     

    Your points are well taken.

     

    It is a truism that in any large private or public sector organization (especially one that is bureaucratic by nature) that about 25% of the workforce is very productive (economies of scale, access to and application of resources etc.) but that a sizable number of time servers (say 20% of the work force) are able to find and continue employment. There are, moreover, aspects of production and service provision that by their nature are more efficiently and effectively delivered by bureaucratic organizations rather than by small unconnected teams.

     

    In sum
    1. Bureaucracies are not inherently bad; they are simply one manner of organization of work (a manner most appropriate for only certain areas of activity);
    2. It is a myth that private and public sector bureaucracies are inherently different or that inappropriate choices to create bureaucracies is the particular vice of the public sector.
    3. Where there is utility in creating a bureaucratic style of organization, the challenge is to build into that organization optimum ways to motivate and reward people for good work throughout the organization (and to minimize the possibility that the time serving mode of employment will become established and endure).
    4. It will be very hard to achieve point 3 in a society that fundamentally believes that bureaucracies are inherently places where second-rate people are employed to perform make-work projects badly.
    25 Jun 2011, 01:39 PM Reply Like
  • TomasViewPoint
    , contributor
    Comments (4845) | Send Message
     
    American

     

    The point here is that we have had many congressional oversight committees and congressment beating up bank executives in public for decades because they would not lend to people with high risk profiles. Once a method was found to enable this lending everyone was happy until the sky fell in and then amnesia set in. But you can always go to YouTube for the greatest hits.

     

    Frankly the government took over underwriting mortgages by dictating terms for resell so best practices and methodologies were gutted from the financial sector over the decades and the government took anything as long as they loans conformed to their specifications. The GSE's also measured their share of the mortgage market so these quasi government agencies were taking on more and more risk and they viewed sub prime as competition so they entered the market by buying securities.

     

    Government is in this industry way over their heads and became the central player until it became a train wreck and then they tried to exit left which did not work.

     

    Credit Agencies were not strong armed they just changed their business models so they could make more money. And they did not tell anyone that they were changing.
    25 Jun 2011, 02:26 PM Reply Like
  • TomasViewPoint
    , contributor
    Comments (4845) | Send Message
     
    American

     

    Given that our system has allowed us to build the biggest economy in the world and we were emulated by Europe in various ways over the past few centuries both politically and economically I would say we have a good batting average.

     

    The biggest mistake we have made recently is letting ourselves slip into socialistic models that have now turned on us with a vengance and we have a lot of bad habits funded via taxes and debt issuance and encouraged by our government. Command and control is not American in its nature. Europe can keep their Kings and Queens.
    25 Jun 2011, 02:38 PM Reply Like
  • Good Captain
    , contributor
    Comments (456) | Send Message
     
    That wasn't my comment AIP. Even so, I don't have a reference for you and rather doubt any regulation would be so ridiculously worded. Wording is obviously important but so too are regulators' interpretations and means of enforcing their regulations. If a regulator brings a fervency to a particular provision, the reality or practicality of the matter is that one either moves in line w/ the will of the regulator(s) or fight them at your peril.

     

    I am not in the banking industry so I cannot vouch this was in fact the case but as you say, the talk has been that was often the case. Because it is plausible and a pervasive, I am not as inclined as you appear to be in wholly discounting the mere possibility of it.
    25 Jun 2011, 03:44 PM Reply Like
  • Good Captain
    , contributor
    Comments (456) | Send Message
     
    AIP,
    Your name fits like a woefully undersized suit might. Your statement that, "... YOUR {emphasis added} country engaged in torture..." wholly demonstrates that irrespective of what passport you may bear, an American you are not in either thought or spirit. This is not meant as a negative attack, but as a statement of fact and one your own words confirm. If you do in fact carry an American passport, might I suggest recasting yourself as "Francophile in Paris"?
    25 Jun 2011, 03:55 PM Reply Like
  • Good Captain
    , contributor
    Comments (456) | Send Message
     
    Part of the reason for the malaise in the US today lies in the fact the current President is acting more European than the Europeans. I don't think you can miss the irony during an earlier meeting of the G - 7 (or was it 20) shortly after he assumed office that the Obama prescription for healing - stimulus - was soundly rejected by .... (drumroll please) the previously Keynesian Europeans.
    25 Jun 2011, 04:01 PM Reply Like
  • TomasViewPoint
    , contributor
    Comments (4845) | Send Message
     
    I am working for a large corporation and have worked for a number. I have worked for large corporations that have been harrassed by government looking to get headlines.

     

    Waste and corruption are indiscriminate about their host but in the government sector it is institutionalized and rewarded. Middle management bureaucrats get whacked every year in the private sector.

     

    You must be the last subscriber to the NYT.
    25 Jun 2011, 04:13 PM Reply Like
  • Windsun33
    , contributor
    Comments (4308) | Send Message
     
    He gets all of his business insight from the Huffington Post :)
    25 Jun 2011, 04:17 PM Reply Like
  • TomasViewPoint
    , contributor
    Comments (4845) | Send Message
     
    American

     

    You must have worked for Citibank. They had more dead weight middle managers than anyone.

     

    So difference between Germany and the US:

     

    Germany: Stratified population, small country compared to the US, fantastic work ethic, not working and free loading frowned on heavily, skilled and educated workforce with good schools to turn out these employees, long tradition of best of breed products, great and desirable brand names in car manufacturing which are sold all over the world, imports most raw materials, relies on the US for military so the don't spend much on military, government is proud of their industry, makes sure it is profitable and sustainable, works hand in glove with manufacturing and takes on all the benefits, typically runs higher UE than the US and great beer.

     

    The US.........heterogenous population, very contentious culture with so many voices, immigration still going strong, very large country and economy with huge diversity, educational system not strong with respect to technical skills training, no long tradition of best of breed manufacturing products although invented here, work ethic is spotty and downright bad at times, not working respected more than working, carries the military burdens of many other countries, government adversarial to industry, however very innovative, typically runs lower UE than Germany.

     

    So we are not Germany and never will be.
    25 Jun 2011, 04:49 PM Reply Like
  • bob adamson
    , contributor
    Comments (4559) | Send Message
     
    Tack -

     

    You do know how to rack up the favorable responses by a good rant!

     

    It is rather pedestrian of me, I know, to trot out the usual rejoinders that:
    (a) Useful and useless (and somewhat limp half way between departments exist within private sector and public sector organizations alike;
    (b) Many areas of public education, public health and safety, research, infrastructure development and maintenance, statistical generation and analysis, weather forecasting etc. etc. would not be performed or be performed as well and publicly disseminated if not done in the public sector;
    (c) Many public sector employees and officers work very hard and effectively and many holding corresponding private sector positions do not (by which I mean to say that it is a myth that private sector or public sector participants are inherently or predominantly better or worse or function in organizations necessarily better or worse than in the other sector).
    (d) This is an era of dramatic change and the real goal should be to continually strive for smooth meaningful adjustment within both sectors to meet the challenges the pace of this change presents. (e) The resulting need to shift activities back and forth between the private and public sector and reorganize units withing private and public sector organizations is too great to be hampered and blinkered by ideological prejudice.
    25 Jun 2011, 05:30 PM Reply Like
  • bob adamson
    , contributor
    Comments (4559) | Send Message
     
    Tomas -

     

    One can cherry-pick good and bad examples of successes derived from US experience and that of Europe. By way of example, the current success of Sweden belies any blanket condemnation of the European welfare state based model and the recent relative success of the Canadian political and economic model (combining as they do aspects of both the American and European models as discussed in this discussion thread) as compared to the US is noteworthy.

     

    Your position is not without merit in moderation but you overstate your case in ways that undercut the relevance of the points that could be made from your perspective.
    25 Jun 2011, 05:40 PM Reply Like
  • bob adamson
    , contributor
    Comments (4559) | Send Message
     
    American in Paris -

     

    In the same vain, the competition of the UK and US investment banking systems in the decade or more before 2007 to create and market ever more exotic securitized debt obligations and derivatives (thereby creating literally trillions of dollars worth of pseudo-assets which the markets largely discounted during the 2007/8 meltdown and ballooning and distorting credit domestic and international markets) should be noted. The fallout continues to plague the national and international economies and will continue to do so for a generation.
    25 Jun 2011, 05:49 PM Reply Like
  • bob adamson
    , contributor
    Comments (4559) | Send Message
     
    Poor Texan -

     

    And we would want our working environments infused (OK, even without the killing part) with similar ruthlessness?

     

    This smacks too much of China's Great Leap Forward of the 1960s.
    25 Jun 2011, 05:54 PM Reply Like
  • bob adamson
    , contributor
    Comments (4559) | Send Message
     
    1980XLS -

     

    A great parody of Poor Texan's comment (except you didn't mean it as a parody).
    25 Jun 2011, 05:56 PM Reply Like
  • bob adamson
    , contributor
    Comments (4559) | Send Message
     
    Tomas -

     

    Tenure lead to abuse no doubt. On the other hand, would you really like to live in a society where all employees work a the unilateral discretion of their employer and can be "fired for any reason" presumably without severance pay?

     

    Jumping from one extreme to another serves no good end.
    25 Jun 2011, 06:01 PM Reply Like
  • 1980XLS
    , contributor
    Comments (3333) | Send Message
     
    Bob Adamson

     

    Oh my God! How horrible that would be.

     

    Public Workers would actually have to work under the same rules as the Private Sector,Taxpayers that Feed them.

     

    Does not sound Extreme to me.

     

    Just Real World.

     

    How dare somebody's Boss have the authority to fire their underlings
    25 Jun 2011, 06:14 PM Reply Like
  • bob adamson
    , contributor
    Comments (4559) | Send Message
     
    1980XLS -

     

    The right to fire yes, the obligation to proviso appropriate severance pay yes..
    25 Jun 2011, 10:35 PM Reply Like
  • TomasViewPoint
    , contributor
    Comments (4845) | Send Message
     
    Bob

     

    So we are comparing Sweden a homogeneous country of 8 million to the US a heterogeneous country of 313 million side by side? And then comparing the US to Canada a country of 33 million but rich in resources? The economies are also quite different. Command and Control has a chance of working in small countries and economies but in large scale it falls apart. Also neither of those countries mentioned spend militarily what the US spends and so on. And we have typically had lower UE than Euro economies.

     

    I am not overstating the case. We have a fairly good batting average over a few centuries not just a few years. Walking away from that as we battle through this latest downturn would be premature to say the least.

     

    To the larger point if we would have not established the US as a free country and raised expectations of what free people should so desire then Europe would probably still have royal rulers and likely experimented with Communism by now. The vestiges of royal rulers still exists in the socialist state which bestows favors from its largesse.
    26 Jun 2011, 01:24 AM Reply Like
  • TomasViewPoint
    , contributor
    Comments (4845) | Send Message
     
    Bob

     

    Absolutely would love to live in a society like that because dead wood is the hardest to get rid of and requires an easy firing process. No employer lets their good employees go if they can help it.

     

    By they way employees can leave when they want and should if they don't like the employer. Employers have pressure also to maintain their reputation as a reasonably decent place to work. Turnover is expensive.

     

    Next!
    26 Jun 2011, 01:29 AM Reply Like
  • bob adamson
    , contributor
    Comments (4559) | Send Message
     
    Tomas -

     

    Far from it for me to suggest that the US should strive to be anything domestically other than what Americans want it to be or that it has been successful over many years in many ways. I'm only saying that there are many roads to success for a country and other countries have achieved success as well by following other routes.
    26 Jun 2011, 01:39 AM Reply Like
  • TomasViewPoint
    , contributor
    Comments (4845) | Send Message
     
    Bob

     

    Not speaking for Tack but let's make this simple.

     

    Dial back Federal spending to $2 Trillion which should likely place us back around the year 2002 and let's live with that level of service. I believe that roughly equals tax receipts. We don't have to go back 100 years we can just go back 9 years.
    26 Jun 2011, 01:41 AM Reply Like
  • bob adamson
    , contributor
    Comments (4559) | Send Message
     
    Geoff –

     

    There is another dimension to the railway history that you relate. During the same period the US Government systematically encouraged the airplane manufacturers to twin the highly subsidized development of military transport aircraft with parallel development of passenger and freight aircraft. This made civil airplanes cheaper to develop and produce than they otherwise would have been thereby improving the competitiveness of the growing airline industry in competition with the railways.

     

    In short, the development of US railways was retarded by subsidized competition of both motor vehicle transportation systems and the airline industry.
    26 Jun 2011, 02:03 AM Reply Like
  • WMARKW
    , contributor
    Comments (10700) | Send Message
     
    The ''quasi-governmental" entity called the Fed started the ball rolling on the housing meltdown by brisking raising interest rates when they could have done it less dramatically over a longer period of time. Once the bubble burst then they went to ZIRP and so you have to ask what the heck were they thinking in the first place.
    26 Jun 2011, 05:56 AM Reply Like
  • WMARKW
    , contributor
    Comments (10700) | Send Message
     
    So your true colors come out. You call yourself an American in Paris, but you say, "your country". You have apparently given up your citizenship....at leat in your own mind. Since we are divorced - you from your country - perhaps you should recuse yourself from these discussions.

     

    BTW....I have no problem with the US torturing terrorists. Apparently your France has no problem letting Islam invade your country and take it over.

     

    And by the way....I keep looking to find the last major thing that France invented....but I have not been able to find anything since Pastuerization...perhaps you can update me.
    26 Jun 2011, 06:00 AM Reply Like
  • WMARKW
    , contributor
    Comments (10700) | Send Message
     
    How many illegal immigrants live in Canada?
    26 Jun 2011, 06:03 AM Reply Like
  • Tack
    , contributor
    Comments (14420) | Send Message
     
    Geoff:

     

    The railway system seems a constant topic of the utopian-minded in this country, who pine wistfully for Europe's rail system, but in complete disregard to the vast differences in history and geography of the two continents.

     

    Europe developed its population-concentrated cities and towns as a direct outgrowth of feudalism, and Europe is relatively small, as compared to the U.S. Owing to these factors, a centralized train network connecting cities serves the population well and travel can be accomplished in reasonable time frames.

     

    Contrast that to the U.S., where the history of its development was through exploration, land grants and individualistic development of an agrarian, then suburban society. It's been decentralized from the start, and still sees the population widely spread out across vast stretches of geography. Here, trains don't works as well because there is a lack in many places of sufficient localized density and the distances to travel across the nation are vast.

     

    So, unless there is going to be forced communalization (I'm sure some on the left would love it) of society into urbanized city-camps, trains are only a good transport option in selected markets, where density and travel patterns support adequate volumes to justify the large investment necessary, as well as the costs of operation.
    26 Jun 2011, 08:49 AM Reply Like
  • TomasViewPoint
    , contributor
    Comments (4845) | Send Message
     
    AIP

     

    Nope that is just bad underwriting standards. Don't get confused.
    26 Jun 2011, 09:34 AM Reply Like
  • losbronces
    , contributor
    Comments (793) | Send Message
     
    Is it because Germans are more productive than Americans? Is it because Germany is able to take advantage of the EC common currency to sell product to other EC nations? Maybe that is why the Germans are willing to come up with bailout money for other EC nations to protect their privileged trading status within the EC.

     

    And please tell us why other European countries with high social spending (Spain, Portugal, Italy and Greece come to mind) are doing worse than both Germany and the U.S. with regard to their respective economies.
    26 Jun 2011, 10:09 AM Reply Like
  • losbronces
    , contributor
    Comments (793) | Send Message
     
    I have worked for large international mining houses and I have seen the results of state-run companies involved in the mining industry. I have worked more than a decade in various foreign countries (mainly in what I consider LDCs, although that term seems to be out of vogue now). There is no comparison, those international corporations are much more efficient than state-run mining companies and with significantly less corruption, and waste. Too much waste gets people fired in private business.

     

    Specifically compare the operation of CODELCO, Centromin (now defunct), the Zambian state mining company (also gone) with the operation of BHP, RTZ, etc. Those state-owned companies all produced huge amounts of waste and in the case of Centromin & the Zambians, almost destroyed their respective mining industries before selling them off to both international and national corporations .

     

    Here is a reference for you regarding Zambia's comments on current African nationalization efforts: www.mining.com/2011/06.../

     

    CODELCO has improved significantly, but the waste was amazing. Most of the time, you can count on CODELCO to not achieve their annual production estimates. Having politicians appoint the leader results in changes in tactics and even strategy costing up to hundreds of millions of dollars (the ex-pit crushers and haul road bridges at Chuquicamata come to mind--cost was in the 100s of millions and the system was never used). The saving grace for CODELCO is that they control some of the best copper deposits in the world.

     

    Even worker safety was poorer in these state-run companies--you don't brag about reducing the number of fatal accidents as CODELCO was still doing that in the 1990s. CODELCO has improved in worker safety but even that improvement was due to pressure from the much better results achieved by international corporations in Chile. And CODELCO achieved those improvements by copying programs developed by those corporations.

     

    Lobbying for lower taxes is not corruption, making campaign contributions to ensure that you get lower taxes is. By the way, Obama set a record for receiving campaign contributions and also in spending for the presidential campaign, here is a link: www.bloomberg.com/apps...

     

    Since you seem to be aware of actual corporate corruption, here is a link to the Foreign Corrupt Practices Act: www.fcpa.us/.
    26 Jun 2011, 10:17 AM Reply Like
  • 1980XLS
    , contributor
    Comments (3333) | Send Message
     
    BobAdamson.

     

    Appropriate Severance Pay?

     

    Appropriate as deemed by who?

     

    Obligatory?

     

    You mean continuation of reward for poor performance should be converted to continued compensation for no performance.

     

    There is no legal requirement for severance pay other than by contract.

     

    Why should any company be required to pay anybody for time not worked?

     

    That's what unemployment insurance is for.

     

    And even unemployment insurance can be denied for a multitude of reasons

     

    Other than the Socialist Republic of Connecticut, which requires Employers to pay for Jury Duty, and now sick Pay, (New and a first) such outrageous violations of private party rights do mostly not exist in the US.

     

    Connecticut ranks first in many categories.

     

    # 1 in per Capita State Debt as well.
    26 Jun 2011, 10:24 AM Reply Like
  • 1980XLS
    , contributor
    Comments (3333) | Send Message
     
    Bob Adamson,

     

    And so it shall be!

     

    www.nytimes.com/2011/0...

     

    Ignorant morons had the most generous, Pro-Union Governor, offer then the deal of a lifetime, and they voted it down anyway.

     

    Guaranty you this, If layoffs were based on Merit, not Seniority, the rank and file would not have thrown their "Union Brothers" under the Bus.

     

    Greed is not exclusive to Business.
    26 Jun 2011, 10:34 AM Reply Like
  • Windsun33
    , contributor
    Comments (4308) | Send Message
     
    Bob - Yes, but that was later - mostly during and after WW2, when the governments pick for winners shifted from what they viewed as obsolete railroads to the "new tech" (does that sound like the same pitch for "green jobs"?).

     

    It took the railroads about 15-20 years to shift from being a government protected industry to being (more or less) on it's own, but I think in the long run we have a much better rail transportation system. As far as I know, the only railroads that consistently lose money now are the government run ones, like Amtrak.
    26 Jun 2011, 12:56 PM Reply Like
  • Windsun33
    , contributor
    Comments (4308) | Send Message
     
    People tend to think that many of the solutions for the US like in copying the European or Japanese models (which was also feudalistic). But just looking at a map shows how wrong that kind of thinking can be - the distance from Seattle to Phoenix is roughly the same as from Paris to Moscow. And getting you to Phoenix is only 1/3 of the way across the US.

     

    Very few Europeans that have not actually traveled much in the US realize the vast difference in size, and why you cannot just transplant the same systems of transportation. Another comparison is that Greece is about the same size as Alabama...
    26 Jun 2011, 01:08 PM Reply Like
  • Windsun33
    , contributor
    Comments (4308) | Send Message
     
    Some good insight into some of the things that go wrong, even in the mining industry when you have what are essentially GSE's.
    26 Jun 2011, 01:13 PM Reply Like
  • Windsun33
    , contributor
    Comments (4308) | Send Message
     
    Not surprising really, given the steadfast resolve of many to ignore facts and the basic math.

     

    As far as "union brothers", that has always been a myth, this just brings it more to light. Unions have been throwing the non-union middle and lower class under the bus for decades, despite all the high sounding rhetoric about "working people" - when a union spokesman says Working People, they really mean union only people.
    26 Jun 2011, 01:32 PM Reply Like
  • Poor Texan
    , contributor
    Comments (3533) | Send Message
     
    Bob,

     

    Ruthlessness? In private business you have certain goals to meet. If you don't perform, you are demoted, moved to an irrelevant position (if you're close to retirement), or fired. I dealt with government people, (revenue agents: the cream of the crop), and their goals were much below the private sector. If we're not paying for efficiency, we're providing welfare (with medical and retirement benefits). Regards!
    26 Jun 2011, 01:34 PM Reply Like
  • 1980XLS
    , contributor
    Comments (3333) | Send Message
     
    Windsun,

     

    What do you mean Gov't Railroads lose money? (Sarcasm)

     

    seekingalpha.com/curre...

     

    Even in tiny Greece they lose money.

     

    USA, Forgetaboutit
    26 Jun 2011, 01:45 PM Reply Like
  • kmi
    , contributor
    Comments (4313) | Send Message
     
    That works both ways Windsun, rail in Greece is weak because its value for transporting goods is non-existant, and those needing it for travel are the poorest in the country, there is not much value outside public service, whereas where there are large distances to transport goods like in the US rail's efficiencies make more sense.
    26 Jun 2011, 03:17 PM Reply Like
  • bob adamson
    , contributor
    Comments (4559) | Send Message
     
    Poor Texan -

     

    You have a touching regard and confidence in the wisdom and good faith of employers (and the middle managers that purport to act in their interests and name).

     

    I am not advocating in support of featherbedding or other measures that make employees immune from the need to give their best efforts to their employer. Further, I recognize that employers (and managers acting on their behalf, should have the major say in determining how work is organized and performed (with due regard, of course, to applicable work and environmental safety laws, employment contracts, collective agreements etc.) although I've always found the the most efficient and effective work settings involve ongoing dialogue between management and the workers doing the work on how best to get the tasks done.

     

    Severance pay for dismissal without cause is an employees protection from termination resulting from errors or callous measures by employers or supervisors acting in the name of management.
    26 Jun 2011, 06:43 PM Reply Like
  • bob adamson
    , contributor
    Comments (4559) | Send Message
     
    1980XLS and Tomas -

     

    Severance pay for dismissal without cause is an employee's protection from termination resulting from errors or callous measures by employers or supervisors acting in the name of management. Collective agreements, personal employment contracts and labour standards legislation should define the circumstances and the way to calculate questions about when and how much this would apply where an employee is terminated.

     

    It is a mark of a decent employment environment; one that reasonably balances the rights of employers, management and supervisors to manage their work force with the right of members of that workforce to fair treatment where they are upholding their individual obligation to work reasonably on behalf of their employer in the performance of assigned tasks.
    26 Jun 2011, 06:54 PM Reply Like
  • TomasViewPoint
    , contributor
    Comments (4845) | Send Message
     
    Bob

     

    Has anyone spoken against severance? Frankly if you are fired by bad management you should thank your lucky stars you are leaving that pathetic company and go get a job with a company that has their act together.

     

    This is not always about employers choosing employees. Employees also need to be choosy and reward an employer with their time and effort that deserves it. Neither side can be arrogant but both need to compete.
    26 Jun 2011, 07:41 PM Reply Like
  • TomasViewPoint
    , contributor
    Comments (4845) | Send Message
     
    Bob

     

    Everyone should be a free agent and go where they want to go. Nobody is getting married. Forget all the collective/union stuff as that comes with huge baggage and overhead and usually keep employers from hiring as each employee is a huge committment. Forget about fair and all that soft fuzzy stuff. Severance is paid because it helps a company maintain an image in the market where they can compete for talent and are seen in a positive light by future employees.

     

    There are times when a company is going broke where severance is very difficult just due to cash flow reasons but that is rare.

     

    Employees need to take care of themselves and not sit on a sinking ship hoping that all goes well. If the can get their own contract they should go for it.
    26 Jun 2011, 07:49 PM Reply Like
  • bob adamson
    , contributor
    Comments (4559) | Send Message
     
    Tomas –

     

    As is often the case, you are correct to a degree but miss, in my opinion at least, the key point.

     

    Choosing or continuing employment for most people most of the time is not analogous to shopping for a new fridge; it’s a longer term commitment made in particular constrained circumstances (i.e. local economic conditions, what employment is available for the spouse, conflicting loyalties, ones age and experience, nearness to retirement, savings, house ownership etc.). It follows that changing jobs is often a complex and uncertain challenge; particularly in today’s difficult job market.

     

    We are as likely to criticize workers to be too choosy as to criticize them for not be choosy enough.

     

    My real point is that a job is often a long standing experience in one’s life; something upon which many aspects of one’s life hinges. It’s more than simply a narrow economic matter.

     

    The rules governing involuntary severance should reflect all this to an appropriate degree.
    26 Jun 2011, 08:18 PM Reply Like
  • bob adamson
    , contributor
    Comments (4559) | Send Message
     
    Tomas -

     

    I wish you every success as a free agent.
    26 Jun 2011, 11:29 PM Reply Like
  • TomasViewPoint
    , contributor
    Comments (4845) | Send Message
     
    Bob

     

    I am already very successful as a free agent and it was the best thing I ever did. Everyone else is a free agent but just don't know it.
    27 Jun 2011, 08:52 AM Reply Like
  • halconnoche
    , contributor
    Comments (68) | Send Message
     
    Ok, here is a NY Times article from 1999:
    www.nytimes.com/1999/0...
    And 1993:
    www.nytimes.com/1993/1...
    1994: Love this one. DOJ forces bank to open in a county with one of the highest murder rates in the country by accusing them of racism. Can't imagine why the bank didn't want to open there.
    www.nytimes.com/1994/0...

     

    In October 1997, First Union Capital Markets and Bear, Stearns & Co launched the first publicly available securitization of Community Reinvestment Act loans, issuing $384.6 million of such securities. The securities were guaranteed by Freddie Mac and had an implied "AAA" rating.
    In October 2000, to expand the secondary market for affordable community-based mortgages and to increase liquidity for CRA-eligible loans, Fannie Mae committed to purchase and securitize $2 billion of "MyCommunityMortgage" loans.

     

    CRA forced banks to offer loans in low income areas otherwise be accused of "redlining" by the Clinton DOJ.
    Freddie and Fannie were the first to guarantee and purchase subprime loans.
    Go back and check your history.
    28 Jun 2011, 05:20 PM Reply Like
  • halconnoche
    , contributor
    Comments (68) | Send Message
     
    No one said anything about regulations...just your straw man technique. Threats and intimidation by DOJ and lawsuits filed by ACORN. By traditional lending practices there was no way most of those loans could have possibly been made so to avoid prosecution lending standards had to be lowered.
    28 Jun 2011, 05:24 PM Reply Like
  • bob adamson
    , contributor
    Comments (4559) | Send Message
     
    Tomas -

     

    Throw in that I can be 9 years younger than I am now and you have a deal!

     

    Best regards.
    28 Jun 2011, 09:45 PM Reply Like
  • TomasViewPoint
    , contributor
    Comments (4845) | Send Message
     
    Bob

     

    Sorry but human life moves only in one direction and is unrelated to economic activity. But if it makes you feel any better I think you look great. You have a great face for radio!!
    29 Jun 2011, 12:37 AM Reply Like
  • The Geoffster
    , contributor
    Comments (4138) | Send Message
     
    Austerity is just another word for prudence. You don't solve a balance sheet problem with more debt.
    24 Jun 2011, 06:51 PM Reply Like
  • American in Paris
    , contributor
    Comments (5504) | Send Message
     
    If private sector increases the savings, debt goes up. Debt is the twin brother of investment.

     

    It's too bad so many of you flunked accounting identities.

     

    The issue is not debt per se. I welcome debt used to support good rate of return projects.
    25 Jun 2011, 10:44 AM Reply Like
  • Windsun33
    , contributor
    Comments (4308) | Send Message
     
    "If private sector increases the savings, debt goes up..."

     

    You must have gone to a different accounting school than most. In one sentence you equate savings to debt, in the next you equate debt to investment.

     

    I don't know where you got your theories, but they don't make any sense. According to you, if I or a corporation saves some cash, I am fostering more debt? Please explain that to us.
    25 Jun 2011, 12:21 PM Reply Like
  • Windsun33
    , contributor
    Comments (4308) | Send Message
     
    If the budget were balanced, then government cuts could almost instantly be tranlsated into more money for the private sector. But there is so much overhang in the debt and deficit that huge cuts will have to be made before we can even start to break even, much less start paying down any debt. That is gonna hurt, but needs to be done eventually - and the longer you wait, the harder it gets.
    24 Jun 2011, 06:57 PM Reply Like
  • American in Paris
    , contributor
    Comments (5504) | Send Message
     
    And why do you need to pay the debt as opposed to rolling its over like any corporation does?
    25 Jun 2011, 10:45 AM Reply Like
  • Windsun33
    , contributor
    Comments (4308) | Send Message
     
    It is quite simple if you do some basic math. The debt is not static - it continues to grow at a rate several times higher than the increase in GDP. At the current rates of growth, the interest payments alone on the national debt would equal the total of all federal tax revenues by around 2027. And the debt would continue to rise Then you have a minor problem.
    25 Jun 2011, 12:24 PM Reply Like
  • Origa
    , contributor
    Comments (572) | Send Message
     
    People you are missing a bigger picture here.

     

    With the present political course, it is going to be a Hollywood drama series, until the 2-August. This is the Best a bear market could dream off.

     

    Another view that is not explored is the after default political scenario.

     

    What kind of power is the president going to have after a default?
    24 Jun 2011, 07:09 PM Reply Like
  • Agbug
    , contributor
    Comments (1164) | Send Message
     
    I agree with the debt limit drama, Origa. It all sounds like good old fashioned political theater, but is it? Did the Republicans walk out this week because the Democrats refused to take raising taxes off the table, or because the Obama Admin pulled a fast one and started drawing from the SPR to get a bounce from lower gas prices? Dealing from the bottom of the deck, Chicago style politics that pissed the Republicans off? Just a wild guess, but the Republicans know that the basic tenant of this article is factual, our economy is a zombie economy propped up with deficit spending. Bernanke admitted as much in this weeks press conference. We all know it and the Republicans are counting on more of the same for next November. The election is being fought right now.
    24 Jun 2011, 11:30 PM Reply Like
  • Origa
    , contributor
    Comments (572) | Send Message
     
    Taxes are always a big subject to discuss.

     

    But the debate in the US fails to address, in a macro view, to raise taxes is the measure where, the budget cuts are so high and millions of federal workers loose their income.

     

    The ripple effect, which is not overstated, would be like this.

     

    Millions on the street, the banks are not receiving payments on all kinds of loans, small business will have less customers, small private companies that sell to government will no longer have its customers etc.

     

    Now, raising taxes is also lowering the cost of federal employees and other unwanted effects. But to cut deep as GOP say, is to destroy the demand, raising taxes will lower the demand.

     

    The GOP policy fails to address that lower demand is better than destroying demand. It is wishful thinking that keeping the current tax rate will generate the jobs that you want to cut.

     

    But here is where US policy is failing miserably, the primaries in 2010 showed that symbolic politics outweigh the challengers you have. The politicians you have voted for, both of GOP and DEM, is those who can convince that their political symbol is the road forward.

     

    The GOP stalemate game is the symbolic politics, the GOP could not care less about a default, they have successfully created the media view "The president has a job killing plan" and they are winning. President Obama had a wish that he could change the political theater in Washington, but he cannot and have walked directly in to every trap the GOP have put in front of him.

     

    The lack of compromise, is the good intentions road, paved to hell.
    25 Jun 2011, 02:59 AM Reply Like
  • TomasViewPoint
    , contributor
    Comments (4845) | Send Message
     
    Origa

     

    The logical extension of your view is that if we all worked for the government then the economy would enjoy incredible demand and we would all be better off.

     

    Let's file that in the round file.
    25 Jun 2011, 08:41 AM Reply Like
  • Origa
    , contributor
    Comments (572) | Send Message
     
    TomasViewPoint

     

    No, I am saying that private small business is going to feel the pain, if the budget cuts are to deep.

     

    Private sector grows jobs, public workers produce nothing, they consume what the private business is selling.
    25 Jun 2011, 10:47 AM Reply Like
  • Windsun33
    , contributor
    Comments (4308) | Send Message
     
    Of course it is - it is nearly all political posturing and a theater production for the masses. In the end, nothing serious will be cut, and there will be some minor tax increases (or removal of tax breaks, same effect).

     

    The only real danger is that a very small number of fringe nut cases on either side (or both) end up with just enough votes to block any compromise. I don't see that happening, but it does have perhaps a 5% chance or so of happening.
    25 Jun 2011, 12:29 PM Reply Like
  • Windsun33
    , contributor
    Comments (4308) | Send Message
     
    Only the idealogues on both sides are stuck in their posiitions. The problem is that 90% of the smoke and mirrors is coming from the 5% fringe on each side. These are exactly the same tactics used by every dictator in the last few thousand years, and the reason they keep doing it is because it works on the uninformed masses.

     

    Instead of changing the theater in DC, Obama has become one of the lead players - doing exactly what he said he would not do. It bothers me just as much when Obama says things like "investing in our future" as it does when some Right wing nut case says that "intelligent design" is proven science.
    25 Jun 2011, 12:38 PM Reply Like
  • TomasViewPoint
    , contributor
    Comments (4845) | Send Message
     
    Origa

     

    Government demand is going to go down if you make budget cuts and that will affect small and large businesses on the revenue side but on the other side the implied tax rate of the current spending is way too high for businesses to support.
    25 Jun 2011, 04:57 PM Reply Like
  • NUNAY the KING
    , contributor
    Comments (266) | Send Message
     
    They could also cut 5% pay now, and 5% pay later on all government pay, 7.5% retirement pay cut now, etc etc. This at least would keep people working, but at more realistic levels, also giving people time to re adjust their lives. And considering the few accomplishments of the house and senate, I think Americans would vote to just about abolish that retirement deal. totally agree that dept of edu should be abolished...States should run their own systems.
    24 Jun 2011, 07:26 PM Reply Like
  • apberusdisvet
    , contributor
    Comments (2953) | Send Message
     
    Duh. Close to 60% of all working age Americans are non tax payers. More than 50% receive some sort of government assistance. The marxist Cloward-Piven Strategy to implode the economy through entitlement spending is working really well, isn't it. The corrupt in Congress and the special interests that fund them are licking their chops at the eventual prospect of buying American assets for 10 cents on the dollar. Greece, and the rest of the PIIGS are the template. Watch how events unfold in the Eurozone and learn, but it may be too late for America.
    24 Jun 2011, 07:28 PM Reply Like
  • bankingqueen
    , contributor
    Comments (135) | Send Message
     
    For the 100th time there is no bleeping recovery. I am starting to feel like the shills that write about a recovery think that if we say it a few more times it might come true lol
    24 Jun 2011, 08:13 PM Reply Like
  • Windsun33
    , contributor
    Comments (4308) | Send Message
     
    There is a recovery.

     

    Unfortunately, most of it is in places like Indonesia, Hong Kong, and Brazil
    25 Jun 2011, 12:40 PM Reply Like
  • IgnisFatuus
    , contributor
    Comments (2167) | Send Message
     
    "Daniel Indiviglio says cuts on the state and local level have knocked $8.8B off GDP and thrown 326,000 people out of work"

     

    The US 2010 GDP was approximately $14 TRILLION... me thinks a mere $8.8 Billion can be considered a rounding error in the scope of things.
    24 Jun 2011, 08:26 PM Reply Like
  • TomasViewPoint
    , contributor
    Comments (4845) | Send Message
     
    Ignis

     

    Bingo! That is what I was thinking.

     

    Only $8 Billion? That is a nit.

     

    Maybe we lay off more if they are contributing that little to GDP.
    24 Jun 2011, 09:01 PM Reply Like
  • WMARKW
    , contributor
    Comments (10700) | Send Message
     
    $8.8 bil and 326 thousand is like $27,000 a year per person....What planet is this guy living on?
    26 Jun 2011, 06:21 AM Reply Like
  • Invest4Life
    , contributor
    Comments (13) | Send Message
     
    It's not a good thing that people are losing their jobs, and I have family members that are affected by the local and state tightening, but we have been riding a wave of debt for decades. The time is now to put a stop to this run away debt, national and personally, before it is too late. This isn't a Democrat or Republican issue, it's an American problem that needs to be solved.
    24 Jun 2011, 09:39 PM Reply Like
  • 1980XLS
    , contributor
    Comments (3333) | Send Message
     
    kcr357,

     

    If you think Military spending is or will make up for 51%, you are dillusional.

     

    money.cnn.com/2011/01/...
    24 Jun 2011, 11:55 PM Reply Like
  • kcr357
    , contributor
    Comments (567) | Send Message
     
    That was quoted from memory, upon researching I have no idea what the number actually is
    Here's 53%
    pubrecord.org/commenta.../
    20%-
    finance.yahoo.com/taxe...
    Less than 8%
    money.cnn.com/2011/01/... (your link)
    Might as well just pick whatever number you want, there's probably a site out there that will support your claim.
    25 Jun 2011, 12:14 AM Reply Like
  • Good Captain
    , contributor
    Comments (456) | Send Message
     
    If you accept that the percentage of discretionary spending (the heading in which defense spending is typically categorized) is less than non-discretionary or entitlement's spending, then whatever else we may argue, defense spending cannot be greater than 50%.
    25 Jun 2011, 12:32 AM Reply Like
  • Serious Cat
    , contributor
    Comments (22) | Send Message
     
    All organizations present financial data in a way which makes the organization look good. The federal government does this also. To figure out what is really going on, you have to put their data into new categories.

     

    Including federal pensions and federal money spent by states, about 50% of federal expenditures are for people 65 and older. Defense-related spending is about 25%. Interest on the debt is about 10%. We have a 40% deficit. This means for example that even if defense spending were eliminated entirely, we would still have a deficit and the deficit would still be growing rapidly.
    25 Jun 2011, 01:16 AM Reply Like
  • kmi
    , contributor
    Comments (4313) | Send Message
     
    Without having read all the comments I'll note that state and local gov'ts have been cutting employment and spending due to a loss of tax revenue and in an effort to balance budgets, so suggesting these gov'ts should continue to run inefficiently is just stupid.

     

    Certainly some of the cuts have been ideological but I'll argue that reducing costs today will lead to a leaner more efficient tomorrow. Additionally, in my state with a proposed property tax cap looming, a balanced budget will require more fiscal conservatism today, but will lead to a healthier economy tomorrow.
    25 Jun 2011, 07:33 AM Reply Like
  • paynebb
    , contributor
    Comments (366) | Send Message
     
    I read many of the comments and there were several that was talking about the poor govt employees that have been laid off. Whatt about the private sector? Do the loss of those jobs not hurt? Also, there are plenty of jobs in the US for AMERICANS. Problem is most of these jobs are being done by ILLEGALS. Throw the illegals out and stop unemployment insurance. There will be a shortage of workers. Those jobs that Americans say they wont do will all of a sudden become more attrective when you have an incentive to work. Also, they pay will also increase for these jobs as the illegal workers will be gone. I guess this is just too simple of a solution. spending 1.6 trillion dollars that we do not have is a much better answer.
    25 Jun 2011, 07:47 AM Reply Like
  • drekon
    , contributor
    Comments (188) | Send Message
     
    I am so SICK of hearing that government jobs. The fact is that a government job sucks off the rest of us. $700 billion was wasted to try to preserve these money sucking jobs when they should have been cut 3 years ago.

     

    AND, you can preserve those jobs if you require the workers to contribute their fair share of health care and pension expense. Oh, and get rid of the pension - start a 401k. This isn't rocket science, it's union posturing.
    25 Jun 2011, 07:48 AM Reply Like
  • buyitcheap
    , contributor
    Comments (1901) | Send Message
     
    I'm quite certain that these states have fantastic under utilized assets they could SELL rather than raise taxes on its citizens.

     

    And yes, austerity won't work when all you do is stop spending and maintain the current rate of taxation, if you CUT taxes you'll get a better multiplier effect b/c cash will stay in more productive hands than government.
    25 Jun 2011, 08:28 AM Reply Like
  • The Geoffster
    , contributor
    Comments (4138) | Send Message
     
    In this game of chicken over the debt limit, I predict that both sides will blink. Despite their posturing, they are two sides of the same coin. They are the Establishment. They want to survive another day and the only way they know how is by kicking the can down the road and pray they're gone before the road is.
    25 Jun 2011, 09:04 AM Reply Like
  • convoluted
    , contributor
    Comments (2168) | Send Message
     
    Barney Frank and Ron Paul are rolling out their own deficit reduction-full employment program. I'm trying to find my old bell-bottom jeans, and thinking about opening a late night restaurant. May call it Alice's. "Return to Woodstock" will be the rallying cry for the new economic stimulus.
    25 Jun 2011, 11:47 AM Reply Like
  • TomasViewPoint
    , contributor
    Comments (4845) | Send Message
     
    Next we can pull out the old WIN buttons. Trivia prize for anyone who can tell what that means.
    25 Jun 2011, 04:59 PM Reply Like
  • 1980XLS
    , contributor
    Comments (3333) | Send Message
     
    Whip Inflation Now

     

    www.lbjstore.com/mm5/m...
    25 Jun 2011, 05:03 PM Reply Like
  • Good Captain
    , contributor
    Comments (456) | Send Message
     
    Are projecting again Machiavelli?
    25 Jun 2011, 08:58 PM Reply Like
  • 867046
    , contributor
    Comments (398) | Send Message
     
    Hey wingnuts here is some hard data, please explain rather than go off the edge. (from Sunday's Washington Post):

     

    "And then there’s Sweden, the rock star of the recovery.
    This Scandinavian nation of 9 million people has accomplished what the United States, Britain and Japan can only dream of: Growing rapidly, creating jobs and gaining a competitive edge. The banks are lending, the housing market booming. The budget is balanced."

     

    Before you get dismissive:

     

    Sweden does have immigration problems:
    "Sweden joins Europe-wide backlash against immigration
    Its asylum policies are the continent's most generous. But the public mood is now changing" (Guardian)

     

    Sweden has a policy of self reliance on defense. They make their own fighter, corvette, IFVs and other weapons (Bofors). No matter how polite their statement of territorial defense, they are geared against a land invasion by Russia.
    26 Jun 2011, 10:26 AM Reply Like
  • Windsun33
    , contributor
    Comments (4308) | Send Message
     
    Sweden is roughly the same population as the Phoenix or Los Angeles metro area. I don't think you can translate that to a country with 35x the population and 500x the land area, and a much more varied ethnic population.

     

    However, it is worth noting that the Swedish recovery started when they began shifting away from the Left - lowered taxes even.

     

    articles.cnn.com/2011-...
    26 Jun 2011, 01:46 PM Reply Like
  • kcr357
    , contributor
    Comments (567) | Send Message
     
    I don't think teaching people how to think critically has been a priority in our education system for a long time, I am starting to see the fallout and probably the reason as well.
    26 Jun 2011, 02:02 PM Reply Like
  • Windsun33
    , contributor
    Comments (4308) | Send Message
     
    No it has not been. What is needed is a lot more skepticism and a lot less acceptance of being spoon fed the pablum (or Kool-Aid, as the case may be).

     

    About 3 years ago I did a "guest speaker" type thing at a local high school, and demonstrated to a 12th grade class about how much myth has taken over real knowledge or research. Perhaps since one of the myths I shot down was one that the teacher was espousing, I was never asked to come back :=P.
    26 Jun 2011, 02:24 PM Reply Like
  • kcr357
    , contributor
    Comments (567) | Send Message
     
    I remember in second grade we had a student teacher in and she was telling us how important it was to conserve water. I was just an ignorant hick in a rural school at the time, the only thing I knew was that we got our water from a well and it didn't disappear after we used it like gas. When I asked her why we needed to conserve water since it just went back into the ground after use, she got kind of flummoxed and said it would keep the water bill down. Seemed a weird reason to me at the time but I shrugged my shoulders and took it for what it was worth.
    26 Jun 2011, 08:29 PM Reply Like
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