Entries Tagged as 'Economy'

New Year – Same Down Economy

Retailers started releasing fourth quarter earning reports yesterday.

There’s no surprise here — Target, the number two retailer in the US, announced on Christmas Eve that sales would not meet there expectations; and Master Card also indicated that spending (via credit card) was down.

Wal-Mart, of course, tipped everyone off that they expected a bad retail season when they started their “Black Friday” sales three weeks before Thanksgiving and most retailers followed suit with deep discounts through out the retail season.

While a bad retail season doesn’t by itself mean that the economy will continue to slump, there are certainly enough signs to that effect (personally I’m ignoring the US Department of Labor’s unemployment numbers… they simply don’t make sense, they don’t seem to reflect reality, and they are designed to be misleading).

I certainly don’t have a crystal ball, but the long the economy continues the slide downward the harder it will be to revive.  My instinct tells me that this downturn, like The Great Depression, will not be ended by planning and programs — but by aggression, greed, and exploitation.

Originally posted 2010-01-13 01:00:13.

ROWE

No, not Rowe vs Wade (but I’m sure I’ll have a rant on that if the current court hears a case that could reverse that land mark decision)… but Result Only Work Environment; essentially a version of “Flex Time” that is focused on increasing productivity by avoiding “presenteeism” (where someone is physically in the office, but mentally somewhere else).

You can read about an article on NPR about the Human Services and Public Health Department of Hennepin County (Minneapolis, MN).

The End Of 9-To-5: When Work Time Is Anytime

Originally posted 2010-03-29 02:00:45.

US Poverty

The Census Bureau released new numbers on the US poverty rate yesterday — 14.3% last year; the highest since 1994.

Largely due to the rising unemployment amount working age individuals in this country (even the US government admits unemployment to be in double digits — and we can all be sure that they minimize the numbers as much as they can through their creative accounting and adjustments).

13.9%, or 39.8 million people in 2008 to 14.3%, or 43.6 million people in 2009… and you can be sure that number will be even higher in 2010.

The report also showed the number of Americans without health coverage rose form 15.4% to 16.7% (or 50.7 million people); mainly because of the loss of employment and employer-provided health insurance.  And the new health care provisions were passed; the main provisions won’t take effect until 2014.

Because of the Recovery Act and many other programs providing tax relief and income support to a majority of working families — and especially those most in need — millions of Americans were kept out of poverty last year.
· President Barrack Obama

The really incredible thing is that the numbers were expected to be much worse — and in fact it’s likely that increases in Social Security payments and expansion of unemployment insurance through federal extensions helped keep the numbers in check.

Clearly those earning over $250,000 need to have their tax cuts renewed!

Originally posted 2010-09-17 02:00:40.

Bye-bye, tax breaks?

By Jeanne Sahadi, senior writer CNN
October 26, 2010: 2:05 PM ET

NEW YORK (CNNMoney.com) — Who says there’s no bipartisanship? Democrats and Republicans running for Congress are finding every way possible to assure voters they will keep Americans’ taxes low forever.

But those will be hard promises to keep after the economy recovers. Tax experts almost uniformly say the next Congress should rethink the more than 200 tax breaks in the federal code that cost more than $1 trillion a year. And, yes, that includes even the really, really popular ones.

Lawmakers may be presented with the idea as early as December, when President Obama’s fiscal commission issues its report. There is a possibility the commission may recommend curtailing or eliminating some tax breaks.

Commission co-chairman Erskine Bowles has publicly expressed support for the idea. So has commission member Alice Rivlin, former White House budget director. Another member, Republican Sen. Judd Gregg, who coauthored a bipartisan plan for tax reform, supports curtailing some breaks but only to lower marginal tax rates in the context of broader reform.

The $1 trillion-plus in forgone revenue is close to the amount allocated for defense and discretionary spending in 2010, or the equivalent of nearly a third of the latest federal budget.

Cutting back on tax breaks can be a more efficient way to bring in revenue than raising income tax rates because it would subject more work and business income to taxation. If done right, it also promises to make the tax code fairer and simpler.

For years, leading tax experts and economists from the left and the right have contended that tax breaks are, in reality, a form of spending. The cost of tax breaks is mostly invisible, since there’s no formal accounting of them on Uncle Sam’s books. And once passed into law, they are rarely scrutinized.

“[Tax breaks] are styled as tax savings, but really function as replacements for explicit government spending. Some make sense, but a great many are poorly targeted and would never pass Congress if presented as an outright spending proposal,” tax expert Edward Kleinbard wrote in an article this summer called, “Sacred Cows: It’s Them or Us.”
Popular tax breaks: Dogfight ahead

A disproportionate amount of the lost revenue from tax breaks comes from just five of them.

Not surprisingly, those five are also among the most popular:

  • mortgage interest deduction;
  • tax-free income workers get from employers to pay for health insurance;
  • deduction for state and local taxes;
  • deduction for charitable contributions;
  • and myriad tax breaks for retirement savings.

Many of those breaks are only available to the roughly one-third of taxpayers who itemize deductions on their returns.

There have been a number of proposals over the years for how the biggest breaks might be modified.

Most recently, the bipartisan Committee for a Responsible Federal Budget put out a paper highlighting many possibilities that combined could raise $1.7 trillion in additional revenue over a decade.
Think you’re smart about deficits? Try this

For instance, consider the money that workers receive when their employers contribute to their health insurance costs. That subsidy is currently treated as tax-free income to the worker and is unlimited.

The subsidy could instead be converted to a credit, which is a dollar-for-dollar reduction of one’s tax bill. The credit would be phased out for higher income taxpayers and it would be refundable for low-income workers who don’t make enough income to owe any federal income tax.

“This strategy would reduce the incentive for employers to offer ‘gold-plated’ insurance plans,” the budget watchdog group wrote.

The mortgage interest deduction — currently available on up to $1.1 million of borrowing — could be gradually reduced so that it only applies to loans on up to $500,000. And the option tax filers get to deduct interest on their second homes could be eliminated.

“[Today’s] policy is regressive (providing larger tax breaks to those well off enough to purchase more expensive homes), promotes homeownership over other productive investments and costs the government roughly $100 billion a year in lost revenues,” the committee noted in its paper.

Since everyone in Congress can identify and vilify what they see as “tax breaks for special interests,” curbing tax breaks has a lot of bipartisan support. The problem, of course, is that there’s less agreement on just which tax breaks deserve the ax or at least a haircut.

And, of course, since politicians much prefer to hand out tax breaks to voters and financial backers, it may be hard for them to muster the mettle required to reverse gears.

How hard? Bowles put it plainly at the fiscal commission’s public meeting in September.

“It’s not going to be easy,” he said. “It’s not going to be fun, and in many cases, it’s also not going to be popular. It is going to require sacrifice on the part of all Americans to get there.”

Original Article on CNN.com

Originally posted 2010-11-06 02:00:55.

Hidden Evil

Many of my friends and I have engaged in intellectual discussions about the evils of society and what most needs to be fixed.

Views of what’s evil, though, largely depend on your perspective — social liberals might call something evil that a fiscal conservative feels is simply just; and vice-versa.

If you’re a conspiracy buff you’ll enjoy reading through the TheHiddenEvil.com.  Volume I contains a number of factoids, and draws interesting conclusions (I’m certainly not going to say I agree with any or all of them).  Volume II builds on Volume I to make some fairly remarkable assertions — of maybe they’re just hard to believe (or hard to read without a giggle or two at least).

With disinformation an accepted practice of government, organized religion, and business it’s always hard to say definitively what is true and what is a shade of gray.

Originally posted 2010-01-22 02:00:23.

Occupy Wall Street

Occupy Wall Street
Occupy Wall Street
By Adam Zyglis, The Buffalo News

Originally posted 2011-10-10 02:00:28.

It’s not our fault we went bankrupt…

I wasn’t sure it it was a new daytime sitcom or a hearing when former Lehman CEO Dick Fuld delivered his 1680 work prepared testimony.

Lehman was a strong company that had corrected it’s problems:

In retrospect, there is no question we made some poorly timed business decisions and investments, but we addressed those mistakes and got ourselves back to a strong equity position … There is nothing about this profile that would indicate a bankrupt company.

The market and the public were wrong to lose confidence in Lehman:

Lehman’s demise was caused by uncontrollable market forces and the incorrect perception and accompanying rumors that Lehman did not have sufficient capital to support its investments.

The government was at fault for not banning naked short selling or allowing Lehman to convert to a bank holding company or let it take deposits:

Each of those requests was denied at the time. Tellingly, though, each measure was later implemented in some form for other investment banks during the days and weeks following Lehman’s bankruptcy filing.

Lehman was the victim:

This loss of confidence, although unjustified and irrational, became a self-fulfilling prophecy and culminated in a classic run on the bank starting on September 10, 2008, that then led Lehman to file for bankruptcy four days later, in the early morning hours of September 15.

For more comedy (without my satire — and please don’t think I’m serious about anything I’ve written in this post) see the links below; and don’t laugh too hard.

Dick Fuld
Repo 105
Lehman bankruptcy attorney
New York Fed general counsel

Originally posted 2010-09-02 02:00:11.

CEO Pay Cut

I don’t think any of them need to worry about landing in the poor house, but here’s a list of the twenty largest pay cuts this year.  I guess the economy must be down — perhaps we can take up a collection to help them all out.


  1. Lloyd C. Blankfein, -$40.1 million
    Company: Goldman Sachs Group (GS)
    2009 salary: $600,000 (same as 2008)
    2009 bonus, options and other comp: $262,657 (down $40.1 million from 2008)
    Lloyd C. Blankfein
  2. Vikram S. Pandit, -$38.1 million
    Company: Citigroup (C)
    2009 salary: $125,001 (down $833,332 from 2008)
    2009 bonus, options and other comp: $3,750 (down $37.3 million from 2008)
    Vikram S. Pandit
  3. James Dimon, -$34.5 million
    Company: JPMorgan Chase (JPM)
    2009 salary: $1,000,000 (same as 2008)
    2009 bonus, options and other comp: $265,708 (down $34.5 million from 2008)
    James Dimon
  4. Robert A. Iger, -$29.5 million
    Company: Walt Disney (DIS)
    2009 salary: $2,038,462* (up $38,462 from 2008)
    2009 bonus, options and other comp: $19.5 million (down $29.5 million from 2008)
    Robert A. Iger
  5. David M. Cote, -$15.9 million
    Company: Honeywell International (HON)
    2009 salary: $1,800,000 (down $25,962 from 2008)
    2009 bonus, options and other comp: $11 million (down $15.9 million from 2008)
    David M. Cote
  6. Richard H. Anderson, -$15.7 million
    Company: Delta Airlines (DAL)
    2009 salary: $600,000 (same as 2008)
    2009 bonus, options and other comp: $1.2 million (down $15.7 million from 2008)
    Richard H. Anderson
  7. Louis C. Camilleri, -$12.4 million
    Company: Philip Morris International (PM)
    2009 salary: $1,500,000 (down $67,308 from 2008)
    2009 bonus, options and other comp: $23 million (down $12.3 million from 2008)
    Louis C. Camilleri
  8. Rupert Murdoch, -$12.1 million
    Company: News Corp. (NWSA)
    2009 salary: $8,100,000* (same as 2008)
    2009 bonus, options and other comp: $9.8 million (down $12.1 million from 2008)
    Rupert Murdoch
  9. Kenneth I. Chenault, -$11.3 million
    Company: American Express (AXP)
    2009 salary: $1,201,923 (down $48,077 from 2008)
    2009 bonus, options and other comp: $15.4 million (down $11.2 million from 2008)
    Kenneth I. Chenault
  10. Mark V. Hurd, -$9.8 million
    Company: Hewlett-Packard (HPQ)
    2009 salary: $1,268,750* (down $181,250 from 2008)
    2009 bonus, options and other comp: $22.9 million (down $9.6 million from 2008)
    Mark V. Hurd
  11. Kenneth D. Lewis, -9.0 million
    Company: Bank of America (BAC)
    2009 salary: 0* (down $1.5 million from 2008)
    2009 bonus, options and other comp: $32,171 (down $9.0 million from 2008)
    Kenneth D. Lewis
  12. Stephen A. Roell, -$8.4 million
    Company: Johnson Controls (JCI)
    2009 salary: $1,371,500* (up $46,500 from 2008)
    2009 bonus, options and other comp: $5.1 million (down $8.5 million from 2008)
    Stephen A. Roell
  13. James W. Owens, -$7.9 million
    Company: Caterpillar (CAT)
    2009 salary: $1,550,004* (same as 2008)
    2009 bonus, options and other comp: $5.2 million (down $7.9 million from 2008)
    James W. Owens
  14. John B. Hess, -$7.8 million
    Company: Hess (HES)
    2009 salary: $1,500,000 (same as 2008)
    2009 bonus, options and other comp: $12.1 million (down $7.8 million from 2008)
    John B. Hess
  15. John T. Chambers, -$6.0 million
    Company: Cisco Systems (CSCO)
    2009 salary: $375,000* (same as 2008)
    2009 bonus, options and other comp: $12.4 million (down $6.0 million from 2008)
    John T. Chambers
  16. Miles D. White, -$3.2 million
    Company: Abbott Laboratories (ABT)
    2009 salary: $1,852,319 (up $56,848 from 2008)
    2009 bonus, options and other comp: $20.1 million (down $3.2 million from 2008)
    Miles D. White
  17. Daniel R. Hesse, -$3.1 million
    Company: Sprint Nextel (S)
    2009 salary: $1,200,000 (same as 2008)
    2009 bonus, options and other comp: $11.1 million (down $3.1 million from 2008)
    Daniel R. Hesse
  18. Thomas M. Ryan, -$3.0 million
    Company: CVS Caremark (CVS)
    2009 salary: $1,400,000 (same as 2008)
    2009 bonus, options and other comp: $14.8 million (down $3.0 million from 2008)
    Thomas M. Ryan
  19. Ivan G. Seidenberg, -$2.9 million
    Company: Verizon Communications (VZ)
    2009 salary: $2,100,000 (same as 2008)
    2009 bonus, options and other comp: $14.9 million (down $2.9 million from 2008)
    Ivan G. Seidenberg
  20. Frederick W. Smith, -$2.7 million
    Company: FedEx (FDX)
    2009 salary: $1,355,028* (down $75,438 from 2008)
    2009 bonus, options and other comp: $6.4 million (down $2.6 million from 2008)
    Frederick W. Smith

Source: Equilar Inc.

Originally posted 2010-08-22 02:00:27.

What’s Happening to MY $700B?

Oh, that’s right, we all spend seven hundred billion dollars so often I should be more specific… that would be the $700B “we” Americans authorized under the Emergency Economic Stabilization Act

The October 29, 2008 report is up on the US Treasury Site now — you should take a look at it to see who’s getting your money.

Some comments:

  • You’ll notice the list includes several financial institutions who have purchased or are attempting to purchase the distressed assets of smaller banks; I guess we know where they’re getting the money.
  • It’s really convenient that they were able to get just the right number of mortgage instruments together to be valued at an even billion each (hell I can’t remember the last time my credit card bill was an even dollar).

If I sound a little leery of what the “usual suspects” are doing with my money — I am… I want to make sure I get it back (with INTEREST), and I certainly don’t want anyone to expect me to pay for any of these financial institutions mistakes and poor judgment — I’ve already lost 36% of my retirement account, and I haven’t seen any government bailout for that!

http://www.ustreas.gov/initiatives/eesa/transactions.shtml

Originally posted 2008-11-14 08:00:52.

Tea Party

The Tea Party has been holding a number of rallies to make people aware of how government is misusing their tax dollars…

Damn straight!

Remember, the wars in Iraq and Afghanistan were not in the budget; the wars were entered into based on lies told to the American people (and the House and Senate — which you would have hoped would have been a little more savvy than the average taxpayer and ask for proof).

So let’s start by getting that nearly trillion dollars that was misappropriated ack; from the defense budget (after all — gotta cut to pay, right Tea Party — and best to cut from the same programs that used misappropriated money than a program that didn’t).

Am I serious… well, I’m as serious as the Tea Party.

If you want to look for places to get money to help this country make ends meet; here’s the short list.

  • Wall Street
  • Banking
  • Oil & Gas Industry
  • Defense

Seems like these are the areas which have taken far more than they have put in for the past several years…


And honestly, no, this isn’t the way I’d try and balance the budget.

I’d look at fixing what’s broken…

Health Care — the Obama health care plan is a waste; let’s move to a single payer system (much like our neighbors to the North) that _all_ US citizens are a part of; and that government employees and elected officials have no option but to use (and have no special access).  Of course any business or individual could elect to pay for private insurance, but that would be using after tax dollars.  Medicare and medicaid would simply be a part of the national health system; and the only difference would be that very low income individuals would get at least some number of co-pay waivers per year.

Social Security — definitely needs to be looked into, but a program that many Americans over 50 have been expecting to be there when they retire cannot continue to change…  I’m not sure how to fix this, but we probably need to view all the different parts of the Social Security system separately and deal with solutions based on the needs of each.

Defense — definitely needs to be trimmed.  We simply cannot spend 20% of every tax dollar for defense (40% of what the world spends on arms — six times that of China)… and that money doesn’t need to be wasted on weapons programs that aren’t needed (or wanted by most Americans).  Let’s keep it in perspective, military spending is what caused the implosion of the Soviet Union, the US need not continue to escalate the arms race.

Taxes — there’s a simple solution, throw out the old tax code (and the IRS) and institute a simple code.  Something like: no tax on earnings to poverty level,  5% on everything above poverty level to say 2x poverty level; add 5% percent on each 1x poverty level beyond that to a maximum rate of 50%.  That’s it, no other Federal tax (everything comes out of one tax stream).  No American entity pays 50% of their earnings in tax; and very few pay anywhere near that.  If the tax rate is too high, just adjust the single 5% number on each band, and instantly the earnings amount the cap applies to goes up.  Plus, as poverty is eliminated, the tax bracket broadens.

Term Limits — any elected official needs to be bound by the same term limits as the President; no more than two terms in the same office.  And we need to make sure that these officials are paid the US median salary — after all, they should represent the views of an average American, and that they have the exact same safety net as the rest of America (Social Security)… no special retirement plan.  Now I would certainly agree that they could be considered government employees, and count their time in office toward a retirement — the same as the clerks in their offices do.

Education — we definitely need to consider education as a national issue, not a local one.  Standards need to be more consistent and graduates need to be functional in our society (if you don’t think education is closely tied to economics, you’re living in a cave).


None of this is what’s being talked about — the Tea Party is completely politically motivated, and are only interested in imposing their regressive (misguided) Christian ultra-right views on the process; and don’t want to work towards any real solution since they view failure as the way to gain control.

The first step to fixing the problem is change — and I subscribe that change starts by sending the signal that we as Americans just won’t put up with the way in which business has been done too long.

Perhaps the American Spring isn’t far off.

Originally posted 2011-09-26 02:00:49.