Post American History

Welcome to Obamacare: the unintended consequences.

Why Work:

I do like Kentucky.

What is hard to grok is Illinois. Its free money is only $13,580 per capita!

Then again, Kauai looks pretty good until the end, probably after my life:   $60,590.

In a window in town, Glens Falls, there is a display and the book open, pretending the imaginary window people read, is called:  Why Democracies Fail.  Read on Line

Without the strictures of a republic, oh, say a constitution, people will find out they can vote themselves money,  Ta Da: socialism - the tool of the oligarchy used to get state control via the little piggy theory (they are big piggies, so have an education, albeit immoral.)

Perhaps, a reader may think the U.S. is a republic. Welcome to the 20th Century where the progressives, Marxists, etc. had destroyed the republic. Time to study up: why the direct election of Senators was a mistake; why the income tax was a mistake; why there is an effort to control guns and speech; why we have a freedom from religion, not of religion. Etc Etc.  All that is necessary is people awake and vote out almost everyone, both parties. A good depression will help get us there.

I no longer see there is any stopping the piggy express. The tangled web cannot be undone; eventually, it will be destroyed, how is unknown, but you can't convince piggies to be more than they are.

A powerful depression might help; we will see. One can hope, I suppose. The cool thing is much of the world has learned from us and our past derailment of piggy history is not lost on other cultures.

Our founders were colonists to the English - it was the colonists who reminded England of the rights of individuals that they had lost to the crown, after centuries of fighting to gain them. One speech in Parliament, back then, praised the U.S. for upholding the liberal rights of the individual that used to be England.

Time for an I-Monastery.

Graphs: debt and unemploymenet

I was listening to the WSJ radio show this morning and the twenty-somethings, who are reporters, were giving updates to their work as found in the Journal.  I was reminded of the BS people in college who gave reports as though they knew what they were talking about. They had affected speech and a flair for obvious dramatics.  Little did I know they would run things.  The normal people didn't pay attention to the affected ones; we went about our lives not worrying about organizing others.

The tone of the reporting was: why worry about this 90 billion dollar in contention, the debt ceiling, etc. when it looks like debt is going down. Things look up.  There are a few "yuks," at this point.

First, there appears no understanding that an exploding debt is an exploding debt, that a minute reduction in the  growth of exploding debt is not proof that we are recovering,

Then, there is no connection, apparently, between imperceptibly better numbers and the war in Congress over spending.  I could be precise and say some Republicans were being niggardly, but some child would think that I was quoting a rodeo clown.

The profundity of the ignorance of common economics is so deep there is no reason to discuss it. You get down in the road with twits, you stand up with fleas, or some such thing. Normal people know how the world works; normal being people who have had real jobs outside the government and education.   Unfortunately, they are presented with useful news, they get opinions from twits; some watch stand-up comics sitting down to discuss current events and think that must be getting the hip opinion.

The aura of "Wall Street Journal" makes one think the reporters are grownups. Facade is a dangerous thing.  So, let me just add this plain graph, the only reason I wrote this blog. No buzz, no spin, just "official" projections. You make of it what you can.

Note, this is a government produced chart.  For serious numbers go to Shadow Stats

Then, I heard three minutes of NPR, that is about my limit of listening to people talking there, and hear how great the housing market it.  As I pretend to be a broker, these days, that struck me as odd.
Seems the valley girl reporter (you can tell when sentences end with an uptick, especially when  the person is attempting to show he or she is stating a fACT!) knew someone who sold a condo in Chelsea that they couldn't sell last year. Now, that is reporting. Yuk, yuk.

Oh, there is no inflation, too.  Yes sir, there is a domino effect in place and the housing market is fine.

This reportage is nothing more than a reprinting of PR from the government, large groups, or from the stock exchange press offices. I have seen this brain dead parroting, personally. In fact, I have issued PR releases. No one called me to verify anything. This is modern journalism in America.

You can see why every so often some NYT reporter is caught having fabricated a big story. No one manages and no one cares. Reporters are frustrated fiction writers, anyway.

The problem with all this white noise is that is creates an unexamined tapestry.  I hear perfectly nice and bright people say the darndest things. Things so insensible that you just stare at them, which they probably take as tacit agreement.

For the hell of it, here is a Shadow Stat for you:

Consider passimg this graph around.  The absurd unemployment rate for black is much higher.  It is terrifying. One would think it is purposely kept high to create racial turmoil. Actually, one should think that,.

You can read up on shadow stats background and you will be more comfortable with their numbers, if you are aware of the open alteration of government numbers to fit an agenda.

Mini lecture: Why I have to buy defective electronics made in China

Greg sent a link to this video. You would think it unnecessary to even consider that jobs are leaving the United States because of the U.S. government, but easily a third of the people I talk to are economically illiterate.  Sometimes, they are just illiterate and proud of it.  

In this lecture, you will hear the argument that our businesses have to leave the nation in order to make a profit and that the prices they require from buyers become too high to compete because of a taxation that is both high and doubled.  As we know, the buyer actually pays the taxes until the price is too high, then the buyer goes to cheaper. Hence, crap from China.

You will also see in that video how it is that it takes three minutes for the stale brain to glaze over - this lack of intellectual discipline is a serious problem.

By stating the obvious in the video, however, one loses an important part of the audience - those taught that anything good for businesses is bad for the worker. They do not know any better, so you need to address their level of understanding. Indeed, you need to learn they have such a view. Long gone are the days of "what is good for General Motors is good for America." 

The way to frame the taxation argument is, first, that companies that stay cannot compete on price because of the high taxation rate and hyper-regulation. This results in higher prices.  The average consumer is becoming unable to pay for American products. (Do not doubt that this is an intended outcome by our happy Marxist leaders.)

This results, in turn, in people buying the cheaper items. This result in Wal Mart, et. al.,  getting all its stuff from China both for reasons of supply and price. This results in me being forced to by inherently defective crap. I cannot even find many qulaity items that are made in this country regardless of price.  The crap squeezes out quality. Even if you want something that will work and endure, often, you cannot find it. The crap will break causing economic loss. ON and on.

The second argument is that jobs are lost when companies move abroad. Unionists need to understand the result of their socialism. Unions are the key operatives for the leftists in power and most of the members have no idea they are key supporters in the loss of their own jobs. 

So, the second argument expanded is Union jobs are lost.  This should resonate with the membership. They must come to understand their leaders are bribing them to promote socialism, a political end contrary to their hopes for a good paying, secure job.  Taking down the evil, big business means eliminating jobs.

As an aside, I noticed as a young adult that unions could care less that younger workers are fired when a "better" contract is secured. That is, the old hands get more money and that is all they care about. This is elitism in its purest form, though the unions and members would denounce any criticism of their undemocratic greed. Unions have become gangs and they operate to promote themselves and friendly leftists. Union members alternate between worker bees and fatted cows.

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There are also, of course, the Eurotrash types who just want hand outs from pushers and will vote for the friendliest pushers. There are too many of these bums, a fostered condition, and they are the key threat to our national traditions and culture, but long term education and a reduction of clown government are necessary here; no logical argument will work with the Eurotrash, only manipulation, which is anathema to the generalized, wilting American morality. 

There is a good argument for some qualifications before one is allowed to vote.  As it is, democratic leaders are promoting the notion that voters include felons and currently illegal aliens as it is thought more addicts will vote for the pushers.  This is strong argument and a pendulum swinging over the body politic in the pit we have built ourselves. If twenty million Mexicans are given the right to vote, look to Costa Rica for a new home.  

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Q:  How is ipod and ipads made in China don't stink? This is an interesting area. Of course, there is the high suicide rate at the Apple factory.  Still, that is OK as we are supposed to love Marxism even when it is in league with evil capitalists and kills its own citizens.

Slip Slidin' Away

I keep pitchen' 'em, son , and you keep missin' 'em.



Get a cup of coffee and read through the article below from the Editor and Chairman of the U.S. New & World Report, the last of the news magazine to crumble into eyewash. Zuckerman is an outspoken liberal journalist, so his words are not meant as an attack. Understand reality is tough MF.

The Economy Is Even Worse Than You Think

The average length of unemployment is higher than it's been since government began tracking the data in 1948.

By MORTIMER ZUCKERMAN

The recent unemployment numbers have undermined confidence that we might be nearing the bottom of the recession. What we can see on the surface is disconcerting enough, but the inside numbers are just as bad.

The Bureau of Labor Statistics preliminary estimate for job losses for June is 467,000, which means 7.2 million people have lost their jobs since the start of the recession. The cumulative job losses over the last six months have been greater than for any other half year period since World War II, including the military demobilization after the war. The job losses are also now equal to the net job gains over the previous nine years, making this the only recession since the Great Depression to wipe out all job growth from the previous expansion.

Here are 10 reasons we are in even more trouble than the 9.5% unemployment rate indicates:

David Klein

- June's total assumed 185,000 people at work who probably were not. The government could not identify them; it made an assumption about trends. But many of the mythical jobs are in industries that have absolutely no job creation, e.g., finance. When the official numbers are adjusted over the next several months, June will look worse.

- More companies are asking employees to take unpaid leave. These people don't count on the unemployment roll.

- No fewer than 1.4 million people wanted or were available for work in the last 12 months but were not counted. Why? Because they hadn't searched for work in the four weeks preceding the survey.

- The number of workers taking part-time jobs due to the slack economy, a kind of stealth underemployment, has doubled in this recession to about nine million, or 5.8% of the work force. Add those whose hours have been cut to those who cannot find a full-time job and the total unemployed rises to 16.5%, putting the number of involuntarily idle in the range of 25 million.

It is critical that the Obama administration not play politics with the issue. The time to get ready for a serious infrastructure program is now. It's a shame Washington didn't get it right the first time.

- The average work week for rank-and-file employees in the private sector, roughly 80% of the work force, slipped to 33 hours. That's 48 minutes a week less than before the recession began, the lowest level since the government began tracking such data 45 years ago. Full-time workers are being downgraded to part time as businesses slash labor costs to remain above water, and factories are operating at only 65% of capacity. If Americans were still clocking those extra 48 minutes a week now, the same aggregate amount of work would get done with 3.3 million fewer employees, which means that if it were not for the shorter work week the jobless rate would be 11.7%, not 9.5% (which far exceeds the 8% rate projected by the Obama administration).

- The average length of official unemployment increased to 24.5 weeks, the longest since government began tracking this data in 1948. The number of long-term unemployed (i.e., for 27 weeks or more) has now jumped to 4.4 million, an all-time high.

- The average worker saw no wage gains in June, with average compensation running flat at $18.53 an hour.

- The goods producing sector is losing the most jobs -- 223,000 in the last report alone.

- The prospects for job creation are equally distressing. The likelihood is that when economic activity picks up, employers will first choose to increase hours for existing workers and bring part-time workers back to full time. Many unemployed workers looking for jobs once the recovery begins will discover that jobs as good as the ones they lost are almost impossible to find because many layoffs have been permanent. Instead of shrinking operations, companies have shut down whole business units or made sweeping structural changes in the way they conduct business. General Motors and Chrysler, closed hundreds of dealerships and reduced brands. Citigroup and Bank of America cut tens of thousands of positions and exited many parts of the world of finance.

Job losses may last well into 2010 to hit an unemployment peak close to 11%. That unemployment rate may be sustained for an extended period.

Can we find comfort in the fact that employment has long been considered a lagging indicator? It is conventionally seen as having limited predictive power since employment reflects decisions taken earlier in the business cycle. But today is different. Unemployment has doubled to 9.5% from 4.8% in only 16 months, a rate so fast it may influence future economic behavior and outlook.

How could this happen when Washington has thrown trillions of dollars into the pot, including the famous $787 billion in stimulus spending that was supposed to yield $1.50 in growth for every dollar spent? For a start, too much of the money went to transfer payments such as Medicaid, jobless benefits and the like that do nothing for jobs and growth. The spending that creates new jobs is new spending, particularly on infrastructure. It amounts to less than 10% of the stimulus package today.

About 40% of U.S. workers believe the recession will continue for another full year, and their pessimism is justified. As paychecks shrink and disappear, consumers are more hesitant to spend and won't lead the economy out of the doldrums quickly enough.

It may have made him unpopular in parts of the Obama administration, but Vice President Joe Biden was right when he said a week ago that the administration misread how bad the economy was and how effective the stimulus would be. It was supposed to be about jobs but it wasn't. The Recovery Act was a single piece of legislation but it included thousands of funding schemes for tens of thousands of projects, and those programs are stuck in the bureaucracy as the government releases the funds with typical inefficiency.

Another $150 billion, which was allocated to state coffers to continue programs like Medicaid, did not add new jobs; hundreds of billions were set aside for tax cuts and for new benefits for the poor and the unemployed, and they did not add new jobs. Now state budgets are drowning in red ink as jobless claims and Medicaid bills climb.

Next year state budgets will have depleted their initial rescue dollars. Absent another rescue plan, they will have no choice but to slash spending, raise taxes, or both. State and local governments, representing about 15% of the economy, are beginning the worst contraction in postwar history amid a deficit of $166 billion for fiscal 2010, according to the Center on Budget and Policy Priorities, and a gap of $350 billion in fiscal 2011.

Households overburdened with historic levels of debt will also be saving more. The savings rate has already jumped to almost 7% of after-tax income from 0% in 2007, and it is still going up. Every dollar of saving comes out of consumption. Since consumer spending is the economy's main driver, we are going to have a weak consumer sector and many businesses simply won't have the means or the need to hire employees. After the 1990-91 recessions, consumers went out and bought houses, cars and other expensive goods. This time, the combination of a weak job picture and a severe credit crunch means that people won't be able to get the financing for big expenditures, and those who can borrow will be reluctant to do so. The paycheck has returned as the primary source of spending.

This process is nowhere near complete and, until it is, the economy will barely grow if it does at all, and it may well oscillate between sluggish growth and modest decline for the next several years until the rebalancing of excessive debt has been completed. Until then, the economy will be deprived of adequate profits and cash flow, and businesses will not start to hire nor race to make capital expenditures when they have vast idle capacity.

No wonder poll after poll shows a steady erosion of confidence in the stimulus. So what kind of second-act stimulus should we look for? Something that might have a real multiplier effect, not a congressional wish list of pet programs. It is critical that the Obama administration not play politics with the issue. The time to get ready for a serious infrastructure program is now. It's a shame Washington didn't get it right the first time.

Mr. Zuckerman is chairman and editor in chief of U.S. News & World Report.

On top of what has happened, the brilliant new medical plan will force employers to pay a large tax on each employee in order to fund the medical care system that will crowd out the insurers. The obvious result, to anyone who actually worked in a business, is that the companies will stop hiring and send work offshore. Another obvious result is the lowering of wages, which makes the medical plan a tax on all employees.

It seems the left does not understand businesses do not pay taxes, they merely pass along the cost to the employees and customers. When they can no longer make a profit, they close or leave. It is that simple. The people who have been pushing globalization will now suffer as their tax targets leave.

You can bring the water to the horse, but you can't make it wine.

I will publish, later today, the recent chart, already spreading across the Internet, of the new plan the Republicans are using to ridicule what is going on. Only, it is not funny. If you see the current speech on CSpan, watch it. I believe it is King who talks for a long time explaining what will happen. He discusses the eonomy from his viewpoint - he owns a business.

When the lowest economic part of a "democracy" learns it can pay itself by taking control of the government, the original idea of democracy is complete - mob rule. Our brief American experiment is ending and becoming a government of the people, by the wet mice, for the mob. This will recreate a class system and, eventually, the ruling class will be those who can convince the dull that they will protect the dull.

The Greeks said after democracy comes a tyranny as people look to a strong hand to fix the chaos. It starts out a well meaning tyranny, then changes, just like early Soviet Russia.

The wealthy will do as they always do. They will not sit around and pay for the picnic society.

Economic snapshot and the Obamanation

The New York Times today reported on how our economy is doing. An excerpt is below.

I quote the Times as it will be the best source to get people to grok what is going on. Not because it is any good, but because some people believe the sermons and put it in their bibles and others know it is the left case scenario. Those who believe that second position know that if the Times reports inconvenient facts then we are in real trouble as even Big Brother can't pull of an illusion.

Of note, the Times says the recession is 18 months old. Huh?

In trying to understand this latest redefinition of reality, I did 30 seconds of research. Here is an article in which the Times said there is no real definition, so people (the Times) accept the findings of a private group from Cambridge, of course, on when a recession or expansion happens. I wasn't aware that the end of a recession is an expansion, but never mind.

The National Bureau of Economic Standards have decided (I like to sometimes use proper grammar) a recession began December 1 of 2007, which everyone, even the democratic politicians, seem to have missed during the election cycle. Anyway, though we all missed it, rest assured Bush caused the recession by being stupid and hid it from discovery by being an evil genius.

This doublespeak is part of the Obomanation. If something is inconvenient, just define the universe differently and refer to smart people in Cambridge or Oxford. Note the article uses the phrase "worst...since the great depression...." Which means, "Bush did it" not the Democratic Congress albeit Congress was in charge of money bills according to the Constitution. It is interesting how you can run a whole nation on five or ten talking point.

For an actual definition of recession: A period of general economic decline; specifically, a decline in GDP for two or more consecutive quarters.

See where it says "specifically." Can't have that. That is the mean definition that demonstrated Clinton left office in a recession. Under the new method, a committee report can hold otherwise.
I have no doubt the double-talk coming from Cambridge will take root. It reminds me of the U.N. report on global warming, the accepted religious belief of a ten years ago.

I propose we have a vote by selected economists on when the recession began, said votes interpreted by a committee of politicians, rather than a precise definition or facts. It is better that some mythical people tell us what is fact rather than define it.

Anyway, note the grass-roots disintegration is just starting - forget following the market. That is a casino where players are guessing about the future and how to best position oneself. It is fun and eventually reflects the macro conditions, but do not think a guy in Jersey buying GM last week knows what the hell is going on. (Why were people buying GM? First Prize for figuring out why one buys stock in a pending bankrupt company is one coffee and bagel. I sat around trying to figure out what I was missing.)

Time:

The United States economy lost 345,000 jobs in May, the government reported on Friday, a sharp slowing in the pace of job losses that fueled hopes that the economy was on its way toward stabilizing.

The recession continued to take a toll as the unemployment rate climbed to 9.4 percent, its highest point in a quarter-century. The rate — a measure of jobless people looking for work — rose more than expected, partly because more people were resuming the hunt for a job.

Economists were encouraged that businesses were cutting fewer jobs, but six million jobs have now disappeared since the recession began in December 2007, and 14.5 million people are now unemployed. They warned that job losses were likely to pile up through the rest of the year as the country’s labor market bottomed out. “These are still terrible numbers,” said Ian Shepherdson, chief United States economist at High Frequency Economics. “We’re a million miles away from a recovery.”

Financial markets nonetheless sensed recovery a bit nearer. Futures on the Dow Jones industrial average rose, and the price of oil shot above $70 a barrel for the first time since November, bolstered by hopes that demand would rebound as the global economy recovered.

In normal times, the loss of so many jobs in a single month would have been interpreted as a calamity. But 18 months into the longest recession since the 1930s, economists said the milder pace of job losses indicated that the economy was gradually leveling off as government stimulus money trickled out and businesses reined in their budgets and payrolls.

“Things are still getting worse, but the pace of decline has slowed down,” said David Wyss, chief economist at Standard & Poor’s. “Over all, it’s not quite as dire as it looked in the first quarter.”

The economy lost an average of more than 700,000 jobs per month during the first three months of the year as shocks from the credit crisis surged through the broader economy. But the pace of job losses eased to a revised 504,000 in April, a welcome sign that the decline in the job market would not continue forever.

Still, by nearly any measure, workers endured another brutal stretch of layoffs, furloughs and pink slips in May. Even as the broader economy made some halting steps toward recovery, businesses continued to slash their staffs and cut employee hours. Economists were expecting 520,000 job losses in May, and predicted the unemployment rate would reach 9.2 percent.

“There’s no question that the jobless rate is going to continue to rise,” said Bernard Baumohl, managing director of the Economic Outlook Group. “It’s a dismal job market. It’s going to remain awful easily for the balance of this year.”

Just this week, General Motors announced it was closing or idling 14 plants across the country, including several in Michigan, which has the nation’s highest unemployment rate. The closings will affect as many as 20,000 workers, and are just part of a vast reorganization by the automakers G.M. and Chrysler....

So, the question remains: what do we do where the government will force down interest rates artificially, thereby creating a backlog of pressure upward created by intentional inflation? There are choices to consider: buy precious metal, get fixed loans now, by bonds that are inflation adjusted.

Bob projects Barney the Purple Congressaur will soon succeed in having state bonds secured by the federal government, why not? - the state is self destructing, so buying a California obligation today will lock in 7%. He mentioned it would be tax free, but I am not sure if that works if you are in NY. On the other hand, he knows this stuff.

Such a smart move begs the question, is 7% enough? Or, do we just get out of the American economy.