Economic Treason: Middle class whacked while arms manufacturing flourishes, case Michigan

Posted in Made in China, Permanent Fail, Predator State at 6:05 pm by George Smith

The Great Recession caused by Wall Street whacked almost all of the middle class in the United States. Newspaper articles and the opinions of economists discuss the the mass unemployment and hardship caused by it daily. However, there are some industries which escaped the Great Recession, one because of massive government bailout, another because it is also protected by the taxpayer and the US government.

The first, and most obvious, is Wall Street; the latter is arms manufacturing. The arms manufacturing industry in the US enjoys protections afforded no other industry except for Wall Street. It is an exercise in socialism for the private sector, rigged to be underwritten and guaranteed by labor and taxes of the US middle class. It is not subject to pressure from global labor markets, pressures which have been used by American big business and government policy to tear apart and destroy all other domestic manufacturing in this country.

Previously, a graph from the New York Times makes a bad picture very clear.

The Great Recession cratered demand and US non-military production. But arms manufacturing, paid for by the middle-class taxpayer, soared.

At a time when the GOP and Fox News portray middle class union workers — teachers — as pampered parasites, there are two American industries totally immune to any notions of austerity and shared sacrifice. Obviously, one is Wall Street. The other is made up of weapons makers.

While they don’t enjoy quite the same very top fruits of greed and avarice like Wall Street CEO’s, the bossmen of US weapons-makers also make out really really well. While everyone else was getting fired or seeing their incomes shrink, for instance, General Dynamics — one of the top five US arms developers — was richly rewarding its CEO.

“The chief executive of General Dynamics Corp. received pay and compensation the company valued at $17.96 million during 2008, a 15 percent annual increase that came as the defense contractor posted a big profit on the sale of equipment such as armored vehicles, private jets and submarines,” reads a news article from The Street.

“General Dynamics gave Nicholas Chabraja $1.38 million in salary and a bonus of $4.5 million, according an Associated Press analysis of the Falls Church, Va.-company’s proxy filing with the Securities and Exchange Commission Friday. Chabraja’s salary was up slightly from 2007, while his bonus was $1 million richer than the year earlier.”

In 2008, when millions of Americans were being laid off, the SIPRI database on worldwide arms sales showed the US industry ascendant. While everyone else in the heartland was being hammered, seven of the top ten arms sales companies in the world were American.

In the previous installment of the Economic Treason series, I discussed the itty-bitty arms maker, Combined Systems.

Combined Systems, a manufacturer of tear gas, high explosive rounds and handcuffs, is the primary employer in Jamestown, PA. Its entire business is arms manufacturing. It ships worldwide and is not subject to the pressures which have destroyed US non-military production. Famously, its products were seen being used against the now victorious Egyptian revolution.

Located in Mercer County, Pennsylvania, it has flourished while all other
industries making things in the county and its environs have suffered.

But that’s only one small company.

This year, SIPRI described its database on very big worldwide arms merchants in this manner:

With e total arms sales of the SIPRI Top 100 maintained the upward trend in their arms sales, an increase of a total of 59 per cent in real terms since 2002 … 45 of the SIPRI Top 100 are based in the USA. These companies generated just under $247 billion in total arms sales, which is 61.5 per cent of the SIPRI Top 100 arms sales.

While American big business has shipped all the jobs it can to China, US arms manufacturing labor is sacrosanct. It is protected, essentially underwritten by the mass of taxpayers who have been treated so shabbily in the last decade. While we were getting poor, arms manufacturing, like Wall Street, was getting rich through its status as a profoundly unfair industry underwritten and guaranteed by the state.

The Economic Treason series focuses on arms manufacturing businesses, comparing them to the fortunes of everyone else in the communities in which they are located. Because the effects of the economic collapse are so widespread, as a general rule it appears that while weapons production facilities have done well in the last ten years, everyone not in weapons production in the same or surrounding communities has done abominably.

Mass layoffs, which ticked up at the Bureau of Labor Statistics here, are for everyone. Except Wall Street and arms makers.

Mass layoffs occur for everyone else but not at weapons plants. And mass layoffs are now always threatened for public sector union workers, something prescribed as belt tightening as well as shared sacrifice and pain. This is fork-tongued speak. Like Wall Street, no sharing of pain ever comes to weapons makers. They are exempt.

Take General Dynamics Land Systems in Sterling Heights, Michigan.

Unemployment is abominable in Michigan. And it is also very bad in Macomb County, part of the Detroit metro-area, where General Dynamics Land Systems design bureau and corporate headquarters is located.

Michigan’s unemployment rate is 11.7 percent, as noted by the US Bureau of Labor Statistics here. Statistically, it stood out in this report because of the rate of change, which has been greater than most of the rest of the country. While the rate has decreased faster, it is not because Michigan has a good jobs creation program. The rate of change downward is due to a decline in the population of the state.

Unemployment is terrible in Macomb County, Michigan. Unless you work for General Dynamics designing armored fighting vehicles. (Data from the St. Louis Fed here.)

The M1 Abrams tank manufactured by General Dynamics Land Systems is not particularly useful in the war on terror. We were attacked by suicide commandos using boxcutters on 9/11. al Qaeda has no armored fighting vehicles. The M1 tank went into action when we attacked a country that didn’t attack us in a war sold on a variety of now very famous frauds.

The M1 tank also had a visible role in the Egyptian revolution. But while it did no harm it was not really on the side of the people who brought down Hosni Mubarak.

In Macomb County, threatening public workers with layoffs is noticeable in the news. Articles oncoming layoffs at municipalities hurt by the economic collapse is also a common feature in Michigan newspapers in nearby Oakland and Wayne counties.

This recent news item from a place called Clinton Township says:

Clinton Township Supervisor Bob Cannon recommended that three police officers and 12 firefighters be laid off in the 2011-2012 fiscal year budget to help the two departments’ struggling bottom lines.

The board is expected to vote on the budget and possible cuts on March 21, and will make another decision that night on a federal grant that could re-hire seven firefighters already laid off last year.

Cannon made the recommendation at a Feb. 22 public hearing on the budget.

From the city of Troy, in neighboring Oakland County, we read this:

The city projects a $6.2 million budget deficit in 2010-2011, $6 million in 2011-2012 and $3.2 million in 2012-2013.

Under Option One of the restructuring plan, there would be no police layoffs until 2011-2012, when four police officers would be laid off. In 2012-2013, 29 police officers are slated for layoff, 14 in 2013-2014, for a total of 47 police layoffs.

The plan calls for reducing library staff by 39 people in 2010-2011 and 69 in 2011-2012.

The Parks and Recreation Department would also be eliminated in phases …

Armored fighting vehicles — special! Libraries, parks and recreation for children and civilians, not so much.

Unemployment has been craptastic in Allen County, Ohio! Except for the General Dynamics tank-making facility in Lima, the county seat.

“Ohio Fraternal Order of Police (FOP) President Jay McDonald hosted a press conference in Lima to highlight how Congressman John Kasich’s tax plan for Ohio would force local tax increases or lead to layoffs in public safety departments, according to a media release Thursday,” reads this bit of news from the web.

“Congressman [John Kasich’s] tax plan for Ohio would continue the damage he wreaked on the state during his time in Washington and on Wall Street … Similar to how Kasich’s support of outsourcing through unfair trade deals like NAFTA led to hundreds of thousands of layoffs in Ohio, his tax plan would force layoffs in our schools, and just as alarmingly, our police and fire departments.”

M1 Abrams tanks — huzzah! Police, public safety, teachers — eh.

Unemployment bloomed in Lackawanna County when the economy went ka-boom in 2008. Except, you guessed it, if you worked for General Dynamics Land Systems in Eynon, PA.

This item from Lackawanna County, describes public worker lay-offs in 2010 due to fiscal distress:

Majority commissioners have pledged to not raise taxes in 2011. They have cut the county budget by about 5 percent since taking office in 2008 without increasing taxes, but to keep that promise have laid off 109 employees and eliminated many others, including more than 320 positions through the sale the Lackawanna County Health Care Center earlier this year.

It is a drearily familiar thing. Public and private sector workers getting the chop everywhere. But not arms manufacturing. Firemen, hospital workers, policemen, receptionists, teachers — everyone threatened or downsized outright. The economy stumbles along, lives are reduced to splinters, people are tossed away in the wind.

But the factories that produce armored fighting vehicles are sure doing well.

General Dynamics Land Systems corporate headquarters emits a steady stream of truly wonderful press releases — these from 2009 — on tanks and armored fighting vehicle production. Tanks for the Iraqi army. And still more tanks and upgrades for our great pals in Saudi Arabia.

And while 2008 was really bad for almost everybody, it was swimming for General Dynamics Land Systems.

Record numbers of Americans apply for food stamps and unemployment. Every job not in finance or arms manufacturing gets beggared or threatened with shipment to China. Saudi Arabia and Iraq get tanks. More and more tanks. There are never enough.

As a thought experiment, I am going to propose a war-profiteering dividend/tax on US arms sales. Since the core markets for all these businesses are essentially guaranteed by the US taxpayer and government, it seems only fair Americans ought to be regarded as shareholders. And as shareholders, they ought to be in for some rewards. It’s the American way.

Let’s make the war-profiteering tax significant because, although even though I haven’t researched it yet, the US arms industry is probably quite adept at tax avoidance already. So I make it twenty percent of all profits in overseas arms sales — weapons, tanks, aircraft, ships, guns, ammo, bombs, chemicals, computer systems, software, consulting services and support — everything.

Here’s the calculation, using SIPRI’s latest data:

20 percent of 247 billion = 49 400 000 000

Further, I will propose a yearly war-profiteering dividend check for everyone in the United States on food stamps.

According to Reuters: “For fiscal 2011, average enrollment is forecast for 43.3 million people.”

Here is the calculation:

49.4 billion divided by 43.3 million = 1 140.8776

Everyone on food stamps, no exceptions, gets a check from the protected US arms industry, for roughly $1,140.88. That would certainly be a help.

One could also extend the dividend to all tax-filers for a given fiscal year although it would probably cut the size of each check by at least two thirds. The only people who wouldn’t be entitled to checks would be employees of the US arms manufacturing base. They’re already getting dividends as well as security.

Of course, none of this has any chance of consideration. It’s just a thought exercise. The protected industry of American weapons production is a third rail. No one will seriously discuss taking any big whacks at it.

However, this article does illustrate that when politicians, both GOP and Dem, fight for pieces of defense budget funding because of the familiar cry that it preserves “jobs” in their community, what they really mean is this:

Weapons making jobs are good and need preserving. Everyone else can go to Hell because “we’re broke” or belts need tightening or public sector union workers are scum.

It is also fun to imagine that such a war-profiteering tax/dividend might cause American arms manufacturers to raise prices to various clients (often countries whose rulers do not share our now largely theoretical democratic ideals) to retain profit margin. Or they could always start outsourcing to China.

Is there an arms manufacturer in your county? One you’d like to see profiled in the Economic Treason series? Send me a note or leave a comment.

General Dynamics plutocrat compensation — 2010.


Anonymous declares war on Koch interests

Posted in Permanent Fail at 2:43 pm by George Smith

With WikiLeaks seemingly stagnant and the HBGary Federal e-mail spill fresh in memory, the Anonymous hacking group has declared war on the Koch brothers, the plutocrats backing the Tea Party and the GOP governor bent on union-busting in Wisconsin.

The prose could be a little less purple but it gets the message across:

It has come to our attention that the brothers, David and Charles Koch–the billionaire owners of Koch Industries–have long attempted to usurp American Democracy. Their actions to undermine the legitimate political process in Wisconsin are the final straw. Starting today we fight back.

Koch Industries, and oligarchs like them, have most recently started to manipulate the political agenda in Wisconsin. Governor Walker’s union-busting budget plan contains a clause that went nearly un-noticed. This clause would allow the sale of publicly owned utility plants in Wisconsin to private parties (specifically, Koch Industries) at any price, no matter how low, without a public bidding process. The Koch’s have helped to fuel the unrest in Wisconsin and the drive behind the bill to eliminate the collective bargaining power of unions in a bid to gain a monopoly over the state’s power supplies.

The Koch brothers have made a science of fabricating ‘grassroots’ organizations and advertising campaigns to support them in an attempt to sway voters based on their falsehoods. Americans for Prosperity, Club for Growth and Citizens United are just a few of these organizations. In a world where corporate money has become the lifeblood of political influence, the labor unions are one of the few ways citizens have to fight against corporate greed. Anonymous cannot ignore the plight of the citizen-workers of Wisconsin, or the opportunity to fight for the people in America’s broken political system. For these reasons, we feel that the Koch brothers threaten the United States democratic system and, by extension, all freedom-loving individuals everywhere. As such, we have no choice but to spread the word of the Koch brothers’ political manipulation, their single-minded intent and the insidious truth of their actions in Wisconsin, for all to witness.

Anonymous hears the voice of the downtrodden American people, whose rights and liberties are being systematically removed one by one, even when their own government refuses to listen or worse – is complicit in these attacks. We are actively seeking vulnerabilities, but in the mean time we are calling for all supporters of true Democracy, and Freedom of The People, to boycott all Koch Industries’ paper products. We welcome unions across the globe to join us in this boycott to show that you will not allow big business to dictate your freedom.

The original, at AnonNews, is here.

Plutocrat money does directly threaten democracy. It also funds war on the middle class.

Leaking/dumping the e-mails of Koch front-group like Americans for Prosperity ala HBGary Federal might, indeed, get results.

In a manner of speaking, like a union, Anonymous is a collective.

Nugent compares Wisconsin protesters to Al Capone

Posted in Extremism, Ted Nugent at 10:42 am by George Smith

Ted Nugent hates more on the Wisconsin protesters and the state senators who have left for Illinois.

The insults and name-calling range from calling for the hanging of Democrats, to bringing up Chappaquiddick, to insinuating the state politicians are lower than Muammar Gaddafi because at least the dictator is choosing to stay and slaughter people to the end.

Some excerpts:

This juvenile, pro-union stunt has only tightened the political noose for Democrats in 2012. Hang ‘em high.


Just as it sank the presidential aspirations of Democratic poster boy Ted Kennedy when he ran away and hid for eight hours or so before reporting to the police that he had driven off a bridge with a female passenger, this stunt is going to bleed Democrats of support


No Democrat is going to turn on the labor unions. Al Capone and Jimmy Hoffa live.

Terminally whacked as he is, at least Col. Whackjob Gadhafi has so far vowed to stay and fight to the end in Libya. He hasn’t run away yet from the mob of Libyans looking to lynch him, but maybe he hasn’t been following what is happening in Wisconsin and Indiana.


Americans intrinsically know that running away is a sign of weakness…

Weaklings, cowards, having less stones than a crazy dictator, like Al Capone and to be figuratively hung. Did I miss anything?


Late Friday Pickin’ Break — The Streets of Laredo

Posted in Rock 'n' Roll at 4:02 pm by George Smith

The Streets of Laredo here.

Country of Mass Layoffs

Posted in Extremism, Permanent Fail at 12:38 pm by George Smith

Fifteen hundred+ mass layoffs in January, according to the Bureau of Labor Statistics. (Original here. Blog copy doesn’t show actual uptick of mass layoff events as of January on BLS page.)

Mass firing in Rhode Island, as in teachers, flippantly equals “creative solutions to … municipal fiscal woes” according to some jerk at Politico.

“My solution to all of this is to dissolve the teachers unions and turn over all teaching to the private sector,” writes the ex-union man at the Lehigh Valley Biblical Bund blog.

Creative use of scapegoating for political and financial crises brought on by the plutocracy, open and direct class war against the middle.

Black Rose

Posted in Phlogiston, Rock 'n' Roll at 10:31 am by George Smith

An obscurity from 1980, this is Cher fronting a hard rock band with her post-Greg Allman boyfriend, the poor woman’s Greg Allman, Les Dudek.

Remember Allman and Woman? Well, if the answer is no, I’m not sure I like you. Heh.

On Geffen, the Black Rose vinyl packaging worked hard to disguise Cher’s membership until you opened it up.

Unsurprisingly, to me anyway, Cher’s more than acceptable as a hard rock singer although discussion of the album, when it occurs, has never been kind. For “Julie,” a metal torch song with chugging guitar, Cher randomly bends over and shakes her butt, a stagy but always popular move. Note the mysterious co-singer in tight shirt on the right.

Black Rose quickly dropped its petals although the vinyl, which you don’t see in used bins at all here, has been pirated to the web. And TV excerpts of the band for Wolfman Jack are on YouTube after having been disappeared from public consciousness for decades.

A hysterically funny cheap champagne-drenched review of Cher’s Black Rose, perhaps penned by someone familiar with her many drag club diva impersonators, is here.

“The heavy chugging of Julie is borderline embarassing,” it reads. “Julie is definately [sic] an upturned-collar polo-shirt-clad lesbian.”

Montana dental floss

Posted in Permanent Fail at 9:00 am by George Smith

I might be movin’ to Montana soon
Just to raise me up a crop of dental floss
Raisin’ it up
Waxin’ it down
In a little white box
I can sell uptown — Frank Zappa

Montana politicians elected as members of the Tea Party and what they want for the state, according to AP:

Some of their bills are moving through the legislature. Others appear doomed: an armed citizen militia, FBI agents under the thumb of the sheriff and a declaration that global warming is good for business …

[The Dem governor] is watching, describing many of the proposals from the new majority as simply “kooky,” such as a plan to make it legal to hunt big game with a spear.

Hardly a day goes by, however, that the merits of “nullification” aren’t discussed …

The nullification debate reached a fever pitch this week when tea party conservatives mustered enough votes in the House to pass a 17-point declaration of sovereignty.

“It would be hard for anyone to top what is going on here in terms of the insanity of it all,” said Lawrence Pettit, a retired university president and author living in Helena. “One could be amused by it, except it is too dangerous.”

What happens when you elect the political equivalents of Ted Nugent to office. And it’s neither pretty nor funny. While the governor has veto power, making it look like none of the extremist bills have a chance, things have a way of always going upside down in the 2011 US of A.

For example, here’s a recent story from the Billings Gazzette on a state bill to form paramilitary groups:

A Republican legislator said Friday that Montana needs an armed paramilitary group of volunteers to help authorities in emergencies, a proposal favored by gun rights advocates and conservative lawmakers skeptical of the federal government.

Rep. Wendy Warburton, of Havre, told the House State Administration Committee that House Bill 278 would let residents organize military-like companies called “home guards” that would answer to the governor and sheriffs during emergencies …

Gary Marbut, president of the Montana Shooting Sports Association, said he supported this and the other bills as a way of shifting power from government to the people.

“The question here is where that slider is located on that range between anarchy and tyranny,” Marbut said. “We’d like to nudge it back a little toward anarchy.”

I’d be lying if I said I didn’t think this was going on elsewhere.

Newspaper article on US business interests wishing to expand shipments of Montana coal to Asia. Making global warming good for business.

New spam tactic

Posted in Stumble and Fail at 8:15 am by George Smith

A new spam tactic raises an eyebrow in amusement.

Instead of the usual exhortations related to “very good blog” and the long lists of links to drugs and goods made overseas, the new spammer scrapes a bit of content from elsewhere off the net — often Wikipedia, it looks like — related to a keyword snagged from the targeted post.

This is then cut and pasted into the spam comment which points back to one of the many standard financial services scam sites.

It is an effort, and not a very good one, to trick the blogger – or spam filter — into passing it as a legitimate part of the discussion.

For example, from yesterday’s post on junk jobs, mentioning the blight of Amazon’s Mechanical Turk:

As long as he can make a little money he says Ill be doing it. The Mechanical Turk has given a 21st-century twist to the centuries-old concepts of cottage industry and piece work. People work in their homes and are paid based on how much they produce instead of an hourly wage using the Internet connections that have become a standard feature in most homes.While some worry that the Turk could become another work-at-home scheme with low pay and no benefits that exploits workers others suggest that if the concept took off it could allow anyone a college student a shut-in the newly unemployed to quickly earn an income. The company also opened up the website to what it calls requesters outside companies looking to use the Turk to find workers. This has huge potential because its really tapping the connectivity thats created by the Internet says Jesse Heitler an entrepreneur in Ann Arbor Mich. whos been developing services to take advantage of the Mechanical Turk and its ready supply of workers sometimes called Turkers .

This is coincidentally funny because as spam for a fraction of a penny, it’s just about the kind of work, in terms of payment and task, Mechanical Turk aims at. The lowest of the low as an engine of innovation and job creation.

In fact, part of the spam appears to be directly scraped from a Mechanical Turk forum.

Other similar intercepted spam comments included discussion on Ted Nugent, sent into this week’s post on the man, and the Internet “kill switch.”


The Big Jangle

Posted in Rock 'n' Roll at 6:19 pm by George Smith

I’m a sucker for pop rock tunes built off the big jangle (open G’s, C’s and D’s radiant into the sky, if you play guitar).

Thompson Square’s “Are You Gonne Kiss Me Or Not?” is a perfect example. They’re peddled as a modern country group but if you’re my age, you hear classic rock.

Hat tip to CE whose review moved this in front of me.

Cult of EMP Crazy: Attracts legal services for the vulture economy

Posted in Crazy Weapons, Cyberterrorism at 9:11 am by George Smith

Everything about the Cult of Electromagnetic Pulse Crazy is odious. Accordingly, one of its new chieftains is Trent Franks, a relatively unimportant Republican congressman famous only for his extremist beliefs.

These include:

The president is not an American, global warming and evolution are hoaxes, African Americans had it better under slavery, shariah law is poisoning the precious bodily fluids of the US judicial system, and extended ammo magazines are an American right.

This kind of general world view of the people pushing protection against electromagnetic pulse doom has bearing on the way one regards their argument. Even with the most gentle interpretation, they’re dodgy and glabrous characters. And they are only interested in things the GOP is now notorious for, like blocking progress and siphoning money to the plutocracy and various corporate pals.

So it’s not a surprise when you see a Washington law firm whose business is basically siphoning money to the plutocracy — promoting outsourcing, homeland security and Wall Street financial services — support the Cult’s hobby horse.

Such firms see protection against EMP doom as just another way to suck taxpayer dollars into client coffers, in this case Wall Street investment firms like Goldman Sachs.

A .pdf here explains elliptically why such firms are interested in the mischief being created by Franks.

What it boils down to is simpler than it reads.

Any legislation adopted, and I’ve stated before there’s not a lot of chance Franks’ bill will survive, would nevertheless present an opportunity for further legal amendment. Since it might affect large portions of the power-transmitting infrastructure in the country, the private sector must be involved. Therefore opportunities will exist to divert potentially large taxpayer sums to the usual corporate parties.

It is also unsurprising that the same memo, authored by the Sutherland, Asbill & Brennan legal firm, also supports Susan Collins’ Orwellian-named Cyber Security and Internet Freedom act, previously stalled because of resistance to Internet “kill switch” powers.

Collins has resubmitted it accompanied by blandishments that the new bill doesn’t give the president “kill switch” power. Critics in the technology sector, and there are many, aren’t having it. They still consider it a rotten fish.

It is.

A recent news article reads:

Republican U.S. Sen. Susan Collins’ latest proposal to beef up the country’s cyber security has a new name and language explicitly denying the president the so-called “kill switch” power to unilaterally shut down the Internet.

But so far the legislation’s makeover has failed to win over the technology community, libertarians and civil rights advocates, who worry the bill still gives the president and the government too much power to disrupt Internet communications.

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