02.21.11
Posted in Permanent Fail at 7:50 am by George Smith
A story indirectly celebrating the fact that the US doesn’t make anything but hookers, the unemployed and beer, that latter which is owned by Belgium, this article on the firms that pay the most.
It’s all financial services, legal manipulation and maximizing global warming and dirty water: Three legal firms, two energy companies, a small cancer-drug “biopharma” firm that doesn’t make anything anyone uses but which appears to be good at raising capital.
And Goldman Sachs:
Everyone knows Goldman Sachs pays big salaries and jaw-dropping bonuses, but the firm’s other benefits are nothing to sneeze at either. Case in point: Goldman has funded employees’ retirement plans every year for more than 65 consecutive years. The current contribution is a dollar-for-dollar 401(k) match, up to 4% of salary, that maxes out at $9,800. Everyone is guaranteed at least $6,000 a year, regardless of what they put in.
Nearly 40% are lucky enough to have access to “wealth creation opportunities” that enable them to reap bounty from the firm’s investments. And more than 38,550 current and former Goldman employees have received stock since the firm’s IPO in 1999.
The DD band performed “Let’s Lynch Lloyd Blankfein” at Artscape in Pasadena on Saturday night.
It was applauded when I explained who Lloyd Blankfein was in the intro.
Everyone seems to understand Goldman Sachs is one of the villains. But they don’t know the people who run it which, perhaps, is part of the problem. However, once you tell them they’re modern Frankensteins or vampire squids …
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02.19.11
Posted in Permanent Fail at 9:00 am by George Smith
Business get rick quick flacks newsmen love stories about crap “inventions” that sold and made millions.
Today at Yahoo, the unintentionally pathetic listing of such American “inventions:” the Slinky, the antenna ball, the Koosh ball, and so on, stopping at five just before nausea erupts.
Naturally, the real story is that none of it is made here now. In fact, we probably can’t even make a Pet Rock, also on the list. American labor, too expensive to make “Post-It Note” pads.
So now all the brain-stormers for junk toys and novelties — don’t forget the “Baby on Board” signs — have to put together a business that allows Chinese workers to manufacture them.
Because wages have been so compressed and rendered stagnant by corporate America in the last twenty years.
There was a lot of vigorous and sometimes angry talk about war being conducted on the middle class on the tube news from Wisconsin last night.
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Posted in Permanent Fail at 8:34 am by George Smith
Krugman presents this graph today from OMB on defense spending in proportion to the national outlay:
Fascinating in that the percentage versus the rest of the government has declined since the early part of the Cold War.
On the other hand, it doesn’t show how it’s ballooned in proportion to accumulated spending of all allies and potential enemies.
Krugman makes the point that even trimming the defense budger won’t cure our ills:
Yes, there’s a lot of wasteful defense spending — in fact, it’s almost surely the most waste-ridden part of the federal budget, because politicians are afraid to say no to anything for fear of being called unpatriotic. And even aside from the question of the Bush wars, it has long been clear that we’re still spending a lot to head off threats that haven’t existed since the fall of the Soviet Union. Read Fred Kaplan for a sense of just how bad it is.
Then there are those wars. I was against Iraq from the beginning — and I was pretty lonely out there on the pages of major newspapers. Afghanistan made sense in 2002, but I have no idea what we’re doing there now.
But if we’re talking about fiscal issues, you have to bear the arithmetic in mind. We’re not living in the 1950s, when defense was half the federal budget. Even a drastic cut in military spending wouldn’t release enough money to offset more than a small fraction of the projected rise in health care costs.
So by all means, let’s try to crack down on the massive waste that goes on in matters military. But doing so would be of only modest help on the larger budget problem.
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02.18.11
Posted in Permanent Fail at 8:30 am by George Smith
A DailyKos blogger asks a question that’s bothered me for the past two years, at least:
However, this belated American uprising also strikes a melancholy note: where were all these people during the elections? It was our own sense of disenfranchisement and apathy that let the wolf in the door. Why is the popular will being expressed in the streets instead of the polling booth? Isn’t the chief glory of democracy the ability to channel the will of the people through normal political operations? Will religious fundamentalism and corporate greed return this country to the state of the Middle East?
The only popular uprising generated until now was the Tea Party, financed by billionaires.
While Facebook has been laughably credited with bringing down Mubarak, somehow social media hasn’t done s— here. With magnitudes more connectivity than the poverty-stricken nation at the head of the Nile, nothing except a lurch into extremism and all out corporate-financed class war on the civilian population.
The DailyKos writer adds:
Tonight Obama is meeting with bigwigs in Silicon valley. I wish he would meet with someone like me. I could tell him the problems with the economy can’t be solved just by persuading rich people to create jobs: there also has to be reforms to aid job seekers, to reduce the barriers that make it so difficult to get the jobs that are there. Efficiencies need to be developed from the bottom up.
Bowing and scraping before Steve Jobs and Mark Zuckerberg was never a good idea. If the President were actually made of the stuff some people still think he has in him he would have canceled those plans and flown Air Force One into Madison.
But he didn’t.
Instead, this morning there is this item, the definition of insipid:
President Barack Obama dined with a dozen leaders of the U.S. technology industry including Apple Inc. Chief Executive Officer Steve Jobs and Facebook Inc. founder Mark Zuckerberg as he sought support for his education and innovation agenda to help promote growth. Cris Valerio reports on Bloomberg Television’s “InsideTrack.”
There he is with Nobel laureate and Pulitzer winner Mark Zuckerberg.
“Who got the best seats?” writes some new Gilded Age sissy fop at the Washington Post:
Apple’s Steve Jobs, who still looks thin as he continues his medical leave. Also Facebook’s Mark Zuckerberg, who was seated on the president’s right.
Good thing President Obama brought his security brigade to the dinner with high-tech executives. The combined net worth of this crowd … someone do the math, please and let me know.
Also at the table: Google CEO Eric Schmidt, Cisco CEO John Chambers, Kleiner Perkins partner John Doerr, Oracle CEO Larry Ellison, Netflix CEO Reed Hastings, Yahoo CEO Carol Bartz and Twitter CEO Dick Costello.
When even a Wall Street Journal opinion blogs notices the disconnection, you have real proof of a leadership problem:
Here, though, the job-seeking president and the t-shirt wearing masses of Silicon Valley may have an inherent conflict. Those tech guys represent a future of a highly skilled but low numbers workforce. Apple, with a market value of $330 billion, has 46,600 employees. Ford, whose market cap one-seventh that of Apple, employs about 160,000 people. Another “old economy??? lion, General Electric, has roughly 300,000 employees.
Exhorting Steve Jobs for more phone kit made in China and rubble-izing what little is left of the US popular music industry is certainly an idea for the Fools Hall of Fame.
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02.17.11
Posted in Permanent Fail, Predator State at 4:56 pm by George Smith
Explained by Matt Taibbi at Rolling Stone.
A lot of it you know — government capture by Wall Street, the revolving door between the financial policing agencies of government and plush Wall Street positions which guarantee you are “fit for life” once landed.
A couple graphs really stand out:
“You put Lloyd Blankfein in pound-me-in-the-ass prison for one six-month term, and all this bullshit would stop, all over Wall Street,” says a former congressional aide. “That’s all it would take. Just once.”
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As for President Obama, what is there to be said? Goldman Sachs was his number-one private campaign contributor. He put a Citigroup executive in charge of his economic transition team, and he just named an executive of JP Morgan Chase, the proud owner of $7.7 million in Chase stock, his new chief of staff. “The betrayal that this represents by Obama to everybody is just — we’re not ready to believe it,” says Budde, a classmate of the president from their Columbia days. “He’s really fucking us over like that? Really? That’s really a JP Morgan guy, really?”
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The mental stumbling block, for most Americans, is that financial crimes don’t feel real; you don’t see the culprits waving guns in liquor stores or dragging coeds into bushes. But these frauds are worse than common robberies. They’re crimes of intellectual choice, made by people who are already rich and who have every conceivable social advantage, acting on a simple, cynical calculation: Let’s steal whatever we can, then dare the victims to find the juice to reclaim their money through a captive bureaucracy. They’re attacking the very definition of property — which, after all, depends in part on a legal system that defends everyone’s claims of ownership equally. When that definition becomes tenuous or conditional — when the state simply gives up on the notion of justice — this whole American Dream thing recedes even further from reality.
Another mental stumbling block is that most Americans don’t even know who Lloyd Blankfein is, given the execrable track record of the mainstream media in pointing out who the big villains are.
Earlier in the week DD ripped a new hole in an old colleague who not only didn’t know who Blankfein was but thought that was the name of the rock n roll band.
So as far as the matter goes, Americans know things have turned awfully rancid. But as to the details and who did the bad, many are still radically mis- and under-informed.
And while there is a great desire loose in the land to see people punished, it’s not the real public enemies who are the targets of the ire. Instead it’s people like school teachers in Wisconsin who the President has failed to enthusiastically support in what can only be described as continuing evidence of politically expedient cowardice.
The idea that he might actually fly in to get on the line in the Madison courthouse with the people who voted for him in 2008 seems very alien now. Instead he flew to see Steve Jobs and Mark Zuckerberg.
Taken altogether it forms the context of the idea that the greatest national security threats faced by the people of the United States are not abroad. They’re right here.
But there are still countless idiots who hog up all the frontpage space whinging about al Qaeda, pathetic alleged homegrown jihadis and Iran.
“Let’s Lynch Lloyd Blankfein” — which I will play in Pasadena on Saturday night — here.
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Posted in Permanent Fail at 7:49 am by George Smith
From AP:
School districts around Wisconsin canceled classes Thursday as state lawmakers were prepared to pass a momentous bill that would strip government workers of nearly all collective bargaining rights.
The proposal from Republican Gov. Scott Walker has drawn thousands of teachers, students and other demonstrators to the Capitol in protest. The nation’s most aggressive anti-union proposal has been speeding through the Legislature since Walker introduced it a week ago.
Madison schools canceled classes for a second day as teachers prepared spend another day at the Capitol. Dozens of other school districts followed suit Thursday and closed, including La Crosse, Racine, Beaver Dam, Mosinee, Watertown and Stoughton.
The Legislature’s budget committee passed Walker’s bill on a partisan vote just before midnight.
Class war to destroy labor for the benefit of the wealthy, in Wisconsin. And lots and lots of people won’t take it lying down.
And most people could not help but notice the President has been lukewarm on it, much more equivocal that his voice of support for Egyptian protesters.
Whenever your host tested Fox News it was spending all its time portraying the middle class protesters in Wisconsin as public enemies.
DD grew up in a neighborhood in Pennsylvania where all Pine Grove Area school district’s teachers lived. The neighbors on both sides worked at the school.
Even if Wisconsin’s poor man’s Hosni Mubarak from the GOP gets his budget rammed through and strips them of their rights, they can still bring things to a halt by staging a teach-out. An immediate closing of Wisconsin public schools, or at least many of them, would be something to behold.
You can’t sic the National Guard on teachers. You can’t replace them and you can’t threaten them all with jail or mass firings unless prepared to collapse the school system. They have the power of a big collective.
Perhaps it is a moment when the GOP oversteps.
In Britain, there is now a solid anti-austerity protest movement called UK Uncut, aimed at pushing back against the government and big business tax avoidance, which has become a plague in that country.
Wisconsin public workers could lead the way in the US in their drawing of and holding the line. The powerful will need to be threatened by group actions they can’t change through decree.
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02.16.11
Posted in Made in China, Permanent Fail at 12:49 pm by George Smith
UPDATED
Now dumbly obvious, from CNN Money:
One major pull on the working man was the decline of unions and other labor protections, said Bill Rodgers, a former chief economist for the Labor Department, now a professor at Rutgers University.
Because of deals struck through collective bargaining, union workers have traditionally earned 15% to 20% more than their non-union counterparts, Rodgers said.
But union membership has declined rapidly over the past 30 years. In 1983, union workers made up about 20% of the workforce. In 2010, they represented less than 12%.
“The erosion of collective bargaining is a key factor to explain why low-wage workers and middle income workers have seen their wages not stay up with inflation,” Rodgers said.
Without collective bargaining pushing up wages, especially for blue-collar work — average incomes have stagnated.
International competition is another factor. While globalization has lifted millions out of poverty in developing nations, it hasn’t exactly been a win for middle class workers in the U.S.
Factory workers have seen many of their jobs shipped to other countries where labor is cheaper, putting more downward pressure on American wages.
“As we became more connected to China, that poses the question of whether our wages are being set in Beijing,” Rodgers said.
Finding it harder to compete with cheaper manufacturing costs abroad, the U.S. has emerged as primarily a services-producing economy. That trend has created a cultural shift in the job skills American employers are looking for.
Replace “services-producing economy” with “services and virtual goods of little to zero social value” — like Wall Street financial instruments.
Closer to home, the “services producing economy” includes the likes of HBGary Federal, Palantir Technologies, and Berico, spying firms whose products are pitched to attack private citizens critical of big money America.
A DD reader posted in comment, a link to this post at a blog written by a another journalist targeted by the US Chamber of Commerce and the three corporate spying/security firms.
That post is here and it mentions a subject I discussed last week. The use of software and methods developed for the war on terrorism against private citizens.
That’s part of the “services economy” as the employees blithely discussed payment splits — 2 million dollars and/or 200,000/month — in this post here yesterday.
At the bottom of the CNN story is a quote from a Wall Street analyst, and a most disingenuous one, at that:
“I think it’s a terrible dilemma, because what we’re obviously heading toward is some kind of class warfare,” Johnson said.
Wrong bucko. There has been class warfare and it’s been the uppers that have mercilessly waged it against the middle.
And the dirty-tricking unethical behavior as a “service” to be sold to law firms, Bank of America and the Chamber of Commerce is just one small direct example of it.
Another even larger example is the Republican attack on what remains of unionized labor — state and federal middle class workers who need to be either downsized or have their benefits hacked.
This brings up another issue that’s nagged your host.
If Mark Zuckerberg’s marvelous Facebook was allegedly what catalyzed volcanic systemic change in Egypt, why doesn’t it work here where the populace has much greater access to social networking tools?
Rhetorical, obviously.
Via Digby, quoting from ThinkProgress, coincidentally one of the organizations to be attacked through the machination services of HBGary Federal, Palantir and Berico:
ThinkProgress has been following both Gov. Scott Walker’s (R-WI) recent “budget repair bill,??? which would effectively eliminate state workers’ right to collectively bargain, and his coinciding threat to deploy the National Guard to stop a walkout. Yesterday, the Super Bowl champion Green Bay Packers criticized Walker, saying that collective bargaining is “fundamental??? to the middle class.
Approximately 13,000 peaceful protesters flooded the state Capitol yesterday, including nearly 800 Madison East High School students who left school to protest Walker’s bill. Democratic lawmakers listened to testimonies from citizens for more than 20 hours, stretching into the early morning. Many people who hadn’t yet gotten to speak pulled out sleeping bags.
Responding to his inappropriate threat to use the National Guard against resisting workers, Walker said last night on Greta Van Susteren’s On The Record that the National Guard has contingency plans for natural disasters, and a worker “walk-off is part of [the] contingency plan???:
Wednesday afternoon, momentary TV check, Fox News in high gear hysterically attacking the Wisconsin protesters, teachers, the IRS and assorted middle class federal workers.
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02.14.11
Posted in Permanent Fail at 3:17 pm by George Smith
Today, a collection of the recent columns on the destruction of middle class manufacturing in the US. As contrasted with the astonishing and immoral growth in weapons manufacturing.
At GlobalSecurity.Org here.
As collected its startling, dismaying and equally enraging. Unless you have no heart or belief in fairness.
It is another example, at its most basic, of class war. The upper class — the rich mega-corporations which are arms developers, have systematically been part of the greatest and most unjust transfer of wealth and fortune from a middle class in history. And the looting is on a growth curve.
On another level it asks the minor question: If you believe in God, why doesn’t he smite General Atomics?
It also asks the question, “Why did Louis Uchitelle ignore the elephant in the room in this story?”
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Posted in Made in China, Permanent Fail at 10:08 am by George Smith
Continuing the subject that the US economic environment preserves arms manufacturing while allowing everything else to go to hell in a handcart, DD gives readers a small profile of Combined Systems, the Jamestown, PA, firm recently in the news as the manufacturer of the tear gas used on crowds in Egypt.
It’s already been noted that the other US product, the M1 tank, was used to lay smokescreens. And, in this, the Egyptian model, one which led to revolt, is similar to the US model.
Nothing for the people who went into the streets — which is why they pulled down the dictator. But no expense spared for arms acquisition.
Combined Systems is here and it is the primary employer in Jamestown, PA.
Its entire business is arms manufacturing with a subsidiary in handcuff production. As such, in the market it is not subject to the pressures which have destroyed US non-military production.
The federal governments, as well as those of states and municipalities — the taxpayer, underwrites it. And while there may even be layoffs of state workers, like policemen, in the time of austerity, usually hardware is not sacrificed in such budget cutting.
Obviously, Combined Systems has a significant business in the sale of tear gas worldwide, Egypt and Israel being two notable customers.
A brochure on high-explosive rounds, called FRAG-12, produced by the company is here.
“We believe FRAG-12 is a game-changing technology for the warfighter engaged in urban combat,” it reads.
A brochure post on the web describes the Combined Systems corporate setting:
The Combined System campus is comprised of 18 buildings on 160 acres in Western Pennsylvania. The workforce of 160 includes a full R&D department, electrical, mechanical and chemical engineers, a full quality assurance department, in house machining department, and in process quality department, and is fully ISO 9001:2000 certified and is DoD 4145.26-M compliant.
Founded in 1981, CSI by Michael Brunn and Jacob Kravel the company has grown to revenues of approximately $25 million, and has a very hands on corporate structure …
The US Bureau of Labor Statistics shows unemployment in Mercer County, where Combined Systems is located, to be among the worst rates in the state. It is, for example, tied with Schuylkill County, where DD was raised.
In December 2009, unemployment was at 11.7 percent in Mercer. One year later it had decreased to 9.6.
Mercer County did have domestic non-military production. You can guess how it has fared.
From a 2009 report in the county newspaper:
The local economy continues to bleed jobs as two leading industries on Tuesday announced layoffs totaling more than 70 workers.
The latest layoffs have led two local economic advisors to peg Mercer County’s manufacturing unemployment rate at 40 percent.
Cattron Group International Inc. said it was laying off 32 workers at its Sharpsville operation while Salem Tube Inc.’s Pymatuning Township plant said it laid off 41 workers since February and more will follow unless business improves.
These are the latest in a series of layoffs that have whipsawed the local economy. Large industrial employers such as Wheatland Tube Co. and Duferco Farrell have been forced to undergo rolling layoffs which have hit hundreds of its workers.
Other companies opted to shut their doors forever such as Signature Aluminum in Sugar Grove Township. When the company folded the local plant in March it employed 280.
Another story on lay-offs for state education workers — teachers — reads:
Hold-ups and haggling over the Pennsylvania state budget in Harrisburg, mean layoffs are coming to Mercer County Head Start. Right now, early childhood education staff for about 10 state-funded classrooms are being put on hold.
“The Senate Republican budget would cut “Pre-K Counts” by 46 percent, about $40 million. It would cut $20 million out of Head Start, which is a 50 percent cut,” says State Representative Mark Longietti, (D) 7th District.
“And the impact that that has is about 152 children will not be able to receive early childhood education as a direct result of this,” adds Larry Haynes, a consultant with Mercer County Head Start.
A collection of links on layoffs in Mercer County, at the county newspaper, is here.
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Posted in Made in China, Permanent Fail, Why the World Doesn't Need US at 8:22 am by George Smith
From the New York Times, Louis Uchitelle’s conclusion that losing the manufacturing base wasn’t such a good idea.
Quotes from various “experts,” easy observables by anyone on the street:
Losing an industry or ceasing to manufacture a particular product, in this case stainless steel flatware, has indeed become a fairly frequent event. Just in the last few years, the last sardine cannery, in Maine, closed its doors. Stainless steel rebars, the sturdy rods that reinforce concrete in all kinds of construction, are now no longer made in America. Neither are vending machines or incandescent light bulbs or cellphones or laptop computers.
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Concern is increasing that this decline has gone too far. “I think there is a growing recognition that a diminished manufacturing sector will undermine our economy,??? says Mark Zandi, chief economist for Moody’s Analytics. (Unintentional knee slapper by ‘economic expert.’ Correction: “Has undermined the economy through mass unemployment and diminished buying power.”)
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How did the nation get into this situation? It gambled, in effect, that by importing more from foreign suppliers and from American companies that had set up shop abroad, consumer prices for manufactured products would fall, without any sacrifice in product quality. Low-wage workers abroad would make that happen.
American manufacturers, on the other hand, would be the world’s best innovators, developing sophisticated new products here at home and producing them, at least initially, in their domestic factories.
The first part of the arrangement worked very well. Consumer prices did fall as imports flooded in — from foreign manufacturers, of course, but also from factories newly opened abroad by American multinationals … The second part of the arrangement, however, has been more problematic. As it turns out, the United States is not the only path-breaker.
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The loss of manufacturing capacity, measured in lost workers, is startling. From the high point in the summer of 1979, through last month, employment in manufacturing has fallen by 8.1 million, to
11.6 million, with most of the drop in just the last decade. While consumers have benefited from lower prices, made possible by unrestricted imports, on the other side of the ledger are tens of billion of dollars in lost manufacturing wages.
Something else is gone, too. “We had a storehouse of knowledge and skill built up in these workers and we can’t use it now,??? says James Jordan, president of the Interstate Maglev Project, promoting a high-speed rail technology that uses special magnets to levitate and propel trains. Maglev was invented in the United States … [but not used here].
Uchitelle’s piece, of course, forgets one big thing.
The US still manufactures weapons. Lots and lots of weapons. And that’s about all.
Furthermore, weapons manufacturing is not constrained by any of the things which have destroyed domestic product-making in the US.
It is not subject to death spiral pricing competition; its workers are not constantly downsized for cheap overseas slave labor. And it is underwritten entirely by the US taxpayers even if the taxpayers can afford it less and less.
There is no network of Walmart superstores pillaging the business, offering equivalent dirt cheap Chinese made kit for every missile, armored vehicle, landmine and drone manufactured in the States.
Diminished buying power and lost wages have no effect on US weapons manufacturing. Sacrifice is for everybody else.
Uchitelle’s story frets that the US will cede “innovation” due to loss of domestic manufacturing. Unless you count Mark Zuckerberg, future Nobel laureate, Pulitzer prize winner and global bringer of freedom to oppressed populations worldwide.
It has not lost “innovation,” if that’s what one calls it, in arms manufacturing.
There are General Atomics drones for every future possible application in global assassination, new varieties of cluster bombs, elaborate grenade launchers for blowing up people hiding behind rocks, and robots galore, to no discernible effect, for the forever war in Afghanistan.
It’s a great game for those on the winning side. For most of us, however, not so much.
The most highly read story on the blog early this year has been Not Made in China: US Bullshit Manufacturing. (Basically because of Internet random event. A high traffic sight, WhatReallyHappened, linked here after a few Twitters. Paradoxically, I don’t use Twitter anymore, being obsolete in my mental processes.)
From it:
[While] what production of durable goods in the US that remains is charted, it — along with the fortunes of the middle class and the new mass of unemployed — cratered in 2009. However, military production did not.
It went through a minor dip and then soared.
This is immoral. It destroys any argument on fairness and shared burden and consequences being a part of US society.
It is also economic treason.
The related series: US Bullshit Manufacturing.
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