Monday, December 26, 2005

Excessive Spending - Wasting Fuel Reprise

On September 11, I began a series of comments about the problems of signal progression on major roads in the Detroit area and used problems on Telegraph Road as an example. I received this letter a few days ago.

Click on letter to see larger image (you may have to zoom in to see actual letter size); then hit BACK to return.

It appears that the response to my August 7 letter was written on August 26 and mailed on December 21.

Sequencing events seems to be a problem... whether it is signal progression or mailing letters.

Oh, well.... What is interesting is that supposedly the signals on Telegraph Road are computer controlled... but the controls are not integrated... and the timing "drifts"!!! Kind of like an orchestra with multiple conductors playing different scores at the same time.

Meanwhile, ladies and gentlemen, start and stop your vehicles!

Sunday, December 25, 2005

Saturday, December 24, 2005

Ethnic Divisiveness - The Grinch

As the Christians prepare to celebrate Christmas and the Jews prepare to celebrate Hanukkah tomorrow, it seems that some in the Middle East are preparing to celebrate Ramadama-Dingdongs.

Peace On Earth - Goodwill To Men

Friday, December 23, 2005

Environmental Extremism - Half Way There

I came across a couple of interesting articles regarding Ford Motor Company.

Ford goes green in report on emissions

Jeff Plungis / Detroit News Washington Bureau

WASHINGTON-- Ford Motor Co. released a report on global climate change Tuesday, the first time an automaker has formally addressed the business implications of greenhouse gas emissions.

Ford said the report was a response to concerns raised by a shareholder resolution in November 2004. Ford officials said the report would serve to start a dialogue about steps the auto industry and society as a whole could take to reduce emissions.
later in the article...
But critics said Ford was not making any meaningful commitments, especially on improving fuel economy.

The Sierra Club faulted Ford for adopting an image of corporate responsibility on global warming while suing to stop California's efforts to adopt state greenhouse-gas emissions regulations to address climate change.

"Ford can't have it both ways on global warming, claiming to be responsible while acting irresponsibly," said Dan Becker, director of the Sierra Club's global warming program. "Ford is a big part of the global warming problem, but they have failed to adopt more than token solutions."

TRUCK OF THE YEAR: Ford improves iconic Explorer with better mileage, shiny grille
The new Explorer's virtues are much more than skin deep.

Fuel economy is up, emissions are down, and the interior is vastly better. It's always tricky replacing an icon, and Ford concentrated on improving the previous Explorer's weaknesses with the all-new 2006 model....

The new V8 engine, mated to a smooth six-speed automatic transmission, produces 53 more horsepower but 10% better fuel economy than the previous model. The base V6 engine's emissions are down an amazing 74% from the 2005 model and are certified to the same federal standard as Ford's gasoline-electric Escape hybrid SUV.
Okay, the Explorer is not a 2-seater getting 50 mpg and that irritates the Sierra Club. But it seems to me that reducing emissions by 74% for one engine and improving gas mileage 10% for another is not "irresponsible."

Monday, December 19, 2005

Excessive Spending - Oil Boom

Energy costs have certainly been the story of 2005.

Energy costs and their impact on consumer spending will probably be the story of 2006... once the first big home heating bills hit.

Interestingly, energy prices have been declining, but don't expect that to be reflected in your bills the first of the year. Retailers should expect to see a drop in first quarter sales versus 2005... probably 3-5%... which should be enough to trash the stock market... and hopefully give the Federal Reserve pause in its quest to quash the economy with interest rate increases.

Energy Prices
Nymex Crude Future57.33-.73-1.2612/19
IPE Crude Future56.11-1.02-1.7914:53
Dated Brent Spot55.21-1.38-2.4414:52
WTI Cushing Spot57.15-.91-1.5714:46
Nymex Heating Oil Future170.33-2.87-1.6612/19
Nymex Gasoline Future152.69-4.20-2.6812/19

Friday, December 16, 2005

Excessive Litigation - Sex and Business

Ford Motor Company and the Catholic Church.

It seems that when you get involved with mixing business and sex, you really set yourself up for the stuff hitting the fan.

Ford Motor Company, in an effort to be everything to everyone, has touted itself as eco-friendly and diversity-friendly. The eco-friendly part has drawn the ire of several eco-warrior groups and that was expected given the big SUVs and trucks that Ford sells in abundance. Still, Ford is really making an effort to reposition its product mix toward high-mileage, low-emission vehicles, so the eco-warriors need to be a little patient.

On the other hand, both Ford and the Catholic Church are embroiled in homosexual politics. Someone at Ford sold the top executives on the idea that "don't ask, don't tell" was not a good idea and that a better idea was "actively embrace". So, Ford started both internal programs and external business actions designed to show the homosexual communities and the rest of the world that it was really a very open-minded company.

The Catholic Church, on the other hand, has taken the public position that homosexual people are inherently perverse, immoral and spiritually deficient. Homosexual priests are not welcome, thank you. After all, boys and husbands must be protected from those priests.

The trouble is, neither Ford nor the Church are experiencing the positive results from these efforts that their respective leadership expected. The American Family Association views Ford's approach to homosexuals as antithecal to the American family and has boycotted Ford products. Homosexual groups, in response to Ford saying it would not advertise in homosexual-oriented magazines, threatened to boycott Ford. Meanwhile, American Catholics are split between those who believe the church is upholding the moral fiber of its parishes and those who ask "what would Jesus do?"

Moral of the story: "don't ask, don't tell".

Thursday, December 15, 2005

Environmental Extremism - SUV Time

My youngest son took delivery of a new Explorer 4WD SUV today.

He was driving his older brother's Mazda and while he was grateful for the use of the car and the fuel economy of a 4-speed manual transmission and 4-cylinder engine, he was also grateful to exchange it for something that he had greater confidence driving in weather like this.

His Explorer might not make sense in some areas like metropolitan Orlando, but on a dirt, snow-covered road in Michigan....

Tuesday, December 13, 2005

Excessive Litigation - Ohh-kayyy....

In about 3 minutes of browsing the local newspaper (hardcopy), I ran across these gems:

  • Religious freedom and Detroit's knife law come into conflict in Wayne State student's case.

    Sukhpreet Singh Garcha, a 23-year-old senior [at Wayne State University], was arrested on campus in August for carrying a 10-inch knife on his hip and was charged with violating a city ordinance that prohibits carrying knives with blades longer than 3 inches. Garcha, a practicing Sikh, said the knife was a tenet of Sikhism -- a religion founded in India.

    The charge was later dropped, but the American Civil Liberties Union and the United Sikhs have rallied around the student, claiming the arrest violated Garcha's religious rights.His lawyers have asked 36th District Court Judge Rudy Serra to clarify the city's knife ordinance. Serra is expected to issue an opinion as soon as today that will likely exempt kirpans from the city's knife ordinance

    Now that makes sense to a lot of people. I know some people who belong to the Seefore religion which has been around for thousands of minutes. Their religion does not allow them to go into public without wearing their C4 and detonators. We need to have a federal exemption for them here in the U.S. Meanwhile, keep those manger scenes off the streets. Also, the Howitsgoing monks are required to travel with Howitzers. Many of these monks feel persecuted in public places such as universities... just like this poor student.

  • Women having sex with boys: Is it child abuse? N.Y. judge calls one woman's behavior unacceptable, but adds teen was not victimized by her.

    When Sandra Beth Geisel, a former Catholic schoolteacher, was sentenced to six months in jail last month for having sex with a 16-year-old student, she received sympathy from a surprising source.

    Judge Stephen Herrick of Albany County Court in New York told her she had "crossed the line" into "totally unacceptable" behavior. But, he added, the teenager was a victim in only the strictly legal sense. "He was certainly not victimized by you in any other sense of the word," the judge said.

    Well of course he wasn't harmed. Sandra was a real looker! Oh, wait. That's not a good reason. Right, the judge is a guy who remembers what he spent all of his time thinking about when he was 16! Regardless, we can't have a bunch of over-sexed, child-bearing women trying to get our boys in trouble. You should have heard that poor kid screaming.
  • Evolution fight puts suburb in spotlight. The evolution controversy in this comfortable Atlanta suburb began with one boy's fascination with dinosaurs.

    "He was really into 'Jurassic Park,' " his mother recalled. The trouble was, "we kept reading over and over that 'millions and millions of years ago, dinosaurs roamed the Earth,' " Marjorie Rogers continued. "And that's where I said, 'Hmm -- wait a second.' 

    " Like others who adhere to a literal reading of the Book of Genesis, Rogers, a lawyer, believes that the Earth is several thousand years old, while most scientists, basing their estimates on the radioactive decay of rock samples, say the planet is billions of years old.

    Rogers soon began a quest to challenge what she sees as educators' blind faith in evolution. It evoked a groundswell of support from other residents of this affluent suburb of high-tech office parks and shopping malls, and it pushed the county school board to put warning labels on biology textbooks saying that evolution "is a theory, not a fact."
    You know, I've been looking for a good lawyer....
Remember, if your TV breaks, there is plenty of good entertainment at your local courthouse.

Monday, December 12, 2005

Excessive Spending - Not!

It's been a bit of a break since my last posting. There's a lot to do before Christmas.

Yes, I've been shopping... which has always gone against my grain since it seemed as if I was just doing more work after I got out of work. Now it's not so bad. My wife has been conditioned to believe that I won't behave myself if I go shopping with her. So now it is amazement and awe when I just amble along the aisles and look over all of the stuff I won't buy. She just has this big grin when we leave a store.

I've also kept busy making homemade pastries that my Armenian grandmother taught me when I had first started dating my wife about 40 years ago. We make it now to send to the rest of the family. My sons show up to help me... but I think the eating part is the primary motivator. It's a pretty simple recipe: dough the thickness of a sheet of paper, melted butter, chopped walnuts all crumpled up like an accordian and baked to a light brown color and then topped with honey. Who needs shopping?

Tuesday, December 06, 2005

Excessive Spending - How Big is BIG?

The Congressional Budget Office provides information about the Budget Deficit (we haven't seen a surplus for awhile).

Update from CBO's October 6, 2005, Monthly Budget Review:

The federal budget deficit totaled about $317 billion in fiscal year 2005, CBO estimates, $96 billion less than the shortfall recorded in 2004. Relative to the size of the economy, that deficit is equal to about 2.6 percent of the gross domestic product (GDP), down from 3.6 percent in 2004. Growth in revenues--from 16.3 percent of GDP in 2004 to about 17.5 percent in 2005--accounted for the improvement. Federal spending was approximately 20 percent of GDP in 2005, slightly higher than the corresponding percentages in 2003 and 2004. Hurricanes Katrina and Rita had relatively little effect on the 2005 budget results because they occurred so late in the fiscal year.
Projections have the deficit declining to 0.3% of GDP by 2015... with individual income taxes rising from 7.6% to 10.3% of GDP, while corporate taxes decline from 2.2% to 1.5% of GDP.

So, let's get this straight; during the time that the budget is projected to grow from $2.1 trillion to $3.8 trillion:
  • Individual income taxes as a portion of GDP will increase almost 36% while corporate taxes will drop by 1/3
  • Discretionary spending will decline; mandatory spending and interest will increase
  • Debt will increase by about 50%
Let's hope there are enough lettuce picking jobs available to generate all of that individual tax revenue in the budget since we plan to ship our manufacturing jobs overseas.

Monday, December 05, 2005

Excessive Spending - Just Mix and Match

Two articles from the Christian Science Monitor:

  • A drought of farm labor - California and Arizona farmers - producers of half the nation's citrus and 90 percent of its vegetables and nuts - are struggling with an acute labor shortage. The situation, worsened by crackdowns on illegal immigration since 9/11, also extends to other states and is no longer just a matter of possible price increases on lettuce, oranges, or almonds, farmers say. Rather, it is a turning point in the nation's ability to produce its own food - and possibly the loss of major parts of its agriculture industry.
  • Outsourcing moves closer to home - Touting Central America as the "new Asia," pro-business and investment organizations across the region are all talking about the benefits of "nearsourcing." It's the same thing as outsourcing - that is, sending jobs to lower cost locations outside the US - but closer to home: It's South rather than East, near rather than far. And it's increasingly attractive to US firms.
Okay, so here's a simple solution: get those newly out-of-work manufacturing workers to go pick apples and lettuce... problem solved! I love it when a plan comes together.


Sunday, December 04, 2005

Excessive Litigation - Sony Is Really Asking For It

Sony shot itself in the foot when it added some malicious software to some CDs, including the latest Neil Diamond effort. Sony is now recalling all of the CDs and is being sued by Texas and probably some other states.

But here's something you might not have noticed on the CD... look closely near the bottom left...

What's that American flag doing UPSIDE DOWN!

Sure, it's a "logo"... and the term "Japs" is one of endearment. What a way to run a company.

Friday, December 02, 2005

Excessive Spending - Plenty of Jobs Out There

I guess I was wrong about the loss of manufacturing jobs being a bad thing. It appears that there are plenty of jobs still available... even here in Michigan.

Seems like those executives who lead companies into bankruptcy are doing everyone a big favor in the long run and deserve those multi-million dollar bonuses.

Tuesday, November 29, 2005

Excessive Spending - 6.32


That's the CPI inflation factor compared with 1965.

Are we truly better off today as a nation than we were in 1965? Remember, back then we were just getting involved in the Vietnam conflict. We had the Cold War with the Soviet Union. We had a space race going on. And we were a net exporter of manufactured products.

  • The minimum wage was $1.25; today it is $5.15........... increased 4.12 times

  • Community college cost $9.00 per tuition hour (1966); in 2003 it was $60.00 ........... increased 6.66 times
  • University tuition was $440 per semester (1972); today it is $4,440........... increased 10 times
  • A 3-bedroom ranch home cost $25,000 in 1965; today it is $250,000 ........... increased 10 times
  • My wife bought a new, full-sized Ford Galaxie 500 with all options for $3,000 in 1965; today a comparable full-sized Ford costs $28,000........ increased 9.3 times
  • National health care costs were $73 billion in 1970; in 2003 it was $1,679 billion........ an increase of 23 times
Now, I'll admit that the quality of some things has increased... but at a significant cost. What hasn't necessarily increased is the ability to afford the comparable things.

Wealth has increased... apparent wealth. Inflation adjusted debt has increased from about $35,000 per person in 1965 to $140,000 today ......... 4 times in real terms.

So let's boil it down to the essence:
  • Starting wages are not keeping up with general inflation... if you are poor, you are likely to be poorer than your 1965 counterpart
  • The cost of education is outstripping our ability to pay for it... but our strategy is to increase our national wealth by having an "intellectual industry"
  • The cost of major products are increasing in real terms
  • Health care is too costly for the working poor
  • Our national debt seems to be our growth product for the future
What does that mean?
  • Families must have two wage earners to survive; the one-income household is an anachronism
  • Economic stratification will intensify; fewer well-paying blue-collar jobs will be available and the opportunity to move to the "intellectual industry" will be reduced
  • The illusion of national prosperity will be harder to sustain; as pensions plans disappear over time, the economic boost from the retired sector will diminish overall consumer spending... retirement savings will not be enough for many given the level of debt most families have

Sunday, November 27, 2005

Letting Go - Moving On

Family Thanksgivings are wonderful and a little sad, too.

Each Thanksgiving holiday reminds us that we can't hold on to our loved ones forever. Each Thanksgiving pulls us just a little farther apart.

Oh, the love remains, but the reality of our lives is that we gradually lose the experiences and goals in common. New jobs, new homes, new families, new interests, new needs, new wants... demand that the older generation let go so that newer generation can move on.

It's life... and it is fair... and it is necessary.

This Thanksgiving made me even more thankful for my children who have become wonderful men with a wonderful passion for life and the courage to go after what they want. They no longer really need their parents, but they still care for us and do their best to share the important parts of their lives with us. They have moved on... and we have had to let go... reluctantly.

It seems like a sad thing... but it's not.

Thursday, November 24, 2005

Giving Thanks

Happy Thanksgiving

Wednesday, November 23, 2005

Excessive Spending - Outsourcing Doesn't Hurt (?!) - 3rd Chapter

I recommend you go to Cafe Hayek to see some interesting commentary on this subject.

Obviously, there is a significant difference in PERCEPTION about how not only OUTSOURCING OF JOBS, but the whole PROCESS OF TRADE has been affecting our nation.

I'm certain that many of those who disagree with me see me as a trade obstructionist... a protectionist, if you will... that wants to ruin the trade built up with other countries in order to protect inefficient and mismanaged domestic industries.

Not so. I'm merely pointing out certain of my PERCEPTIONS that are not necessarily shared by some others, to wit:

  • certain countries are now or have provided their own industries significant "insulation" from foreign competitors enabling those industries to grow and strenthen... and then reduce their cost of production by expanding unit volume to capacity and selling the excess at cost in the U.S. to 1) gain a foothold in the U.S. market and 2) competitively undermine domestic manufacturers
  • certain countries have used currency manipulation to ensure that their industries have a competitive edge in the U.S.
  • certain countries do not come close to the U.S. standards protecting workers and the environment, thereby avoiding those direct costs for their industries which must be borne by U.S. manufacturers
Perhaps the strangest response to my position was by "Micha" who stated:
I have a bit of an ethical and moral problem with arguing that two wrongs make a right. The correct response to foreign countries that put up trade barriers reduce our trade barriers as much as possible and continue to trade with them. It is sheer insanity to shoot ourselves in the foot merely to "get back" at the other guy for making their own country poorer through trade barriers.
1) These countries are not "making their own country poorer" through their actions... they are systematically undermining U.S. industrial capabilities

2) Trade barriers take many forms from inspection of individual vehicles verses certification of an entire model (a practice used by Japan to make importation of U.S. vehicles virtually impossible), to tariffs, to currency manipulation, to worker and environmental abuse. If such practices so hurt China, how is it that they have been so successful at creating wealth?

Other responses have been that we can replace our manufacturing with an intellectual industry. That's highly suspect, in my opinion. There is a symbiotic relationship between academia and industry... whether or not certain "intellectuals" wish to admit it or not. Without a domestic automobile industry, for example, thousands of engineers and physicists would be competing for hundreds of jobs. Without those jobs, universities would find much less demand for their "services". Oh, "something else will take their place". Why? If we are willing to let our manufacturing fall prey to predatory practices by other countries, what is to say that our universities will compete much better in the future when foreign universities can partner with their industries for new research and development... sharing both the costs and benefits.

It is my PERCEPTION that the so-called "free traders" have not thoroughly thought through the consequences of their positions. Cheap imports will be paid, ultimately, by a sharply stratified U.S. society of fewer "haves" and more "have nots".

Tuesday, November 22, 2005

Excessive Spending - Outsourcing Doesn't Hurt (?!) - 2nd Chapter

Rather than posting comments to comments, there are a few additional points I'd like to make regard today's earlier post.

There seems to be a tendency to view our economy as just a dynamic, free-wheeling, competitive marketplace where the weak competitors will be displaced by the strong. Well, yes... and no.

The marketplace doesn't exist in a vacuum. Certainly, there are always companies arising while others are disappearing. There are always new products replacing old products. Efficiency is rewarded; complacency is punished. This is a free market, after all.

Okay, and then there is the real world of currency manipulation, protected markets, government subsidized competition, child/slave labor, and a host of other "un-American" practices that directly impact U.S. manufacturing companies.

If you think Toyota became a powerhouse in the U.S. because they were a better company than U.S. competitors, then you don't understand how they sold their products here at cost (and avoided significant U.S. taxes) while enjoying a protected home market. You don't understand how China has grown its "competitive" manufacturing base by copying - outright pirating - U.S. intellectual property and then using that pirated capability to undermine U.S. competitors.

So, there is not a lot of sympathy for evil old General Motors now that it has fallen on hard time. Those "service economy" states sneer at the "wasteful" U.S. heavy industries. Okay, how about:

  • textile quotas and restrictions protecting southern states
  • sugar quotas and restrictions protecting Florida
  • lumber quotas and restrictions protecting western states
  • beef quotas and restrictions protecting central states
  • corn subsidies for the plains states to produce ethanol
Hey, any wine producers fighting internet sales and imported brands? Is wine producing an industry or a service??? Oh, agriculture is different... we can't be dependent on foreign countries for our food and grown raw materials. Why not, Brazil and Canada are more cost "efficient".

Oh, come on. What would U.S. universities say if the government suddenly awarded research or service grants to foreign universities on the basis of competitive cost bidding? Plenty of good Indian PhDs out there who can work at half the price. And how "cost efficient" are U.S. universities... those bastions of our intellectual wealth... when they require double-digit percentage tuition increases for decades? Oh, yeah, we can't import those services.

Right, so a geographic oligopoly gives our intellectual industry the right to lord it over our manufacturing sector.

This isn't a "free market". It is many different kinds of markets that play by many different kind of rules. And rules can be changed. It is part of "economic policy"... or lack of one.

Excessive Spending - Outsourcing Doesn't Hurt (?!)

In the blog "Cafe Hayek", Don Boudreaux writes:

Among the many histrionics of election year 2004 was the concern that free trade in general, and "outsourcing" in particular, would soon rid America of high-paying jobs.

But now comes this report, entitled "Firms' New Grail: Skilled Workers," in today's Wall Street Journal (paid subscription required). Here are the opening lines:

Difficulty in finding enough skilled workers is hampering the ability of many U.S. manufacturers to serve their customers.

My response was the following:

I'm sorry. What country was that again?

As reported in the Detroit Free Press:

"The Motor City is facing a fearful holiday season after three of the auto industry's biggest companies announced nearly 60,000 job cuts in the past week, with more to follow."

There are plenty of highly skilled people being fired (let's not use euphemisms). Okay, blame it on poor management, high labor costs, etc. But the reality is that outsourcing has had a real and significant impact on this midwestern area.

The federal government declared Louisiana a disaster area with its hurricane damage and is pouring billions into it to restore and repair. What is happening to Michigan is far more insidious, but just as real.

Just wait until it hits home elsewhere and see how sanguine the rest of the country is.

The billions of dollars that the "baby boomers" retiring from Michigan spend in places like Florida may be at risk as companies like Delphi and General Motors collapse. Remember, "service jobs" are at the end of the money trail. A few new robotics plants or medical research facilities do not equate to the loss of U.S. owned manufacturing jobs and profits that get recirculated in the U.S. economy.

Ask yourself if our goal as a country is to restructure ourselves to be a source of low cost labor so that we can be "competitive." If not, ask yourselves what those reasonably-paid skilled people will be doing... they won't all be medical researchers or mechanical engineers.

John R. Saul is the author of The Collapse of Globalism

"At the heart of The Collapse of Globalism is a question that's fundamental to economics but often not asked explicitly: Are political decisions meant to be made in deference to the economy and markets, or can we use our political institutions to shield us from some of the harsher effects that markets can dish out?

The argument is that "globalization" isn't a homogeneous process, but is economic interaction that can be... and is... affected by political policies.

In short, in what's meant to be a "world without borders," it's been impossible for people to ignore just how much local economic conditions really matter. In response, some participants in the global economy have begun to realize and exercise some of their local power."

Chicken Little? Think again.

The problem is that "outsourcing" is more than replacing a few people with a few jobs overseas. It is "outsourcing" of supplies and even whole products that are imported and sold as "U.S." brand products by companies like GM and Delphi. Who needs Chevy when we can import "Chery"? Sure, we can gut our manufacturing capability and become a "nation of consumers."

For how long???

Monday, November 21, 2005

Excessive Spending - Market Pricing or Greed

Dr. Don Boudreaux who writes in the blog "Cafe Hayek" noted today:

Yesterday, at a gasoline station that I frequently use, I noticed that the price of a gallon of 87-octane gasoline is down 36 percent to $2.17 -- down from $3.39 about six or seven weeks ago.

I guess this fact means that oil-company executives are 36 percent less greedy today than they were in mid-September.
I commented that:
The oil companies were certainly the beneficiaries of a market distorted by speculation about possible oil and gasoline shortages. The subsequent price adjustment to the "compared to what" level reflects what a less speculative marketplace values those commodities. [Another writer had asked "When people complain that "gouging-level" prices are too high, I always want to ask, "compared to what?". What is it that made the original prices okay?"]

The marketplace works... most of the time. It's only when speculators grasp control for awhile that oil and tulips reach untenable positions... and when the "Joe" on the street pays the price for their greed.
Some other people decided it was best to get into a philosophical discussion regarding the differences between "greed" and "market pricing." That's all well and good except the marketplace is not perfect or immune to manipulation or speculation (another term for "greed" to which many "traders" and "investors" succumb). The marketplace does, however, correct those abuses rather dramatically.

Sunday, November 20, 2005

Excessive Spending - Recession or Remixing?

On October 13 I wrote:

I'm going out on a limb now, but I think the 4th Quarter of 2005 will be viewed, retrospectively, as the beginning of a new recession in the U.S.
Since then, the stock market has done pretty well with the S&P going from around its yearly low to near its yearly high. Does that mean no recession?

Well, let's not confuse the stock market with economic activity. Especially in Michigan.
  • Ford to cut 4,000 white collar jobs in North America by early next year
  • Forecast: Manufacturing slump to hold down Michigan's economy
  • Michigan job losses to go on, U-M says... despite recent declines in Michigan's unemployment rate, they forecast the jobless rate in the state to begin rising again soon, peaking at 7.6% by late 2007.
Add to that the woes at Delphi and Northwest Airlines and Delta Airlines and I just don't see "booming economy" anywhere.

Maybe it's in Florida?
Florida job market is enviable
In the Orlando area, unemployment rate hits 5-year low
Doing what?
In certain sectors such as information technology, human resources and engineering, employers are bidding for the services of skilled workers
Must be the warm weather....

Saturday, November 19, 2005

Big Day

The food is ready, the drinks are chilling, more chairs have been gathered near the big screen.

Yes, a big day today! This is our last chance to see our friends before they return to Florida for the winter.

Oh, yeah. Michigan and Ohio State are playing some kind of game, too, I think.

Friday, November 18, 2005

For Sale: Everything

Sometimes things just don't make sense. Looks like the "beta" version needs a little fine tuning. Posted by Picasa

Thursday, November 17, 2005

Excessive Litigation - When Lawyers Sue Lawyers

Most lawyers I've met personally have been pretty decent sorts. Family guys, football fans, hard working, even generous with their time.

But sometimes the headline-grabbers mix it up in public. To wit, State Attorney General Mike Cox has threatened to prosecute (not sue, really) the notorious Geoffrey Fieger because Mr. Fieger is alleged to have created a "Citizens for Judicial Reform and that a Herb Charbonneau was the treasurer" when actually there was only one citizen involved, Mr. Fieger, and that Mr. Charbonneau may not have actually existed.

Mr. Fieger has now hired yet another attorney to represent him, Mr. Richard L. Steinberg, who stated:

Only last month, the Delaware Supreme Court held that the First Amendment protected the anonymity of a blogger who launched a vitriolic, even defamatory, attack on the integrity and sanity of a small-town public official.

So, if Geoff Fieger decided to reach into his own pocket and spend his own money to make his own views known to Michigan's voting public, so what? It's his money. So what, if there is not, and never was, a Citizens for Judicial Reform or a Herb Charbonneau. Where's the crime?

Well, maybe no crime was committed there.

Curiously, however, Mr. Cox has also accused Mr. Fieger of threatening to blackmail him concerning some sexual affairs Mr. Cox had. I say "curiously" because if there really has been no crime, why bother to blackmail the prosecutor? On the other hand, Mr. Fieger has stated his intentions to run for Attorney General, so perhaps there was some interest in derailing that by showing some related nastiness on Mr. Fieger's part. On the third hand, Oakland County Prosecutor, David Gorcyca, said he didn't really have a case against Mr. Fieger. On the fourth hand, Mr. Fieger has been known to get pretty creative with the law.

The Detroit Free Press gives a pretty good accounting of the intrigue, if you are interested. For me, this is a case of Mr. Windbag vs. Mr. Bluster... leaving most of us wondering what the real meaning of "justice" is... and who is pursuing it.

Wednesday, November 16, 2005

Ethnic Divisiveness - Liberty, Equality, Fraternity - Verse 2 has a different take about the riots in France than I wrote:

A striking characteristic of the demonstrators is their youth, with many of those involved only 13 or 14 years old. In part this is because French law cannot punish them until they reach 16. Many observers worry, however, that the age of the rioters has shown that their parents have lost control or, worse, agree with the tactics.

One thing the great majority of observers agree about is that the disturbances are not controlled by Islamic extremists or inspired by religious sentiment. The young people rioting have a sense of religion "approaching zero," says Dounia Bouzar, a former member of the Superior Council of French Muslims. "In general, these kids dream only of getting money and consuming like everybody else."

For Bouzar, French politicians have for 20 years refused to deal with the origins of inequality in French society. Riots in 1982 included a march by immigrants from Lyon to Paris that received massive media coverage.

"After the 1982 riots, the young promoters of the March for Equality denounced discrimination in housing and jobs," Bouzar said. "But the idea was insidiously planted in the mind of the public that the causes were not social but cultural . . . if young people burned automobiles it was not because of discrimination but because their parents came from a different culture."

Bouzar says nothing has changed but that today French leaders try to relate the violence to religion, providing an excuse for dealing with the political, social, and economic reasons behind the violence.

However, the story did suggest that the French government may not be entirely to blame:
Employment does indeed seem to be one of the keys to the problem, along with endemic —if frequently silent —discrimination. Unemployment among immigrants of North African origin ages 15 to 24, for example, is about 37 percent compared with 20 percent for the French as a whole and 12.7 percent for foreigners from other EU countries. Even in the 751 so-called sensitive urban zones designated by the government for special attention, unemployment is 19.6 percent and as high as 30 percent among the 21-to-29 age group, according to official government statistics.

Immigrant youths living in underprivileged areas complain that no matter how many CVs (resumes) they send out, the answer is almost always the same- –silence. An experiment by the independent "Discrimination Observatory" found that applications with the same resume received half as many invitations for interviews when the address signaled a disadvantaged area.

Nevertheless, it is easy to forget in the current context the tremendous efforts made by the French government over the past two decades to improve conditions for immigrants.

"The poor French suburbs are relatively spoiled compared with American inner cities," says Stanger. "They have medical care, schools, and gymnasiums that any affluent American community would be proud of."

On October 16, 2004, I wrote:
Recounting previous points:
  • we have an instinct to survive, acquire, and pass on our DNA
  • we survive best in "herds"
  • herds are structured to satisfy the strong and accomodate the weak
  • the rules of one herd may vary from others based on experience and environment

To this list, let's add

  • herds will not readily accept "outsiders"
Why, because outsiders alter the dynamics of the herd and may not play by the rules of the herd. Therefore, they are seen as a threat to the survival of the herd.
The "native herd" accepts a few different individuals as "curiousities" until there are enough of these individuals to be discerned as a "new herd". Then conflict commences.

Addendum from The National Review

Ironically the politician being denounced for inflaming the French rioters, interior minister Nicolas Sarkozy, has some of the best ideas about how Europe could better integrate its Muslim citizens. Sarkozy argues that affirmative action is needed for Muslims, heresy in egalitarian France. He also proposes that the state fund mosques. This is imperative: Otherwise large numbers of mosques will continue to preach the divisive, extremist doctrine of Wahabism. There is no reason that Muslim populations hailing from moderate societies should be led by Wahabi imams.

Of course, these steps towards integration cannot come only from one side. Muslim leaders will have to play a constructive role rather than acting as grievance mongers. For instance, as the Prospect's editor David Goodhart points out, the supposedly mainstream Muslim Council of Britain could stop referring to the war in Afghanistan as a "misguided" effort that sparked an "increase in prejudice" against Muslims.

We can be fairly confident that the Paris riots will not convince immigrants in other countries to begin a European intifada. They should, however, convince European leaders to stop casting around their own continent for an effective model of integration. That model, unfortunately, doesn't yet exist. Sarkozy and Europe's other visionaries are going to have to create it on their own.

...seems like damned if you do and damned if you don't.... I still like "melting pot" versus "diversity".

Tuesday, November 15, 2005

Ethnic Divisiveness - Myth of Muslim Solidarity - Verse 2

Back on September 18, I wrote regarding :

The IRA (Iraqi Republican Army aka al-Qaeda aka Charles Manson & Associates) have officially "declared war" on Shi'ite Muslims.

That reminds me a lot of the "other IRA" that has had an ongoing war against certain Protestant Christians.

It's A L L__A B O U T__P O W E R; it's not about religion. Repeat that 72 times.

Now listen carefully so that you can hear the voices of protest amongst the Muslims worldwide to this anti-Islamic display. You have to listen very carefully. Very, very carefully. Shhhh....
Since then, that same Iraqi contingent of al-Quiche has blown apart their "fellow Muslims" in Jordan. Now, as the Detroit Free Press reports, there are voices of protest:
After the bombings, claimed by al-Zarqawi's Al Qaeda in Iraq, thousands of Jordanians took to the streets throughout the kingdom, shouting: "Burn in hell, al-Zarqawi."

Because of the extremist attacks, "All Jordanians -- even fanatic Muslims -- are changing their minds because of what they saw happen to innocent people" in Amman, said Ibrahim Hreish, a jeweler in the Jordanian capital.

"There has been empathy among Jordanians for insurgent strikes against military targets in Iraq, particularly against U.S. forces," said Mustafa Hamarneh, a researcher on domestic attitudes toward suicide bombings....

"I believe we will now begin to see a change in how the country's press reports events in Iraq, such as suicide bombings, and in public attitudes," he said
Well, duh! We meant it was okay for you to bomb them, not us.

Sunday, November 13, 2005

I.Q. Relates To Longevity

SOURCE: American Journal of Epidemiology, November 2005.

And in general, (Dr. Laurie T.) Martin noted, IQ scores reflect a "set of skills," like reasoning, planning and communication, that affect how people manage their health -- from talking with their doctors to dealing with a complex healthcare system.

Understanding exactly why IQ affects longevity, according to Martin, could ultimately help improve health and healthcare for everyone.
Okay, smarter people tend (not a rule) to get better jobs, have more resources, manage their circumstances better, and make better decisions which reduce the chances for accidental, violent, or neglect-related deaths.

Now there is no need for a further study.

Saturday, November 12, 2005

Ethnic Divisiveness - Liberty, Equality, Fraternity

The French have had a shaky time of things. The idea of "liberty, equality, fraternity" has never quite caught on despite best intentions. Now events in France are testing that notion fully.

There is a new phenomenon ... well, not new, but more recognized... that immigration is different than it used to be. Immigration, acclimation, assimilation is now immigration, isolation, confrontation. It is a defacto invasion rather than immigration.

That is not to say that all immigrants are trying to undermine the community of their new home. Rather it is a clash of ideologies. The expectations of the new Middle Eastern and African residents is that they are simply moving locations rather than starting a new life. There is no real interest in becoming part of the culture of the new location... they are bringing their own culture and plan to keep it intact despite significant differences with that of the new host country.

We cannot bring up our kids the way we want, to teach them Islam," said Sabrine, adding that France encourages children to choose how they want to practice religion.

"They say religion is not obligatory or that parents are not allowed to make their children wear the hijab (veil) or to pray," she said. "They want to give our children the same freedoms they give to the French." (oh, oh!)

Then there is this "confusion" about why there is a sense of isolation and rejection by the citizens of the host country. Hmmmm.

Friday, November 11, 2005

Veteran's Day

Veterans Day, 2005

November 2, 2005

A Proclamation by the President of the United States of America

Americans owe a great debt of gratitude to those who have sacrificed for our liberty and for the security of our Nation. We express deep appreciation to our veterans -- the men and women who stepped forward when America needed them, triumphed over brutal enemies, liberated continents, and answered the prayers of millions around the globe.

From the beaches of Normandy and the snows of Korea to the mountains of Afghanistan and the deserts of Iraq, our courageous veterans have sacrificed so that Americans and others could live in freedom. As we mark the 60th anniversary of the end of World War II this year, we remember the millions of veterans who crossed oceans and defeated two of the most ruthless military forces the world has ever known. The freedom that the children and grandchildren of these veterans now enjoy is a monument to their fallen comrades and the generations of patriots who have served our country.

Through their commitment to freedom, America 's veterans have lifted millions of lives and made our country and the world more secure. They have demonstrated to us that freedom is the mightiest force on Earth. We resolve that their sacrifices will always be remembered by a grateful Nation.

With respect for and in recognition of the contributions our service men and women have made to the cause of peace and freedom around the world, the Congress has provided (5 U.S.C. 6103(a)) that November 11 of each year shall be set aside as a legal public holiday to honor veterans.

NOW, THEREFORE, I, GEORGE W. BUSH, President of the United States of America, do hereby proclaim November 11, 2005, as Veterans Day and urge all Americans to observe November 6 through November 12, 2005, as National Veterans Awareness Week. I urge all Americans to recognize the valor and sacrifice of our veterans through ceremonies and prayers. I call upon Federal, State, and local officials to display the flag of the United States and to encourage and participate in patriotic activities in their communities. I invite civic and fraternal organizations, places of worship, schools, businesses, unions, and the media to support this national observance with commemorative expressions and programs.

IN WITNESS WHEREOF, I have hereunto set my hand this second day of November, in the year of our Lord two thousand five, and of the Independence of the United States of America the two hundred and thirtieth.


Thursday, November 10, 2005

Ethnic Divisiveness - Shades of Black

From Desiree Cooper of the Detroit Free Press:

Rule No. 1 for campaigning in Detroit: Not all blacks are black. In order to win here, you've got to resonate with those citizens of what Michigan State University sociologist Carl Taylor calls the "Third City," an urban sub-culture born of poverty and neglect. Taylor is the author of several books about urban culture including "Dangerous Society."

"In the Third City, you have citizens, noncitizens -- people who participate in an underground economy, but not in mainstream civic life -- and anticitizens -- people who defy authority and accept criminal activity as normative," said Taylor. "There's a strong identity of 'us' against 'them' -- the white power structure and the black bourgeoisie."
My response to Ms. Cooper and the Detroit Free Press:
Desiree Cooper's article (Kilpatrick's win was not really a surprise) resonated strongly with me.

My three closest neighbors are an automotive plant supervisor, an industrial engineer and an engineer who owns his own consulting firm. They maintain their property well and are all out-going, friendly and helpful. Their children are well-behaved and get along well. They appreciate a good place to live. Two just happen to have much darker skin than the third. But in Detroit, those two would not qualify as "black" according to Ms. Cooper's article.

Ms. Cooper's article is perpetuating a myth of what being "black" is. You know... style over substance, slang versus educated speech, posing versus profundity... diamond ear studs, Lincoln Navigators and wild parties at taxpayer expense. Sadly, rather than aspiring to better themselves and their city, a majority of Detroit's voters chose to be "represented." It is that thinking that has emptied much of Detroit of it's intellectual and financial resources. When the people who qualify as citizens of a "Third City" are the role models for the future, then the future is a "third-class city."

Wednesday, November 09, 2005

Detroit - Be Careful What You Wish For

It's hard to fathom that the most maligned mayor in the U.S., Kwame Kilpatrick, would be re-elected by the citizens of Detroit. Yet, somehow, the citizens of Detroit decided that Mr. Kilpatrick would be a better choice than Freman Hendrix, the challenger.

Well, it seems that everyone deserves a second chance... or third ... or fourth ... or fifth ....

Meanwhile, Poll finds 33% of Detroiters want to leave

November 9, 2005


About one out of three Detroit voters surveyed Tuesday said they would move out of Detroit if they could.
The big question seems to be: what is Mr. Kilpatrick's appeal to the 67% of Detroit's citizens who want to stay? After all, he did take his ear stud out and Jackie Currie, his free-wheeling City Clerk, is gone.

Maybe they just decided that Freeman Hendrix wasn't ----- enough.

Saturday, November 05, 2005

Environmental Extremism - Nothing Finer

Posted by Picasa

  • Michigan
  • November
  • 70 degrees
  • Clear skies
  • Spectacular color

Does not compute!

Tonight, my wife, brother, son and friend sat with me around a large campfire in the middle of the Michigan "thumb" where the only lights were from the occasional farmhouse. Crisp, cool, cozy. Very nice.

Friday, November 04, 2005

Ethnic Divisiveness - Out Of Sight

Looking back over the natural disasters that affected the world, everything pales in comparison with the earthquake that hit Pakistan. Sure, hurricanes were big news in the U.S. and caused a lot of property damage. But for deadliness, nothing has come close to the earthquake in Pakistan.

And yet...

  • ...the World Food Program has only received $9.8 million of the $100 million it needs to run the Pakistani air operation, the UN said.
  • Less than a quarter of the $550 million needed for aid agency emergency programs has been pledged by donor nations....
  • The death toll in Pakistan rose to 73,276, General Farooq Ahmed, the chairman of Pakistan's Federal Relief Commission, said yesterday in Islamabad.
Why do you suppose that a disaster of this magnitude has been largely ignored by the rest of the world. Some possible reasons:
  • Remoteness - few foreigners have reason to go there and few if any have been affected directly. When the Tsunami raced over the Indian Ocean, there were Americans and Europeans in the area. News travels fast when friends and family are affected.
  • Politics - " The Himalayan territory of Kashmir has been the cause of armed conflict between India and Pakistan since their independence in 1947. More than two dozen groups are fighting against Indian rule in Jammu and Kashmir, India's only Muslim-majority state. A 16-year insurgency in Jammu and Kashmir has killed at least 50,000 people."
  • Antipathy toward Muslims - like it or not, the world is not exactly enamored with Muslims these days and many "kuffar" do not care if the "true believers" die... some may think it is perfect "justice"
But one only need look into the faces of the children to know that all of those "reasons" mean nothing.

Wednesday, November 02, 2005

Ethnic Divisiveness - Iranian Nazis

Heil, Ahmadinejad!

Who? What? Huh?

Iran Leader Calls for Israel's Destruction

Okay, so what else is new?

Useful Idiot
by James Forsyth

A joint statement by the E.U. leaders noted that "Calls for violence, and for the destruction of any state, are manifestly inconsistent with any claim to be a mature and responsible member of the international community." Blair then personally went further: "To anyone in Europe, knowing our history, when we hear statements like that made about Israel it makes us feels very angry, it's just completely wrong. ... Ask yourself: A state like that, with an attitude like that, having a nuclear weapon?"
And how did Iran respond?

Iranian leader rebuts critics over Israel remarks
Thousands of Iranians stage anti-Israel demonstrations

Friday, October 28, 2005; Posted: 4:26 p.m. EDT (20:26 GMT)
Iranians at anti-Israel rally in Tehran

(CNN) -- Thousands of Iranians staged anti-Israel protests across the country Friday and repeated calls by their ultraconservative president demanding the Jewish state's destruction.

Iran Purges 40 Ambassadors in Shake-Up

By ALI AKBAR DAREINI, Associated Press Writer 1 hour, 15 minutes ago
TEHRAN, Iran -
Iran's hard-line government said Wednesday it was removing 40 ambassadors and senior diplomats, including supporters of warmer ties with the West, from their posts in a shake-up that comes as the Islamic republic takes a more confrontational international stance.
Remember when Rodney King asked why can't we all just get along? Because....

Tuesday, November 01, 2005

Where Were All Of The Children?

Halloween... trick or treat... ghost and goblins... empty street.

The weather was perfect... calm... 60. The porch lights were on. The bowls of candy ready. The children were absent.

Maybe all of the children have grown up and there are none to take there place. Neighborhoods do grow older before they get younger again. But it was quite a disappointment. Less than 2 dozen children... and at least half of them were teenagers... showed up to beg for their once-a-year treats.

Maybe it's our society. Too much fear. Maybe holidays have lost their appeal. Too commercial. Whatever the reason, the children were absent.

Not much of a Halloween.

Monday, October 31, 2005

Excessive Spending - Nothing Is As Simple As It First Seems

... but some things are not as complex as they might first appear.

In a recent note to executives at Ford, I pointed out that certain things stand in the way of most large companies attempting to change quickly:

  1. Teamwork means "my team"... not the company. When times are rough and people become insecure, people will do what it takes to "protect" themselves rather than take risks for the company. Risk and failure are much less desirable than inaction and deflection.
  2. Economies of scale may work for production, but they have the opposite effect on management. Size forces management to use processes and procedures rather than active communication. "Nimble" is not a word usually associated with large corporations.
  3. The best and the brightest become discourage because instead of letting them "create, fix, and adapt" the company and its products in response to the competitive environment, they are forced into positions or processes where they "consider and review and discuss".
I suggested that if they did not know the history of the A-12/SR-71, they might consider that as a model for a large company that wants to achieve successes quickly: take the best of what is available and give it to the best people available and let them do what is necessary to make something much better in the shortest possible time with the fewest resources needed. You might find the history of this project interesting as well because of the way a small team of the very best people in their fields were able to design and produce a plane that should have been impossible in the time they had (5 years from contract to completion) which was less than it took to develop a new car model back then.

I don't believe one could argue that an airplane that was the fastest, highest flying, longest range craft for nearly 3 decades was less complex than a 1967 Ford. Well, you could, but then you might also be one of those people who believes that "team" means "my team." For them, everything is more complex than anyone can imagine.

Friday, October 28, 2005

Education Failure - Where Are The Jobs?

Maybe it's not fair to use the newspapers as an indication of the job market anymore. After all, with and all of the rest of the online job placement services, newspapers have lost a lot of their clout. But I found it curious that in today's classified section, only 3 partial columns... about the equivalent of 2 full columns... or about 20% of 1 page... were for companies seeking workers.

That compares with about 2-1/2 columns dedicated to "pets" for sale.

What are some of those listed jobs?

  • 5 for auto technicians
  • A couple for drivers
  • 3 for medical personnel
  • 4 for sales jobs
  • and about a dozen for various jobs like roofers and housekeepers
Hopefully, Sunday's paper will have more than that.

So what does this tell those young people who decide that 2 years or even 4 years of high school is enough? Three things:
  • What you see (in a newspaper) may not be all you can get
  • You need to learn how to find a job online
  • You might need to consider college... except that...
College students, educators rue unpreparedness ... oops!
And what is a major concern for many students and their parents? Homework is difficult... oops!!!

Wednesday, October 26, 2005

Delphi offer: $9 an hour

Ailing supplier lowers bid to UAW; workers asked to pay up to $5,000 yearly for health care.

Thursday, October 27, 2005

Excessive Litigation - A Pig in a Poke? - Verse 2

On October 4, I questioned the wisdom of "buying" the nomination of Harriet Miers:

You get my point. While there is nothing in her background that indicates she may be a bad judge, there is no record to base her selection to the Supreme Court. She may actually have the potential to be a very good Justice. But for now, it looks like Congress could be buying a "pig in a poke."
Apparently, our senators and congressmen from both parties didn't like what they saw after they looked... and now "the cat is out of the bag."

The other day, my sons and I were tossing around the reasons why President Bush might have nominated her. I pointed out that it might be nothing more than a tactic to get someone he really wants on the court to be more acceptable to Congress. After all, almost anyone might be seen as "well qualified" in comparison with Ms. Miers.

In other words, the "pig" in the poke and the "cat" out of the bag was really a sacrificial "lamb."

Excessive Spending - Snow vs. Bernanke?

"U.S. Treasury Secretary John Snow on Wednesday urged Congress to extend expiring tax cuts and control spending to promote economic growth and create jobs." (Reuters)


"Ben Bernanke, a plain-speaking former economics professor, was chosen Monday by President Bush to be the next chairman of the Federal Reserve, the most influential economic policy job in the world.

If approved by the Senate, Bernanke would succeed Alan Greenspan, who has spent 18 years at the helm and is expected to step down Jan. 31. Bush called Greenspan a "legend," and Bernanke promised to continue the chairman's policies." By JEANNINE AVERSA, AP Economics Writer

So, let's get this straight... the U.S. Treasury Secretary has concerns about the economy faltering and wants to extend tax credits to keep the economy strong and growing. Meanwhile, the Federal Reserve, now headed by Ben Bernanke, is concerned about the economy being too strong and inflation being a big problem.

Meanwhile, again...
And finally...
So, do you need an interpreter?

By the way, today's Detroit Free Press commented on the excessive spending in the U.S. Okay, that's only a month after...

Sunday, September 25, 2005

Excessive Spending - If You Don't Have It; Flaunt It

Wednesday, October 26, 2005

Ethnic Divisiveness - Irony

Today I wrote a short note to The Detroit News:

Perhaps you didn't notice the irony of your two headlines on October 25:
  • Rosa Parks - Civil rights legend dies at age 92
  • Police sued; race bias alleged - Detroit commanders says he was passed over for promotions and was demoted because he is white
Last October, I wrote a piece about the "herd mentality" in Detroit (and everyplace else, too). I invite you to read it. If... if the police officer's account of the situation is factual, it is just another example of the "herd mentality" in action. Rosa Parks became a symbol of blacks rising up against the white "herd mentality." Now, as Detroit celebrates the life of Rosa Parks, the very blacks that benefitted from her actions may have instituted their own version of that mentality.


Tuesday, October 25, 2005

Autumn - View From The Window

The picture says it all. Posted by Picasa

Monday, October 24, 2005

Ethnic Divisiveness - Taken To Its Illogical Conclusion

Extremism is nothing more than reasonable thought that has been extended to an unreasonable conclusion.

  • If two aspirin reduce pain, 50 aspirin will eliminate it forever (well, yes, this may be true)
  • If cutting back calories is good, eating nothing is best
  • If rain is good for crops, floods are best
Part of the problem in dealing with extremists is their inability to understand that context in which a statement is rational. Another part of the problem is falsely equating one condition as a logical extension of another (more = better).

Another part of the problem is semantics: "The message of Islam and Muslims is modesty, fairness, security, stability, sympathy, harmony and kindness," said Dr Shaikh Abdul Rahman Al Sudais, the veteran Quran reader and imam of the Holy Mosque in Makkah. (cited from Jihad Watch)

This sounds pretty reasonable except that the extremist interprets that to apply only to Muslims:
The exiled radical Islamist cleric Omar Bakri Mohammad is continuing to reach his followers in Britain through websites and internet chatrooms.... In one session a man calling himself Mizaan, who spoke with an English accent, said: “We should all of us glorify terrorism and we should incite religious hatred.... Speaking animatedly, Mizaan stated that the world was divided into two camps — Islam and kuffar (non-believer) — which would always be at war. He repeatedly urged his listeners to take part in that war... (The Times)
It is not difficult to follow the "logical" progression: Islam is good; that which resists good is evil; non-believers are resisting Islam; non-believers are resisting good; non-believers are evil; we must struggle (Jihad) against evil; we will always be at war with non-believers.

i.e.; more = better

Thanks, Wiley.

Sunday, October 23, 2005

Excessive Spending - Globalization and Our Wallets

Forbes had an online artile that interested me: Book Review - Globalization's End.

Globalization is one of those buzzwords that everyone uses and, as far as I can tell, few agree what it really means. To the business executive, it means trying to reduce costs in order to not lose any more profits to overseas competitors. To the worker on the assembly line, it means losing my job to some guy willing to work for next to nothing. To the consumer, it means getting things more cheaply. To the communities hit by plant closings, it means loss of tax revenues and more strain on community services.

To me, globalization is a process of economic dislocation. It is about making choices that have long term impact for short term reasons... and hoping that everything will work out just fine.

John R. Saul is the author of The Collapse of Globalism

At the heart of The Collapse of Globalism is a question that's fundamental to economics but often not asked explicitly: Are political decisions meant to be made in deference to the economy and markets, or can we use our political institutions to shield us from some of the harsher effects that markets can dish out?
The argument is that "globalization" isn't a homogeneous process, but is economic interaction that can be... and is... affected by political policies.
In short, in what's meant to be a "world without borders," it's been impossible for people to ignore just how much local economic conditions really matter. In response, some participants in the global economy have begun to realize and exercise some of their local power.

Saul points to countries like New Zealand, Argentina and Brazil as examples of governments and people who have broken the rules of globalization when the results haven't suited them. The reason, as Saul describes it, is that globalization didn't keep its promises.
The Forbes article concludes:
Globalization was supposed to deliver a world without borders and its adherents have often said that the power of governments would wane against the more fluid powers of commerce. Saul says that it just isn't so. Governments can make choices, and people aren't required to simply follow what the market dictates, even if it hurts them.

This is the start of a new debate: We made this economy, shouldn't it serve our interests?
If you are interested, also see the Australian Financial Review article for a more in-depth articulation.
One comic sign of the coming era was the creation, in 1971, in a Swiss mountain village called Davos, of a club for European corporate leaders. There they could examine civilisation through the prism of business. Soon businessmen were coming from around the world. Then government leaders and academics flooded in, looking for investors. Business leaders, politicians and academics alike seemed to accept without question the core tenet of Davos: that the public good should be treated as a secondary outcome of trade and competition and self-interest.

Let's look at sports to better understand what Saul is saying. During the cold war, the Soviets and East Germans attained dominance in women's swimming in global competition. Everyone understood the rules; the Soviets and East Germans just decided it wasn't in their best interests to follow them. Through the use of steroids, they created female swimmers that were bigger and stronger than Hulk Hogan. After awhile, the rest of the world wised up and enforced the rules through a governing body.

The problem with globalization is that there is no governing body to really enforce the rules. So, Saul is arguing that if some countries are modifiying globalization to serve their local situation, ultimately all countries must do the same or suffer economic problems.

This sounds like the old days of trade policies, tariffs and barriers... as opposed to NAFTA and CAFTA and "free trade with China". But in reality, Saul is arguing for a saner approach to trade: don't destroy your home base for a short term "good deal." A lot of economists will argue that the markets will take care of themselves and good policy is no policy. That sounds like advice that a lot of globalization "winners" are not following.

Yesterday, I made one of those short term decisions, but followed my "local policy." I had a choice between some pliers made in China and some made in the U.S.A. I chose the latter even though they were a few bucks more. It seems to me that there should be more to our economic decisions than "the bottom line"... especially since that is too often only one of several economic dimensions to consider. Think not? Remember the Chevy... er, Cadillac Cimmeron? That was a product of "bottom line" thinking.

Does that mean I support "overpaying" U.S. workers? No, it means I don't support underpaying Chinese workers.

Saturday, October 22, 2005

Education Failure - Facing Facts... Or Not

People want government to be accountable and rational; people don't like it when government is accountable and rational.

Recently, Livonia, Michigan, announced that it was scaling back the number of schools to reflect declining student population and increased operating costs; a wholly rational and logical decision. Reaction was disappointment, but surprisingly supportive; for example:

Rayleen Morgan, who has two children in the district, said the district is making the best of a difficult situation.

"This is a proactive way to deal with this," Morgan said.

The cost of educating our children has increase while the general ability of our communities to pay for these costs has diminished. This has little to do with teachers' salaries. It has a lot to do with onerous administrative and facility costs.

What is superfluous? After all, haven't schools cut their costs to the bone? Consider this:
  • Schools have accepted the responsibility to transport students to and from the schools. That used to be the responsibility of the parents. Transportation costs are an increasing portion of the schools' expenses.
  • Sports facilities have become too important. Yes, I played football, baseball and wrestled. But high schools in my hometown shared facilities such as stadiums. After all, half of the teams play "away" games each week. Football and track teams used a simple practice field and baseball teams played at public parks. But recently, despite enormous pressures on Detroit schools to cut back, a new $2.5 million stadium was built (and couldn't be opened because of safety issues). It's nice to have those neat facilities, but not central to education... especially when schools have to be closed.
We want our government to be accountable and rational, but that doesn't mean we want to be accountable and rational... especially if it means we are inconvenienced.

Thursday, October 20, 2005

Excessive Spending - No, That's Bad News, Too

Oil prices went up and that led to accelerated inflation... you know, things cost more. That's bad news.

Well, now oil prices have dropped a little so oil companies won't earn as much money from you and me. No, that's bad news because the stock market likes higher earnings and is reacting negatively so your investments are tanking (no pun?).

Of course, that means gas prices and other prices should come down because oil prices are coming down. No, that's bad news because oil prices went up before and the Federal Reserve is looking at that as it ponders raising interest rates even higher which will offset any cost reductions from lower oil prices.

That doesn't make sense! Yes, that's also bad news.

Wednesday, October 19, 2005

Excessive Spending - Road to Nowhere?

GM in trouble
Delphi in trouble
Ford in trouble
Northwest Airlines in trouble

Major players in Michigan struggling. Employees laid off or fired. Major wage and benefit reductions.

Fuel costs increasing for vehicles, homes and commercial buildings.

Building materials getting increasingly expensive due to hurricane damages.

Okay, so things are a little tight right now. But our government is working hard to help. Here's a good example. Back on September 11, I began a series of articles about how the state, county and local governments were exacerbating the cost of transportation by not addressing poorly sequenced traffic signals. Part of what I stated was:

The State of Michigan charges almost 20 cents per gallon of gasoline as a flat tax plus 6% sales tax on the price per gallon. This is an incentive for the state to promote fuel inefficiency! Am I the only one who gets really PO'd about this situation?
Fast forward to yesterday's The Detroit News.
LANSING -- Higher fuel taxes, local tax increases, toll lanes, beefed-up mass transit and per-mile charges are among the solutions being bandied about as Michigan scrambles for cash to repair local and state roads and reduce congestion on urban highways.
Maybe the reason the freeways are so congested is that traffic elsewhere is so poorly managed. Drivers can't use major surface roads to get anyplace because the signal progression is so poor that everyone floods the expressways which become crawlways.

Well, we do need to fix the roads and bridges... no real choice. So where is the money going to come from? Not from places represented by strong lobbies.

Expect to keep seeing those 11-axle monsters jackhammering the highways. They are the single greatest cause of damage to our roads and bridges, but Michigan "needs" them. Right, I "need" a 50-room mansion, too. The argument for keeping them is that those monsters would have to be replaced by more trucks causing more congestion. Well, if the roads were not damaged so much, they wouldn't have to be repaired so often. Overall congestion might well decrease and those lanes that were not under constant repair could handle the extra, lighter-weight trucks.

And, we might not have to keep trying to tax and spend more. Nah, that part will continue.

Monday, October 17, 2005

Excessive Spending - Seems Fair... Not!

Delphi executives announced with great fanfare that they will be taking base salary reductions of 10-20% (nothing was mentioned about other compensation). The CEO, Robert Miller, will work for $1 until restructuring is completed.

Just one thought: if labor is expected to take a 63% wage cut, why isn't that appropriate for executives who make the decisions leading to profits or losses? Even then, an executive making $1 million per year base salary could probably get by on $370,000 in a pinch. Compare that to a worker who gets $52,000 and takes a cut of over $32,000. A little harder to get by on $20,000, eh?

Oh, and one other thing: the cuts that the executives want the workers to take are permanent; the cuts that the executives are offering for themselves are temporary. Seems fair... not!

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There is always an easy solution to every human problem—neat, plausible, and wrong.
Henry Louis Mencken (1880–1956)
“The Divine Afflatus,” A Mencken Chrestomathy, chapter 25, p. 443 (1949)
... and one could add "not all human problems really are."
It was beautiful and simple, as truly great swindles are.
- O. Henry
... The Government is on course for an embarrassing showdown with the European Union, business groups and environmental charities after refusing to guarantee that billions of pounds of revenue it stands to earn from carbon-permit trading will be spent on combating climate change.
The Independent (UK)

Tracking Interest Rates

Tracking Interest Rates


SEARCH BLOG: FEDERAL RESERVE for full versions... or use the Blog Archive pulldown menu.

February 3, 2006
Go back to 1999-2000 and see what the Fed did. They are following the same pattern for 2005-06. If it ain't broke, the Fed will fix it... and good!
August 29, 2006 The Federal Reserve always acts on old information... and is the only cause of U.S. recessions.
December 5, 2006 Last spring I wrote about what I saw to be a sharp downturn in the economy in the "rustbelt" states, particularly Michigan.
March 28, 2007
The Federal Reserve sees no need to cut interest rates in the light of adverse recent economic data, Ben Bernanke said on Wednesday.
The Fed chairman said ”to date, the incoming data have supported the view that the current stance of policy is likely to foster sustainable economic growth and a gradual ebbing in core inflation”.

July 21, 2007 My guess is that if there is an interest rate change, a cut is more likely than an increase. The key variables to be watching at this point are real estate prices and the inventory of unsold homes.
August 11, 2007 I suspect that within 6 months the Federal Reserve will be forced to lower interest rates before housing becomes a black hole.
September 11, 2007 It only means that the overall process has flaws guaranteeing it will be slow in responding to changes in the economy... and tend to over-react as a result.
September 18, 2007 I think a 4% rate is really what is needed to turn the economy back on the right course. The rate may not get there, but more cuts will be needed with employment rates down and foreclosure rates up.
October 25, 2007 How long will it be before I will be able to write: "The Federal Reserve lowered its lending rate to 4% in response to the collapse of the U.S. housing market and massive numbers of foreclosures that threaten the banking and mortgage sectors."
"Should the elevated turbulence persist, it would increase the possibility of further tightening in financial conditions for households and businesses," he said.

"Uncertainties about the economic outlook are unusually high right now," he said. "These uncertainties require flexible and pragmatic policymaking -- nimble is the adjective I used a few weeks ago."

December 11, 2007 Somehow the Fed misses the obvious.
[Image from:]
December 13, 2007 [from The Christian Science Monitor]
"The odds of a recession are now above 50 percent," says Mark Zandi, chief economist at Moody's "We are right on the edge of a recession in part because of the Fed's reluctance to reduce interest rates more aggressively." [see my comments of September 11]
January 7, 2008 The real problem now is that consumers can't rescue the economy and manufacturing, which is already weakening, will continue to weaken. We've gutted the forces that could avoid a downturn. The question is not whether there will be a recession, but can it be dampened sufficiently so that it is very short.
January 11, 2008 This is death by a thousand cuts.
January 13, 2008 [N.Y. Times]
“The question is not whether we will have a recession, but how deep and prolonged it will be,” said David Rosenberg, the chief North American economist at Merrill Lynch. “Even if the Fed’s moves are going to work, it will not show up until the later part of 2008 or 2009.
January 17, 2008 A few days ago, Anna Schwartz, nonagenarian economist, implicated the Federal Reserve as the cause of the present lending crisis [from the Telegraph - UK]:
The high priestess of US monetarism - a revered figure at the Fed - says the central bank is itself the chief cause of the credit bubble, and now seems stunned as the consequences of its own actions engulf the financial system. "The new group at the Fed is not equal to the problem that faces it," she says, daring to utter a thought that fellow critics mostly utter sotto voce.
January 22, 2008 The cut has become infected and a limb is in danger. Ben Bernanke is panicking and the Fed has its emergency triage team cutting rates... this time by 3/4%. ...

What should the Federal Reserve do now? Step back... and don't be so anxious to raise rates at the first sign of economic improvement.
Individuals and businesses need stability in their financial cost structures so that they can plan effectively and keep their ships afloat. Wildly fluctuating rates... regardless of what the absolute levels are... create problems. Either too much spending or too much fear. It's just not that difficult to comprehend. Why has it been so difficult for the Fed?

About Me

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Michigan, United States
Air Force (SAC) captain 1968-72. Retired after 35 years of business and logistical planning, including running a small business. Two sons with advanced degrees; one with a business and pre-law degree. Beautiful wife who has put up with me for 4 decades. Education: B.A. (Sociology major; minors in philosopy, English literature, and German) M.S. Operations Management (like a mixture of an MBA with logistical planning)