Really Silly Bits

I had a couple of things that I was debating in writing about for a weekend rant and some of them seemed very serious indeed.  While they may be important, I now clearly recognize that most of them are clearly in fact, quite silly.  Besides, I was having a great deal of difficulty in deciding which of them to choose, and by treating them as they deserve, I don't need to choose at all.  So here they are in no specific order.  All by the way, relate to fairly simple ma mathematical computations.

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Now I may not be an economist and I've never played one on TV, but even I can figure out that the approaching Fiscal Cliff is a big deal for this country.  Since the last couple of the Bush Administration, the federal government has been pursuing the policy of a reduction of taxes and an increase in spending; and when the Obama Administration took the reins of power, they accelerated the process (at least on the spending side).  Now it doesn't take a degree in advanced mathematics to see that neither the trends for revenue generation or spending add up very well for the American people and that they never will.  

What also doesn't add up is that a bunch of people who make a very good living were sent to Washington DC to address situations exactly like this, and seem to have no interest in taking on this problem, though they've been perfectly willing to kick the can down the road before going on to talk about how important addressing it is on cable news networks.  The President is in fact pulling down $400K, the Speaker and Majority Leader earn $223K, Cabinet members are at $200K, and Senators and Congressman see $174K in annual salary.  Now normally when people get paid that much, it's because they have the ability to solve problems or steer companies away from them.  All of these high priced politicians however seem to think that solving this problem means putting off til next year, what you shouldn't have put off til tomorrow.

At the invitation of the President, Representatives of this august group met this week in the White House on Friday to talk about this very serious situation for an hour.  REALLY?  A WHOLE HOUR!  Why that's 1/4 of the time that it would take the President to play a round of golf. That's less time that it would take Speaker Boehner to fly back from Washington to his home in Ohio.  And not only did they spend less time in this doomed effort of national importance than Jerry Springer spends on the average day talking about brothers who cheat with each other's wives, but they did it late enough on a Friday so that their all but planned failure to make any real progress could come light barely in time to make it into the Friday 'take out the trash' news cycle and go all but unnoticed.

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Speaking of modern math, the next time I hear from a Democrat about big business pouring too much money into political campaigns, I'm going to (as they say in Python's 'Holy Grail'), "fart in their general direction".  Labor unions poured $400 million into the President's re-election, and still had enough money to pour hundreds of millions more in state and local initiatives.  According to the Wall Street Journal, in the case of California's Prop 32, an initiative which would have banned using automatically deducted dues for political purposes, in fact "Labor contributed about 90% of the $62 million spent to defeat Prop 32, including $21 million from the California Teacher's Association and $13 million from SEIU." 

They successfully bankrolled a school collective bargaining reform initiative in Idaho with $3.4 million, a South Dakota initiative to overturn a law installing merit pay for teachers by outspending them 5 to 1, and set aside $2 million to roll back an emergency financial manager's law in Michigan because it allowed contracts to be restructured in troubled cities like Detroit.  

So for all of you standing on your tired soapboxes complaining that the Supreme Court's 'Citizen's United' decision has handed politics over to rich white guys and major corporation, maybe you should take a closer look at who is actually giving and to what ends.  The numbers don't seem to add up.

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Most of you not living in a cave this week are now well aware that Hostess bakeries has all but shut down and that it plans to liquidate its assets.  Most of you have likewise heard the story that the tasty snack treats this company manufactures have fallen on hard times due to the changing eating habits in this country, multiple bankruptcies, and in the fine print, a strike from their bakers union.

It's true that Hostess is going through it's second recent bankruptcy in a decade and that eating habits in this country are changing. (Though to hear politicians speak, they're getting worse; which should have been good for Hostess.)  Some are now instead trying to get the message out that the Hostess demise comes not from the way it operated, but because greedy management and private equity funds were draining it of profits.  I guess the fact that Hostess did $2.5 billion in sales, but lost $341 million last year is equally lost on anyone attempting to define the concept of profits.  Apparently a company that just lost $341 million asking its employees for pay cuts (also for the second time this decade) is likewise unreasonable under the circumstances.  

According to a Wall Street Journal article from the November 16th however, what you haven't heard is,  "The snack giant endured $52 million in workers' comp claims in 2011, according to its bankruptcy filing this January. Hostess's 372 collective-bargaining agreements required the company to maintain 80 different health and benefit plans, 40 pension plans and mandated a $31 million increase in wages and health care and other benefits for 2012."  On top of which, existing collective bargaining agreements prevented bread products (like Wonder Bread) and cake products (like Twinkies) from being delivered to the same location by the same truck, nor could the guys who loaded cake products into trucks also load bread products.  It should go without saying therefore (but won't) that the drivers of neither the cake or the bread product trucks could have anything to do with loading their own vehicles.

I should stop here and also point out that a company management that is constantly seeking bankruptcy protection is as bad as a Union constantly seeking more from a company that doesn't have it.  Teamsters had already settled, and perhaps this Union might have sought a greater stake in the company's future than a bigger piece of a pie that was long gone, but they didn't.   And for those of you who might be wondering about Hostess's biggest competitor, Little Debbie....   Well, they're actually able to offer similar products in larger portion sizes than Hostess while still managing to remain profitable.  Of course Little Debbie's is a company consisting of  non-union bakeries.

Fortunately however, the 18,500 layoffs that will be caused by this layoff and liquidation did not happen before the election, and will not therefore be counted until long after any recall ballots already have.  From the sounds of things, Hostess will probably not have much of an impact on unemployment numbers anyway, since so many firms are likewise sending people home in the wake (pun intended) of the election.

                                    

The Twinkie Is On Life Support (Updated)

Those of you not paying particular attention to financial events critical to this nation's survival may not realize that Hostess Brands Inc., makers of Twinkies, Ding Dongs, Ho Hos, and Cupcakes is on life support today.  You were warned of course, I wrote about the potential demise of the Hostess Brands some ten months ago here; as its battles with the Bakery, Confectionery, Tobacco Workers and Grain Miller Union.  (Some have hinted the biggest impediment to an agreement is the aggravation caused by repeating the Unions name over and over again during negotiations.  There has been no confirmation to these rumors.)  

Now let's face it, a management group that's constantly taking the company through bankruptcy protection is a lousy one.  As badly as they've served the stockholders however, the Union however took it to the next level when went on strike last Friday.  A company so often in bankruptcy has little if anything to negotiate with.  As a consequence, Wednesday Hostess announced that it will liquidate the entire company if enough workers aren't back to work by 4 PM today. 

Now I don't know what the strike's about and I don't care.  I am however begging anyone out there who is or even knows a striking worker to go back on the line.  

MY GOD PEOPLE , WE'RE TALKING ABOUT NO MORE TWINKIES HERE!

How can Americans be asked to face the impending financial crisis, the continuing lack of well-paying jobs, and the increasing pressure of the boot of government on our necks without the solace of these creme-filled, angel cake beauties?

I'm sorry ladies and gentlemen, I am simply too overwhelmed to go on.  With only hours to go on this death watch saga however, I ask you to visit your church, temple, synagogue, or mosque and pray that this purveyor of heavenly treats survives to see another sunrise.

As for me, if you are on the streets he in Mission, you undoubtedly will find me at one of my local grocery outlets, attempting to buy out their Twinkie inventory, lest the worst-case-scenario occurs.  If your efforts fail, the expiration date on Twinkies insures that I will have an ample supply, and should at least have enough to stave off the worst effects of TWS (Twinkie Withdrawal Syndrome).  I may even become a wealthy many if, as I suspect, the world abandons both fiat currency and gold, and goes on the "Twinkie Standard".  If your efforts succeed, I will undoubtedly lock the door to my apartment and binge on my inventory on what can only be considered a Biblical scale, at which point your prayers may again be required ... this time for me.

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Update:

 

Hostess Brands made it official and pulled the plug as they had promised.  The company has officially filed with the Courts for formal liquidation.  This process will not only cost approximately 18,000 jobs; but also deprive the general public of one of the few government non-approved treats left in the world.  And while some of Union persuasion have been attempting to blame these job losses on management, it should be remembered that this same management will likewise be losing their jobs, even though they never went on strike.

While we must truly say "Requiescat In Pace" to the Hostess Brands (at least for now), this is not yet the death of the Twinkie, since their 20-year shelf life means that for those of us who recently began to hoard them, there are years of creme-filled pleasure to look forward to.  And as the Financial Cliff of 2013 occurs, there many of us out here who may yet survive the financial holocaust as the price of silver, gold, and even diamonds plummet in favor of the "Twinkie Standard" of economic exchange.

And so let me say in closing that, "We come not to bury Twinkies, but to praise them (and maybe snack on a few)."

 

                                             

Happy Worker's Day

The summer is about to be officially over (not that you could tell from the temperatures in Kansas City).  Swimming pools will soon be closing however, most of the kids are already back at school (and the rest soon will be), and along with the rest of the nation I find that I am more than ready for a three-day weekend to let off a little steam.

In my own case, it might have something to do with having begun my week by traveling last Sunday and having labored a considerable (and perhaps inordinate) number of hours training for my chosen profession.  The fact that such efforts may well be in vain (something to do with old dogs and new tricks that I seem unable to recall in my depleted physical and mental condition) has nothing to do with the honest effort expended by such exertion.  I find however that my well-deserved bit of rest has been ruined by by the holiday that in title at least celebrates such efforts, Labor Day.  

For it seems as though the extended weekend we get away from our jobs cannot even manage to rise to the level of carrying the stigma of being a Hallmark Holiday.  We cannot even happily revel in rampant consumerism, safe in the knowledge that the increasing credit card debt we saddle ourselves with will put money back into the economy in more direct way than the food stamps or unemployment benefits that the government apparently prefers.  Instead, we will have to grudgingly accept that whatever merrymaking we choose to participate in will in fact celebrate the labor movement in this country.  

Don't get me wrong, there was a time in this country when such a movement was perhaps necessary.  People often worked too many hours and in conditions that would be considered unsafe by any standards today; but unlike the long weekend that I at least need, that time has long passed.  Legislators and government regulators have long since stepped in to insure that citizens are protected, producing as many positives as negatives in their often misguided efforts to correct past ills.  Even without organized labor as a force in this country, it hardly seems possible that evil corporations could have their evil way with their workforce ... even in Right to Work States.

The impetus for the festivities this weekend therefore, is little more to me than a reminder that another President (Grover Cleveland) once attempted to placate organized labor with a national holiday after using government troops during a strike back in 1894.  And since the current Administration seems to use its bureaucratic thugs on employers rather than employees, the holiday seems more like a hollow remnant that does little more than highlight the sorry state of jobs in this country.  

The numbers have only gotten worse since I wrote about this back in January of 2010, with employment (or more accurately unemployment) still the largest problem that this nation faces.  And while Union jobs are a small percentage of the entire workforce, the growth of high paying, union-protected government jobs seems to be the only employment expansion going on.  This not only highlights the astonishing incursion of that government and its minions into the present and future in this country, but the control of organized labor in today's government.  And it is that very incursion that perhaps most contributes to the stagnation; both in terms of growing the economy and restraining the runaway spending that plagues government.  A government that pays more to its own unionized staff than the private sector does (or can afford to), while imposing its will upon private corporations has done nothing to promote growth or alleviate the current malaise.

A willingness to gift large parts of GM and Chrysler to their Unions, ignoring the limitations of the Constitution and legal traditions regarding preferred debtors, and the nonsensical interference with Boeing's attempts to build production lines where it wants to cannot help but make one wonder who is indeed in control of policy in Washington itself.  And while there has always been a fear of government and religion having far too cozy a relationship, one cannot help but wonder instead if equal or greater concern should be directed at the affinity of the labor movement with those in power these days.  

Celebrating the labor movement in this country hardly seems patriotic, though it could be considered politically expedient.  Certainly, labor unions are seen by as  large contributors and equally large voting blocks by those running for elected office these days; and not to be trifled with.  The influence of labor leaders over policy and legislation is often far greater than their actual numbers would seem to justify as a consequence. Perhaps then, it's long past time that the unrecognized leverage of Unions took its place along with corrupt lobbyists and evil corporations as an unhealthy influence on the direction in which the ship of state sails.

Now as luck would have it, the KC Irishfest is going on this weekend.  I am determined to attend at least one day of these festivities (and perhaps even tip back a pint or two).  I refuse however to acknowledge the motivation for the holiday that it falls within.  So it is with truly mixed feeling that I wish you what I choose instead to call a "Happy Workers Day".   

Two Minds On Public Sector Unions

Like many taxpayers across the country, I've watched demonstrations in state capitols in Wisconsin and Ohio with interest and with fear. The interest is two-fold. First, because these public demonstrations bring out all of the best and worst in people; and as one who considers himself a student of the human condition, this is a wonderful condensed study guide. Second and more importantly, because these appear to be the battlegrounds where the financial future of states across the country will be fought. 


The fear is likewise two-fold. I fear that politicians have simply decided that this issue is the 'distraction de jour', and are simply using it to keep us from looking more closely at what government is doing elsewhere. I likewise fear that as government often does, the furor over the subject at hand will cause the pendulum to swing too far in the opposite direction in some form of demented retribution. This could easily produce compensation packages that leave us a workforce competency level ill-equipped to adequately serve citizens. 


If it seems that I am caught up on 'two's' where this subject is concerned, it might be because I am of two minds on the subject. The first part of my thought is pretty straightforward. A contract is a contract, and a government (like any other employer) does not have the right to abrogate a legitimately negotiated legal agreement, regardless of whether it has discovered that there is political gain to be had, or that it simply doesn't like the one in place. Like other employers, they are not allowed a "mulligan" (legislative or otherwise) when they discover that they made a bad deal. 


There is a both a legal and ethical principle involved here, and attempting operate in this manner is a betrayal of public trust that should be of great concern to all of us. For those of us who cried foul when the feds overruled bankruptcy law when deciding how to treat legitimate bond holders in what should have been done with the assets of GM; consistency demands that we can think no differently. If however, the government or any other employer wants to change the way that they do business in the days going forward and re-negotiate such an agreement with workers on that basis, they certainly have the right to do so. 


The other part of my thinking concerns Unions in general and public sector unions in particular. I am no fan of organized labor, but recognize that they have a legal right to exist and to attempt to negotiate compensation on behalf of their members. Unlike some, I do not believe that this "right" to organize is guaranteed under the right of free assembly in the Bill of Rights of the Constitution however. Oh they can get together any time that they want, they can also exert political influence as an organized entity, but there is nothing in the Constitution that says that their employer must negotiate with them. That employers can be forced to negotiate with such groups is law however, and one that has been created at state levels. 


In fact across the country, there are 'closed states' and 'open states'. In closed states, it's perfectly legal to force a person to join a union in order to get certain types of jobs (something that seems inconsistent for those now crying for freedom). In open or "right to work" states, you are free to take any job you choose without joining a union. These open states do not preclude you from joining such organizations, but do not force you to do so in order to gain employment. 


Because they are state laws, state legislatures have the right to change them. As long as they do so following the rules governing the creation and passage of laws in such states, their efforts are within the rights granted to states under the Constitution. I also think that due consideration should be given to the fundamental difference between union negotiations in the private and public sector. In the private sector, unions negotiate with management over sharing the surplus capital of the company. If the union workers at some point begin to get more of a share than the employer can reasonably afford, that employer probably goes bankrupt, and the jobs are lost. 


In the public sector however, there's not supposed to be a much of surplus to divvy up in the first place (if there was, it would mean we were being taxed too much). When the employee share of revenue in government grows beyond the capacity of the employer to pay for in this case however, they merely generate more capital by raising taxes to cover what might be their purposefully politically inadequate negotiating skills. 


There is also something particularly odoriferous about the concept of a public sector employees union financially supporting the careers of those in management negotiating their contracts. It doesn't take much in the way of critical thinking to see that it is a conflict of interest for these politicians to make decisions on the pay of those contributing to their campaigns. With all of my concern over how things will work out after legislation in Wisconsin and Ohio is finally passed (as it seems it will), I find that I am still of two minds on where this can and should go in the long term. 


While not in favor of having unions in the public sector, I might view this more favorably if the playing field were leveled. I might be willing to concede the right of a public sector union to organize and to negotiate their compensation (and this includes those considered 'safety workers' like police and firefighters), if they in turn would relinquish the requirement that members of their professions have to join a union to achieve employment. I would likewise expect a concession to that level playing field that their employers no long have an obligation to take on the union's responsibility to collect its members' dues.

TFP Column: Political Prestidigitation

It hardly seems like a week since my last effort for the Toledo Free Press. Of course that may be because it actually hasn't. I can only assume that editor-in-chief Michael Miller is working even harder than usual, since he got this effort up only hours after I sent it to him on a Saturday.

The effort, "Political Prestidigitation" (and yes I had to check the spelling), came from realizing that the shows going on in Madison, in Columbus, and elsewhere across the country might not be the point of the story. I also realized that the casting of the roles for heroes and villains for this entertainment might have some flaws in it.

In fact, the more I got to thinking about it, the more the whole thing began to look like a rather shabby magic trick; and the secret to understanding it might be penetrating the misdirection being performed by many of the players on stage. I hope you find my own verbal sleight-of-hand equally intriguing.

The effort this week is truly going up rather early in the process, so there's no telling what compelling stories might yet develop through the week ahead. If you want to know what's going on in Toledo and NW Ohio however, you going to want to do so through the Toledo Free Press Star edition mid-week; and Toledo's largest Sunday circulation newspaper, the Toledo Free Press.

TFP Column: An Unlikely Winter Freeze

The weather outside has indeed become colder and the first day of winter is less than three weeks away, but this week's effort for the Toledo Free Press has nothing to do with falling temperatures, but rising rhetoric. 


In "An Unlikely Winter Freeze", I take the recent announcement by President Obama of a federal employee pay freeze and pose a few questions. Like so many other things that a politician says, it appears to make some sense on first hearing it than it does if you actually attempt to make it happen. 


But I'm not the only one looking at the numbers in this week's TFP. Kristen Rapin-Criswell has put together some interesting information on the proposed increases in Toledo's proposed water and sewer rate increases, and Caitlin McGlade looks at the money that the Toledo Symphony Orchestra is looking for from the city for their upcoming Carnegie Hall appearance. 


There's cold and snow in the forecast for NW Ohio, so my advice would be to curl up in a warm place and catch up with Toledo's largest circulation Sunday paper, the Toledo Free Press.

Labor Day Conflict

I had been putting forth considerable effort in the last week in training for a new career, so I was more than little grateful yesterday with the realization that there would be a three day weekend to recharge my batteries. (I was also feeling a little smug over the timing of this mini vacation, in spite of the fact that I had little or nothing to do with it.) 


Recognizing that 'there is no such thing as a free lunch' however, I could not help but realize that there would invariably be a price to pay for the fortunate circumstance of my first paid work holiday. The bill didn't take long to show up. You see, the joy of this short furlough from my labors made me curious as to their cause (and curiosity is normally a dangerous thing). 


As with I am sure many of you out there, I had long taken the concept of a "Labor Day" weekend for granted. As kids, Labor Day traditionally marked the end of summer vacation and the beginning of school. While schools around the country can now begin a little earlier or later depending on the vagaries of state attendance requirements (and since most of those in government education camps are no longer required to work the harvest with their parents), the necessity of reducing the costs of climate control for their buildings, and the prognostications of weather guessers as to how many bad weather days will be required during the school year; most openings still closely mirror in some way this three day weekend. 


It is also the traditional weekend for the closing of outdoor swimming pools in much of the country, in spite of the fact that often there is still plenty of warm weather to follow. Like the opening of school, this was a heartfelt tragedy of youth for many of us, as swimming pools were both a source of entertainment and a summer refuge for many us. As we grew older, these sites even became educational; as we gradually began to recognize the necessity social networking (though we just called it 'hanging out with our friends' at the time) and the increasing hormonal challenges that were eventually presented by a burgeoning maturity. I had never bothered then, nor do I recollect ever being taught at the time, what it was that the actual holiday symbolized. 


Having opened this Pandora's Box however, I was now bound to perform the research (and write about it). Now according to the definitive (but sometimes questionable) source Wikipedia, Labor Day became a federal holiday in 1894, with legislation rushed through Congress a mere six days after the ending of the Pullman Strike (back when Congress didn't rush most of the legislation that it writes through). 


The idea apparently was to create a holiday as a peace offering to labor unions that had suffered mistreatment and death at the hands of the military and US Marshalls during this strike. The September date was chosen apparently, in order to prevent potential confusion with the May Day (or International Workers Day) celebrations; which not only carried overt Communist connotations, but carried the additional baggage of commemorating the violence that erupted during yet another labor strike and demonstration, the Haymarket Affair of 1886. 


The bottom line here apparently, is that the holiday that we are all currently enjoying was manufactured by the federal government as a way of distancing itself from the abuse that it had committed in the name of, and as a small punishment to the 'big business' interests that it far too often finds itself under the thumb of. It was likewise seen as a sop to the labor movement in this country that it alternately and frequently finds itself in the same position with. (This is the kind of distasteful and tainted process that makes Hallmark's avaricious efforts at holiday creation seem almost saintly by comparison.) 


Now I have made no secret of my opinions of the labor movement in the past, but one cannot help but concede at least a modicum of sympathy to union labor in this case. While I am sure that not all of the actions perpetrated by striking workers were laudable and that a close examination of the facts at the time would find plenty of fodder for recriminations on both sides, one cannot help but be sympathetic (and even to admire) those willing to be injured or even killed while standing up for their beliefs and what they felt were their rights. 


Much like the contention from which it was born, I cannot help but feel conflicting emotions as I enjoy the rest and respite provided as a result of this Labor Day holiday. While certainly appreciative of the short breather provided by this holiday, I am disdainful of the concept of celebrating organized labor at a time when we force two of what are considered this country's most famous presidents to share a holiday. While I am more than willing to accept the temporary ease provided to write this piece, I must admit to feelings of remorse at its source. 


Perhaps I should instead acknowledge the guilty pleasure of an unasked for gift from the hands of my oft-stated enemy, accept it as a form of absolution for the embarrassed confession that I make here, and simply enjoy what promises to be a gorgeous weekend here in the Kansas City area. Then again, that might be doing too much work ...

Sounds of Silence

Without attempting to weigh the Constitutional issues involved on whether a mosque should be built close to the site of the World Trade Center (which are pretty clear cut in favor of building such a facility), certainly there are others that we can consider. For surely there are realities to such a project which have yet to see the light of day and voices yet to be heard on the subject. 


I've heard Mayor Bloomberg make an impassioned plea on behalf of those seeking to move forward with construction. I've heard David Patterson, the governor of New York, also say that while he does not oppose the building of this mosque he understands why some feel anxiety or even anger; and that he was willing to intervene to help the group seek an alternate site for construction. I've heard Newt Gingrich, Sarah Palin, and every talk show host on TV and radio weigh in on the subject on one side or the other, often with a shortage of facts and an abundance of emotions. I have even heard a couple of candidates for office (most recently Sen. Harry Reid and his opponent, Rep. Sharron Angle) voice a few well chosen words on the subject, agreeing for once that they believe that the mosque should be built elsewhere. 


Amazingly enough in all of these voices however, I have not heard from the unions of New York City on the subject. One must believe after all, that unions representing police and firefighters, whose members perished in the collapse of The World Trade Center, must certainly have some opinion on the subject. We must likewise believe that as organizations representing some of those who fell on 9/11, certainly their opinion (like those of the families) is one that we would expect to hear in the ongoing discussion of the situation. 


Now assuming that these unions exhibit nothing but support for their fallen comrades (which is not much of a stretch) and object to such a project, the next logical question would be how other the other unions of NYC react. Certainly we could again make an assumption of union solidarity on the subject (again logical), which would inevitably lead us to believe that they too would in fact oppose such a project (in spite of the jobs that it would provide in a tough economy). Taking all of the preceding into consideration, we might then ask: How could anyone expect to complete construction of a building in the Big Apple without the support of the local trade unions? 


It does not seem much of a stretch to believe that if the construction unions (or any other for that matter) were to stand behind a negative reaction by police and firefighters, that a work action against such a project would be short in commencing. If carpenters, electricians, iron workers and plumbers were to refuse to work on such a job site, it hardly seems possible that such a project would ever be able to be started, let alone completed. If that action were to include a picket of such a site (again, not much of a stretch), it seems more than probable that even getting building materials delivered to the site would be difficult, if not impossible. 


Now while no one will ever accuse me of being an expert on the subject of labor unions (or much of a supporter for that matter), it doesn't take one to recognize the practical power that such organizations have in relation to such projects. It takes even less of one to recognize that the environment of New York City is one where unions are capable of a great deal of real power and control. Were they seriously to voice a negative opinion on the subject of the construction of a mosque (or anything else for that matter) anywhere in the city, much of the ensuing discussion on the subject would become little more in fact than noise. 


Instead of the shouts of protest in support of their union brothers and sisters and the cries of injustice being done that we would normally expect to hear however, in this particular instance we have heard nothing yet from any of these organizations but the sounds of silence ...

Concession Speech

At the end of an election night, there is always one politician who must stand before a dejected (and usually intoxicated) group of supporters to concede defeat. (The other politician usually stands in front of an exuberant and equally intoxicated group to accept victory.) The speech that the loser gives is one where he congratulates his opponent on victory, pats his supporters on their collective fannies in spite of the outcome, and concedes that their effort (while noble) was not successful. While there is no election this week, there certainly seems to be a number of concession speeches being given. 


In fact it seems that we have heard little else in recent days than speeches about concessions by Toledo Unions. AFCSME locals gave a speech on their concessions of six members, 3 percent of their pension pick up (for 7 months), and spread of retirement payouts for those leaving employment this year. Toledo firefighters had already conceded at least a temporary 3 percent pension pick up and some delayed overtime payments. Toledo fire chiefs also conceded the 3 percent pick up, along with some vacation to be carried over to 2011 and some sick time conversion reduction. The police union (TPPA), has to date conceded nothing to the city and has instead taken it to court. All of this was done in response to Mayor Bell and City Council approving the move to exigent circumstances for Toledo, and the city demand of an across the board pension pick up all 10 percent of the employee contribution by all unions to their respective pensions (for those of you who didn't already know it, the city currently picks up the 10% employee contribution). 


Now since this is Toledo, we must defer to the definition of concession in the SOS Dictionary as the final arbiter of meaning, and this tome speaks as follows:  


Concession: 
1. Yielding a right or privilege in an argument or negotiation 
2. Yielding something barely worth noticing on a temporary basis in a contract negotiation, only to have it returned to you a few months later with interest. 
3. The appearance of giving something back when in fact nothing actually has been, so as to make those asking for it appear in some way assertive and those giving it in some way magnanimous . 


The problem in this case however, is that I at least am confused about who is actually losing, and who should be giving the concession speech as a consequence. While the unions appear to be giving something back to the city, they don't appear to be giving much ... or for long. The city, having finally taken the principled stand of exigent circumstances to resolve this situation now seems to have conceded that the problem may not have been as great as they made it out to be. They also seem to have conceded that what they originally demanded of the unions to balance the budget is not in fact what they need. Meanwhile, it seems as if the city has merely put a piece of duct tape on the band aid, which is in turn holds on the patch, which covers the money leaking out of the hole in the city's budget through union contracts. 


The solution proposed appears to do little to resolve the issue of spending more money than the city is taking in; and instead seems only to push the hard choices out beyond the next election cycle (perhaps what was intended all along). It should also be noted that should TPPA win any part of its case in court, all bets on these "concessions" will probably be off. 


I fear that the only concession speech that should be made is the one that will never be given. It is the one where the Mayor and Council concede that they took the best chance they had to permanently fix the budget problems of the city and threw it away in the name of political expediency. It should also concede that far too many City Council members are running for new offices in the approaching election cycle to maintain the principled stand that they briefly assumed, and have once again conceded the city's future to union rule.

TFP Column: Look For The Union Label

Another week has come and gone in Toledo and the only thing that we know for sure is that neither the budget for the city nor that for the Toledo Public School system are balanced yet (though the city is fast approaching its March 31st deadline). Union layoffs have been threatened by both organizations, but both appear to be hesitating. It seems as though pulling the trigger on such a decision is as attractive to the politicians involved as a game of Russian roulette with most of the chambers loaded. 


It was thinking like this that led me to this week's TFP effort, "Look For The Union Label". I hope that this catchy little jingle from days gone by also strikes a chord with you. 


After a week of beautiful weather in Toledo, it now appears that we will see declining temperatures and increasing humidity (of the rain variety). My advice would be to find a way to stay dry while catching up on the week's events in the Toledo free Press.

State of the Union(s)

The president has now delivered his annual State of the Union address, and for those of us with the intestinal fortitude to listen to it, we now find ourselves in a state of incredulity, disbelief, and almost terminal boredom. In all fairness, this is not entirely the president's fault. Most of those who in recent years have sat in the White House have used this address to a joint session of Congress in an attempt to obscure the real issues of the country with more smoke than I have blown since I began I began enjoying cigars, let alone writing this blog. Mr Obama has merely lived up to (or perhaps down to) the level of rhetoric that we expect from presidents at such events. Add in the minority response and the spin from political operative and pundits on both sides of the aisle and you end up with something best disposed of under strict Hazmat regulations. I will therefore not try to add to the obfuscation by putting my own two cents in. I will however, point out some dirty little secrets that did not come out last night, and will likely never come out in any address to Congress or the public. Bureau of Labor Statistics numbers discussed in a recent Heritage Foundation piece speak on it however, and they are very interesting indeed. For those of you unwilling to read the entire article, the highlights are:

• At a time when overall employment is falling around the country, the number of union employees working for the government at various levels rose by 64,000.
• At a time when many are concerned about the money provided to auto makers (now largely owned by the government and the unions), we find that three times more union employees work in the Post Office than the auto industry.
• In fact, 52% of all union workers now work for the government at the local, state, or national level.
• Union government workers earn an average of $39.83 per hour in wages and benefits, where those in the private sector earn only $27.49 per hour.
• In recent health care negotiations, union workers were granted exemption until 2017 for taxation on so-called "Cadillac health care plans", while non-union workers with similar plans would begin to pay taxes immediately.

What the article goes on to point out is that when union wages and benefits take too much of the profit from a company, that company will no longer be able to compete and will ultimately lose to its competitors and go out of business (unless its bailed out by the government, of course). When the same thing happens with regards to government union worker, the additional revenue required to meet the requirements of these demands comes from ... us. 


This is not to say that membership in a union automatically demonizes a person, it does not. What it does say however is that it would be a failure of logic not to recognize that Unions have become one of a growing number of self-perpetuating bureaucracies in this country. 


Saying that Government is one of the other great offenders in this category would be an understatement. Putting the two together I fear is not a problem added to itself, but one that is squared instead. If you consider the considerable influence that Unions can therefore have on the government: as a political contributor, as an entity that can quickly put membership on the street to stump for a candidate, and as a part of the greater mechanism of government itself; one cannot help but wonder if the government in general, this Administration in particular (with its close ties to Unions like SEIU), and the professional politicians in Congress of both parties are more concerned with the "State of the Union" or the "State of the Unions".

What Health Care Reform Doesn't Say

To say that I watched with interest the President's speech to a joint session of Congress last week would be stretching a point (OK, it would be flat out lying). In fact, the only bits of it that I managed to catch were in the process of channel surfing in order to see if it was over yet. 

You see, political speeches are for the most part well choreographed pieces of water ballet. They can be beautiful if viewed from the proper angle. They can even be exhibitions of athletic prowess when performed by professionals (as the President is). They are in the end however, performances that for the most part contain about as much intelligence and importance as a Marx Brother's movie in which Zeppo sings. 

This is no offense to the speechwriters, carefully crafting phrases to stir patriotism, fervor, and zeal among the faithful (and sometimes even among those not so faithful), after running each word and phrase through spin groups of various ages and ethnicity, and just as carefully tracking the results. This is no offense either to the actors/politicians who attempt to bring out the nuances of each written word and every pregnant pause, read them to their audience with the proper reverence, and hopefully manage to play their role in the piece with proper respect and without laughing at the insanity of it all. 

No matter how well crafted the speech however, or skilled the performance; in the end it's never what is said in these speeches that is important, but what is not. For example, in spite of the furor over the Joe Wilson "liar" remark, it was at least stated in the speech that illegals would not be provided care under the latest plan. What was of more importance however was that it was not said that no one was going to check those asking for treatment if they were a citizen (but there's no need to look behind that curtain). Likewise, what no one talked about and no pundits questioned in the later analysis was who wasn't going to be forced to participate under the plan.

• No one for example, asked if the President or the members of Congress, blessed with some of the best medical plans that money can buy, were going to be forced to give up those plans and participate ... they aren't.
• No one asked if an ever-growing number of union government employees at the federal, state, and local levels, who are the fastest growing number of workers in Washington DC (and the fastest growing percentage of union workers in many parts of the country ) were going to give up the health plans carefully negotiated by their union leaders and participate ... they aren't.
• No one even asked if workers at auto manufacturers who had just received government bailouts and have reorganized in such a way that the union workers had received substantial cash and stock to pay for retirement and health plans for current and retired workers were going to give up that money and stock and sign on to this government plan ... they aren't.

So while once more we were presented with a great deal of pomp and circumstance, while we are provided with information that is likely to change faster than the weather, and while we were presented with facts and figures that are subject to more dispute than the basis of many religious conflicts, in the end what we were given a piece of prose that would make the former writers of the episodes of "The West Wing" proud (and be almost as full of carefully crafted fiction). What we were left once again were far too many questions unasked and far too much left unsaid. 

Happy May Day

Now for those of you unfamiliar with this holiday (it not being a recently created Hallmark Holiday), May Day is traditionally celebrated on the 1st day of May. In Ireland it was also known as the feast of Beltane, and bonfires were lit on the Emerald Isle to mark the banishment of winter and the first day of summer. 

Over the years May Day has had many types of celebrations in many countries, from electing a May Queen to dancing around the traditional Maypole, with dancers circling the pole with ribbons. Since the original pagan holiday was a celebration of spring however, most of the celebrations involved fertility rites. (Woo hoo!) 

In more recent history, May Day has become known as "International Workers Day" in commemoration of the Haymarket Massacre of Chicago in 1886, when Chicago police fired on striking workers seeking an eight hour work day. Demonstrations were called for in 1890 and were so successful that the event was made an annual celebration, which somehow became subsequent riots in 1894 and 1919. 

By 1904 however, Labor Unions and the International Socialist Conference had called on all good Social Democrats to demonstrate enthusiastically in celebration of workers on May 1st. In 2006, migrant farm workers celebrated May Day with "The Great American Boycott", a general strike of all migrant farm workers in protest against immigration reform legislation. In 2007, a repeat of this protest ended in violence with an assault by officers of the LAPD. In 2008, the International Longshore and Warehouse Union celebrated by moving no cargo in West Coast ports as a protest against the Iraq war. 

So before it becomes a more widespread part of the Democratic Socialism that seems to be becoming a greater part of our present and our future, let me be the first to wish for you (a bit sadly, I must add):

Happy May Day 

 

GM: Government Motors

Well, General Motors has unveiled its plan for how to move forward in the business of automobile manufacturing; and it is unique in the annals of American capitalism. As a part of this reorganization, GM will drop its Pontiac brand, eliminate an additional 21,000 jobs, and do likewise with some 2,600 dealers. It announced this plan under a government deadline of reorganization that it hopes will get it another $11.6 billion in government aid, on top of the $15.4 billion in that has already been invested by our leaders in Congress and the White House. GM likewise has a deadline of just one month to get both bondholders (who are far less than happy) and the government to sign off on the final details of this plan. It must also get the UAW to agree some kind of settlement on over $20 billion in cash obligations that GM has with the healthcare plan of its union retirees. If it fails to meet this deadline with any of the three groups in question, it faces bankruptcy. Should this perfect storm of economic events manage to occur however, the GM of the future would look something like this:

• The government would end up with at least 50% of the common stock of the company, making them the majority stockholder.
• The UAW would end up with as much as 39% of the common stock.
• Bondholders would end up with the remaining 10%+ of the stock in exchange for $27 billion of GM's current debt.
• Current shareholders of GM stock would effectively have their investment wiped out.

For those of you have somehow managed to miss the signs (Signs, more like billboards!) of a fundamental shift in capitalism in the US (and the world), this would be it. This is no longer a loan or a temporary fix, this is a company voluntarily and permanently turning over voting control of its stock to the federal government. While the taxpayer will foot the bill for this, Congress, the White House and a small group of Federal bureaucrats will determine the long term future of what was once the world's largest company. What's more, they will do this in partnership with one of the nations largest labor unions. I cannot imagine a more ill-suited group to run a business of any kind, let alone one of such size and importance.
And ask yourself this:

• If GM is owned in the majority by the government, will it change it's name to "Government Motors"?
• What level of debt, in a government which seems to treat debt as its closest ally, will this new GM be allowed to roll up?
• If this plan, boldly put forward by current management, fails to return GM to profitability, what amount of red ink in this new company will determine when it fails?
• What unsupportable contracts with its partners in the UAW will be allowed to continue regardless of a lack of profitability because the UAW controls so much of the stock and the government has the taxpayers bank account to fill any gaps?
• What new levels of expensive federal bureaucracy will be required to direct, manage, and regulate this new Government Motors?
• What impact on competition (from the standpoint of both US and foreign automakers) will a government owned auto manufacturer have?

And most importantly,

Would you buy a car from a company where the design, manufacture, sale, and long-term service of your vehicle would be ultimately performed by the federal government?

I have to tell you that I will be purchasing a new car later in the year, and that this situation has certainly given me pause over the potential selection that I will make...

The Pay Gap Is Growing

As we celebrate the day by which all of us will have handed over our "Fair Share" to the Federal, State, and Local governments in an increasingly tough economy (and the day of the Tea Parties of course), we have yet one more thing to inflame our passions (as if the budget, the bailouts, and the tax code were not enough). It is a disparity that continues to grow in this country. 

No I am not talking about the disparity in the amount of taxes paid between the rich and poor (I'm an evil Conservative after all, and we don't talk about things like that). In fact it's a growing disparity in the in the compensation that people receive for their labors. This is not however a discussion of the disparity in the packages of CEO's and blue collar workers or the disparity between the pay given to male and female employees for the same work (again I am a Conservative, so you obviously won't hear about such things from me). Instead, it is a discussion of the growing disparity in pay between workers in the public and private sector. 

According to an article in USA Today from 4/10/09 entitled Public, private pay gap grows, while the wage gap between the public and private sectors has remained pretty much the same (in the public sector's favor of course) the growth in salary benefits has led to a steadily increasing divergence between the two. Last year in fact, government benefits rose at a rate three times more than those in the private sector, $.69 vs $.23; with totals salary packages averaging $27.35 in the private sector and $39.25 in the public sector.  

In fact, according to the numbers in just one area of such packages from the the Bureau of Labor Statistics data that USA Today used, government workers receive more than double the amount of money contributed to their health care than private sector workers received ($8800 vs $4100). While this seems to have had no impact on a Federal government that continues to add new employees at a rate that only Carl Sagan would have been capable of keeping up with (oh come one, everyone remembers "billions and billions"), this disparity does appear to be having some impact on other levels. 

Ohio's government workers as an example, have agreed to take unpaid furlough days in order to help return $440 million to state coffers over the next two years, a period in which the state budget is desperate to find ways to make ends meet. (Of course what remains little talked about with this agreement is that the workers will get most of this back in the third year.) On the local level, Toledo has likewise noticed this trend and while facing a $28 million budget shortfall, is looking at both the salary and benefit packages of city employees (even those with previously negotiated union contracts). 

In yet another example of emulation, they are attempting to discover if there is a way to use the state as an example to get some of the money contributing to this disparity back. Being politicians, I suspect that they are likewise deciding whether such a growing disparity in pay to city workers in an area where unemployment is currently running at about 13%, is a politically defensible position any longer. While many will be running for cover as this continues to be an ever-growing issue in an ever-growing government, legislators across the country have finally realized that there is an elephant in the room that they can no longer ignore.

"People will become angrier and angrier when they learn the difference between their pay and benefits and what we give to public employees," state Sen Chris Lauzen of Illinois was quoted as saying in the article.  

(Really!  Ya think?)

 

A Very Special Fairy Tale

(Please look up the definitions of irony and satire before reading the following.)  

Once upon a time in the deep green woods, their lived an evil corporation that built terrible machines that polluted the earth and threatened the planet's very existence. This evil corporation was called General Motors and was one of a bunch of nasty, despicable creatures who served no one but themselves, their executives, and their stockholders. This evil creature was helped by a group of kindly, but unsuspecting little people called the United Auto Workers who unknowingly aided this evil creature in order to make a lot of money to feed their families (and buy some pretty cool stuff). Other groups of the United Auto Workers helped the other evil corporations who were also doing terrible things to the planet, but they were also good people. 

Well one day, the UAW sat down with this evil corporation and said, "We don't really care about what you want to do, but we want to be sure that we get to continue to help you, and that you will continue to pay us a lot of money."  

Not terribly surprised at this statement, the corporation said in return, "What about your health plan and stuff like that?  The truth of the matter is that we're running out of money from giving so much to you, and the other evil corporations are slowly killing us. We don't know how long we will even be around, let alone whether you will get to keep helping us."  

The UAW had expected this, and replied, "Pay us some money and let us take care of the health care thing and all the rest of that stuff. We have some connections in government and we think that pretty soon they will take care of all of this for everybody anyway. Then neither of us will have to worry about it, and we will still be getting all that money. But in return, you have to make sure that we are still getting paid a lot of money to help you."  

And the evil corporation said, "Wait a minute! You've been getting a lot of money for a long time, and that's one of the big reasons that we are running out of it. We can't do what you ask."  

With that, the UAW got really mad, and said, "If you won't keep giving us the money, we won't help you anymore. That will mean that the other evil corporations will take over polluting the world, and by showing them that we mean business in dealing with you, they will do what we ask." And with that, they went on strike.  

The End  

Well of course that's not really the end of the story and every Fairy Tale needs a happy ending, so here it is: 

Eventually the two groups made up, GM caved in for the most part, and they went back to building the terrible machines that were destroying the world, but the damage to the evil corporation had been done. While it didn't happen right away, pretty soon the two were again fighting over money, and the evil corporation had even less than they had before; but they kept giving the UAW more and more, mostly because it had become a habit. Eventually the evil corporation died, because evil corporations can't survive when they can't make money doing bad things like polluting the earth. 

The funny thing though, is that the UAW died too. It seemed that the other evil corporations that gave in to the UAW died the same way that GM did, and the ones that didn't give in found out that they didn't need the UAW to continue to build machines to destroy the earth. They also found that they made more and better machines and made more money without them. But without the chance to help the evil corporations, the UAW couldn't survive. ... and the world lived happily ever after 

REALLY THE END!