Greedy Public Sector Unions in San Francisco demand Taxpayers pay them More

Posted by PITHOCRATES - July 7th, 2013

Week in Review

FDR was pro-union.  He was all for tearing businesses a new one when it came to collective bargaining.  For he didn’t like those royalists.  Greedy businessmen who put their profits ahead of their employees.  While making them work in horrible conditions.  For long hours.  For little pay.  The greedy little profit whores they were.  But FDR drew a line when it came to government workers.  Because taxpayers pay government workers.  And it just didn’t look right for government unions to call the taxpayers greedy little profit whores.  So FDR opposed unionizing government workers.  Because you just can’t have government workers tear the taxpayers a new one to enrich themselves at the taxpayers’ expense.  Something was just wrong with that.  But that was then.  This is now (see San Francisco Bart rail strike ends as contract extended posted 7/5/2013 on BBC News US and Canada).

San Francisco Bay’s transit rail service has resumed after two labour unions called off a strike.

The four-day walkout came to an end after both sides in the Bay Area Rapid Transit (Bart) dispute agreed to a one-month extension of the current contract while bargaining continues…

Talks between the two sides had resumed as early as Tuesday, but key sticking points include salaries, as well as employee costs for pensions and healthcare…

Bart has said workers from the two unions earn on average $71,000 (£47,500) in base salary and $11,000 in overtime annually…

The president of one of the striking unions, the Amalgamated Transit Union, struck a defiant tone.

“We’re not going to let them hijack us and the riding public,” Antonette Bryant said, as she apologised to commuters for the disruption.

So these union workers make $88,000 between base salary and overtime.  Being that train schedules are pretty fixed so must that overtime.  That’s well above the median household income of about $50,000.  Yet on top of that $88,000 they get pension and health care benefits.  And some pretty nice ones at that.  Which is why everyone wants to get into these unions.  While most Americans have to put something aside for their retirement from that median household income.  As well as pay a percentage of their health insurance premium.  Unlike public sector unions.  Who just have to go on strike to get the city to increase taxes on the taxpayers.  So the city can afford to pay those generous pay and benefit packages.

Hijack the riding public?  By opposing these union demands management is trying to prevent the unions from hijacking the riding public.  For when you add in the pension and health care benefits they’re already making about twice what the riding public is earning.  Making it difficult to call the taxpayers the greedy little profit whores here.  Yet they are because they won’t consent to pay more.  Which they can do by only having less in their personal lives.  Which certainly isn’t fair.  Especially considering that a lot of these people don’t even ride the damn trains.

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Japan’s Low Replacement Birthrate gives them an Aging Population and Soaring Debt

Posted by PITHOCRATES - July 7th, 2013

Week in Review

The United States debt as a percentage of GDP is approaching 100%.  Meaning that we owe as much as we produce in goods and services each year.  A frightening prospect.  For imagine if you earn $50,000 a year and were $50,000 in debt.  How easy do you think it would be to repay your debt?  Chances are that you will never be able to repay your debt.  But here we are.  Our government borrowing more than ever.  Without any concern of that rising debt.  They say it isn’t that bad.  Just look at Japan.  Their debt is about 200% of their GDP.  And they seem to be doing just fine (see Elderly shoplifters outstrip teenagers in Tokyo by AFP posted 7/8/2013 on France 24).

The number of elderly people caught shoplifting in Japan’s capital city has outstripped that of teenagers for the first time since records began, a report said.

A quarter of the people arrested on suspicion of the crime in Tokyo last year were at least 65 years old, figures showed, amid warnings of increasing isolation in the age group…

Around a quarter of Japan’s 128 million population is aged 65 or older, and the country has a far-below replacement birthrate of an average 1.39 children for every woman.

There are regular reports of bodies lying unfound for weeks or even months after a single, elderly person has died alone. Commentators say the phenomenon is a result of the fraying of familial ties as Japan has modernised.

When you have a replacement birth rate of 1.39 you have an aging population.  One that is growing so old that the rate of people leaving the workforce will soar while the rate of those entering the workforce will plummet.  So just as these elderly people start consuming their pensions and health care benefits the tax base that pays for them will be disappearing.  Perhaps explaining why these people are shoplifting.  As the burden to care for an aging population eventually becomes too great for a government to sustain.  So they cut back.  And leave the elderly to fend for themselves.

When people are having only 1.39 kids on average that means couples are not just having one child.  But a lot of them are having no children.  This is what birth control and abortion have given advanced nations.  The ability to wipe themselves off the map.  Either by a negative population growth rate.  Or by throwing open your borders to try and offset the population decline with new immigration.  Transforming the nation from the native population to the immigrant population.  Replacing the native culture and traditions with the immigrant culture and traditions.  Just like when the Americans moved west and replaced the culture and traditions of the Native Americans.

Two things that just don’t go together are an expanding welfare state and a declining replacement birthrate.  As you have a shrinking tax base paying for that expanding welfare state.  If you want an expansive welfare state you have to have more babies.  Plain and simple.  You have to stop using birth control.  And stop having abortions.  So you can grow the population.  To always have more people in the base of the pyramid than you do at the top.  Like any good Ponzi scheme should.  It’s either that or you have to reduce the size of the welfare state.  So you can live within your means.  That is, what your tax base can afford to pay.

Or you can keep borrowing and printing money like Japan.  And wonder when the deflation and recession of the Lost Decade of the Nineties will ever end.

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The Profit Incentive has made Air Travel Safe and Crashes Rare

Posted by PITHOCRATES - July 7th, 2013

Week in Review

During the height of the Cold War people feared the might of the Soviet Union.  And nuclear war.  As those were scary days.  For the Soviet Union had some awesome military power.  And was the only nation that could threaten the United States.  But you know what was even scarier?  Flying on a Soviet jetliner.

The Soviet Union lost the Cold War because communism is a terrible economic system.  The Soviets couldn’t feed their people.  Or keep enough toilet paper and soap on store shelves.  As their command economy did such a horrible job in allocating scarce resources that have alternative uses.  So you never had the best of anything in the Soviet Union.  Which is why people from the West dreaded flying into the Soviet Union on Soviet jetliners.  For they had a tendency to crash.  The Soviets stole as much technology from the West to improve their technology as they could.  And many of their aircraft designs looked similar to those in the West.  But they were Soviet made.  And Soviet maintained.  In the same economic system that couldn’t keep toilet paper or soap on store shelves.

The problem with the Soviet Union was that there was no profit incentive.  When money is at stake everything is better.  Like in the West.  But when you don’t have profits you don’t have to please customers.  And you don’t.  Everything is like standing in line waiting to renew your driver’s license.  And if a plane crashes it doesn’t change anything.  Planes will keep flying as they were before.  And everyone’s pay will be the same as before.  So everyone will do the minimum.  Just enough to avoid punishment.  This is why Soviet air travel was among the most dangerous air travel in the world.

This past Saturday there was an Asiana Air 777 that crashed while landing at San Francisco International Airport.  Of the approximate 300 on board 2 people died.  Some were injured.  While many were able to walk away from the crash.  Cable television has been covering this nearly 24/7 since the crash.  Even though only two people died (a terrible tragedy but a tragedy that could have been far worse).  And one of them may have been accidentally driven over by the first responders arriving on scene.  Why the intense media coverage?  Because accidents like this are so rare these days.  Especially when they involve big airplanes.  And the 777 is about as big as they come.

In the aftermath of this crash we can see why flying has become so safe under a profit incentive.  Unlike in the former Soviet Union (see Asiana Air Crash May Bring New Safety Regulations in Korea by Kyunghee Park posted 7/7/2013 on Bloomberg).

“Asiana’s accident is going to damage the image of not just Asiana, but all Korean airlines,” said Um Kyung A, an analyst at Shinyoung Securities Co. in Seoul. “It only takes one incident to undermine years of work Korean airlines have made to get a solid, accident-free record. This will prompt the government to call for stricter safety measures…”

Shares of Asiana, South Korea’s second-largest airline, slumped to the lowest level in more than three years in Seoul trading today. The stock plunged as much as 9.6 percent to 4,630 won, the lowest price since April 2010…

All South Korean airlines, including budget carriers, were ordered to ensure safety, the transport ministry said in an e-mailed statement yesterday. The country had no fatal air crashes between December 1999 and July 2011, when an Asiana freighter crashed, the ministry said…

A Korean Air 747-200 cargo plane crashed in December 1999 shortly after taking off from London’s Stansted Airport, killing three of its four crew members on board. That was eight months after the airline’s MD-11 freighter crashed in Shanghai in April and killed eight people, including those on the ground.

The accidents prompted the government to tighten safety standards at Korean airlines, as well as foreign ones flying into the country. It also strengthened regulations on pilot and maintenance licenses.

Pilots were required to be trained and evaluated at an international center, and airlines were required to fly more hours on domestic routes before obtaining a license to fly overseas. The government also strengthened safety regulations at domestic airports.

The U.S. Federal Aviation Administration downgraded South Korea to Category 2 safety rating in August 2001 following the accidents. The rating was restored to Category 1, which allowed Korean carriers to open new routes in the U.S. and resume marketing alliances with American carriers, in December that year.

In the Soviet Union there was no profit incentive as they put people before profits.  Which made Soviet air travel among the most dangerous in the world.  But look at what happens when there is a connection between safety and profits.  After a series of crashes and a downgrade by the U.S. to Category 2 South Korea tightened safety standards.  To improve their safety record.  For the fewer accidents you have the more profitable you will be.  A very strong incentive to be safe.  Which is why South Korea enjoys a better safety record than the Soviet Union ever had.

When people say that we need government to keep us safe from the greed of corporations all we need to do is look at the former Soviet Union.  And how their government failed to keep their flying public as safe as in countries that use a profit incentive.  For no corporation wants to see their stock price fall 9.6 percent.  Have a nation block them from opening new routes into their country.  Or have people perceive that their planes are not safe.  Things the former Soviet Union did not have to worry about.  As the Soviet people had no other alternative but to fly on those dangerous planes.  But there are many airlines flying between Asia and the United States.  And if one has a poor safety record people will book their flight with another airline.  This is what the profit system gives people.  Choice.  Where people can choose not to fly on an unsafe airline.  Something the Soviets couldn’t do.  Because there were no profits in the Soviet Union.

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The Unemployment Rate and the Labor Force Participation Rate tell Two Different Stories

Posted by PITHOCRATES - July 7th, 2013

Week in Review

The June jobs report is out.  And already they’re putting a positive spin on it.  Because of the new jobs reported in June.  But that’s about as far as anyone wants to dig into the report.  For the rest of it is rather dismal (see Employment Situation Summary posted 7/5/2013 on Bureau of Labor Statistics).

Total nonfarm payroll employment increased by 195,000 in June, and the unemployment rate was unchanged at 7.6 percent, the U.S. Bureau of Labor Statistics reported today. Employment rose in leisure and hospitality, professional and business services, retail trade, healthcare, and financial activities.

Yeah.  195,000 new jobs.  This was better than expected.  And the markets rallied.  While the Obama administration made the perfunctory statement that their economic policies are working.  Eternal optimists.  Never willing to admit that it is their economic policies that have given us the worst economic recovery since that following the Great Depression.  What with things like Obamacare causing a nationwide freeze on new hiring.  And their war on fossil fuels raising energy costs.  Further strangling business growth.  It’s all there in the Employment Situation Summary.  If you read further down the report.

Among the major worker groups, the unemployment rate for adult women (6.8 percent) edged up in June, while the rates for adult men (7.0 percent), teenagers (24.0 percent), whites (6.6 percent), blacks (13.7 percent), and Hispanics (9.1 percent) showed little or no change. The jobless rate for Asians was 5.0 percent (not seasonally adjusted), down  from 6.3 percent a year earlier. (See tables A-1, A-2, and A-3.)

Interestingly, strong supporters of President Obama in the last election (women, teenagers, blacks and Hispanics) either have rising unemployment rates (women) or unchanged unemployment rates that are well above the national average (teenagers, Hispanics and blacks).  The president may talk about being the guy for them.  But his actions sure would suggest otherwise

In June, the number of long-term unemployed (those jobless for 27 weeks  or more) was essentially unchanged at 4.3 million. These individuals  accounted for 36.7 percent of the unemployed. Over the past 12 months,  the number of long-term unemployed has declined by 1.0 million. (See table A-12.)

The civilian labor force participation rate, at 63.5 percent, and the employment-population ratio, at 58.7 percent, changed little in June. Over the year, the labor force participation rate is down by 0.3 percentage point. (See table A-1.)

The number of persons employed part time for economic reasons (sometimes referred to as involuntary part-time workers) increased by 322,000 to 8.2 million in June. These individuals were working part time because their  hours had been cut back or because they were unable to find a full-time job. (See table A-8.)

In June, 2.6 million persons were marginally attached to the labor force, essentially unchanged from a year earlier. (The data are not seasonally adjusted.) These individuals were not in the labor force, wanted and were available for work, and had looked for a job sometime in the prior 12 months. They were not counted as unemployed because they had not searched for work in the 4 weeks preceding the survey. (See table A-16.)

Among the marginally attached, there were 1.0 million discouraged workers in June, an increase of 206,000 from a year earlier. (The data are not seasonally adjusted.) Discouraged workers are persons not currently looking for work because they believe no jobs are available for them. The remaining 1.6 million persons marginally attached to the labor force in June had not searched for work for reasons such as school attendance or family responsibilities. (See table A-16.)

So there were 195,000 new jobs in June.  But there is still a net loss of jobs over the year as the labor force participation rate fell by 0.3 percentage points.  Meaning that there were fewer people in the labor force in June than there were in January.  Because the job market is so bad people are discouraged and give up trying to find a full-time job.  Work a couple of part-time jobs instead.  Live on their spouse’s income.  Or on their retirement nest egg.  The Obama administration and their economists and the mainstream media talk about positive signs with every jobs report.  That we’re turning the corner.  That the president’s economic policies are working.  But they’re not.  As you can see if you look at the official (U-3) unemployment rate and the labor force participation rate since he’s been president (the following numbers were pulled from the Bureau of Labor Statistics).

U-3 Unemployment Rate and Labor Force participation Rate 2009-2013 R1

The economic numbers show a decline in the official (U-3) unemployment rate starting sometime in 2010.  But it wasn’t because of an improving economy.  It was because people were just disappearing from the labor force.  For the fall in the labor force participation rate is GREATER than the fall in the unemployment rate.  That is, even though the official unemployment rate showed more people were entering the labor force (i.e., fewer people unemployed) the labor force participation rate showed an even greater number of people leaving the labor force.  (Note: If both graphs were plotted on the same vertical axis the graphs would have nearly the same slop.  Perhaps with the unemployment rate falling at a slightly greater rate.  However, because the actual number of people working far exceeds the number of people unemployed each percentage point move in the labor force participation rate represents a far greater number of people than each percentage point move in the unemployment rate.  So the above graph shows the trend in the number of people more accurately than it does in the percentage of the totals of each data set.  That is, there are more people who have lost a full-time job than have found a full-time job.)  Throughout the Obama presidency the economy has been getting worse.  Not better.  So there is nothing to cheer about in this jobs report.  Or in the many to come.

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Teenager High on the Legal Drug Salvia throws Baby to the Floor

Posted by PITHOCRATES - July 7th, 2013

Week in Review

A lot of people say marijuana is no different than enjoying a few beers.  At least, those who want to decriminalize it.  And, no, they say, decriminalizing marijuana will not encourage more adults to use it.  Or kids.  For kids are too busy doing their homework and doing chores around the house for Mom and Dad to be thinking about getting high.  Throwing up the ‘what about the children’ argument is just a red herring.  Only responsible adults are interested in getting high.

So you won’t see any difference in our children’s behavior when we go from marijuana being illegal to being legal.  And very accessible (see Legal high warning after baby is grabbed out of pram and thrown to floor ‘by teenager who’d smoked Salvia’ by Paul Cockerton posted 7/5/2013 on the Mirror).

A teenager who had taken a legal high grabbed a baby out of a buggy and threw it to the floor today.

Police said a woman in the street with her child saw a man apparently in some distress and went over to talk to him.

He then grabbed the baby, threw it on the floor then left the scene in Newbiggin, Northumberland at around 3.20pm…

Northumbria Police later said another teenager was in hospital having smoked a cigarette which contained a substance called Salvia.

That boy, a pupil at Ashington High School, was in a stable condition having collapsed.

The force said the 16-year-old who was arrested on suspicion of assaulting an infant in nearby Newbiggin had taken the same substance.

Hmmm.  Seems like some kids are getting high.  Marijuana is illegal so they get high with something that is legal.  Salvia.  Which made one kid physically assault a baby.  And put another kid in hospital.  Something few people do after a couple of beers.  Of course, some will blame the Salvia.  And say had these kids smoked marijuana they would have just gotten silly like that Spicoli kid in Fast Times at Ridgemont High.  (Warning: The following movie clip shows naked women in Playboy centerfolds in the background).

But the point is this.  Kids want to get high.  They use Salvia because it’s legal and easy to buy.  But they’d rather have marijuana.  Like Spicoli.  And once it’s no longer illegal they’ll find a way to get their hands on it.  Because these kids want to get high.  As proven by their use of Salvia.  Ignoring this fact will put a lot of our kids onto the path of further drug use.  Abuse.  And addiction.  As they start chasing the dragon.  Trying to find a better high.  And the easier it is to start their drug addiction the worse their drug addiction will be.

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