This Time,It’s Different

It’s true. President Obama is roaming the country singing the same song, but he’s hoping that a few Republicans will hear a verse they like, such as corporate tax cuts. The title of the song might as well be “This time ,it’s different” because the obstructionist party is not listening.

I think Chris Haynes is right, progressives are glad that the GOP is not taking the president’s deal. The last time we passed legislation to give corporations a tax break on their foreign profits,they used the money to buy back their stock and cut 20,000 jobs to boot. A prominent tax attorney, Clay Johnson, said that the new low tax rate would be the new highest tax rate the corporations will ever pay. The corporate tax rate is 35% but the average effective rate they pay, comes out to 12.5%. A car dealer is not going to hire a new salesperson because they got a tax cut. I’m not against a corporate tax rate cut but I would put it under recapture rules to ensure that corporations hired a certain amount of employees at a livable wage with benefits.

I’m sure there’s a word or term for educated people who make ignorant statements but I can’t think of one right now. Senator Mike Lee echoed the Obamacare sentiments of his colleagues ,Ted Cruz,Rand Paul and Marco Rubio when he said “Defund it, or own it. If you fund it, you're for it."  He might as well have said that for Social Security or Medicare because the Affordable Care Act is the law and is now considered an entitlement. Congress cannot defund major portions of the law without a 2/3 majority and a president’s signature. Those individuals can shut down the government but it won’t make them anymore principled;it just makes them stupid and badly uninformed. It’s not even a good bluff.

It turned my stomach to hear that Halliburton got away with a $200,00 fine for admitting to destroying evidence in the BP spill fiasco, but  the culprit didn’t go to jail. I’m not surprised because the Dallas fed is now reporting that 2008 financial crisis cost was $14 trillion, and not one CEO has been perp walked.

I just can’t seem to get away from the injustice that’s being displayed every day. Have you tried to watch a major-league  baseball game lately? ESPN devoted several innings on three separate games talking about Alex Rodriquez and his possible lifetime ban for using performance-enhancement  drugs. Major League baseball knows of at least 100 ball players who they suspect, but they will only ban eight players or so, within the next two weeks. Want to clean up baseball? Ban all 100 for 50 games or more and start off fresh.

It’s Time For A New Business Model

Thousands of minimum-wage workers are taking to the streets in protest against low wages that they are receiving from McDonald’s, Wendy’s, Burger King and other fast food establishments. Representatives of those establishments ran a full-page ad in the USATODAY saying that raising the minimum wage would cost jobs. The workers responded by saying that they were crappy jobs anyway.

A new study by the University of Kansas stated that doubling McDonald’s salaries and benefits would cause your Big Mac to cost just 68¢ more. There you have it; McDonald’s can raise the burger by 68¢, and still keep their profits and expenses at the level they are now. Yes, McDonald’s CEO, Donald Thompson could keep his 8.75 million yearly compensation package.

McDonald’s 2012 annual report showed that the fast-food giant only spent 17.1 percent of their revenue on income and benefits for more than their 500,000 U.S. employees.

I think the workers would see a pay raise before the fast-food chains allow them to unionize without fear of retaliation.

In the 1970s, the fast food jobs were mainly for high school and college kids who used them as entry-level jobs. With unemployment at 7.6% many of these jobs are now held by older workers who need their job to support their families.

The Walmart business model of low-cost goods and low wages and benefits for their employees has made them the world’s largest retail giant in the world. The retail giant’s lobbyists have spent a lot of money trying to convince us that increases in employee wages and benefits would mean that they would have to cut back their workforce. That’s ludicrous; they pay so little now, that a price increase on their merchandise wouldn’t be that much and they still could maintain their current profit margin. It’s the same way for the fast food industry.

The low paying corporations are being called out but they’re not going to be embarrassed into doing the right thing, so it’s time for a Federal minimum wage increase.

My wife cracked up when I told her that a man offered me a job to bale some hay. I went to get my annual truck inspection at Larry’s Texaco this morning. I was sitting in the crowded office, surfing the web on my iPhone when a man who was also waiting for his truck to be inspected, told me that he was on his way to bale some hay and asked me if I was interested in making some extra money by helping him. I assume by the look on his face that he was surprised that I turned him down. He said it was impossible getting help these days, and then he went on to say that as a kid, he used to bale hay for 3¢ a bale. I don’t know how much he was paying, but I bet it’s nowhere near minimum-wage.

Last month the Washington D.C. city council stood up to Walmart and this is being followed by low wage workers protesting for decent pay. Perhaps the worm is beginning to turn.

We Need to Change the Narrative

Saturday, I went to the new Costco store in Sugarland where I was surprised to see so many people lining up to get their new membership cards. I thought everyone in the Houston area had one but as we were leaving an hour later; long lines of brand new applicants were in line. It’s true, if you’ve seen one Costco, you have seen them all and that’s because they can build a new one every 100 days.

The Costco Sugarland location is ideal for Victorians; it's only about a 90- minute ride; close to all the big stores without entering the Houston city limits, and the exit takes you straight to 59 South.

I’m glad America is finally standing up to the largest retain corporation in the world, Walmart, by not cowering to their enormous pressure. The stories of Wal-Mart intimidations are legendary. It didn’t work in Washington D.C. where the city council stuck to their guns and did not give in to them on their new $12.50 minimum wage on companies with more than $1 billion in annual revenues and indoor retail premises of 75,000 square feet. Walmart said it would look for another city to build their six brand new stores.

I saw an interesting debate about the Wal-Mart/D.C. situation when Michael Smerconish, hosted the Chris Matthews show. He had libertarian economist, Stephen Moore, and another chap whose name is escaping me at the moment as his guests. Mr. Moore made the predicable “hey Wal-Mart offered jobs D. C. needed, and now they don’t have that.” The other guy made the status quo argument of income inequality. Mr. Smearconish made his “let the free market decide” argument.

Costco was used as an example of a company with an average payroll of $20 an hour  that could compete nicely with Wal-Mart whose typical payroll is a little over $8 an hour. Costco employees were not on the public dole while a lot of their competitor’s employees were. Even when Walmart pays for a portion of their employee's benefits, Costco workers’ pay a 12 percent out- of- pocket premium for benefits, while Walmart workers’ pay 40 percent. How does Costco do it? They don’t have the selection Walmart does but Costco averages $814 in sales per square foot, while Sam's Club makes just $586 per square foot. And don’t even try to compare customer service.

Companies have been allowed to set the narrative that they are the job creators, and they need the room to prosper, so it can have a trickle-down effect. That meant that they are not to be burdened with unions, minimum wage or equal pay legislation, regulations or environmental standards. They have gotten their way for over thirty years and are now benefiting while a great portion of the country continues to struggle. Even if Walmart raised their employee's to the required $12.50 an hour in D.C.,the customer would only see an increase of 46¢ at the cash register that day and about $12.40 annually. People are finally calling them out on  their talking points but it took them 30 years to catch on to what they were doing.

Walmart needs to continue to build in urban areas in order to survive; Washington D.C. knows that, so they feel that they don’t have to succumb to the standard Walmart threats.

The problem with Michael Smearconish “let the markets decide” theory is that it’s great in concept, but large corporations use it to their advantage by persuading politicians to skew the laws in their favor. Consumers are not political advocates; they will shop at a store for its convenience and prices and not pay attention to what they hear about the company’s payroll practices. It sounds good but before you know it, another Walmart has set up shop and the cycle continues. Victoria Caterpillar is another example of Fortune 500 Company getting away without having to pay top wages.Mr. Smearcomish did not like government interfering in the free market, but I’ve lived long enough to know that, we are the government and companies no longer do the right thing without a nudge from us as consumers or as part of the government.

I’m not a Walmart hater. I shop in their stores. I know that they add to our tax base, provide a lot of jobs and keep prices low. I just believe they should share more of their wealth with their associates who work hard so that the company can remain the global retail giant that they are.

It’s all about the numbers

Where are those 11 poor states?

I thought I would paste in the chart to show those who are interested just where the country has been for a long while. You can choose to believe or disbelieve the poll numbers, but the Wall Street Journal/NBC News poll was a lot more accurate than Gallup or Rasmussen in the last election. The map clearly shows that the GOP has land mass and the Dems have the most populated areas.

Did you hear about the Republicans latest plan? The Senate Republicans want to give the president the authority to make the cuts where he wishes. That’s ludicrous, and the White House knows what they’re up to. The GOP reads the polls, and they see that they will once again take the fall for the sequester failure, so they are trying to dupe the president. I’m sure the White House had a good laugh, but the president will invite congressional leaders over Friday afternoon for little chat. Senate minority leader, Mitch McConnell already said that revenues would not be part of the deal. Fed Chairman Ben Bernanke told the Senate that they are engaging in backward thinking. He said they should be working on long-term solutions and not be obsessed over short term deficits.

The congressional Republicans remind me of local poster Jack Evony, who despite the poll numbers and election results, he still thinks that his philosophy still reins superior. He said Obama supporters are from poor states (he said there were 11 states but didn’t name them), and those states had 166 electoral votes. In fact, he said that those Obama voters made more money off welfare than a man could off a regular 40-hour week. If Jack kept up with politics, he would know that no Republican candidate has not won a state above the Mason-Dixon line since 1988. Perhaps George W. Bush won New Hampshire don’t know but the northeast, west, and Midwest states like Colorado and Nevada then and there are solid blue states like Illinois, Michigan Ohio, Wisconsin, Iowa and Pennsylvania. Being in denial is not a good political strategy. As the panel on “Morning Joe “were once again talking about the demise of the GOP, Tom Brokow spoke of the ebb and flow of politics but then advertising elite Donny Deutsch, said" it is not about their policies or the big tent, its that people see the GOP as an old white man's party that refuses to change.”

I love math because it’s a science that can’t be disputed although some try to manipulate it. For example, neither party tried to keep the payroll tax cut (2% FICA) it was allow to expire, so it was no surprise when the retail giants came under their sales projections. It’s the good-paying middle class jobs that will keep those retail sales up. That doesn’t keep Walter Williams from recycling his minimum wage propaganda because the only part he’s right about is the entry-level position. The minimum wage increase (long overdue) would be phased in, and companies would adjust. I wish our local paper would splurge a little and feature a real economist because we sure could use it.
 

It would be interesting to get a local perspective from a prominent local republican such Dale.I would be interested to know if they think that the national GOP has the problem and if it does can it be fixed at the grassroots level?  Sort of like a rising tide lifts all boats.I know the GOP still growing strong in Texas but can it hold off a mass registration by the DNC and their cronies?

If the GOP had the numbers they wouldn’t be trying all their gimmicks to keep people from voting.

We need fresh ideas

Congratulations baby boomers, we're the first generation who can say that we will put more into Social Security than we received. Spare me; don’t tell me how much you could have earned if you would have had a chance to invest it. Number one, you don’t know and the other is, it’s a” you pay for others as others paid for you” retirement supplement Yep, if you're a baby boomer, we can say that we weren't as much of a socialist as our parents and grandparents were. However, that's only a comfort for those people who use that line of reasoning.

Every since I heard the word " misinformation" sometime last week , I just can't get that word out of my head. I agree that the media, in one form or another is the probable cause, but I think of it as replacing the roof shingles. It's best if you replace the old shingles and felt paper and start anew. We still have people trying to convince us what the founders meant, or they want to use philosophy from the 1900s. America was once an isolationist country and afraid of the military; we're now at a leader in the global economy and have the largest military known to man. The fundamentals are the same, such as spending less than what we bring in but today; we have to deal with huge budget and trade deficits and preventing our financial sectors from bringing down our country, with their predatory schemes.

I flipped on Fox News Sunday to hear what potential Texas senator to be, Ted Cruz, had to say, but I can't say I was surprised when I heard the boilerplate rhetoric. I was disappointed because, if elected, he'll be another obstructionist. When asked if he would compromise with the Democrats he said, "I am perfectly happy to compromise and work with anybody,” Cruz said. “Republicans, Democrats, Libertarians. I’ll work with Martians. If — and the if is critical — they’re willing to cut spending and reduce the debt."... That would sound reasonable except, he won't consider raising taxes. We're back to that," won't take $10.00 in spending cuts for $1.00 in revenues" deal. For the record, I am very anti- Ted Cruz and his ilk. I understand his line of thinking; he thinks that the government does not need any more money to spend, but he doesn't understand that we cannot cut our way to prosperity. Ted Cruz is bought and paid for by the Club for Growth and FreedomWorks.,so he 'll never understand that it's going to take a balanced approach.

Try going back to my " replacing the roof'" analogy'" where I said that we were going to have to start fresh. I think the partisan propaganda we've been fed throughout the years won't allow new ideas to penetrate. Chicago's Mayor Rahm Emanuel, realizes that our Federal government is tapped out but the infrastructure in Chicago is in a state of the decay. The mayor knows that the city of Chicago won't be able to grow unless they fix the infrastructure. What company would want to move to a city full of potholes, busted water mains, and inferior public transportation?

 The mayor will use conventional methods like raising utility bills and issuing bonds, but the city will negotiate a private-public trust fund with three banks to fund their needed repairs. For the record, the city of Chicago sold their parking meter rights to a private company, that is making 10 times more than what the city ever did, and they have also issued long-term leases on their parking garages, which amounts to the private sector owing that source of revenue for a long time. Chicago is not letting those two mistakes stand in the way of yet another risk taking proposition. On paper, it looks like a win- win proposition; the banks have been waiting for a safe investment to spend some of their low-interest money on. The city will use private contractors and make them pay for any cost overruns because, as we know; cost overruns and can run into millions. The city will install cost saving devices such as smart meters and use that savings to pay off their debt. If everything works well, the city will get their needed repairs without extra cost to taxpayers. Cities and states are copycats, so if this project works in Chicago other cities and states will adopt it. This is just a temporary measure until our country's economy recovers, and then we can go back to federal government grants and loans when it's more feasible.

I know that occasionally we will take an exit road to discuss some social issues and that's OK, as long as you understand that some will evolve and others won't. The economy doesn't work that way. The economy is like a baseball pitcher who has to make adjustments on every hitter, umpire, and his capability. I heard a great discussion about the Keystone XL project this morning. On one hand, the proponents of fossil fuels say the tar sands from Canada will provide $45 billion a year in revenue and 500,000 jobs by 2035. I think it's a bit exaggerated but on the other hand, what will it do to the natural gas and alternative fuels industry? We shouldn't let the lure of cheap fossil fuels make us forget the environmental impact that this project will have on greenhouse emissions. That's why I say we need to keep an open mind and not be persuaded by those who stand to benefit by our lack of interest.
 


Yet, another senseless shooting but again this is not the time to talk of measures to try and prevent those “impossible to stop” tragedies. If only one of those Sikhs were armed! I can hear the same old talking points.

Our Catchphrase Society

We all like to use catch phrases in our day-to-day conversations to emphasize a point or to make it more understandable. Unfortunately like everything else, catch phrases can be a tool for deception  and it's often used to simplify matters that usually require more detail.

I'm starting to simplify political situations for my wife, who’s becoming interested in politics,so can get up to speed. Yesterday, she asked me why President Obama said, "You didn't build that" in reference to small-business owners thinking that their success was due only to their initiative and hard work. Of course, that catch phrase was taken out of context because, before that sentence , he had emphasized what most of us already know. We know that we have a collective society, that's taken for granted. We know that a business success is also what doesn't show up in their balance sheets. Government with taxpayer dollars, built the roads, provided the schools, teachers, library, firemen and police officers as support systems for the consumer and the business owners.Conservatives seem to ignore the DEMAND side of the supply and demand economic equation;most seem to think it's all about the job creators. It is but I like to think the REAL job creators are the consumers.

Recently, the free market ideologues changed what they used to call the free- market because it  can’t possibly be called that if we have a central government. I think the consensus now is to call it a" free enterprise" because that enables them to operate competitively for profit with minimal government regulation. I think free enterprise or the free market is just the exchange of a business transaction between human beings. We know from experience, that when dealings are made between a large number of human beings, generally accepted rules, regulations, and principals must be enforced by a third party. The days of the handshake agreement are gone and show me one country that lets the free market go unfettered, and I will show you a country that's doomed. So when you hear the catch phrases like “job killing bills, job creators, fewer taxes, smaller government and crony capitalism," it's safe to assume that those words were conspired to favor businesses over the rest of us. The catch phrases have to be repeated until most of the people think that government is too incompetent to handle anything except defense. They will call those who oppose their philosophy a socialist or a statist. This is an open door to plutocracy.

The catch phrase" 40 to 50% of the people don't pay income tax" is used as an excuse not to raise taxes on the top 2%. It's used to make those who don't have enough money to pay income tax, look like free loaders instead of people, sometimes ,through no fault of their own,who are down in their luck. It's a diversionary tactic. It goes in line with the catch phrases " everyone has access to health care" and " we have the best health care system in the world, as another trick used to make people think that we don't have to do anything about the rising cost of health care because the insurance companies will figure it all out and do the right thing.”Let's pass the pass the plate, the lobbyists are anxious to go home."

The Republicans are successfully dealing deaf blows to unions using the catch phrase “job killing agreements" and enacting” right to work laws" but like everything else it helps businesses not workers. I've never been in the union; in fact, I was against unions for a selfish reason. You see. I was getting union benefits by using the threat of the union. Collective bargaining is just an agreement between employees and companies, but it's been demonized so much that the only viable unions remaining are in the public sector. We all saw what the Republicans governors are trying to do to them. I do agree that the lucrative union pension contracts that were made several years ago need to be renegotiated to reflect today's economy.

That catchphrase “cliffhanger" is being used to describe today's economic condition... I didn’t get to the word “liberty” but stay tuned and I guarantee you, it will come up.

A $10 an Hour Minimum Wage?

Representative Jesse Jackson Jr. (D-IL) is busy trying to gather sponsors to send a "$10 an hour Minimum Wage" bill. It's practically dead in the water, but  it's a first step in asking for another minimum wage hike increase. The last minimum wage legislation was in 2006 taking three years to bring the increase to the current $7.25 minimum. Some state's minimum wage is higher than that. I remember in 2007, Chicago barred Wal- Mart from inside the city because they do not want to pay the $10.00 an hour minimum wage. Representative Jackson said that the last time we set the correct amount on a minimum wage was in 1968, so in order to meet the 1968 minimum wage increase after indexing for inflation, that amount would be $10.00 an hour. It's not that out of the ordinary because candidate Obama said he wanted to see the minimum wage at $9.50 by 2011. The president never got around to talking about it.

Come on Democrats,you have to get on base,steal second,get bunted over to third and then come home anyway you can;can't just go for the home run ball.

I can see a $10.00 an hour minimum wage phased in over a 5-year period (depending on what party is in power), especially during these hard economic periods. Economists have always been against a minimum wage because of their free-market principles, but they are normally supply- siders. The $2.25 increase will help the demand side of the “supply and demand equation." Henry Ford was not a liberal by any standard, but he recognized that he would prosper with a strong middle class. In 1914. Mr. Ford, established an unheard of $5.00 a day minimum wage in his factories. That $5 a day made the Ford Company much more attractive and made Henry Ford a billionaire. Morale shot up, employee turnover sharply dropped, and, most important, productivity surged. The argument is that Mr. Ford made a free market decision and not one mandated by the government. My answer to that is, competition did not follow suit allowing Henry Ford to become a billionaire and his decision brought up the upper- class to boot. We need to start doing something about the income inequality, but I don't think the answer will be come from the supply side because they will continue out sourcing, employing fewer workers and using more technology to make profits for their shareholders. That's good for my portfolio but it doesn't do a thing for my middle-class working friends,relatives and neighbors.

It's not a one- sided issue because the small-business owner is already burdened with a lot of overhead and with 15 million people unemployed, his goods aren't exactly flying off the shelves. I saw a roundtable discussion where a small-business person said that an increase in the minimum wage would make him shutdown one of his three stores because the little own aspect of raising the minimum wage would mean that he would have to raise the wages of those making $10.00 an hour in order to keep the peace. Congressman Jesse Jackson Jr. then said that small businesses had received 18 tax cuts, so it only seems fair that workers get an increase. Remember that story in our paper a few days ago about the employee who worked  all those years at Chesnik's  furniture? I would be willing to bet that his salary is not among the highest; mid-level at best. We know that you can't really make it with $8.75 an hour and considerably less so at $7.25, so even if you account for the fact that those are supposed to be entry level wages, workers have not gone greatly above that for years. It would be wonderful if market competition controlled the wages, and I've seen a good example of that because I remember our company regularly increasing our benefit package, wages, and bonuses and but then that stopped as insurance costs started skyrocketing and they changed their focus to downsizing and increasing the bottom line.

 The $10.00 minimum wage will also get many workers off the government dole and make them taxpayers, they might finish that degree program  that they couldn't afford or start paying their student loans.  It's not all bad but like the one of my favorite political saying goes " Don't let the perfect be the enemy of the good."

I don't expect this to be an issue in this year's presidential campaign even thou increasing the minimum wage is a well-liked issue. It's as popular as tax cuts but wait, isn't that one of the reasons we're in this mess in the first place! We always want the goodies, but we don't want to pay them.