The Many Kinds of Lies

July 18th, 2009


Here’s a quotable quote popularized by Mark Twain. In fact, Benjamin Disraeli was the original author.


     ”There are three kinds of lies: lies, damned lies, and statistics.”

In addition, we are easily confused when we can’t bring different statistics together in one place or find that their darned footnotes still don’t explain what’s included. And, data is filtered through talking heads and reporters who often don’t know what any of it really means. In other words, the true picture is lost. Statistics are never turned into information. We’re simply misinformed.

Take the job situation. What follows is a suggestion of why it is worse than reported.


College Grads


First, what’s the impact of all those new college grads? There are millions who are thrown into the labor market each year. According to the Digest of Education Statistics, the following were degrees conferred within the United States for the 2008-2009 academic year. This is the breakdown by degree type.

       
  • Associate degree  -     714,000
       
  • Bachelor degree   -  1,585,000
       
  • Master’s degree    -    647,000
       
  • First Professional  -     91,000
       
  • Doctorate             -      55,800

That’s a total of over 3 Million college graduates. Of course, that does not tell us how many were attending night school and already working or not. The National Association of Colleges and Employers said job offers for 2009 college graduates ran 22 percent behind 2008’s. So, right out of the box, it seems that their unemployment level is over 20%.


High School Grads


Then, there are approximately 3 Million new graduates from high school. Some percentage are headed to academic and vocational colleges and not seeking long-term employment. However, most high school grads are trying to join the workforce right away. That’s a grim prospect. From April, 2009 to June, 2009, the unemployment rate for that age range (16-19) rose from 23.6% to 27.8%.


Independent Contractors


The National Employment Law Project says, “Today, only 37 percent of unemployed workers collect unemployment benefits, which is especially low compared to prior recessions.” We NEVER hear this reported. So many people work as ‘Independent Contractors’ and are not even considered employees. All too often, it’s a phony arrangement demanded by unethical employers. Also, part-time employees are not covered, and so forth. Unemployment insurance is a moth-eaten system.


Working People


Economist Nouriel Roubini said, “. . . consider that the total value of labor income is the product of jobs, hours and average hourly wages–and that all three elements are falling right now.” The trend is down. Even working people are going through reductions in weekly hours worked and hourly wages. The forecast for the next year and a half is that more working people will be joining the ranks of the unemployed.


New Unemployed People


Here’s one of the ways in which statistics are turned into ‘damned lies.’ Here’s the number of NEW claims for unemployment after the ‘adjustment’ by the Bureau of Labor Statistics: “In the week ending July 11, the advance figure for seasonally adjusted initial claims was 522,000, a decrease of 47,000 from the previous week’s revised figure of 569,000.” The ‘real, unadjusted’ number is in the OPPOSITE direction. BLS also said, “. . . actual initial claims under state programs, unadjusted, totaled 667,534 in the week ending July 11, an increase of 86,389 from the previous week.” So 133,000 unemployed people got adjusted under the rug and out of existence. The trend is exactly the opposite of what was reported by our dear American media.


Conclusion


The Bureau of Labor Statistics could do a far better job of research. And, the media reporting is mostly shallow, if not mindless. Again, Mark Twain says it so well:

    ”If you do not read the paper, you are uninformed.
      If you do read the paper, you are misinformed.”

Your comment below is welcome.

Click here to contact your representatives in Washington, D.C.:
Our Elected Officials.Ask them what their labor policy is and why.

– Byron

What Would Thomas Jefferson Say Today?

July 4th, 2009


Happy Independence Day! Remember the American Revolution! While skirmishes and battles were taking place in 1775 and 1776, the pressure built for a stated public policy of complete separation from the rule of Britain, its King and Parliament. The Declaration of Independence served that purpose by having a spectacular effect on the colonists And, of course, the genius Thomas Jefferson, at age 33, was its principal author.

Before, and for decades after, Jefferson did and said a lot. It is unmistakable that we can see how so many of his values are lessons for us today. Here are a few quotable quotes from Thomas Jefferson.

In the Declaration itself, Jefferson had many complaints about the King. Here are just two.

He has refused his Assent to Laws, the most wholesome and necessary for the public good.

He has forbidden his Governors to pass Laws of immediate and pressing importance, unless suspended in their operation till his Assent should be obtained, and when so suspended, he has utterly neglected to attend to them.

A link to the entire Declaration is included in ‘References’ at the bottom of this page. Jefferson lived another 50 years and died on July 4, a few hours before John Adams died. These next Jefferson quotes were taken from other sources.


“The issue today is the same as it has been throughout all history, whether man shall be allowed to govern himself or be ruled by a small elite.”

“There is a natural aristocracy among men. The grounds of this are virtue and talents… There is also an artificial aristocracy founded on wealth and birth, without either virtue or talents; for with these it would belong to the first class… The artificial aristocracy is a mischievous ingredient in government, and provision should be made to prevent its ascendency.”

“The country is headed toward a single and splendid government of an aristocracy founded on banking institutions and monied incorporations and if this tendency continues it will be the end of freedom and democracy, the few will be ruling and riding over the plundered plowman and the beggar.”

“I hope we shall crush in its infancy the aristocracy of our monied corporations which dare already to challenge our government to a trial by strength, and bid defiance to the laws of our country.”

In conclusion, it does appear that Thomas Jefferson’s sentiments could equally apply to the way business is being done in Washington, D.C. Do you think Mr. Jefferson would approve? Or, have some of Jefferson’s worst fears come true?

Click here to contact your representatives in Washington, D.C.:
Our Elected Officials. Tell them you want
to be represented by the values of Thomas Jefferson.

– Byron


References:


“The Declaration of Independence,” Thomas Jefferson, July 4, 1776.

The Declaration of Independence
.

Who’s Calling the Tunes?

May 31st, 2009


The source of this is apparently an e-mail that’s circulating widely:

Members of Congress should be required to wear uniforms like NASCAR drivers so we could identify their CORPORATE SPONSORS.

If you also get a chuckle out of this, that’s a good indication of the truth that lies behind it. ‘Nuf said.

Click here for 4 searches of campaign contributions in the Federal Election Commission’s Disclosure Data Search. You might give it a try for your elected official. However, it looks like they’ve got the sponsors’ true identities pretty well buried behind committee names.

Click here to contact your representatives in Washington, D.C.:
Our Elected Officials. Tell them you would be opposed to continued corporate sponsorship of political candidates.

– Byron

Congress Legalized Loan-Sharking

May 25th, 2009


That’s what the Congress did this past week. And, Senator Bernie Sanders used those exact words to describe the credit card bill. The bill does almost nothing except require that a credit card company give you a little advance notice before they pick your bank account. The card issuer still gets to decide when it wants to jerk you around by raising the interest rate on your existing balance. Where’s the remotely fair deal for the customer?

Noting that one-third of credit card holder’s pay interest rates higher than 20% and up to 41%, Sanders said, “They are engaged in loan-sharking.” This next one-line quote has become part of American folklore. It is apparently incorrectly attributed to Albert Einstein. It is nevertheless something to remember at all times:


    The most powerful force in the universe is compound interest.

Also, don’t forget the handy rule of 72. If you pay an interest rate of 36%, divide 72 by 36. The answer is 2 years. That’s how long it takes for your debt to double. Imagine a typical household owing and simply continuing an average balance of $10,000. After 2 years, they owe $20,000. Now that’s the power of compound interest. That doesn’t even count late fees and penalties. Anything close to a 36% interest used to be called usury, and it was absolutely illegal in most states.

So, credit card companies want the laws to enable them to do darned well what they please. Now let’s turn the tables upside down so that you the borrower can be protected from the corporate gouging. Oh, by the way, this solution is very fair and even-handed to the credit card companies. To simply cut to the chase, here’s a simple set of rules.

  • Cap the interest rate.
  • Require one interest rate.
  • Require a fixed term.
  • Ban retroactive rate changes.
  • Eliminate all late fees.

Let’s explain by example under such a new, fair law for fair dealing. First, let’s set a maximum rate. Sanders said credit unions may not charge more than 15% under current law. But, let’s be overly-generous and say 18% at the most. So the credit card company can offer any lower rate for the life of the card, i.e. the term. Requiring a term would be like setting the length of a mortgage. That would be all we need to know about this
credit card. The credit card company might choose to offer you, and a whole lot of of other propects, a new card with a $2,500 limit for 2 years at a rate of 14%. That would mean that you could utilize that card as you see fit. If you’re late on a monthly payment, or miss the payment entirely, there would be no late fee and no penalty. You’d just have to pay the stated interest on a higher balance. At the worst, if permitted under this new set of laws and rules, the unused credit might be reduced without notice, at the option of the issuer.

The example is an attempt to describe an even-handed approach to these unsecured
loans. Right now under the corporate regime in the Congress, you and I are still at the mercy of the whims and greed of the credit companies. Is this ‘new’ proposal fair to all? What do you think? Please post your opinion using the “Comment” option below.

Click here to contact your representatives in Washington, D.C.:
Our Elected Officials. Tell them you want
common-sense consumer protection.

– Byron


References:


Donna Rosato, Money.CNN.com, May 18, 2009.

Credit Card Reform: What Might Have Been
.

Enough of the Happy Talk

May 17th, 2009


Do you hear this from time to time? ‘The economy is stronger than expected,’ or ‘the economic indicators are better than expected.’ You can ask, “Whose economy are we talking about?” “Whose expectations are those?” Here are a few facts that would seem to anchor us in reality.

Bankruptcy Filings: 5,300 per day from JAN-MARCH, 2009. For the entire year of 2009, that would add up to over 1,300,000 bankruptcies. In 2006, the rate was about 2,000 per day. The rate had been rising steadily since then.

Official Unemployment Rate: 8.9%. It’s rising steadily. The Dept. of Labor says, “The number of unemployed persons increased by 563,000 to 13.7 million in April.” Economist Mark Zandi suggests it will level off at 10% a year from now. Obama advisers are forecasting the unemployment level will not decline until the end of 2010, i.e. NEXT year. That’s a year and a half from now.

Official Underemployment Rate: 15.8%. This is called U-6, the estimate of the Bureau of Labor
Statistics. It’s more realistic than the official rate reported.

Home Prices: “Four years of gains in home prices wiped out.” That’s the national estimate using the S&P Case-Shiller Index for the top 20 cities.

Home Foreclosures: 342,000 households received at least one foreclosure-related notice in April. That’s a 32-percent increase compared with April of last year.

Stock Market Crash: Last November, Market Watch said the S&P 500 Index was at its lowest level in more than a decade and had lost almost half of its value in a year. Today, the index is 883, down further from last November when it was 929. The market watch reporter said, “Call it the Great Give-Back.”

NEW Unemployed People: 637,000 workers lost their jobs and filed a first-time claim for unemployment money in the week ending May 9. This is what’s going on every week. Never mind the academic talk. It has the feel of a humanitarian disaster . . . each and every week.

President Herbert Hoover, a great believer in statistics, said that the 1930 census would “show the first real determination of unemployment” and would prove his contention that “the worst effects of the crash . . . have passed.”

Click here to contact your representatives in Washington, D.C.:
Our Elected Officials. Tell them you’re looking for their replacement.

– Byron


References:


New York Times, May 10, 2009.
The Jobless Rate, Slow to Improve, Tests Obama.


Market Watch, May 16, 2009.
Four years of gains in home prices wiped out.


ABC News, May 13, 2009.
RealtyTrac: April Foreclosures Rise 32 Percent.


Market Watch, Nov 21, 2008.
Are stocks cheap? It depends on earnings..

Who Owns Our Congress?

May 9th, 2009


If you’ve never before heard the truth about the corruption of our decision-making in Washington, D.C., then you now have a very clear statement. As widely reported this week, Senator Dick Durbin, disappointed at the defeat of his bill,
said:

“And the banks – hard to believe in a time when we’re facing a banking crisis that many of the banks created – are still the most powerful lobby on Capitol Hill. And they frankly own the place.”

What more do we need to understand about corporate America calling the shots in our government? The adage is that money is the root of all evil. Well, corporate campaign contributions are the source of the money that buys the election process.There’s really nothing more to explain.

Generations ago, Mark Twain observed:

“It could probably be shown by facts and figures that there is no distinctly native American criminal class except Congress.”

Today, there is only one party called the Corporatist Party. It has two wings, the Republican Wing and the Democratic Wing. The solution is to ban all contributions to parties and candidates. Until that happens, the corporations will, as Durbin said, “own the place.”

Click here to contact your representatives in Washington, D.C.:
Our Elected Officials. Tell them you demand the ban on corporate campaign money before you’ll even consider voting for them again.

– Byron

Let’s Take the Money and Run!

May 2nd, 2009


Jonathan Swift (1667-1745), the famed and multi-talented English writer, had a strong opinion about the way the world works, to wit:

“Promises and Pye-Crusts, are made to be broken.”

And, so it is today with contracts in the world of modern enterprise. Contracts are promises. The longer the time horizon, the greater the likelihood that its promise will be broken, in part if not in whole. For some time, America has been watching the unraveling of its formerly largest and strongest companies. In the news this week, it’s the auto companies which are breaking their promises to their workers. Imagine devoting your entire working life to a job based on a promise. Imagine then, when your working life has ended and cannot be repeated, you would be told that the promises couldn’t be kept.

In this context, broken promise is more than broken pie crust. It results in broken lives. Remember, it’s not just Chrysler and GM, the auto companies. It’s not just about organized labor. It has occurred time and time and time again throughout history. All too often the worker winds up with nothing at all; the auto workers are in fact lucky to wind up with anything at all.

Enough should be enough for every fair-minded American. No more promises of money and benefits. Every payday, let’s just take the money and run. That would mean removing the control of all benefits and promises from the hands of the employers. Cash for work. We can all have a system that then divvies up your pay into wages, health insurance, pensions, and every other benefit.

Harold Geneen, former Chairman of International Telephone and Telegraph, seems to agree with Jonathan Swift. Geneen said:

“It is an immutable law in business that words are words, explanations are explanations, promises are promises — but only performance is reality.”

Click here to contact your representatives in Washington, D.C.:
Our Elected Officials. Tell them you prefer to take the money and run.

– Byron

Fix the Banks!

April 25th, 2009



OLD  Rule: The big banks are too big to fail.

NEW Rule: All banks are too strong to fail.

Global bank losses hit $4.5 TRILLION. $2.7 TRILLION is from loans and assets originating in the United States. The biggest losers are the biggest banks, which the U.S. taxpayer has bailed out with direct infusions of money. The latest plan is to start giving the banks money for their bad loans. Heads they won; now it’s tails, and we lose. And, the U.S. taxpayer has backstopped the FDIC, which simply closes the smaller banks. Just this week, the FDIC closed 4 banks at a cost of $700 Million. In 4 months this year alone, the FDIC has closed 29 banks; last year, 25 banks. Who wants to see failures of this magnitude? And, who wants to keep paying for this disaster? Do you?

The American bankers have so mismanaged their business that they threaten the stability of the U.S. The most worn and tiresome phrase is to hear politicians and commentators talk about the big money center banks as being “too big to fail.” So what’s at the core of the problem? The banks just didn’t have the reserves to make it through a downturn and/or to cover the outrageous losses due to speculation with the credit default swaps. Framing the problem is to identify the solution. But, I have not seen a long-term solution proposed.

The common-sense solution is thus to require the banks to increase their reserves quarterly and yearly. Slowly perhaps, but surely. Additions to reserves should exceed dividends until the long-term reserve requirement is met. Unless a bank can get stronger, it would be imprudent and unwise for that bank to pay out any dividends at all. (And, forget any stock options, political contributions, etc.) That’s one way to maintain the advantages of a capitalist system. By the way, an alternative would be to break up the big banks so we can let them fail later as small banks. To simply expect the government to rescue banks of any size is to invite nationalization. We can take our choice.

The above is the best solution I’ve seen. The heart-breaking observation is that the political leadership hasn’t offered any solution. The silence is deafening. The politicians close their eyes and borrow more money to give to the bankers. What will it take to get the members of Congress to do their job?

Click here to contact your representatives in Washington, D.C.:
Our Elected Officials. Tell them you want a permanent fix for American banks and bankers.

– Byron


References:


New York Times, April 21, 2009.
I.M.F. Puts Bank Losses From
Global Financial Crisis at $4.1 Trillion
.


CNNMoney.com, April 24, 2009.
Bad year for banks:
Failures surpass 2008
.

Dump This Awful IRS Tax Code.

April 11th, 2009


Let’s just dump this whole tax preparation business. It’s more than a nuisance. Here’s what the IRS says:

Taxpayers filing Form 1040 had an average burden of about 33 hours, and taxpayers filing Form 1040A and Form 1040EZ averaged about 11 hours.

If you have wage, salary, dividend, and interest income, it’s already being reported to the IRS. The IRS already calculates your taxes for you when you file. If you make a mistake, the IRS will tell you about it, won’t they?

But, you say, “But, what about exemptions, deductions, and credits that apply only to my special situation?” That’s what creates this tax preparation nightmare and industry. So, let’s get rid of the entire tax code on the common sources of income . . . except one. Let’s give each man and each woman one single exemption of about $25,000 per year. Each person filing gets that one exemption. For example, a working married couple now filing jointly would file singly for a total exemption of FIFTY THOUSAND dollars. Regardless of the details, the IRS would already have all the information needed.

At worst, the IRS computer would take about a half-second to make the calculation. You could figure it with paper and pencil in about 10 minutes, not 33 hours.

But, you say, “But, what about landlords, farmers, and small business people?” True, the IRS does not have data about their income and legitimate business expenses, so those folks would have to file a supplemental form. But that’s a small group, relatively speaking. The great majority of us could get out from under the burden of tax preparation.

In America’s Declaration of Independence, Thomas Jefferson listed the many complaints against the King of England and the English Parliament. Referring to King George III, Jefferson wrote:


He has erected a multitude of New Offices, and sent hither swarms of Officers to harass our people, and eat out their substance.

You can read more at the reference link below.

Click here to contact your representatives in Washington, D.C.:
Our Elected Officials.
Tell them what Tom Jefferson had to say to the King of England.

– Byron


References:


“Fair Deal,” The Hundred Network.

Thomas Jefferson’s Complaint
.

Who Let This Disaster Happen?

April 3rd, 2009


Kevin Phillips, the gifted researcher and author, recently gave new life to an old quote from 1904. That quote is a sharp and accurate observation yet today. The former colonial secretary of Great Britain, Joseph Chamberlain, spoke to British Bankers:

“Granted that you are the clearing house of the world, ‘but’ are you entirely beyond anxiety as to the permanence of your great prosperity? . . . Banking is not the creator of our prosperity but the creation of wealth; and if the industrial energy and development which has been going on for so many years in this country were
to be hindered or relaxed, then finance and all that finance means, will follow trade to the countries which are more successful than ourselves.”

There are two very sharp concepts brought out. First, it is “production” that creates the wealth. The banks are just a service organization, like dry cleaners and casinos. The production, the foundation of the economy, is in mining, farming, manufacturing, and the transport of the products. If the core economic activities are sent abroad, the wealth goes abroad. No banks can replace it.

Second, as one economist said recently, banks and the other financial institutions are like the “circulatory system” for the economy. But, as Chamberlain points out, “banking is not the creator of our prosperity.” So, we are back to the issue of 2009. How is it that “banks” brought the United States (and many other countries) to the brink of a global depression? Who let this happen?

Click here to contact your representatives in Washington, D.C. Our Elected Officials.
Ask your representative how the Congress let this happen.

– Byron