Tuesday, January 31, 2006

Income Spread

A State-by-State Analysis
of Income Trends
Jared Bernstein
Elizabeth McNichol
Karen Lyons
January 2006

This is a good Study, but expresses the greatest detriment to effective Wage adjustment: the idea that Government can properly regulate Incomes. The largest discriminate in Wage allocation in the American economy comes from Business use of Welfare transfers in Wage placement. Welfare transfers simply negate Labor demands for a Living Wage. Business sets Wage rates which force lower-waged Labor to seek Government assistance.

The major element in Wage demands is meeting Living Costs. Business utilizes any option to minimize those Living Costs--including generous tolerant Parents, Government Housing subsidies, tax-free Mortgages, and the Social Security system. The trouble is compounded by the Economic belief that any restrictions upon Business--financial or otherwise--will curtail total Employment to some degree; this is a belief that has never been adequately tested statistically, and regulation could actually generate increase of Employment levels. A government demand that Business supply full Living Costs to their Employees in the form of Wages and Benefits might not even affect long-run Business decisions of Employment levels.

The elimination of Tax incentives for Business operation could also increase long-term Employment levels beneficially. Tax incentives, Today, allow for business investment no matter where the location of said investment. Insistance on tax incentives only for native investment would perdictably increase Employment rolls inside the governing district. Much of the offshoring of business investment comes only from Tax allowance of tax advantage for this investment. Much could be changed with only the alteration of Taxation. lgl

Social Pressures and Economics

We again have an instance of Someone going 'Postal'. with Six dead and one critically injured. It is time to examine the whole contextual process once more. Why is it always the Post Office? Can it be that Work conditions are so much worse at the Post Office, than say at UPS, Federal Express, or MacDonalds? It is true that Office Politics remain a serious problem and hazard in government agencies, and most firings occur because of 'smear' campaigns organized by the Rand and File. It, though, remains only marginally higher than in the Private Sector.

The answer must lay somewhere in the economics of the situation, else such Outbursts would occur in the outer society, not within the confines of the Workplace. There is the Copycat effect with Individuals searching for recognition, but the impulse must be considered marginal at best; frequency reduces cognizance of the Event, and the momentary noteraity simply does not engender such serious injurious impulse.

The contruct of the Workplace, itself, must be the impetus for the abrerrant reaction. The Post Office is one of the few Employees, as are most Government agencies, which offers 'Birth to the Grave' benefits of Health Care, Pension, and Job Safety. It also remains one of the few places where Job Placement depends upon a general educational and skill level without specific training. The Jobs are prized by a specific set of Employees for the security offered. Loss of such protection must be the decisive impulse behind such Employee reaction to Job loss. The ex-Employee cannot obtain such security elsewhere, connected to the fact that Job loss invariably comes from adverse Office Politics. lgl

Monday, January 30, 2006

Greenspan Out, Bernanke In

This is an excellent time for the leavetaking of Al Greenspan, as the last go-round of Interest rate hikes almost certainly are not the pattern desired. He will be leaving before the political fallout of unsavory economic numbers rise to a alarmist level. He will get out with his reputation intact, though much of the bad economic policy coming from the Fed results from immoderate economic training given to several Generations of Economists and Business personnel. This is not actually a bad thing, because Greenspan consists of the stuff of Icons!

Ben Bernanke was trained in the Greenspan era, and therefore has been captivated by the Greenspan spin; a fact which Bernanke may come to resent. He lacks the political contacts of the great Greenspan, and the political expertise. Fed Chairmanship require both the Former and the Later, as the Chairman must deal as an Equal with President, Senator, and Representative. His lack of political connections will not serve to divert criticism as was the Case for his Predecessor.

Bernanke's skill as an Economist has already been established, but this could work against him. The Fed Chair requires a common-sense attitude combined with a gritty willingness to get into the trenches. Bernanke may lack the truculence mandated for the position. Pulling out Graphs in the midst of a bloodbath simply indicates lack of touch with reality, not defendable argument in the political spectrum. We will have to wait and see! lgl

Sunday, January 29, 2006

More Effective Inflation-Fighters

Many Economists, not just this Author, suggest that the Fed has already raised the Benchmark rate too high. The Fed, on the other hand, insists there exists significant pressures in the Economy to incite Inflation--driven by the high Cost of Energy. The pity lay in the fact both assessments are particularly sharp and accurate. What is there to be done?

The first element which must be understood consists of the fact that the Economy is a flexible system, continually reacting, altering, and responding to new pressures in a manner to flow around constraints. This is accomplished through alteration of Business practices, change of the Product mix, and switching between financing instruments. Reliance upon one institutional framework to control Inflation cripples the effort, as the Economy constucts shields against from such interference. The Fed may have done all it can in the Inflation fight, and it is not enough.
Effective controls on Inflation may have to be disbersed between alternate areas.

This Author also believes that Deficits are too high, and Taxation remains the greatest Inflation fighter appliable. He also believes We dare look to the Past for appropriate economic controls, their current lack of appeal coming only from present-day economic theories, many of which have already been discounted to some degree by contradictory economic data in the real World. Previous economic initiatives have often shown a better record.

There will now be a howl among almost all Economists--Liberal and Conservatives. This Author immediately calls for a 10% Surtax upon all Federal taxes, until such time as the United States military is no longer engaged in active Field operations. The Fed could comfortably reduce the Benchmark Overnight rate to 3.75%--a effective rate which will not hinder marginal-Profits industries. The stress on Taxpayers would not be excessive, nor would economic incentive be curtailed to great degree. The final gain results in higher Tax revenues at a time when We have an extremely profligate Government; One so spendthrift that this Author would call for terms in such Surtax legislation that it could only be spent to reduce the Deficit. lgl

Saturday, January 28, 2006

The Tax-Policy Dilema

There was dramatic slowdown of the Economy last Quarter, basically coming from Auto Sales slumping by almost half with the removal of the Car companies' discounts, and an over 13% reduction of Government military spending. Other Commentators are reflecting on this data, as this Author did yesterday. Today, I want to discuss other aspects of the economic situation.

Conservatives face the consistent Deficits of the Federal Budget with huge borrowing from foreign sources, while Imports continue to increase. There exists an artificial structure to the economic growth of the later Bush's administrations. The Federal Government pushes a Deficit-financed economic fuel into the Economy which has a potentially huge Inflationary impact. Deficit-spending is economic fuel because it allows Taxpayers to continue their Expenditure patterns without curtailment as Federal expenditures grant added economic activity; the problem being this leads to overconsumption of Resources at artifical pricing. Such Deficits could still be acceptable, when Employment levels are low, and when Business Profits actually paid for the Deficits through absorption of the deficit bonds. Cyclical flow patterns simply utilized a Wrap formula where Government spending simply curtailed unprofitable business operations.

The selling of the Deficit Overseas changes the pattern of Capital flow. Employment incentive moves Overseas, as foreign business operations have additional investment opportunity for additional Profits, Federal spending directs native Business investment to Capital-intensive industries, and artificially-high Wages make marginal-Profit industries less attractive for business investment. Marginal industries start to fail as foreign competition has heightened potential for Importation--with lower Wage schedules, lower Production Costs, and expandable markets. Native employment starts to decline, while heavy purchase patterns keep Wages high in the remaining Labor force.

The answer is higher Taxes, but Conservatives believe Government already possess too large a magnitude of funds to spend. The trouble is higher Taxes may be the only means to reverse the explained Trend. It has an additional cavet: if Taxes are raised to place Government Budgets in surplus, Politicians must be foretalled from spending the additional revenues. lgl

Friday, January 27, 2006

The Good, The Bad, and the Ugly

U.S. Economy Grows at Slowest Pace in Three Years
Published: January 27, 2006

The lead Business article at the NYTimes. The GDP was down in the Fourth Quarter to 1.1% according to released Government reports. Consumer and Government military spending were down, the later by 13.1%. Consumer spending was down because of the decrease in Sports Utility vehicle Sales, a huge drop indicating Consumers are good Economists; purchases dropped with the end of huge discounts by Automakers--said discounts providing a removal of added Gas pricing. A classic Consumer awareness that Operational Costs lower the value of Product. This is the Good, as Business and Industry are forced to alter their Product provision to better, more economical Products.

A major trouble spot lay in the fact that median Home Sales dropped by 3.4% while Inventories rose. The Housing Market is not clearing, indicating that either overConstruction has occurred, or Consumers are confronting a Financing block because of higher Interest rates and other higher Maintenance Costs--especially Energy. Expect Inventories to accumulate as overburdened Consumers realize they have overCapitalized. This Author perdicts that median Home Sales will fall another 12% over the Year. The Fed benchmark rate is already too high at 4.25%, canceling Business expansion in marginal sectors because of the increased Cost of Running Capital. This is the Bad.

Disposable Income remains less than the Inflation rate of 3.1% for the Fourth Quarter on an annual basis. The poor showing of Business in capital equipment and Software purchases foretell curtailment of the 7% increase in Disposable Income as fewer Workers are added to the Employment Rolls. This is heavily enforced by the 9.1% increase in Imports. The Later happens to be the Ugly. lgl

Thursday, January 26, 2006

The Gas Wars

The World is rapidly developing, and regretably using the American model of high Energy consumption. The American economy increases Energy use, whether in Boom or Bust. The trouble comes in the fact foreign economies have the resources from their development and Export levels to compete with the United States for Energy reserves. The Gas Wars, though probably descending sometimes to physical combat, will be on the level of finding the technology to Produce more with less Energy. The Time is now! American Business needs to learn the tactics and strategy of Production not only in terms of total Production Costs, but in terms of Energy Costs as well. The Now comes from the fact that Gas may reach $5/gallon this Year, if World energy needs increase with equal pace as last Year with equal-impact crisis in the Supply line for Energy products.

What Strategies can be employed?

1) The development of Work Station technology (previously described by this Author in an Appendix of a prior Work). Work Station technology allows Machine operation to be separated from Machine supervision. Both Machine Operation and Machine Maintenance can be run from Work Stations. Added Cost of machinery can be minimized, costing only the Communication charges in most instances, as all current machinery uses the basic format of electronics technology.

2) Microwave technology can allow for Work Stations to be transferred to Buses, where Employees go on the Clock upon being picked up for the Shift (providing incentive to employees to utilize Company bus programs), leading to a vast reduction in fuel Costs to the employees; this two aspects reducing Employee Wage demands. Eventual effort could create a scenario where obtaining a Job with an Employer will mean delivery of a Work Station to the home of the Employee. Properly constructed Bus Work Stations may even eliminate the need for major Office space; requiring only sufficient Parking facilities for the Bus.

3) Standardization of Work Station technology could vastly reduce Employee Training Costs, and separation of the delicate human body from the actual Production lines will reduce Insurance and Disability Costs dramatically. It will also greatly aid in reduction of Pollution emisions and ease fulfillment of Emision standards set by law.

4) Those Trades and industries which require human interaction (Retail etc.) can still benefit from Busing of Employees. The program can be expanded to Busing of Customers combined with delivery of their purchases in the storage compartments under the Buses. This major saving in Fuel Costs can be managed with an Advertising campaign where the comfort of not fighting traffic, not paying for Gas, and lack of actual handling of heavy purchases will intice Customers to utilize the free Bus service. It will have the added benefit of Customer direction to the Stores which supply the Service (there could be multiple Stores or Shopping Centers as underwriters of the Service).

5) The Federal Government, through direct Grants, Tax incentives, and Guarranteed Profits, should reinstitute the railway system; raising the railway performance to the equal of Japan and Europe, in both provision of Services and Safety. This would produce the Energy economy enjoyed by Europe at the minimum, and will gain the volume of Travelers and Freight with short, on-Time trains and Traveler pampering alongside a vested Advertising campaign. lgl

Wednesday, January 25, 2006

Rumfeld's War

Rumsfeld Says Military Not Overextended
Published: January 25, 2006

Rumsfeld denys the U.S Military is a 'Thin Green Line'. He says Those serving in Iraq make up a Manpower pool of 380,000, while the total military complement of the U.S. military is two million soldiers, including Reserves and National Guard. He acts like this is proof. This Author wants to know Why an excess of 50% of the military personnel serving in Iraq are on their Second or Third tour, and Why about 40% of the Personnel in Iraq consist of Reserves and National Guard units? The Author does understand the difference between Combat and Combat Support units, and the threat to the viability of the U.S. Military is not centered upon Pentagon office perssonel, and I believe this is the full complement which Rumsfeld asserts exists. It is something which must be considered.

In the earlier report obtained by The Associated Press, Andrew Krepinevich, a retired Army officer who wrote it under Pentagon contract, concluded that the Army cannot sustain the pace of troop deployments to Iraq long enough to break the back of the insurgency

This Statement may be assessed as true, though this Author remembers the Vietnam Conflict, and believes a Two million Troop force in Iraq would be equally incapable of breaking the back of the insurgency. Iraq remains a Problem which demands a political solution, not a military one. Palestinians brought Humas into the Government, basically in Voter revolt against a foreign military continuing military operations against themselves. It has been standard Government propaganda that Iraqis want the U.S Military in Iraq, but how many Iraqi citizens have died because of this self-same intervention? It does not even enter into the innate Iraqi knowledge that the bloodshed will not end until American troops are removed from Iraqi soil.

The Army fell more than 6,600 recruits short of its goal of enlisting 80,000 troops last year, the first time it missed its annual target since 1999 and the largest shortfall in 26 years.

A new law will let the Army attract older recruits, raising the top age from 35 to 42. In addition, financial bonuses for enlistments and re-enlistments have increased.

Do We need parents of High School kids serving on the front lines? That itself states that the 'Thin Green Line' is too thin. The Problem is not that the Clinton administration starved the Military. The truth is that superfat military Supply Contracts for weapons systems which will not reach military complement for a decade, if then, are starving deployed Troops in the field. Suppling Troops rather than fanciful Weapons does not ensure Corporate profits. The starvation of the U.S. Military comes from the Bush administrations. lgl

Chinese Export Trade

Dani Rodrik
Harvard University
Revised, January 2006

The Paper basically expresses this Author's own views on Chinese Export success, though there is some lack of clarity in definition of the factors. China combines a controlable Labor force with appropriate intelligent Economic policy. Chinese Labor must adhere to their Employers, as they exist in an undeveloped economic market where they cannot obtain alternate employment at Payscales equal to their Export employment. Employers utilize the differential between native Payscales and Importing Countries to set Employee Payscales above native Payscales, but far lower than the Payscales of Importing Countries. The Chinese Government and Employers therefore enjoy higher Profits alongside a loyal Labor force, while the Chinese Government allows Employers a higher share of the Profits than other Competitors--such as India and Banglodash. This incites heavier than normal foreign investment in China.

The matrix grants foreign investors the capacity and Profitability to provide the higher Training Costs of their Employees, while insuring those Employees do not have the opprotunity to sell that training elsewhere. The Chinese Government has already shown the willingness to control the private Employees of foreign investors--forestalling regional or national immigration, or competitive development in singular regions. The Chinese Government also limits the investment mix so the vast majority of Chinese Wages are deposited in a Government-owned and operated Banking system. The facilitates a high Taxation of Chinese Wages and Products to the native Consumers. This Two-Tier system has deep roots in Chinese society, going back to the Tax and Trading policies of the Chinese empires. lgl

Tuesday, January 24, 2006

Back Online

This Author has been thrown out of hospital, and perforce must do something. Still sore and somewhat incapitated, he will try to provide originality in the days ahead. Short insight: the Health industry may await a Downsizing in the years ahead, the reason being the Cost of Services in the face of Market uncertainity. High Profit ratios have led to an overdevelopment of medical Labor resources in an arena where only Cost-Cutting Procedures will last given the artificial shakey structure of the industry. Expansion of the Proscription D side of Medicare and Medicaid may be delusional, as most Insurance policies offered might be the best derived. The Future may hold a Crisis, in the face of alternative procedures available; eventually there must be sharp competition, especially in the reality of a possible younger Population. Remember that the latest round of Disease and Illness have swung to the Terminal.

One element the Author noted in his latest sojourn in health facilities consists of the multiple increase in Energy usage of modern medicine. It will impact as Energy prices rise--both in the venue of medical technology, and in the realm of Proscription drugs. Medicine has been pushing the Inflationary envelope since the late 1960s, and differential Payscales between Industries proclude added Charges. lgl

Saturday, January 21, 2006

Military Supply Contracts

The NYTimes lead article in the Business section today dealt with the complexity of military supply contracts. The Author must first say he is busy this Weekend, and did not read it. Sufficient to state that one, small company is incapable of meeting the demand schedules for military personnel who have already been deployed in large quantities. It is a 'Catch-Up' game which can never be won. The second statement to be made on the supply of Body armor for the Troops says the entire thinking on Body armor is flawed. We do not need heavier weight on the Troops, but lighter materials. This Author believes a continous-line of unbreakable Thread underlaid by padding able to exhute Sweat, and also distribute impact from the initial point of impact is the answer.

I am finally going to be operated on Monday to implant a Defibulator (my heart is even more anarchistic than myself). I will not be Posting until the middle of next Week. lgl

Friday, January 20, 2006


Why Republicans Can't Cut Spending
By Jonathan Rauch, National Journal© National Journal Group Inc.
Friday, Jan. 20, 2006

An essentially good Read to be found at RealClearPolitics. The key element of the article states that 5/6 of the proposed Budget is not touched by any Budget-Cutting measure. This Author has always wondered how reduction of the size of the Deficit can be Budget-cutting. I think that witticism came in with the current Bush administrations. Rauch's definition of the machine-building efforts of Delay and Rove are accurate, as his his definition of the entrapment of the Republican machine by Lobbyist interests.

The real trouble with the Bush Corporate administrations lay in the composition of their support. Corporations, and the Lobbyists they employ, give Money and Support only for specific favors, and will desist with both the Money and Support under even the suggestion that those favors will be cut. The Bush administration and Republican Congress are hamstrung by their own promises.

Eveeryone, inside and outside of Government--Federal, State, and Local, know that approximately 40% of all Government Supply contracts must be canceled in order to slice the Budget. Corporate Republicans wish to cut those contracts issued by Democratic predecessors for the welfare of People--like Social Security, Medicare, Medicaid, OSHA, and Environmental Protection. Democrats will not vote for this elimination, and are rigorously backed by the American Voter--who are not above extortions like pressuring for Medicare D. Democrats are increasingly vocal in calling for curtailment of the lush Security and Defense contracts awarded under the later Bush promised the Corporate world. Corporate America and World will not stand for backpedaling of President, Senator, and Representative. The Republicans may yet learn first hand, one way or another, the meaning of the Word 'Capon'. lgl

Japan's Ban on American Beef Imports

Japan has again banned American beef. Something smells? American Meatpackers have traditionally been exacting in fulfilling Customer Orders. They know that ReOrders do not come without such exactitude. Simply put, there was deliberate violation of Japanese demands. Why?

It might be the native Ecoterrorists--Animal Rights Groups are quite fanatical, even though three major Terrorists were recently arrested. It could be al Quada, who desire to estrange the two major Trading powers of the World; alongside the chance to spread disease in the West. It could simply be disgruntled American Worker or Businessman, who wished to tell the Japanese to 'stick their Regulations where the Sun don't shine'.

American leadership may proclaim the Japanese reaction was excessive, but this ignores the deep Japanese fear of Pandemics. Japan cannot endure an Image which allows the United States greater deferment from Japanes regulations. They are too close and integrated to the source of Pandemics--the current outbreak being Asian flu which has had many predicessors in China and south Asia. Americans cannot lightly dismiss the Japanese alarm. lgl

Thursday, January 19, 2006

Net-Centric Warfare

This Author had written an extensive review of a Paper by a Major Nicholson on Battle Command. My Blog Server decided to eat it. A true sadness as it was probably one of my better efforts--however good they may be!

My criticique of the microManagement which the Military calls 'net-centric warfare' was ablaze with lucidity (or so the Author thinks). It contained almost logical argument on the dangers involved with net-centric warfare. Nicholson claimed that the Solution was the expertise of command. Here are my arguments against this position:

1) Enemy Commanders can be equally skilled
2) We may not always going to be technologically superior
3) There is excessive amounts of Ordiance always utilized (too much Gun), where one day We will suffer from insufficient Lines of Communication
4) We lose the Initiative at the Battle point, while lead elements wait for coming advanced weaponry delivery systems.
5) American Commanders have Training only in the Offensive, but Stalmates cost high Casualty rates without knowledge of Assault skills, and what American Commander has Training in use of Advanced Weapons systems to engineer effective Retreats? lgl

Wednesday, January 18, 2006

Corporate Image

The NYTimes carried a article on turning Natural Gas into diesel, making a cleaner fuel than current diesel made from the sulfur byproducts of Crude Oil. It is a grand idea, except for the fact Natural Gas reserves are themselves limited. It will use up those Reserves in areas where current exploitation of the Natural Gas is uneconomical. The Processing Costs also seem competitive or cheaper than the Processing Costs of the sulfur byproducts, but what will We do with the later if We switch to the former? My commentary on Processing Costs remains important: it is actually the most important issue whenever discussing Energy source development of any type.

The Nikkei Exchange was closed down because the small investors became scared that a Government investigation of a Company would engender more investigations. What does this tell Us? It simply means all small investors believe Japanese Companies have been 'cooking the books' to show Profits. Small investors may be a little too small if they invest in Ventures which they expect are misrepresenting their Profit ratios.

The SEC is set to implement regulations to provide transparency for Stockholders in the rates of Executive pay. Again We have an issue, not with clarity, but with the deliberate misrepresentation of fact by Companies. The issue need not actually concern the art of misleading Stockholders, simply the belief in the self-same misrepresentation. Companies has a real problem with Image, with some part of it based in fact.

The basic problem may will be Corporate tendency to obsufcate Costs. A great share must come from the actual rates of Pay for Employees, not just Corporate management. There is common belief Corporate R&D is engaged in to provide the lucrative positions for Corporate Executives, not for profitable Ventures to be undertaken for the Company. The Lobbyist Scandal in D.C. does not help Corporate image, as who pays for the Lobbyists? All get smeared by the same brush!

There has to be change in Corporate reportage, and it cannot be ordered from the outside of the Board room. It took from 1930 until 1960 to really get the small investors back into Stocks, whether or not small investors are important to the overall functioning of the Markets. Another bloodbath where Stockholders lose as much as had the Japanese investors will drive them away. Corporate leadership then will be faced with institutional investors whose job is competent analysis of Corporate reports. The Corporate Board room had better start thinking about Others than themselves. lgl

Tuesday, January 17, 2006

Iran, Iraq, Nigeria, and Oil

The price of Oil is over $65 per barrel, and Some expect it to set a new record over $73 per barrel of sweet Crude. Iran claims the right of retaliation with restraint of Oil exports if sanctions are imposed. Nigerian militants threaten attacks upon offshore Oil platforms, the IEA claims Oil demand is increasing in China and the U.S., and that OPEC countries have little capacity to expand Oil supples in the Short-term. The United States military is concentrated on occupation of Iraq, where Oil production will not return to normal pre-War levels without major concentration of economic capital. China may not present as great a Demand threat as thought, but development of the rest of the World will substitute in Demand. The United States must enter into a Energy Conservation program.

The Oil Executive administration of George W. Bush does not present creditability in the promotion of a Energy conservation program. Neither does the mouthings of a Liberal establishment which has did little on Energy conservation of the previous thirty years. The only element which might provide a creduleous statement would be the addition of taxation. The later ability holding the only restrictive power believed by American or Foreigner.

Suggested Taxes:

1) the previous Gas Tax outlined by this Author
2) a Flight Tax of $25 per individual and $7 per item of Cargo for all Air Transport.
3) a graduated Cargo tonnage Tax based on amount of tonnage shipped: Railroads being the lowest level of taxation, Road transport next highest, with Air Transport highest. The amount of tonnage in each Class will determine if your pay a 0.25% Tax, a 0.75% Tax, or a 2.0% Tax.
4) Business will be legally entailed with paying the Labor Transport Costs of Employees (this Author envisions a Bus system development similar to the School Bus system).
5) Federal law which will allow Law Enforcement to ticket with a $100 Fine any Single-Occupant vehicle over 250 miles from their listed Residence.

This heavy Taxation will seem too excessive, and to some degree, misapplied. The fact stands that American Business and Consumers will pay these funds as Oil expenses, if Energy consumption is not curtailed. lgl

Monday, January 16, 2006

Reading List on Iraq

Remarks to the Security Policy Working Group Forum on Iraq
James K. Galbraith, Chair, Economists for Peace and Security
February 22, 2005
January 17, 2005
How to Exit Iraq
by Christopher Preble
Gareth Porter

These are three relatively reasonable arguments on Exit strategy on Iraq. The trouble with these Works lay in lack of knowledge of American Politics. The Invasion of Iraq was the prime element of the administration of the current sitting President. Bush has made a strong stand on Counterterrorism the ideological context of his Administration, and early asserted the Invasion of Iraq was a tactical fulfillment of the defined Strategic end. Knowledgeable individuals tried to warn it was a tactical Sideline without remedial effect. The Invasion went forward!

Bush assertiveness on Iraq has bound his Administration to an expensive Commitment for this Country, from which he cannot back away without loss of political control in this Country; his Administration will be a total 'Lame Duck' three years ahead of schedule. Diplomatic and Military Policy has entered the realm of American Politics, and cannot escape. The chance of American exit from Iraq under the Bush administration is only 1 in 20, and will destroy the political leadership of Bush if accomplished.

The next Presidential campaign will be based upon the Exit strategies expressed by the Candidates. Losses and Expense should assure that both Candidates will advocate some Exit from Iraq, but whichever that advocates only after a reduction of violence in Iraq will be the wrong choice! lgl

Sunday, January 15, 2006

Deficits and the National Debt

Analysts: Growing Deficit Hobbles Economy
Published: January 15, 2006

The Article is a good review of current economic thought on Deficits. The trouble lies in that the focus of attention is blurred. A good Five years after this Author published Inflation: Roots of Evil (iUniverse), Economists still worry about the effect of Deficits on Interest rates; a relatively inconsequential affect upon either Inflation or economic growth, if the Prime rate can be kept below 10%.

Government deficits, though, have immense impact upon Resource pricing. Deficits actually possess a Double-Whammy: they first create Money--through the production of financial instruments which can be bought and sold (the Later to serve as purchasing capacity); while providing an overdraft of Resources by the Government. The Government continues to spend drafting huge Resources, while the financial instruments allow the Private Sector to maintain their own sustained Resource purchasing power. The immediate hazard is the draft of Resources above the norm, the long-term hazard is the creation of Money which will not be contained until the Debts are repaid.

Government deficits spark artificial Demand, which seemingly generates Employment and Profits, but is offset by the increased draft of Resources which raise Resource pricing above natural Production levels. The creation of Money forestalls any future reduction of Resource pricing until the Government debt is repaid, and erodes natural economic performance because of the abnormal Resource pricing. lgl

Auto Industry

GM has notified the Public they are going to introduce the Cost-Savings program ahead of schedule, due to the softness of Consumer demand for vehicles. There has been planned 'force-fed' program in the Past, to entice Consumers to purchase ahead of their own personal Consumption schedules. This Author does not know the details of the GM plan, but estimates it will not go far enough to bring in the Buyers and leassers. An economic evaluation should be made.

The criteria of Consumers is the cancellation of risk. The Car Companies fail to provide 'Fail-Safe' protection for Consumers. Expenses are killing the Consumers, and Risk has become more hazardous. The Car companies have a distribution and Retail problem. A meeting of the Minds may be necessary.

A suggested Protection Plan:

1) Companies assume the Auto insurance for Consumers, negotiating by Group insurance, more adjustable and affordable Rates. The Cost would be added to the monthly payments.
2) The current Warranties program be replaced by guaranteed Maintenance Monthly charges, where Car companies collect a monthly payment per month, and themselves pay all Maintenance charges (including Oil changes, Tune-ups, and Fluid replacements) on the vehicles for a lengthy period.
3) Vehicles should be guaranteed this protection for 10 years.
4) Consumers are guaranteed a Used Car replacement when their vehicle is in Maintenance for Accident or malfunction, and a Used Car replacement if an Accident or malfunction has functionally ended the vehicle life.
5) The Consumer is guaranteed a Resale value through 10 years, no matter what condition the vehicle is in, if the Maintenance record was fulfilled.

This Program may seem expensive, but Car companies could charge Rates which would make this Program quite profitable, by limiting Insurance and Maintenance Costs. It would generate Brand loyalty, and force other Companies to match Resale guarantees for vehicles. Car companies can assure the Customer that they will stand behind their Product, while Consumer satisfaction with any one vehicle can be turned into a new Purchase; Salesmen able to concentrate on the really mild increase of monthly payments (likely none, if Car companies are smart, just the initial Down Payment). lgl

Friday, January 13, 2006

Weapons Procurement

A Report by the Assessment Panel of the
Defense Acquisition Performance
Assessment Project
For the Acting Deputy Secretary of Defense
Defense Acquisition
Performance Assessment
Executive Summary
December 2005

A typical DoD Report: it is a shining example of bureaucraticize. It's purported streamlining of the Procurement process will only produce more nonaccountability, without generating the Procurement integration desired and expressed in the Report. Expert Managers are also not the salvation; even the dumbest must understand when they are crossing the line. One of the worst problems is Project creep, where more desired capabilities are hung weapons systems without any Oversight.

Potential Solution:

1) A Congressional Act establishing that a Congress of Combatant Commanders plus their Assistant Combatant Commanders be established, where either the Combatant Commander or his Second in Command must attend every session of the Congress.
2) The Act will state funding for support of committed Troops must come first, before any other Budgetary funds are allocated.
3) Every weapons system will be allocated a a projected Price tag.
4) The Congress of Combatant Commanders and their Assistants will be told they will get only 70% of the projected total funds of the combination of the separate Price tags for the proposed weapons systems.
5) The Commanders and Assistant Commanders must deliver a list of weapons systems which they desire at the 70% Price tag total.
6) the Congressional Act will not allow funding of any other weapons systems, except those selected, without a 75% approval in both the House of Representatives and Senate.
7) Funding for any weapons will cease for the Budgetary Year in which the projected Price tag is exceeded, Defense Contractors expected to pay for development in the absence of funding. lgl

Sound Economics?

Wholesale Inflation and Retail Sales Climb
Published: January 13, 2006

The 5.4 percent increase for wholesales prices for all of 2005 followed a 4.1 percent 2004 increase. Both gains were the biggest since a 5.7 percent rise in 1990, a year when Iraq's invasion of Kuwait sent global energy prices soaring.

The Above Quote is the heart of the article, yet the article followed by the other Services and Newspapers, talks about the small rise in the Wholesale Core Inflation. It sounds good, and is a good lie for the Stock Markets, but Business is still paying the 5.4% increase for their Supplies and Products. No matter what the level of Core Inflation, Retail prices will begin to reflect the increase in business costs.

This Author, more than Anyone, believes that the Fed should cease raising Interest rates; he thinks 3.74% for the Overnight rate is the desired ending point. This assessment, though, is based on his perception of the limitation of power and influence of Rates to curb Inflation, combined with his perception that high Interest rates retard Business profits of marginal industries. Fed, Economist, and Investor should all stay will the realistic. lgl

Thursday, January 12, 2006

Free Trade May be Suicide

The Income Implications of Rising U.S. International Liabilities
Matthew Higgins, Thomas Klitgaard, and Cédric Tille

the ongoing buildup in U.S. net liabilities to the rest of the world
means that the United States is likely to begin making net
payouts in the near future.

When this occurs, net income flows will begin to add to
the U.S. current account deficit instead of working to reduce
it.As the net income deficit grows, the U.S. trade deficit must
narrow merely to prevent the current account deficit from
increasing. Achieving an actual reduction in the current
account deficit would require the trade deficit to decline
even further.

This Paper outlines the degree of the problem of the Current Accounts deficits which the United States is running:

the rate of return on U.S.FDI assets has
consistently been higher than that on FDI liabilities (Chart 4).
Since 1982, the rate of return on FDI assets has, on average,
exceeded that on FDI liabilities by 5.6 percentage points,5
and not once during this period has the differential dropped
below 3.2 percentage points

The Paper states there is no discernible reason for the above fact, but the Author believes a simple reason can be found: Foreign investments in this Country were made to dispose of Dollar stocks in safe investments, said elimination necessary to maintain their Trade position with the United States which accounted for a large proportion of their own GDP. This will diminish in the future, as the Dollar weakens further (20% between 2000-2004), foreign native economies develop and raise their Trade exchange rates between each other, and their own native populations absorb more of their own production. All of these effects will impact, if the United States does not take Steps to reduce the Trade imbalance.

This Author believes strongly in the third Scenario presented by the Paper. The United States will not retain a rate of 9% increase per year in the returns of their Foreign investments. Foreign Investors will not continue to accept the disportionaite rates of Return. The United States will eventually have to switch Imports from Finished Goods and Interim Production Parts to a heavy concentration of Resource importation alone. This means that American industry has to be restarted in major degree.

The current round of Free Trade agreements may be exactly the wrong Proscription for the American economy. It impoverishes Our own Labor force, puts Our Current Accounts balance in liability, and will eventually raise Our Payments posture on foreign liabilities to unacceptable levels which constrict Our economy. The lesson of the Great Depression was Free Trade was the answer to avoid economic dislocation. What We have to determine Now is what elements of Free Trade have to be maintained, and what elements must be canceled for continued success. lgl

Wednesday, January 11, 2006

Robert Samuelson on Benjamin Friedman


Is Economic Growth Morally Uplifting
Robert Samuelson

The immediate dilemma involves the welfare state. It requires fast economic growth to generate the income and government revenues to pay all the promised benefits. But the mounting costs of those benefits -- especially as populations age in the United States, Europe and Japan -- may stifle growth through higher taxes and budget deficits. If so, the welfare state may cause the stagnation and strains against which Friedman warns.

Here is the real rub:

Declining population will curb economic growth; there being less Demand for Goods coupled with fewer Labor elements to produce those Goods. Another element states that as Populations age, the proportion of the population engaged in Labor declines faster than the aging of the population, at least; until Life Expectancy drops somewhere into the low Forties, leaving fewer and less competent Workers (due to their Aging) to produce insufficient Goods. There must be a long-term shortage of Goods leading to a decline in overall GDP.

The basic thesis of Friedman, though, remains very solid. GDP declines will foster factionalism, discord, and increase of discrimination. The accommodation of economies to increasing populations stands far higher in providence than do declining populations. Aging populations possess about 15% of the adverse impact of declining populations, because aging populations decrease their Expenditures while hoarding their financial assets in less-protected but Safer investments. It is irony that Aged Populations require a higher economic expenditure, because their needs insist on expensive- provision Goods like Drugs, Hospitalizations, and Rest home care. The previous expense draws unnaturally huge drafts of the younger, healthier, more expensively-trained Labor assets.

Our GDP, as those of the rest of the World, will enter into a decline sometime within the next decade according to the Author's estimate. How We handle this decline will be the challenge. lgl

Tuesday, January 10, 2006

The Cost of Playing John Wayne

This Author is in the process of reading a academic paper produced by a cojoint effect of two prominent Academics on the Cost of the Iraq and Afghani wars. I cannot cite the Work without written permission, but it can be found at:

It is a vastly important Read for Those interested. I will state I assume the Moderate estimate will be the final Cost of the Wars. I have not yet completed the Paper, but will provide some of my own observations.

Their inclusion of the increase in Oil price must be tempered by the fact that Oil Market pricing was bound to rise since the start of the Wars, conflict or not. They seem therefore to weight the Oil Cost picture too heavily in their micro-economic Cost estimates. The Author has not yet found Cost estimates of Health Care Cost increases into the American economy, which the Author attributes will be 2% per year over the next thirty years; this due to the artificial shortage of trained medical personnel created, causing an overall rise in the Cost of Average American Health Care. They also tend to concentrate on the loss of Productivity of the American Dead and Wounded; this is a definite Cost, but mostly overmagnified by almost all Economists. The American economy has managed to run at marginally Full Production through a series of wars in the Past, and enduring the loss of far greater numbers of Dead and Wounded. The Cost should be reduced by some factor of 3-4 times the lost Wages of the Unemployed and Underemployed during the studied Period.

The Paper is the best the Author has seen so far, and based upon research taken from official Government reports and official citements. The Footnotes are indeed as valuable as is the Work itself. lgl

Monday, January 09, 2006

A Devil's Advocate Argument

The News is full of the fact that the DOW rose above 11,000, the price of Gold has risen over $9 per ounce, and that the Dollar has stabilized somewhat. Most would ascertain that this is good news, and shows the strength of the American economy. There are equal reports, though, that Oil Crude has dropped to slightly over $63 per barrel. This Author imagines the turnaround comes from Speculators' group decision that Oil has become a poor speculative Product in the face of warm winter weather in the United States, alongside some indications that Oil Refining capacity will be on the increase.

Here is the Quandary:

Is it possible that Speculator funds are of such magnitude that concerted switch of Speculative Product mix could alter the Markets to this degree? The Answer is Yes! Accumulation of funds by foreign government, Corporate structure, and Private Investor has been intense since the investiture of the Bush administrations with their Tax Cuts. Speculators today swing a very heavy stick, and they acquired this Stick by the current levels of real taxation placed upon the Individual, Business, and Corporation in this Country.

Could it really be time to raise real taxation in the United States?

A horrid statement as it is stated. The Bush administrations, though, have not cut Spending to make up for the lost Tax revenues. Actual (real) opportunities for Investment are limited in a developed Economy, and often require levels of Investment which few Investors feel a desire to dedicate such largese of Funds, whether their own or borrowed. The above Statement accounts for the rapid rise of Speculators among the total ranks of Investors, while real Investment has been far less than the amounts accumulated. This Author will not advocate raising Tax rates which conform basically to G7 nations. It is really Time, though, to close the Tax loopholes which are so freely granted by Our legislators. lgl

Sunday, January 08, 2006

Wages and Government

Wage Determination Process Could Benefit from Greater Transparency, and Better Use of Violation Data Could Improve Enforcement


Recipients of federal government contracts for services are subject to wage, hour, benefits, and safety and health standards under the McNamara-OÂ’Hara Service Contract Act (SCA) of 1965, as amended, which specifies wage rate and other labor standards for employees of contractors.

The McNamara-O'Hara Act basically set a differentiated form of Minimum Wage for Federal Service Contract employees. The separation of Federal employees from other American labor was a fundamental flaw in the economic sense, guaranteeing basic protections to Federal employees not granted to the Private Sector. The Dept. of Labor took the enactment, and transformed it into a bureaucratic nightmare, defying the transparency for which the GAO cries.

In 2002, the Department of Labor (DOL) estimated there were about 60,000 federal service contracts.

DOLÂ’s Employment Standards AdministrationÂ’s (ESA) Wage and Hour Division (WHD) administers the SCA and each year determines prevailing wage and fringe benefit rates for approximately 300 standard service occupations, such as janitor and cafeteria worker, in 205 metropolitan areas. SCA also authorizes DOL to conduct investigations to enforce contractor compliance with SCA provisions.

The WHD operates an Occupational classification system which overly complicates the Issue involved. There should be only 7 Wage levels existent at most, based upon Education and Training level, combined with economic productivity estimates of the Occupation (in reality, the replacement cost of current Workers). All Occupations should be placed within these Wage levels, rather than using the outdated Directory of Occupations which the DOL now uses. Second, there should be only approximately three Living Costs sectors--based upon average Income levels existent in the Private Sector independent of geographical limitations or expansions. The key here is the exact location of the Work, and the Cost of living there as expressed by Private Sector incomes. The three levels would be Below-Average, Average, and Above-Average.

The major point within the Discussion is the overall distortion in economic Wages coming from Federal Employees holding specialized protection from economic hazard. This is not to say Federal Employees should be stripped of their protection under the McNamara-O'Hara Act, but to say this protection should be expanded to all American Labor. Much would have to be done prior to this intervention, though it could be accomplished in a economic Cost-effective manner. A realistic Retirement program would have to be initiated, the scope of the Plan simplified to as great a degree as possible.

Some Points on Retirement Plans:
1) All should be scaled to provide 40% of Income level at Retirement
2) This percentage of Income should equate to the average Minimum Wage income, with a 5% increase per Income level.
3) The Income levels should be defined through the Income Tax Returns filed.
4) The Retirement program should be entirely financed by Worker and Employer paying equally.
5) It should be separate from Social Security--which will be transferred to proven need to be eligible--and transferable between Employers (carried with the Worker).

Energy and American Consumption

This Author has just read a Country Analysis Brief of the EIA on Iran. Iran is still running deficits because they subsidize Gasoline to Consumers, it selling at about $.40 per gallon, with excess consumption due to the low Price of about 15%. Iran, though, is about to introduce Consumer Charge Cards alongside a two-Price system, where Gas is subsidized only to a specified quantity, then the subsidy is removed. The Concept of the Two-Price system excited the Author's imagination.

A Plan could be implemented where all Tax be removed upon some fill-up quantity of Gasoline, with much heavier taxes imposed on the remaining Gas drafted each time at the Pump. The tax revenue raised could be Origin-specific: These taxes revenues could be directed, after payment of State taxes on the Fuel, to maintenance of the Refinery system of this Country.

What type of tax levels are envisioned?
Elimination of all taxation upon the first Seven (7) gallons of Fuel, with a $.70 per gallon taxation on Gasoline above each extension of this limit (at the Pump). Diesel fuel would be left with the same tax rate. The Federal Government would have to pay approx. $.30 per gallon to the States to replace lost tax revenues, with the remaining $.40 per gallon taken by the Federal Government and loaned to viable Refining capacity Operators to build new, or expand existing capacities. The governing enactment would further entail no tax revenues could be spent by Government, except after repayment of the extended credit to Refiners, who would have to pay Two percent interest on the extended loans.

What would the Plan accomplish?
The Author has no hard numbers, so cannot give a good portrayal. The Subsidy on the first 7 gallons would be a Welfare transfer to All who would utilize it; Unemployed and Welfare receiptents possessing the time to double or triple trips to the Pumps. This Subsidy would cut their Fuel Costs substantially, while the Plan would not affect Heating fuels. Everyone else would pay the added taxation, which would propel purchase of more fuel-efficient vehicles. The Refining capacity of this Country would be economically stabilized, while current Federal taxations on fuel would remain in place at the Importation and Distillation levels. lgl

Saturday, January 07, 2006

Body Armor

Pentagon Study Links Fatalities to Body Armor
Published: January 7, 2006

A Marine Report:

It suggests that approximately 38% of the Casualties in Iraq could have been prevented with correct Body Armor. This would indicate that first simple Costs of these unnecessary Injuries cost in excess of $1.6 bn so far, with long-run Costs beyond $4 bn; not evaluating the Cost of Insurance and Subsistence payments. Moss confirmed the substance of the Marine Report and his other information at the Pentagon, the later figures are the Author's own estimates.

Moss states the new armored vehicle, the Cougar, is three months behind schedule, while the Marine Corps is still waiting for armored Humvees to replace their unarmored Humvees now in use. Interservice friction and Army delays are slowing down the process of providing armor, while the sole Contractor for the Humvees, like the sole Contractor for the Cougars, are swamped with Orders which they cannot fulfill in the short-run. The Cougars also possessed transmissions which Prototypes have shown to be inferior to the task at hand.

This Author is not an advocate of heavy personal Body Armor. The weight shortens operational range for Infantry, while obstructing personal movement; a vital necessity under Combat conditions. There is the additional problem of Heat exchange for all armor under the combat conditions of Iraq. An ideal scenario may be Infantry traveling Two to a armored Four-Wheeler, with one to conduct surveillance while the Other drives and search for Mines. The Problem in this venue remains the power of the vehicle that has to propel the total weight including the armor. The real Solution is cessation of Operations in Iraq. lgl

Friday, January 06, 2006

Two Million Jobs Year Over Year

The Author will simply say: I don't think So!

How many of the Jobs quoted were just Replacement jobs for ones which were completed, especially in the Construction industry--Author-estimated 300,000. The Software industry also shifted a probable 100,000 Jobs in like manner. The Retail industry could probably add another 200,000 Jobs to the total. The administration, though, can still claim a substantial gain in the number of Jobs.

Bush said it himself today, in stating that 18-38 years olds could expect to hold 10 different Jobs in the Period. He claimed this was the dynamics of the American economy with its Jobs generation. He failed to mention that the indicated Individuals could be expected to be without a Job for a substantial period of the 20 years--this Author estimating somewhere between 2-3 years of the Period. Unemployment periods are exactly that which destroys the Savings capacity of the American Worker, and additionally causes the major impetus behind the rise in Credit Card debt. Advanced Education and Training does not reduce the Job-Search Costs, and reduces the duration of Unemployment very little. The admirable record of the Tax Cuts are belied by the slow Job recovery since the Economic turnaround.

The truth states that the profligate Spending by the Bush administration has actually sapped the vitality of the Economy, in the face of the Recovery forces. The Fed needing to raise Interest rates over the past Year clearly expresses the overdraft of Resources for non-Productive Spending. The Challenge to Bush must be made, because of the Challenge of George W. Bush, who cannot genuinely aid the Economy by Spending. lgl

Thursday, January 05, 2006

Novak Again makes the Call

January 5, 2006
"The Nancy Problem"By Robert Novak

Bob Novak again outlines a Problem, one which affects all of Us: the aged leadership of the House. This is not a rant against Seniors, Bob himself showing some Years, as does this Author. The Problem is a House leadership wrapped up in Points of Order, rather than real Points of Discussion. The House leadership, whether Democrat or Republican, has been in office too long. It is not a simple Call for Term limits, only a need to free up Committee business. House leadership have answered too many Roll Calls; they are tied to previous Votes, which do not meet the needs of Today.

The Scandal in Washington may disturb the 'Business as Usual' philosophy in D.C. Current action by all Congressional leadership, though, is straight 'Damage Control'. The fact they are shedding the monies provided by people who turned States' Evidence should not be allowed, in terms of whether or not the receiptiants should be held accountable. The Voters have the opportunity to make a Change, through Prosecutors, or by their Votes.

Real discussion of how Congress does Business must be the agendas of the next campaigns. Voters and Journalists who fail to maintain this pursuit will be doomed to the current performance of Our Congress. lgl

Five More Americans Dead

Iraq has become an unaffordable, as well as an overextension of American effort. Less than 2000 Dead, and One can claim only hundreds, but after that; it becomes talk of thousands. This Author has not studied the Statistics, but immediate losses for dead American soldiers must exceed $130k per Individual, without consideration of the Death benefits to Survivors. This would include loss of Training Costs, Transportation Costs, Replacement Costs, and Burial Costs. The provisional estimate of Death benefits could more than double this initial Cost, including Welfare benefits for Survivors and higher premiums paid for Insurance of Soldiers.

The existence of Casualties perforce must be aa even higher Cost per Individual, as Medical Costs for simple and major surgeries rise. Rehabilition also skyrockets in Cost, and invariably there must be extensive rehabilition before any Individual can return to Service or to civilian labor. The Welfare Costs extended to Survivors must extend through the recovery period, and mayhaps longer, due to degree of Injury. This Author estimated normal average Cost must be around $280k when all Costs are included. Wounded are even more expensive than Dead as the current Economy operates, and these Costs do not include Cost of lost Labor resources.

There is no gainsaying that Iraq is more violent Today, than it even was during the War, if American Bombing and Shelling is excluded from the matrix. American aims and goals in Iraq may have always been altruristic and dellusionary. There are completely so at this Point, if they were ever anything more. We started out to make the World safer from Terrorism, and may have only helped spread it through propagandist ranting against it; not effectively conducting an effective response. The American military must once again admit they lack the resources or training to constrain Civilian populations; something which they not only had to admit in Vietnam, but in the Latin America and the Island nations south of Us.

The Author repeats: We must have an Exit strategy from Our current military commitments. lgl

Wednesday, January 04, 2006

Insecurity at the FED

The Fed Committee records much uncertainity about the current course, simply stating that economic data must be more closely watched. This brings to the fore discussion about the ability and power of Monetarist policy. This Author has long been an advocate of the thought that the scope of Monetarist policy is limited: Countercyclical economic effect forestalls artificial lowering of Interest rates, and implementation of excessive Rates does not combat Inflation as much as retard economic growth.

False low Interest Rates engender a plurge of inefficient Investment because of the easy opportunity to expand low-Shelf Products, which do not have an expanded Market; the Whole effort propelling excess accumulation of Capital equipment and Warehousing capacity. Marginal industries, who rely upon very low per Product profit are adversely injured by expanded Interest Rates because these Firms depend upon borrowed Flow capital more than higher Profit industries. This Theory would indicate the Fed has only a limited range of Rate management in which to influence the Economy. lgl

Tuesday, January 03, 2006

Truth admist Illusion

Mirage and oasis
Energy choices in an age of global warming

This Report uses Scare tactics, some of which should frighten, some should not. The threat of aging nuclear power stations is very real; something must be done soon, and it will be very expensive. The heating Global atmosphere is a problem, as is the Oil Peak; but the later cancels the former to some degree before the realization of the Former. The Oil Peak does present the greatest danger to economic performance. Microgeneration of electricity has its limitations, and serious concentration methodology will have to be utilized to take over major aspects of the Grid; though there is great savings in transmission loss. Microgeneration will eventually entail as large a Capital outlay as nuclear power, if it is to serve as replacement for it.

The intrinsic Cost of the Capital will forestall the extension of electrical power to the currently impoverished population without Power. The fact stands that Local control of electrical generation, whether Microgeneration of Renewable Sources, Fossil Fuels, or nuclear power requires heavy education of Local residents--a further vast Cost. No alternative will be cheap despite all Claims.

The Oil Peak, though, is a very real threat, and will bring economic dislocations; a fact which will operate within the lifespan of the current Young. It is something which will have to be addressed, and relatively quickly. lgl

Monday, January 02, 2006

Sea Ice

The Incredible Shrinking Sea Ice
ByBarber, Fortier, and Byers

First real indication that Climatic Change is not as long-term as everywhere discussed. The Year 2050, under current projections, could see the least multi-year Ice as seen in a million years. We are losing 74,000 km squared of perennial Ice every year, and have been since first noted in 1979. The Report attests that the less refraction of seawater over refraction from Ice will cancel the impact of Greenhouse Gas absorption of the spread of Plant life in the Artic, so that the heat of the Planet Earth will actually increase. The additional Heat will incite further Climate Change.

The Report, though, goes further than a normal 'Save the Whales' type of environmental statement. There will be an expansion of animal life into the Artic, opening of a seaworthy passage some 7000 miles shorter than the route through the Panama Canal capable of potentially handling the Supertankers, and expanded Fisheries. It outlines Canada's problem of asserting territoriality.

What the Report does not fulfill is a statistical framework to evaluate the current Trend's degree of reversibility, which this Author thinks is quite high. The heating of the Ocean waters will generate more Hurricanes, while it will reduce the impact of tsunamis. Wind pattern alterations may redistribute Rainfall regions, and Snowfall will lessen because of the heat. lgl

Sunday, January 01, 2006

New Year Trends

Everyone else may provide Predictions, but this Author will surrender personal desires which he hopes will become Trends. Some of these may seem very complex, but can be sorted out easily with the use of IT. Many among Economists may laugh, but this provision might engender some discussion.

1) All Taxation of Personal Responsibility will be eliminated except for a graduated Business Income Tax, said tax rate grades determined by percentage of Operational Profits--not simple Income levels; reminding that absolutely no Tax deferments be granted at any Time.

2) Gas Taxes will be assessed at the Pump and graduated by the MPG ratings of the vehicle. Commercial freight vehicles will be assessed at only One-Quarter the tax rate as the rest of Motorists. Other Fuel taxes will be graded by type of activity, whether Productive or simple Heating.

3) The Federal Government passes a solid Debt ceiling, where new Spending must be endorsed only with reduction of other Spending at the identical same level.

4) Passage into of a Federal Order than only that level of Federal Employees can be hired each Year, where the total number of Federal Hires will total a Federal Labor Roll some 40% less in 30 years.

5) Passage into Federal law restriction of Subordinate levels of Government for Business Startups through the usage of differential Tax advantages.

Is my list realistic?
The current matrix of Lobbying effort exerted at every level of Government in this Country would say such a Program is unreachable. The dire Trade pattern where Legislators, Representatives, and Senators (not to mention City Councils) sell their Votes to each other to gain Votes for their own agenda forestall the realization. The Budgetary malfeasant of all levels of Government, though, propel for a Change. lgl