Past Accomplishments and Future Challenges
http://assets.aarp.org/rgcenter/health/medicare_40.pdf
According to the latest projections by the
AARP Public Policy Institute, in 2003, non-institutionalized Medicare beneficiaries age 65 and
older spent 22 percent of their income (or $3,455), on average, for health care, including
Medicare cost-sharing, Part B and private insurance premiums, and the costs of goods and
services not covered by Medicare.15 (This estimate excludes the cost of long-term nursing home care and the costs of home care.)
According to the most recent projections of national health expenditures, Medicare
spending is projected to grow by 7.3 percent annually between 2006 and 2014
Medicare program spending is highly concentrated in beneficiaries with chronic conditions: about one-quarter (23%) of Medicare beneficiaries have at least 5 chronic conditions and account for about two-thirds (68%) of Medicare fee-for-service expenditures
A clear Statement of Medicare positioning in the current health care world. The Study makes much of the prospective patient system, which is only a corruption of the average per-visit payment system, solely for the purpose of granting the health care industry higher levels of payment. The Average Per-Visit system could pay $100/Patient Clinic/Doctor visit, care for all Patients (not just Medicare patients), and provide all Expense and Doctor recompensation; the Doctors allowed to determine specific method of treatment. $1000/Outpatient Hospital Visit would care for all Patients (again beyond Medicare), and pay for Hospital Outcare. $2000/Hospital Day would pay for all Patient care, if Government or Medicare paid upfront for all expensive Hospital equipment; this bought competitively and distributed evenly, with Medicare preemption right to treatment use. Estimated Medicare Savings per year: $85 billion with individual enrollee savings of $880 with attendent average Medicare use per year. lgl
Thursday, August 04, 2005
Wednesday, August 03, 2005
DOD Ammunition
July 2005
DEFENSE
AMMUNITION
DOD Meeting Small
and Medium Caliber
Ammunition Needs,
but Additional Actions
Are Necessary
http://www.gao.gov/new.items/d05687.pdf
Ammunition supply stands as absolutely essential in maintenance of an effective Military force. The Republican President, backed by a Republican-dominated Congress, is managing to bottleneck this military component.
Between fiscal years 2000 and 2005, total requirements for small caliber
ammunitions more than doubled, from about 730 million to nearly 1.8 billion
rounds, while total requirements for medium caliber ammunitions increased
from 11.7 million rounds to almost 22 million rounds.
First, the PEO plans to increase Lake
City’s production capacity to 1.5 billion rounds per year by March 2006
through additional modernization. Moreover, the PEO is in the process of
selecting a commercial contractor that will provide an additional
300 million small caliber ammunition rounds per year. This commercial
producer will serve as a second source in addition to Lake City, to meet
small caliber ammunition needs. The contract is to be awarded in mid
2005, with initial deliveries to start in January 2007. Also, the PEO is
requiring that this commercial source be able to supply an additional
200 million rounds of small caliber ammunition, if requirements continue
to increase.
In the event that future small caliber ammunition requirements were to
decrease, which would likely happen if war fighting operations were
scaled back, the PEO plans to reduce the amount of ammunition produced
at Lake City, while maintaining the 300 million rounds of ammunition
production provided by the commercial producer. According to a PEO
official, the reduction at Lake City will be accomplished by reducing the
number of work shifts rather than by storing or mothballing equipment.
Where is the Problem?
Current DOD ammunition requirements rival the needs of WWII, when more than a dozen Ammunition plants operated. Three Government-owned plants still operate, but the most important one cannot meet current Ammunition needs. The Republican-run DOD would farm out Ammunition needs to private Business--even worse--foreign Production capacity. The majority of Production must still be met by three Plants, extremely subject to Military or Terrorist attack; Production which the Military has to possess. Foreign Suppliers can be invested by Enemy forces, be blockaded from delivery, or alter their own Production delivery to serve Interests counter to American national policy.
We need three Plants to supply medium caliber Ammunition, not the underdeveloped two Plants which We possess. We also need three Plants to supply small caliber Ammunition, not the singular, over-extended Plant We have at Lake City. Dispersal of Ammunition Supply capacity is essential. These new Plants need to be Government-owned, and subject to being taken over, and directly run by the Military. Any Military authority, inside or outside the Government, will state extended Lines of Communication are most attackable by any Enemy. No One in their right mind would buy Ammunition half a World away, to import it, then send it clear across the World. lgl
DEFENSE
AMMUNITION
DOD Meeting Small
and Medium Caliber
Ammunition Needs,
but Additional Actions
Are Necessary
http://www.gao.gov/new.items/d05687.pdf
Ammunition supply stands as absolutely essential in maintenance of an effective Military force. The Republican President, backed by a Republican-dominated Congress, is managing to bottleneck this military component.
Between fiscal years 2000 and 2005, total requirements for small caliber
ammunitions more than doubled, from about 730 million to nearly 1.8 billion
rounds, while total requirements for medium caliber ammunitions increased
from 11.7 million rounds to almost 22 million rounds.
First, the PEO plans to increase Lake
City’s production capacity to 1.5 billion rounds per year by March 2006
through additional modernization. Moreover, the PEO is in the process of
selecting a commercial contractor that will provide an additional
300 million small caliber ammunition rounds per year. This commercial
producer will serve as a second source in addition to Lake City, to meet
small caliber ammunition needs. The contract is to be awarded in mid
2005, with initial deliveries to start in January 2007. Also, the PEO is
requiring that this commercial source be able to supply an additional
200 million rounds of small caliber ammunition, if requirements continue
to increase.
In the event that future small caliber ammunition requirements were to
decrease, which would likely happen if war fighting operations were
scaled back, the PEO plans to reduce the amount of ammunition produced
at Lake City, while maintaining the 300 million rounds of ammunition
production provided by the commercial producer. According to a PEO
official, the reduction at Lake City will be accomplished by reducing the
number of work shifts rather than by storing or mothballing equipment.
Where is the Problem?
Current DOD ammunition requirements rival the needs of WWII, when more than a dozen Ammunition plants operated. Three Government-owned plants still operate, but the most important one cannot meet current Ammunition needs. The Republican-run DOD would farm out Ammunition needs to private Business--even worse--foreign Production capacity. The majority of Production must still be met by three Plants, extremely subject to Military or Terrorist attack; Production which the Military has to possess. Foreign Suppliers can be invested by Enemy forces, be blockaded from delivery, or alter their own Production delivery to serve Interests counter to American national policy.
We need three Plants to supply medium caliber Ammunition, not the underdeveloped two Plants which We possess. We also need three Plants to supply small caliber Ammunition, not the singular, over-extended Plant We have at Lake City. Dispersal of Ammunition Supply capacity is essential. These new Plants need to be Government-owned, and subject to being taken over, and directly run by the Military. Any Military authority, inside or outside the Government, will state extended Lines of Communication are most attackable by any Enemy. No One in their right mind would buy Ammunition half a World away, to import it, then send it clear across the World. lgl
Tuesday, August 02, 2005
Sweatshops
Don't get into a lather over sweatshops
By Benjamin Powell and David Skarbek
http://www.csmonitor.com/2005/0802/p09s02-coop.html
Powell and Skarbek simply collated data to prove what all Economists suspected. Sweatshops are located where they will produce the highest Profits for the Owners, coincident with paying the highest Wages to Workers. Attempts to curtail purchase of Sweatshop Goods injure Workers, Sweatshop Owners, and the economies where the Sweatshops are located. These endeavors are not the answer!
There are ways to distinctly affect Sweatshop operations. It requires a two-pronged attack on old business practices. The Standard Sweatshop Workday is twelve hours, not the ten hours suggested in the Article. The goal is to force Sweatshop Operators to give their Workers only a Eight-Hour day. Why? Preliminary sketch modeling by this Author suggests Worker pay will be reduced 22%, but the number of Workers employed will increase over 60%, while the after-Spread Pay must still be higher than the national Average pay to gain Workers. The Employers must migrate to a Two-Shift schedule in order to maintain Production levels, must improve Work conditions with the addition of Lights to maintain Second-Shift production (higher Production levels with Lights will engender Lights staying on both Shifts). The heavier investment in Plant will lead Sweatshop Operators to differential Pay for experienced Labor, easing of Piece-Production demands on Workers, and ease harsh Work conditions. Notice all this was achieved by a simple Work Schedule change, not by asking Anyone to be better People.
The Two-Pronged Effort to get the Worldwide Eight-Hour Workshift is to achieve Labor Treaty accords signed by all nations. National Signatories can be gained by Trade barriers if not signed. These Signatures, though, do not assure Sweatshop compliance with the Accords. Labor Organizations, of the WTO, must maintain standing supervisory personnel to assure compliance (these need not be numerous or expensive, 150 trained individuals could supervise almost all Sweatshops in the World). Rapid Post transfers, and possibly short-Period of Careers, will limit the corruption of such a Supervisory force. The World becomes a better place. lgl
By Benjamin Powell and David Skarbek
http://www.csmonitor.com/2005/0802/p09s02-coop.html
Powell and Skarbek simply collated data to prove what all Economists suspected. Sweatshops are located where they will produce the highest Profits for the Owners, coincident with paying the highest Wages to Workers. Attempts to curtail purchase of Sweatshop Goods injure Workers, Sweatshop Owners, and the economies where the Sweatshops are located. These endeavors are not the answer!
There are ways to distinctly affect Sweatshop operations. It requires a two-pronged attack on old business practices. The Standard Sweatshop Workday is twelve hours, not the ten hours suggested in the Article. The goal is to force Sweatshop Operators to give their Workers only a Eight-Hour day. Why? Preliminary sketch modeling by this Author suggests Worker pay will be reduced 22%, but the number of Workers employed will increase over 60%, while the after-Spread Pay must still be higher than the national Average pay to gain Workers. The Employers must migrate to a Two-Shift schedule in order to maintain Production levels, must improve Work conditions with the addition of Lights to maintain Second-Shift production (higher Production levels with Lights will engender Lights staying on both Shifts). The heavier investment in Plant will lead Sweatshop Operators to differential Pay for experienced Labor, easing of Piece-Production demands on Workers, and ease harsh Work conditions. Notice all this was achieved by a simple Work Schedule change, not by asking Anyone to be better People.
The Two-Pronged Effort to get the Worldwide Eight-Hour Workshift is to achieve Labor Treaty accords signed by all nations. National Signatories can be gained by Trade barriers if not signed. These Signatures, though, do not assure Sweatshop compliance with the Accords. Labor Organizations, of the WTO, must maintain standing supervisory personnel to assure compliance (these need not be numerous or expensive, 150 trained individuals could supervise almost all Sweatshops in the World). Rapid Post transfers, and possibly short-Period of Careers, will limit the corruption of such a Supervisory force. The World becomes a better place. lgl
Monday, August 01, 2005
Legislative bureaucracy
Japan imposed Steel tariffs, joining most of the World, simply because the Byrd amendment will not die. Bush waits until Congress stands in Recess, before he can appoint his own U.N. Envoy. Congress can only seem to pass omnibus bills--where every Senator and Representative gets to write two Pages of his own copy. Is it true that they used a Semi-tractor to haul the Energy bill to the White House?
Congress is currently in Recess, as previously mentioned, and the Nation is probably safer for that fact. This Author advocated the use of closing Military bases to build Cracking Plants and Refineries. There is rationale even for leaving the bases open, building the Refining capacity, and leasing the Plants to private Contractors. The Military could be assured of sufficient Output in national emergency, provide greater security for Plant facilities, and utilize Government Upgrade and Maintenance schedules to minimize Fire/Explosion hazards. Congress, though, would have to do something rarely done--Act. lgl
Congress is currently in Recess, as previously mentioned, and the Nation is probably safer for that fact. This Author advocated the use of closing Military bases to build Cracking Plants and Refineries. There is rationale even for leaving the bases open, building the Refining capacity, and leasing the Plants to private Contractors. The Military could be assured of sufficient Output in national emergency, provide greater security for Plant facilities, and utilize Government Upgrade and Maintenance schedules to minimize Fire/Explosion hazards. Congress, though, would have to do something rarely done--Act. lgl
Sunday, July 31, 2005
Economic Fuel
GDP Revised Down 2001-2004
Posted by John Irons at July 29, 2005 04:34 PM
http://www.argmax.com/mt_blog/archive/000557.php
Revisions to 2002-2004 estimates
The percent change from the preceding year in real GDP was revised down for all 3 years: From 1.9 percent to 1.6 percent for 2002, from 3.0 percent to 2.7 percent for 2003, and from 4.4 percent to 4.2 percent for 2004.
This startles very little, because revisions of original data is common as more precise measurements are added. The consistent reduction through the Years also can be somewhat standard, simply based on types of measurements and Readings used. None of the foregoing is of especial concern; at least, until you look at the size of the yearly numbers, compare the Dates with Bush and Republican fuel for the economy, and collate with the data. 2002 was at stall speed, 2003 are ridiculous numbers considering how much Cash Federal spending threw into the economy, and 2004 should be degraded far below 4.2% to get an actual growth rate minus the (supposedly) one-time War expenditures.
This Author has always been skeptical of Keynesian fueling of the economy. The monetarist theory of low Interest rates does not jibe with the economic growth data either, as the Economy has taken off under the Fed raising Interest rates. It also suffers from the fact of no American Savings, and a huge American government draft of World financial resources. It must, in fairness, be stated that American Savings are basically hidden by current Economic models--which have yet to evaluate increased American involvement in new Housing and Investments. The two elements are not technically Savings, but not truly Consumption either.
This Author is so old-fashioned economically that he has come full circle. His belief states the only genuine economic fuel for an Economy stands as balanced Government budgets, where Taxes absorb Inflation, Government spending is curbed, and Government debt is the dinosaur. lgl
Posted by John Irons at July 29, 2005 04:34 PM
http://www.argmax.com/mt_blog/archive/000557.php
Revisions to 2002-2004 estimates
The percent change from the preceding year in real GDP was revised down for all 3 years: From 1.9 percent to 1.6 percent for 2002, from 3.0 percent to 2.7 percent for 2003, and from 4.4 percent to 4.2 percent for 2004.
This startles very little, because revisions of original data is common as more precise measurements are added. The consistent reduction through the Years also can be somewhat standard, simply based on types of measurements and Readings used. None of the foregoing is of especial concern; at least, until you look at the size of the yearly numbers, compare the Dates with Bush and Republican fuel for the economy, and collate with the data. 2002 was at stall speed, 2003 are ridiculous numbers considering how much Cash Federal spending threw into the economy, and 2004 should be degraded far below 4.2% to get an actual growth rate minus the (supposedly) one-time War expenditures.
This Author has always been skeptical of Keynesian fueling of the economy. The monetarist theory of low Interest rates does not jibe with the economic growth data either, as the Economy has taken off under the Fed raising Interest rates. It also suffers from the fact of no American Savings, and a huge American government draft of World financial resources. It must, in fairness, be stated that American Savings are basically hidden by current Economic models--which have yet to evaluate increased American involvement in new Housing and Investments. The two elements are not technically Savings, but not truly Consumption either.
This Author is so old-fashioned economically that he has come full circle. His belief states the only genuine economic fuel for an Economy stands as balanced Government budgets, where Taxes absorb Inflation, Government spending is curbed, and Government debt is the dinosaur. lgl
Free Traders
Saturday, July 30, 2005
Economics, Politics, and Sausage
http://angrybear.blogspot.com/2005/07/economics-politics-and-sausage.html
I’m surprised that we do not hear more conservatives asking our policymakers to "just say no". No to diversions from free trade cloaked in the language of trade agreements. No to the pork in the highway bill. And no to a give away to the shareholders of oil companies (which happens to include me in a wee way) financed by deferred tax bills on the kids
Might I plea with him and other conservative economists in joining pro-growth liberals in telling this White House and Congress to cease with such pork paid for by future taxes on the kids?
PGL (and the rest of the crew at Angry Bear) are some of the best econ bloggers; liberal, but with high quality of statistics, research, and thought. This to let the Reader know I am not picking on PGL or Angry Bear. The second element consists of the Author having heard the Ricardian argument for Trade dozens of times. This Author can now present his own view on Free Trade.
Trade can become disadvantageous to One or Both participants, and still serve the basic Ricardian argument. The competition for cheapest Production Costs inherent in the Ricardian argument must be based on actual geoeconomic advantage. A reduction to simple Wage competition reduces Trade Advantage to simple World Wage Averaging, a Concept which sounds great, but is as destructive as most other Income Redistribution schemes devised. The greatest incentive for growth comes from the knowledge that a better, more comfortable life can be attained. World Wage Averaging would actually destroy economic incentive.
Economics used to utilize a concept called prerequisite growth, an idea this Author has not heard of in a long time. The fundamental idea behind this concept states that Social structures can only be developed under a specific structure of economic development. Lack of this economic development will impact future development. Would the Social Security system have ever developed in this Country, without the development and pressure of Unionism? Conservative philosophy says there should never have been a Social Security system in the first place; this Author suggests they invest Time and energy in What If economic modeling, and determine how elimination of the entire Social Security system since 1935 would have affected Personal Income, total Household assets, and the current level of economic development in the United States. Free Trade, backed by extreme Corporate greed, remains the worst Destroyer of prerequisite growth which exists. lgl
Economics, Politics, and Sausage
http://angrybear.blogspot.com/2005/07/economics-politics-and-sausage.html
I’m surprised that we do not hear more conservatives asking our policymakers to "just say no". No to diversions from free trade cloaked in the language of trade agreements. No to the pork in the highway bill. And no to a give away to the shareholders of oil companies (which happens to include me in a wee way) financed by deferred tax bills on the kids
Might I plea with him and other conservative economists in joining pro-growth liberals in telling this White House and Congress to cease with such pork paid for by future taxes on the kids?
PGL (and the rest of the crew at Angry Bear) are some of the best econ bloggers; liberal, but with high quality of statistics, research, and thought. This to let the Reader know I am not picking on PGL or Angry Bear. The second element consists of the Author having heard the Ricardian argument for Trade dozens of times. This Author can now present his own view on Free Trade.
Trade can become disadvantageous to One or Both participants, and still serve the basic Ricardian argument. The competition for cheapest Production Costs inherent in the Ricardian argument must be based on actual geoeconomic advantage. A reduction to simple Wage competition reduces Trade Advantage to simple World Wage Averaging, a Concept which sounds great, but is as destructive as most other Income Redistribution schemes devised. The greatest incentive for growth comes from the knowledge that a better, more comfortable life can be attained. World Wage Averaging would actually destroy economic incentive.
Economics used to utilize a concept called prerequisite growth, an idea this Author has not heard of in a long time. The fundamental idea behind this concept states that Social structures can only be developed under a specific structure of economic development. Lack of this economic development will impact future development. Would the Social Security system have ever developed in this Country, without the development and pressure of Unionism? Conservative philosophy says there should never have been a Social Security system in the first place; this Author suggests they invest Time and energy in What If economic modeling, and determine how elimination of the entire Social Security system since 1935 would have affected Personal Income, total Household assets, and the current level of economic development in the United States. Free Trade, backed by extreme Corporate greed, remains the worst Destroyer of prerequisite growth which exists. lgl
Saturday, July 30, 2005
Guns and Refineries
A Foreign Affair
Contracting for U.S. Military and Law Enforcement Firearms
http://www.vpc.org/studies/foreign.pdf
Senator Frist again invoking patriotism which does not exist to pay off political lobbys. How? He claims arms supply will go to foreign manufacturers if constraining gun liability litigation is not annulled. Answer of Article: foreign manufacturers already supply the majority of arms for the U.S. Army and American law enforcement. Reply of the Author: Gun liability litigation may already be part of the reason foreign manufacturers currently control the majority of arms supply sales. Fact states, though, that Gun liability litigation possesses no fear for Those who use the weaponry responsibly, or for the arms suppliers. The second element states that why should foreign manufacturers enjoy a greater advantage over domestic arms suppliers, when it comes to gun liability litigation (Secret: they don't possess any advantage in American Courts).
The good Senator should attempt to ease Oil Refinery liability litigation instead. Refinery explosions and Fires are overwhelmingly caused by Carelessness. Refinery Management and Labor are not stupid; they know the exact Cost of these Events, both in terms of Injuries and Deaths, but also in term of Production delays from Cleanup and resumption of Operations. There remains only one real Cause for these Events--excessive haste; the type of haste which comes from attempted Overuse of Plant capacity. Everyone tries to convince Americans they have a lack of Refining capacity, but Congress, State, County, and City will not allow the proper Permits to build new Refining capacity. It is time for Change! lgl
Contracting for U.S. Military and Law Enforcement Firearms
http://www.vpc.org/studies/foreign.pdf
Senator Frist again invoking patriotism which does not exist to pay off political lobbys. How? He claims arms supply will go to foreign manufacturers if constraining gun liability litigation is not annulled. Answer of Article: foreign manufacturers already supply the majority of arms for the U.S. Army and American law enforcement. Reply of the Author: Gun liability litigation may already be part of the reason foreign manufacturers currently control the majority of arms supply sales. Fact states, though, that Gun liability litigation possesses no fear for Those who use the weaponry responsibly, or for the arms suppliers. The second element states that why should foreign manufacturers enjoy a greater advantage over domestic arms suppliers, when it comes to gun liability litigation (Secret: they don't possess any advantage in American Courts).
The good Senator should attempt to ease Oil Refinery liability litigation instead. Refinery explosions and Fires are overwhelmingly caused by Carelessness. Refinery Management and Labor are not stupid; they know the exact Cost of these Events, both in terms of Injuries and Deaths, but also in term of Production delays from Cleanup and resumption of Operations. There remains only one real Cause for these Events--excessive haste; the type of haste which comes from attempted Overuse of Plant capacity. Everyone tries to convince Americans they have a lack of Refining capacity, but Congress, State, County, and City will not allow the proper Permits to build new Refining capacity. It is time for Change! lgl
Friday, July 29, 2005
The Crippled Horse
E.P.A. Holds Back Report on Car Fuel Efficiency
By DANNY HAKIM
Published: July 28, 2005
http://www.nytimes.com/2005/07/28/business/28fuel.html
Jist of the Argument: the Bush administration is hiding the bad news until their pet Energy bill gets passed, nothing new in Washington. What is the bad news? Fuel efficiency of Vehicles, both American and foreign, is going Down rather than the desired Up in terms of miles per gallon. Great hidden Secret? Americans have been switching to heavier vehicles for years, and Some could ask Why? This Author has a Brother-in-Law who is one of safer Drivers he has known, who recently contacted with a Semi-Tractor at only medium speed. The heavy SUV prevented this Author having to spend what remaining Vacation time he has left on attending funerals. Just because you are paranoid, doesn't mean that they won't get you!
The Energy Bill before Congress, though, stands as a totally different vehicle of Corporate lobbying effort. Utilities are allowed to use higher-priced Energy generation (and set their Costumer unit charges from this Cost), get tax credits to defray the added Cost, and allowed ability to ignore any potential increase in pollution (remember that Bush allowed the dirty Coal plants to reopen, after years of Closure). Car companies are allowed to ignore both current mileage per gallon requirements, and coincidently, current Pollution standards. The addition of ethanol, heavily financed by Tax credits in the Bill, will reduce mpgs much further, as alcohol is much less efficient as fuel than Gasoline. Renewable energy is also underwritten, but only in creation of artificially-high Cost massive generation facilities, not the more productive and less pollutive environmentally-integrated energy generation of local initiative. lgl
By DANNY HAKIM
Published: July 28, 2005
http://www.nytimes.com/2005/07/28/business/28fuel.html
Jist of the Argument: the Bush administration is hiding the bad news until their pet Energy bill gets passed, nothing new in Washington. What is the bad news? Fuel efficiency of Vehicles, both American and foreign, is going Down rather than the desired Up in terms of miles per gallon. Great hidden Secret? Americans have been switching to heavier vehicles for years, and Some could ask Why? This Author has a Brother-in-Law who is one of safer Drivers he has known, who recently contacted with a Semi-Tractor at only medium speed. The heavy SUV prevented this Author having to spend what remaining Vacation time he has left on attending funerals. Just because you are paranoid, doesn't mean that they won't get you!
The Energy Bill before Congress, though, stands as a totally different vehicle of Corporate lobbying effort. Utilities are allowed to use higher-priced Energy generation (and set their Costumer unit charges from this Cost), get tax credits to defray the added Cost, and allowed ability to ignore any potential increase in pollution (remember that Bush allowed the dirty Coal plants to reopen, after years of Closure). Car companies are allowed to ignore both current mileage per gallon requirements, and coincidently, current Pollution standards. The addition of ethanol, heavily financed by Tax credits in the Bill, will reduce mpgs much further, as alcohol is much less efficient as fuel than Gasoline. Renewable energy is also underwritten, but only in creation of artificially-high Cost massive generation facilities, not the more productive and less pollutive environmentally-integrated energy generation of local initiative. lgl
Thursday, July 28, 2005
China Prospects
OVERVIEW OF THE CHINESE ECONOMY
Chairman Jim Saxton (R-NJ),
Joint Economic Committee, United States Congress,July 2005
http://www.house.gov/jec/publications/109/07-26-05china.pdf
The Report is an excellent Read, but suffers from the Western economic viewpoint. The focus was on the nonperforming loans (NPLs) held by the Chinese banks. Roubini and Setser(2005) probably provides the best evaluation of the Cost of a bad loan problem resolution. China, or its Government, maintains the climate needed to prevent such a crisis resolution. How? Through prevention of alternate forms of investment other than investment. The lack of high levels of Corporate stock, annunities, insurance, and lack of genuine retirement benefits ensure a huge level of Savings--as self-insurance against adversity. This Savings, which is only slowly dissipated, covers the lost revenue of the NPLs.
Why won't the Government or the four major Banks change, and reduce the NPLs?
The answer is contained in the last of the Report:
However, Jinghai Zheng and Anagang Hu (2004) found that the growth in PRCÂ’s total factor productivity68 decelerated dramatically from 3.2 percent a year for 1978-1995 to 0.6 percent a year for 1995-2001.69 Total factor productivity measures the growth in output that is not attributable to increases in factor inputs such as labor and capital assets. Thus, total factor productivity represents the gains from efficiency improvements and technological innovation.
The combination of a high rate of labor productivity and a dropping rate of total factor productivity means that the marginal productivity of new capital assets is falling. This is further evidence that domestic firms are investing in too many capital assets or the wrong types of capital assets given the PRCÂ’s comparative advantage in plentiful, low-cost labor
The Report does not go into the fact that SOEs(State Owned) and SIEs (functionally State-controlled) enterprises employ about 99 million Workers(2004), produce 53.9% of Chinese GDP(2003), and accounts for 76.7% of total PRC capital investments (2003). This information was all in the Report. Also mentioned was the fact that Chinese affiliates of multinational business firms employed 10 million Workers(2004). Now comes that left unsaid:
The Chinese domestic economy has not been stagnant since 1982, but growing much slower than Export Production sectors. The Later provides a huge nominal production, but with relatively slight employment per total size of the Chinese economy. Some 35% of the SOEs were unprofitable in 2004, yet they employ a huge labor force. Elimination of the NPLs would demand shutter of SOEs employing a much larger labor force, than that employed in the Export Production sectors. China already suffers from intense rural migration to the Cities in search of employment. It cannot endure the loss of 30 million Jobs, even if they come from SOEs which are unprofitable.
The Report also implies China has benefited greatly from integration in the global economy. This Author is not so sure. Production for the Global economy is not sufficient; an economy must also assume a comparative consumption from the global economy. This does not necessarily mean consumption of Imports, but can mean a development of a domestic market for the Products currently being produced for Export; the growth actually impacting the domestic economic growth positively, not with the simple negative of domestic inflation. There is still no sign of a effectual domestic market for such technological progression. lgl
Chairman Jim Saxton (R-NJ),
Joint Economic Committee, United States Congress,July 2005
http://www.house.gov/jec/publications/109/07-26-05china.pdf
The Report is an excellent Read, but suffers from the Western economic viewpoint. The focus was on the nonperforming loans (NPLs) held by the Chinese banks. Roubini and Setser(2005) probably provides the best evaluation of the Cost of a bad loan problem resolution. China, or its Government, maintains the climate needed to prevent such a crisis resolution. How? Through prevention of alternate forms of investment other than investment. The lack of high levels of Corporate stock, annunities, insurance, and lack of genuine retirement benefits ensure a huge level of Savings--as self-insurance against adversity. This Savings, which is only slowly dissipated, covers the lost revenue of the NPLs.
Why won't the Government or the four major Banks change, and reduce the NPLs?
The answer is contained in the last of the Report:
However, Jinghai Zheng and Anagang Hu (2004) found that the growth in PRCÂ’s total factor productivity68 decelerated dramatically from 3.2 percent a year for 1978-1995 to 0.6 percent a year for 1995-2001.69 Total factor productivity measures the growth in output that is not attributable to increases in factor inputs such as labor and capital assets. Thus, total factor productivity represents the gains from efficiency improvements and technological innovation.
The combination of a high rate of labor productivity and a dropping rate of total factor productivity means that the marginal productivity of new capital assets is falling. This is further evidence that domestic firms are investing in too many capital assets or the wrong types of capital assets given the PRCÂ’s comparative advantage in plentiful, low-cost labor
The Report does not go into the fact that SOEs(State Owned) and SIEs (functionally State-controlled) enterprises employ about 99 million Workers(2004), produce 53.9% of Chinese GDP(2003), and accounts for 76.7% of total PRC capital investments (2003). This information was all in the Report. Also mentioned was the fact that Chinese affiliates of multinational business firms employed 10 million Workers(2004). Now comes that left unsaid:
The Chinese domestic economy has not been stagnant since 1982, but growing much slower than Export Production sectors. The Later provides a huge nominal production, but with relatively slight employment per total size of the Chinese economy. Some 35% of the SOEs were unprofitable in 2004, yet they employ a huge labor force. Elimination of the NPLs would demand shutter of SOEs employing a much larger labor force, than that employed in the Export Production sectors. China already suffers from intense rural migration to the Cities in search of employment. It cannot endure the loss of 30 million Jobs, even if they come from SOEs which are unprofitable.
The Report also implies China has benefited greatly from integration in the global economy. This Author is not so sure. Production for the Global economy is not sufficient; an economy must also assume a comparative consumption from the global economy. This does not necessarily mean consumption of Imports, but can mean a development of a domestic market for the Products currently being produced for Export; the growth actually impacting the domestic economic growth positively, not with the simple negative of domestic inflation. There is still no sign of a effectual domestic market for such technological progression. lgl
Wednesday, July 27, 2005
The E-Government Act of 2002
July 2005
FEDERAL CONTRACTING
Share-in-Savings Initiative Not Yet Tested
GAO-05-736
http://www.gao.gov/new.items/d05736.pdf
Federal agencies spend billions of dollars every year on information technology. Increasingly, agencies are using performance-based contracting methods where they specify desired outcomes and allow contractors to design the best solutions to achieve those outcomes. Share-in-savings contracting is one such method under which a contractor provides funding for a project, and the agency compensates the contractor from any savings derived as a result of contract performance.
The E-Government Act of 2002 authorized the use of share-in-savings contracting for information technology and required implementing regulations by mid-September 2003. The Office of Management and Budget (OMB) reported in December 2004 that no share-in-savings contracts had been awarded. The act’s authority expires in September 2005
A bad entitlement clearly recognized by the bureaucrats employed by the Federal agencies. Actual rationale for the lack of use: the speed of Information technology development, the actual low cost of said development, and the resultant speed of Displacement of technology. Quality of Development depends on the skills of Design labor. Bureaucrats know they could commit their Agency to paying Billions of Dollars for an Information package supplanted before its completion, by some College Student working on his PC; the total Copyrighted and selling for $99 plus Sales tax. Said bureaucrat begins to wonder if their Agency has an office in Guadacanal. Such people will not even bet on Who buys the coffee at Coffee Break. lgl
FEDERAL CONTRACTING
Share-in-Savings Initiative Not Yet Tested
GAO-05-736
http://www.gao.gov/new.items/d05736.pdf
Federal agencies spend billions of dollars every year on information technology. Increasingly, agencies are using performance-based contracting methods where they specify desired outcomes and allow contractors to design the best solutions to achieve those outcomes. Share-in-savings contracting is one such method under which a contractor provides funding for a project, and the agency compensates the contractor from any savings derived as a result of contract performance.
The E-Government Act of 2002 authorized the use of share-in-savings contracting for information technology and required implementing regulations by mid-September 2003. The Office of Management and Budget (OMB) reported in December 2004 that no share-in-savings contracts had been awarded. The act’s authority expires in September 2005
A bad entitlement clearly recognized by the bureaucrats employed by the Federal agencies. Actual rationale for the lack of use: the speed of Information technology development, the actual low cost of said development, and the resultant speed of Displacement of technology. Quality of Development depends on the skills of Design labor. Bureaucrats know they could commit their Agency to paying Billions of Dollars for an Information package supplanted before its completion, by some College Student working on his PC; the total Copyrighted and selling for $99 plus Sales tax. Said bureaucrat begins to wonder if their Agency has an office in Guadacanal. Such people will not even bet on Who buys the coffee at Coffee Break. lgl
Tuesday, July 26, 2005
Energy Bill
Lawmakers Reach a Deal on New Energy Policies
By CARL HULSE
Published: July 26, 2005
http://www.nytimes.com/2005/07/26/politics/26cnd-energy.html?
The article contains all the major elements about the Bill. The Bill stinks, and lawmakes of Yesteryear would have been ashamed to consider passage of such trash. A omnibus bill only hides the undesirable crap, underfunds or does not fund desirable elements, and gives away Taxpayer funds to the undeserved. An examination of the mechanizations could be helpful.
Lawmakers cut out two provisions to limit Consumption of fossil fuels because they were too restrictive, but they conveniently ignored nine other methodologies to effect the same curb without the undesirable aspects. They refused to give the President authority to initiate a proposed reduction of Oil consumption because it might make an impact for the President to mandate a program which would work, in the process cutting Oil company profits. The renewable portfolio standard was actually defeated some years ago, when the original provision called for a mandate on Utilities to use the cheapest source of energy generation, rather than an artificial structural goal of 10% renewable which is easily defeated.
The real interest comes in the waiver of royalties and taxes for the richest industry in the World, whose actual Share profits could not have done less than triple over the past two years. (Some Students might be misled, Share profits are Profits/Volume, not Corporate stock.) The interesting element here stands as the Oil industry's apparent disinterest in using those Profits to find new Oil, or increase the rate and amount of Drilling operations. lgl
By CARL HULSE
Published: July 26, 2005
http://www.nytimes.com/2005/07/26/politics/26cnd-energy.html?
The article contains all the major elements about the Bill. The Bill stinks, and lawmakes of Yesteryear would have been ashamed to consider passage of such trash. A omnibus bill only hides the undesirable crap, underfunds or does not fund desirable elements, and gives away Taxpayer funds to the undeserved. An examination of the mechanizations could be helpful.
Lawmakers cut out two provisions to limit Consumption of fossil fuels because they were too restrictive, but they conveniently ignored nine other methodologies to effect the same curb without the undesirable aspects. They refused to give the President authority to initiate a proposed reduction of Oil consumption because it might make an impact for the President to mandate a program which would work, in the process cutting Oil company profits. The renewable portfolio standard was actually defeated some years ago, when the original provision called for a mandate on Utilities to use the cheapest source of energy generation, rather than an artificial structural goal of 10% renewable which is easily defeated.
The real interest comes in the waiver of royalties and taxes for the richest industry in the World, whose actual Share profits could not have done less than triple over the past two years. (Some Students might be misled, Share profits are Profits/Volume, not Corporate stock.) The interesting element here stands as the Oil industry's apparent disinterest in using those Profits to find new Oil, or increase the rate and amount of Drilling operations. lgl
Monday, July 25, 2005
Spread of Imagination
On the Contrary
The Green Machine That Could Be Detroit
By DANIEL AKST
Published: July 24, 2005
http://www.nytimes.com/2005/07/24/business/yourmoney/24cont.html
Akst asks an intriguing question, but then suffers from a basic Journalist funk, and limits his article to what is provable as possible implications. A good article suffers from a lack of genuine speculation because Journalists are Source-sensitive to maintain integrity. The trouble comes in the existence of many other advantages which cannot be immediately sourced for truth.
The future Auto industry should not pattern itself off its own earlier Role model. One of the great Business successes of Our time revolves around Bill Gate's refusal to sell a DOS system, insisting instead on the lease of this system. The 'Green' Car company will be the One which does not sell automobiles, does not simply lease them, but provides full Service for them to the point of providing the fuel used in them; all for one simple monthly rate dependent on mileage usage by Contract.
What are the Advantages?
The Consumer does not have to assume a large Consumer debt, which is the major detriment to purchases, and is even freed from worry about unexpected Service charges; this a major concern when setting Consumption sights higher than the basic formula cars. The Car company has a Production schedule set by the size of their Distribution and Service network, not current Consumer worries about the state of the economy. The Car company can still provide a spread of vehicles, from base model to extreme luxury; differentiated only by monthly rental charge. Business loves the system, even better than Program cars, as the upfront charges can be avoided. A real push could make such a "Green' Car company the major Provider of Taxis, Delivery vehicles, and Government transportation. Fuel efficiency could be maintained by a consistent Maintenance schedule. The route to the Green lies in Service, not cheap Parts. lgl
The Green Machine That Could Be Detroit
By DANIEL AKST
Published: July 24, 2005
http://www.nytimes.com/2005/07/24/business/yourmoney/24cont.html
Akst asks an intriguing question, but then suffers from a basic Journalist funk, and limits his article to what is provable as possible implications. A good article suffers from a lack of genuine speculation because Journalists are Source-sensitive to maintain integrity. The trouble comes in the existence of many other advantages which cannot be immediately sourced for truth.
The future Auto industry should not pattern itself off its own earlier Role model. One of the great Business successes of Our time revolves around Bill Gate's refusal to sell a DOS system, insisting instead on the lease of this system. The 'Green' Car company will be the One which does not sell automobiles, does not simply lease them, but provides full Service for them to the point of providing the fuel used in them; all for one simple monthly rate dependent on mileage usage by Contract.
What are the Advantages?
The Consumer does not have to assume a large Consumer debt, which is the major detriment to purchases, and is even freed from worry about unexpected Service charges; this a major concern when setting Consumption sights higher than the basic formula cars. The Car company has a Production schedule set by the size of their Distribution and Service network, not current Consumer worries about the state of the economy. The Car company can still provide a spread of vehicles, from base model to extreme luxury; differentiated only by monthly rental charge. Business loves the system, even better than Program cars, as the upfront charges can be avoided. A real push could make such a "Green' Car company the major Provider of Taxis, Delivery vehicles, and Government transportation. Fuel efficiency could be maintained by a consistent Maintenance schedule. The route to the Green lies in Service, not cheap Parts. lgl
Sunday, July 24, 2005
Union Turmoil
AP: 4 Unions to Boycott AFL - CIO Meeting
By THE ASSOCIATED PRESS
Published: July 24, 2005
http://www.nytimes.com/aponline/business/AP-Labor-Rift.html?
Strange fare for Economists, battling unions are (shades of Yoda). The article says a lot, but a lot it left unsaid. The Carpenters and Joiners are a large union who has already quit the AFL-CIO, and the fight is more Blue Collar against Office workers than Anyone wants to admit. The Later want the Status Quo and John Sweeney. The Former wants Workers out on the streets to stop the drain of Jobs from the American economy--the drain is there, but overwhelmingly limited to their sectors. The Office workers (mostly Civil Service) have little fear of Job loss, wanting only patterned packages of Raises and Benefits. The Split was bound to come!
The Blue Collar workers feel they are under-represented, with all Union officialdom functionally College-educated, and MBAs controlling both Sides of any union negotiations. They suspect union leadership does not spend on Organizing efforts out of a greater desire to improve their own Pay packages. NAFTA produces the approximate damage to the Unions' position as most members suspicioned it would. Rank-and-File membership see no organized attempt to forestall CAFTA. The Split will likely be permanent, and along Occupational lines.
The Impact will undoubtedly be great, and not truly a loss for Labor. The more-energized Blue Collar unions will combat Republican influence with the Grass Roots Voters, with Republican leadership finding they do not own the Local issues at all. A whole new crop of Democratic Legislators will likely show up in State Capitols, Ones who have already committed Votes on Bread and Butter legislation. Democratic and Republican national Office-Holders will face greater Voter knowledge of their Voting record, and their sources of Income. The Blue Collar Movement will do battle for the Republican-dominated Congress, and will likely win eventually. lgl
By THE ASSOCIATED PRESS
Published: July 24, 2005
http://www.nytimes.com/aponline/business/AP-Labor-Rift.html?
Strange fare for Economists, battling unions are (shades of Yoda). The article says a lot, but a lot it left unsaid. The Carpenters and Joiners are a large union who has already quit the AFL-CIO, and the fight is more Blue Collar against Office workers than Anyone wants to admit. The Later want the Status Quo and John Sweeney. The Former wants Workers out on the streets to stop the drain of Jobs from the American economy--the drain is there, but overwhelmingly limited to their sectors. The Office workers (mostly Civil Service) have little fear of Job loss, wanting only patterned packages of Raises and Benefits. The Split was bound to come!
The Blue Collar workers feel they are under-represented, with all Union officialdom functionally College-educated, and MBAs controlling both Sides of any union negotiations. They suspect union leadership does not spend on Organizing efforts out of a greater desire to improve their own Pay packages. NAFTA produces the approximate damage to the Unions' position as most members suspicioned it would. Rank-and-File membership see no organized attempt to forestall CAFTA. The Split will likely be permanent, and along Occupational lines.
The Impact will undoubtedly be great, and not truly a loss for Labor. The more-energized Blue Collar unions will combat Republican influence with the Grass Roots Voters, with Republican leadership finding they do not own the Local issues at all. A whole new crop of Democratic Legislators will likely show up in State Capitols, Ones who have already committed Votes on Bread and Butter legislation. Democratic and Republican national Office-Holders will face greater Voter knowledge of their Voting record, and their sources of Income. The Blue Collar Movement will do battle for the Republican-dominated Congress, and will likely win eventually. lgl
Friday, July 22, 2005
Employment News
What do we know about job loss in the United States?
Evidence from the Displaced Workers Survey, 1984–2004
Henry S. Farber
http://www.chicagofed.org/publications/economicperspectives/ep_2qtr2005_part2_farber.pdf
This Author is not near finishing the Work, but several elements glare. Government allocation of the term Temporary Employment should be altered, as Farber claims half of all New Jobs end within one year; this Author (without proof) believes this share of New Jobs has been increasing since the Spring of 2004, until it currently stands over 60%. Entry-level Wages evolve into the prime Characteristic of Employment under such Conditions, yet little Economic evaluation has been made of whether Entry-level Wages have been keeping pace with Inflation. It is probably the leading cause for the lack of Payroll growth.
A second fact lies in the Dropout Rate of Labor from the Employment rolls. The Dropout rate averages about 10% throughout the twenty years, basically unaffected by Expansion or Recession. Statement that Discouraged Workers have dropped from the Labor Force stands as a basic lie, simply a Government tactic to hide that the Unemployment Rate is about the same as the best nations of the EU. Statistics don't lie, and all that!
Farber finds less response to the cyclical pattern of Employment with higher education, but has not so far equated the rise of Temporary Help among the educated Labor; a circumstance, if included, might note a cyclical pattern shown of educated Labor simply being switched to temporary Employment--an employment in which the Worker must fund the Costs of interrupted Income and Employment search. Temporary Help traditionally loses Wages, Benefits, and Pension rights.
Some might have wondered why the Author has dropped from the Labor rolls. lgl
Evidence from the Displaced Workers Survey, 1984–2004
Henry S. Farber
http://www.chicagofed.org/publications/economicperspectives/ep_2qtr2005_part2_farber.pdf
This Author is not near finishing the Work, but several elements glare. Government allocation of the term Temporary Employment should be altered, as Farber claims half of all New Jobs end within one year; this Author (without proof) believes this share of New Jobs has been increasing since the Spring of 2004, until it currently stands over 60%. Entry-level Wages evolve into the prime Characteristic of Employment under such Conditions, yet little Economic evaluation has been made of whether Entry-level Wages have been keeping pace with Inflation. It is probably the leading cause for the lack of Payroll growth.
A second fact lies in the Dropout Rate of Labor from the Employment rolls. The Dropout rate averages about 10% throughout the twenty years, basically unaffected by Expansion or Recession. Statement that Discouraged Workers have dropped from the Labor Force stands as a basic lie, simply a Government tactic to hide that the Unemployment Rate is about the same as the best nations of the EU. Statistics don't lie, and all that!
Farber finds less response to the cyclical pattern of Employment with higher education, but has not so far equated the rise of Temporary Help among the educated Labor; a circumstance, if included, might note a cyclical pattern shown of educated Labor simply being switched to temporary Employment--an employment in which the Worker must fund the Costs of interrupted Income and Employment search. Temporary Help traditionally loses Wages, Benefits, and Pension rights.
Some might have wondered why the Author has dropped from the Labor rolls. lgl
Army Transformation
Stretched Thin
Army Forces for Sustained Operations
Lynn E. Davis, J. Michael Polich, William M. Hix,
Michael D. Greenberg, Stephen D. Brady,
Ronald E. Sortor
http://www.rand.org/pubs/monographs/2005/RAND_MG362.pdf
A Must Read for Those interested in current Administration and Command policy; take the time to read at least the Summary.
Alternatively: What If High Overseas Rotation Requirements
Continue for Some Time? To meet requirements levels in the upper
range that we have considered—14 to 20 brigades—the Army would
experience serious problems in AC unit readiness and the nation
would have few if any ready AC brigades to turn to in a crisis. Transforming
the Army into the planned structure of 43 active transformed
brigades will help, but transformation is largely in the future,
The Study examines many avenues, but finds few solutions. This Author will stipulate the three alternatives he finds the most advantageous to transform the Army into an effective Ready Force:
1) Reintroduce the Draft: This revitalizes the Force with Numbers, Youth, undiffused loyalty to the Unit (non-confused by commitments to family), and willingness to accept lower Payscales (no Colas for Draftees). The youthful integrity of the Unit can be enhanced by Mandatory Retirement at Age 32 (or the birth of a Child), unless a E-8 for Enlisted Personnel or Lt. Colonelcy is attained for Officers. The previous stipulation would allow curtailment of Retirement benefits for Military personnel to be reduced, while providing a more capable, Ready Force with youthful endurance and capacity to quickly adjust.
2) The second Option stands as transforming National Guard units into Our Main Force capacity. They would be trained in the basic full battle tactics on a steady basis for the defense of the Nation, while active Army Units would be trained in the basic Population-control measures, which is the main duty of deployed Units presently. The Author knows that the Army, especially High Command, loves this Option.
3) Forget the Brigade Combat Team crap. Forget the Nation-Building crap. Forget the 'Make the World safe for Democracy' crap. Forget the 'War on Terrorism by shooting an Afghani Sheepherder' crap. Build Five Carrier Strike Force Groups, each with rotating Regiment of Marines, it's own Seal Team along with an additional Marine LRRP battalion, and leave the Army at home to play soldier. lgl
Wrongway Carrigan?
Pentagon Proposes Rise in Age Limit for Recruits
By DAMIEN CAVE
Published: July 22, 2005
http://www.nytimes.com/2005/07/22/politics/22recruit.html?
Draft, Stupid, not Old Folks Home. lgl
Army Forces for Sustained Operations
Lynn E. Davis, J. Michael Polich, William M. Hix,
Michael D. Greenberg, Stephen D. Brady,
Ronald E. Sortor
http://www.rand.org/pubs/monographs/2005/RAND_MG362.pdf
A Must Read for Those interested in current Administration and Command policy; take the time to read at least the Summary.
Alternatively: What If High Overseas Rotation Requirements
Continue for Some Time? To meet requirements levels in the upper
range that we have considered—14 to 20 brigades—the Army would
experience serious problems in AC unit readiness and the nation
would have few if any ready AC brigades to turn to in a crisis. Transforming
the Army into the planned structure of 43 active transformed
brigades will help, but transformation is largely in the future,
The Study examines many avenues, but finds few solutions. This Author will stipulate the three alternatives he finds the most advantageous to transform the Army into an effective Ready Force:
1) Reintroduce the Draft: This revitalizes the Force with Numbers, Youth, undiffused loyalty to the Unit (non-confused by commitments to family), and willingness to accept lower Payscales (no Colas for Draftees). The youthful integrity of the Unit can be enhanced by Mandatory Retirement at Age 32 (or the birth of a Child), unless a E-8 for Enlisted Personnel or Lt. Colonelcy is attained for Officers. The previous stipulation would allow curtailment of Retirement benefits for Military personnel to be reduced, while providing a more capable, Ready Force with youthful endurance and capacity to quickly adjust.
2) The second Option stands as transforming National Guard units into Our Main Force capacity. They would be trained in the basic full battle tactics on a steady basis for the defense of the Nation, while active Army Units would be trained in the basic Population-control measures, which is the main duty of deployed Units presently. The Author knows that the Army, especially High Command, loves this Option.
3) Forget the Brigade Combat Team crap. Forget the Nation-Building crap. Forget the 'Make the World safe for Democracy' crap. Forget the 'War on Terrorism by shooting an Afghani Sheepherder' crap. Build Five Carrier Strike Force Groups, each with rotating Regiment of Marines, it's own Seal Team along with an additional Marine LRRP battalion, and leave the Army at home to play soldier. lgl
Wrongway Carrigan?
Pentagon Proposes Rise in Age Limit for Recruits
By DAMIEN CAVE
Published: July 22, 2005
http://www.nytimes.com/2005/07/22/politics/22recruit.html?
Draft, Stupid, not Old Folks Home. lgl
Thursday, July 21, 2005
The AMT
Tax Panel Wants to End Alternative Minimum Tax
By DAVID E. ROSENBAUM
Published: July 21, 2005
http://www.nytimes.com/2005/07/21/business/21tax.html?
Over the years, more and more middle-income Americans have become subject to the tax (AMT). Almost four million taxpayers will owe it this year. Unless the law is changed, 20.5 million will owe it in 2006, and 51.3 million, about 45 percent of all taxpayers, will owe it in 2015.
Mr. Mack set five goals for the panel's recommendations: tax filing should be easy and straightforward; the system should be fair and without gimmicks; inefficient tax breaks and loopholes designed for special interests should be scrapped; savings should be encouraged; and barriers to competitiveness in American business should be removed.
Surrounded by breaking News, the floating Yuan and a drop of 34,000 in Jobless claims, this Author chooses to pick on the Tax Panel instead; closely resembling the Panel itself, which never approaches the real issues. Why is the AMT hated by Everyone? Because it is practically the only thing still getting people to pay taxes. It is as the Panel said, they could not agree on how to come up with the $1.2 trillion worth of lost tax revenue(by the way, this should be yearly tax revenue lost by 2015).
Analysis of the News
1) The Chinese will manage the Yuan float to maximize sale of Chinese Goods to the U.S., while paying the least possible for expensive Oil (traded in Dollars).
2) The drop of Jobless claims means little without corresponding data of the average Entry-level Wage for new Hires, knowing We are still around 2.58 continuous claims.
3) The London bombs were obvious amateurs thinking to incite fear, not being aware of London history; from the Great London Fire to the Blitz, Londoners stood fast, and they will again. lgl
By DAVID E. ROSENBAUM
Published: July 21, 2005
http://www.nytimes.com/2005/07/21/business/21tax.html?
Over the years, more and more middle-income Americans have become subject to the tax (AMT). Almost four million taxpayers will owe it this year. Unless the law is changed, 20.5 million will owe it in 2006, and 51.3 million, about 45 percent of all taxpayers, will owe it in 2015.
Mr. Mack set five goals for the panel's recommendations: tax filing should be easy and straightforward; the system should be fair and without gimmicks; inefficient tax breaks and loopholes designed for special interests should be scrapped; savings should be encouraged; and barriers to competitiveness in American business should be removed.
Surrounded by breaking News, the floating Yuan and a drop of 34,000 in Jobless claims, this Author chooses to pick on the Tax Panel instead; closely resembling the Panel itself, which never approaches the real issues. Why is the AMT hated by Everyone? Because it is practically the only thing still getting people to pay taxes. It is as the Panel said, they could not agree on how to come up with the $1.2 trillion worth of lost tax revenue(by the way, this should be yearly tax revenue lost by 2015).
Analysis of the News
1) The Chinese will manage the Yuan float to maximize sale of Chinese Goods to the U.S., while paying the least possible for expensive Oil (traded in Dollars).
2) The drop of Jobless claims means little without corresponding data of the average Entry-level Wage for new Hires, knowing We are still around 2.58 continuous claims.
3) The London bombs were obvious amateurs thinking to incite fear, not being aware of London history; from the Great London Fire to the Blitz, Londoners stood fast, and they will again. lgl
Wednesday, July 20, 2005
Hare-Brained Idea
This Author, like most Economists and Conservatives, finds Government intervention highly suspect, with high probability of eventual damage. The only trouble with such a mind-set comes in a paucity of legislation which could actually help, because We avoid Government regulation as We would the Plague. The current development of Hedge Funds may call for a change of attitude.
Hedge Funds need high Turnover profits in order to survive, in order to pay down the margin borrowing service they engage in. This means they plunge-invest, dumping huge amounts of funds into one stock issuance or commodity until the Market price has risen to sufficient level, that they can make the necessary Turnover profit upon Sale of shares to bandwagon Investors. Commodities are exactly the same as Stock, with $40/barrel Oil selling for $57.68/barrel. The injury of Hedge Funds is clear, but how to limit the excess?
Every avenue of regulation when studied has very ugly connotations for the Market system. It is one of those scenarios where the shortest distance between two points is not a straight line, because the destruction of the environment along the way drives the desired Point further and further away. What is the desired Point? The Answer is quite simple: Stabilized Equity(read as Value) in Stock and Commodities.
Corporate value today stands as overwritten with Stock and Bonds. Hedge Funds value are far too liquid (too flush with funds) because of Margin-borrowing capacity. Is there a fundamental way to stop either practice? Yes and No. What does that mean? We cannot effectively regulate either activity, but We can effectively regulate the Equity value produced.
A Law could be passed stating total Shares of Corporate stock can only be increased by sale to the open Market. Stock Options and Stock Grants can be made to Employees, but said Stock must be bought back by the Corporation anytime Corporate Stock price lowers to level where the initial Stock Option or Grant was made, with no Dividends paid, or Tax credits received by the Corporate entity, until such Buyback is made (in the form of an exact equal number of Shares). The secret of success here lies in automatic Corporate intervention to support their own Stock price.
Commodities must be approached from a different angle. This will become an impediment to Commodity listings. Commodities will be allowing listing, if and only if they are listed with their Production Cost Estimate, Asking Price, and Selling Price. The initial Producer must supply the Production Cost Estimate which must carry through until the Commodity goes to Retailer or Consumer.
Two such laws would help stabilize Corporate stocks and Commodities, one by effective underwriting of Equity price, the other by increasing Market awareness. lgl
Hedge Funds need high Turnover profits in order to survive, in order to pay down the margin borrowing service they engage in. This means they plunge-invest, dumping huge amounts of funds into one stock issuance or commodity until the Market price has risen to sufficient level, that they can make the necessary Turnover profit upon Sale of shares to bandwagon Investors. Commodities are exactly the same as Stock, with $40/barrel Oil selling for $57.68/barrel. The injury of Hedge Funds is clear, but how to limit the excess?
Every avenue of regulation when studied has very ugly connotations for the Market system. It is one of those scenarios where the shortest distance between two points is not a straight line, because the destruction of the environment along the way drives the desired Point further and further away. What is the desired Point? The Answer is quite simple: Stabilized Equity(read as Value) in Stock and Commodities.
Corporate value today stands as overwritten with Stock and Bonds. Hedge Funds value are far too liquid (too flush with funds) because of Margin-borrowing capacity. Is there a fundamental way to stop either practice? Yes and No. What does that mean? We cannot effectively regulate either activity, but We can effectively regulate the Equity value produced.
A Law could be passed stating total Shares of Corporate stock can only be increased by sale to the open Market. Stock Options and Stock Grants can be made to Employees, but said Stock must be bought back by the Corporation anytime Corporate Stock price lowers to level where the initial Stock Option or Grant was made, with no Dividends paid, or Tax credits received by the Corporate entity, until such Buyback is made (in the form of an exact equal number of Shares). The secret of success here lies in automatic Corporate intervention to support their own Stock price.
Commodities must be approached from a different angle. This will become an impediment to Commodity listings. Commodities will be allowing listing, if and only if they are listed with their Production Cost Estimate, Asking Price, and Selling Price. The initial Producer must supply the Production Cost Estimate which must carry through until the Commodity goes to Retailer or Consumer.
Two such laws would help stabilize Corporate stocks and Commodities, one by effective underwriting of Equity price, the other by increasing Market awareness. lgl
Tuesday, July 19, 2005
Foreign View
Owen Harries: Costs of a needless war
http://www.theaustralian.news.com.au/printpage/
0,5942,15959815,00.html
A most important article for All to read! The wars of Iraq and Afghanistan extend far beyond destruction of Terrorist elements and/or al Qaida. The current administration wants to leave a historical legacy, while filling their own coffers with rich Government contracts for their Corporate friends. Many, or Most, of this author's readers disagree with the author's position of the current American military ventures. Foreign attitudes, though, are growing increasingly attuned to this author's views on the Wars. Excerpts:
It is still a fundamental strategic axiom that the availability of means should not determine ends, and there are very powerful reasons why the US, even as the "sole remaining superpower", should be very parsimonious in using its military force actively
Barry McCaffrey, a well-informed and, up to now, dedicated supporter of the war, has recently maintained: "The US Army and the marines are too under-manned and under-resourced to sustain this security policy beyond next [autumn]. They are starting to unravel."
Today we are witnessing in the US not only substantial increases in government expenditure, but a serious diminution of the rule of law in the form of a partial suspension of habeas corpus, a circumventing of the Geneva Convention, a justification of the use of torture, and greater secrecy.
(As I write, it is reported that the Bush administration is classifying documents at the rate of 125 a minute or, if my arithmetic is accurate, 180,000 a day!)
as a general approach to political action a commitment to hold undeviatingly to a line of action, regardless of circumstances or consequences, is foolish and dangerous.
As always in politics, circumstances are crucial. To ignore them and to insist that the mission must proceed regardless is to invite recourse to that old play on Kipling's lines: "If you can keep your head when all about you are losing theirs, you have probably misunderstood the situation."
Indeed, prominent US Republican senator Chuck Hagel virtually said as much last month: "The White House is completely disconnected from reality. It is like they are making it up as they go along. The reality is that we are losing in Iraq."
Owen Harries, a former editor of The National Interest in Washington, DC, is a visiting fellow at the Lowy Institute for International Policy in Sydney.
====================
There are other paramount economic reasons for aborting the present Wars as quickly as possible. The Cost of rebuilding the U.S. military Main Force structure from the deterioration now endured is estimated by this author (and some Others) at $180 billion, with that figure growing by $3 bn per month of continued operations in Iraq and Afghanistan. Future Disability payments can be estimated as increasing (containing Survivor Benefits) by $8 million per year for every additional month spent in Operations in the two countries. Iraq, itself, can be estimated to have lost 2% of its Labor Force to Death or Disability payments since the start of the War.
Can the War in Iraq be won?
Islamic Fundamentalists worldwide will finance Terrorist activity in Iraq, as long as American military forces are on Iraqi soil and conducting military operations. American military presence in Afghanistan only incites support for the Taliban, as they learn to counter American tactics effectively, and are adequately financed from Opium sales. Neocon thinking is not going to cure this headache. lgl
http://www.theaustralian.news.com.au/printpage/
0,5942,15959815,00.html
A most important article for All to read! The wars of Iraq and Afghanistan extend far beyond destruction of Terrorist elements and/or al Qaida. The current administration wants to leave a historical legacy, while filling their own coffers with rich Government contracts for their Corporate friends. Many, or Most, of this author's readers disagree with the author's position of the current American military ventures. Foreign attitudes, though, are growing increasingly attuned to this author's views on the Wars. Excerpts:
It is still a fundamental strategic axiom that the availability of means should not determine ends, and there are very powerful reasons why the US, even as the "sole remaining superpower", should be very parsimonious in using its military force actively
Barry McCaffrey, a well-informed and, up to now, dedicated supporter of the war, has recently maintained: "The US Army and the marines are too under-manned and under-resourced to sustain this security policy beyond next [autumn]. They are starting to unravel."
Today we are witnessing in the US not only substantial increases in government expenditure, but a serious diminution of the rule of law in the form of a partial suspension of habeas corpus, a circumventing of the Geneva Convention, a justification of the use of torture, and greater secrecy.
(As I write, it is reported that the Bush administration is classifying documents at the rate of 125 a minute or, if my arithmetic is accurate, 180,000 a day!)
as a general approach to political action a commitment to hold undeviatingly to a line of action, regardless of circumstances or consequences, is foolish and dangerous.
As always in politics, circumstances are crucial. To ignore them and to insist that the mission must proceed regardless is to invite recourse to that old play on Kipling's lines: "If you can keep your head when all about you are losing theirs, you have probably misunderstood the situation."
Indeed, prominent US Republican senator Chuck Hagel virtually said as much last month: "The White House is completely disconnected from reality. It is like they are making it up as they go along. The reality is that we are losing in Iraq."
Owen Harries, a former editor of The National Interest in Washington, DC, is a visiting fellow at the Lowy Institute for International Policy in Sydney.
====================
There are other paramount economic reasons for aborting the present Wars as quickly as possible. The Cost of rebuilding the U.S. military Main Force structure from the deterioration now endured is estimated by this author (and some Others) at $180 billion, with that figure growing by $3 bn per month of continued operations in Iraq and Afghanistan. Future Disability payments can be estimated as increasing (containing Survivor Benefits) by $8 million per year for every additional month spent in Operations in the two countries. Iraq, itself, can be estimated to have lost 2% of its Labor Force to Death or Disability payments since the start of the War.
Can the War in Iraq be won?
Islamic Fundamentalists worldwide will finance Terrorist activity in Iraq, as long as American military forces are on Iraqi soil and conducting military operations. American military presence in Afghanistan only incites support for the Taliban, as they learn to counter American tactics effectively, and are adequately financed from Opium sales. Neocon thinking is not going to cure this headache. lgl
Monday, July 18, 2005
Tax Foundation Case
No. 04-1704
Supreme Court of the United States
DAIMLERCHRYSLER CORPORATION,
v.
CHARLOTTE CUNO, ET AL.
On Petition for a Writ of Certiorari to the
United States Court of Appeals
for the Sixth Circuit
http://www.taxfoundation.org/publications/show/955.html
The Tax Foundation filed this BRIEF OF AMICUS CURIAE in a mistaken interpretation of the dormant Commerce Clause of the Constitution. This again is one of those times where Precedent serves only to confuse, using previous decisions to forestall discrimination against Out-of-State taxpayers as attack on In-State taxpayers, the Later attempting only to stop a positional discrimination against themselves and their property. Said Tax incentive in question would have unquestionably penalized them by maintaining the exact Tax burden upon themselves, while allowing new entrants to avoid taxation in total.
The dormant Commerce Clause does not grant apriori right to Tax competition, if such entails adverse, differing Tax applications against segments of the total polity taxed. The intent of the Commerce Clause defines simply that no government entity will by its action artificially diminish the role of interstate commerce. The existence of Tax incentives to lure business into a State discriminates against established Business to compete within and without the State. The Cuno decision should stand without writ of certiorari, as not to falsely restrict lower Court powers of determination. lgl
Supreme Court of the United States
DAIMLERCHRYSLER CORPORATION,
v.
CHARLOTTE CUNO, ET AL.
On Petition for a Writ of Certiorari to the
United States Court of Appeals
for the Sixth Circuit
http://www.taxfoundation.org/publications/show/955.html
The Tax Foundation filed this BRIEF OF AMICUS CURIAE in a mistaken interpretation of the dormant Commerce Clause of the Constitution. This again is one of those times where Precedent serves only to confuse, using previous decisions to forestall discrimination against Out-of-State taxpayers as attack on In-State taxpayers, the Later attempting only to stop a positional discrimination against themselves and their property. Said Tax incentive in question would have unquestionably penalized them by maintaining the exact Tax burden upon themselves, while allowing new entrants to avoid taxation in total.
The dormant Commerce Clause does not grant apriori right to Tax competition, if such entails adverse, differing Tax applications against segments of the total polity taxed. The intent of the Commerce Clause defines simply that no government entity will by its action artificially diminish the role of interstate commerce. The existence of Tax incentives to lure business into a State discriminates against established Business to compete within and without the State. The Cuno decision should stand without writ of certiorari, as not to falsely restrict lower Court powers of determination. lgl
Sunday, July 17, 2005
The Children
Body Burden: The Pollution in Newborns
A benchmark investigation of industrial chemicals, pollutants and pesticides in umbilical cord blood
Environmental Working Group, July 14, 2005
http://www.ewg.org/reports_content/bodyburden2/pdf/bodyburden2_final.pdf
In a study spearheaded by the Environmental Working Group (EWG) in collaboration with Commonweal, researchers at two major laboratories found an average of 200 industrial chemicals and pollutants in umbilical cord blood from 10 babies born in August and September of 2004 in U.S. hospitals. Tests revealed a total of 287 chemicals in the group. The umbilical cord blood of these 10 children, collected by Red Cross after the cord was cut, harbored pesticides, consumer product ingredients, and wastes from burning coal, gasoline, and garbage.
Three Scenarios:
1) Resistance Immunity Need: Newborns kept pristine pure will not possess the Survival factors necessary to function in a healthy manner (Everyone has to learn how to live on this world). Shielding the Newborns could provide exactly the injury which We desire to avoid.
2)Irreparable Injury: We are creating entire Generations of idiots, who will be incapable of replacing Us, bringing the downfall of Civilization as We know it.
3) The Consequences Have Already Been Endured: Now the Author knows why he always meets so many stupid people.
Facts:
1) Sound implementation of Pollution Restraints are showing signs of lower Infant Mortality than the United States, even with less prenatal care. Expectant Mothers: Nix on the Drain Cleaner, just like the Shooters.
2) There is little ability to protect the Newborns from pollutants without protecting the Mothers, impossible without scrubbing the entire society of Pollution.
3) Study Recommendation
Grant the EPA clear and unencumbered authority to demand all studies needed to make finding of safety and to enforce clear deadlines for study completion.
Remove from the market chemicals for which tests demonstrating safety are not conducted.
Eliminate confidential business protection for all health, safety, and environmental information.
The first recommendation will be costly beyond belief--a probable $30 bn per year. The second recommendation would close down American industry, as well as much of the World. The third recommendation would be very handy to implement, if given teeth against Those who would hide genuine health risk.
We are seriously at risk, but cannot actively reduce this risk without major change of lifestyle. Vested Interests would not allow such harsh revision, nor would the general Consumer. Extensive study of the risk will not make people feel better, and will not accomplish any long-run reduction of the risk, at great expense better used for design and construction of safer Products. REAL THREAT LEVEL: No higher than some dozen other threats, and thirty times more expensive to correct than the War on Terrorism. lgl
A benchmark investigation of industrial chemicals, pollutants and pesticides in umbilical cord blood
Environmental Working Group, July 14, 2005
http://www.ewg.org/reports_content/bodyburden2/pdf/bodyburden2_final.pdf
In a study spearheaded by the Environmental Working Group (EWG) in collaboration with Commonweal, researchers at two major laboratories found an average of 200 industrial chemicals and pollutants in umbilical cord blood from 10 babies born in August and September of 2004 in U.S. hospitals. Tests revealed a total of 287 chemicals in the group. The umbilical cord blood of these 10 children, collected by Red Cross after the cord was cut, harbored pesticides, consumer product ingredients, and wastes from burning coal, gasoline, and garbage.
Three Scenarios:
1) Resistance Immunity Need: Newborns kept pristine pure will not possess the Survival factors necessary to function in a healthy manner (Everyone has to learn how to live on this world). Shielding the Newborns could provide exactly the injury which We desire to avoid.
2)Irreparable Injury: We are creating entire Generations of idiots, who will be incapable of replacing Us, bringing the downfall of Civilization as We know it.
3) The Consequences Have Already Been Endured: Now the Author knows why he always meets so many stupid people.
Facts:
1) Sound implementation of Pollution Restraints are showing signs of lower Infant Mortality than the United States, even with less prenatal care. Expectant Mothers: Nix on the Drain Cleaner, just like the Shooters.
2) There is little ability to protect the Newborns from pollutants without protecting the Mothers, impossible without scrubbing the entire society of Pollution.
3) Study Recommendation
Grant the EPA clear and unencumbered authority to demand all studies needed to make finding of safety and to enforce clear deadlines for study completion.
Remove from the market chemicals for which tests demonstrating safety are not conducted.
Eliminate confidential business protection for all health, safety, and environmental information.
The first recommendation will be costly beyond belief--a probable $30 bn per year. The second recommendation would close down American industry, as well as much of the World. The third recommendation would be very handy to implement, if given teeth against Those who would hide genuine health risk.
We are seriously at risk, but cannot actively reduce this risk without major change of lifestyle. Vested Interests would not allow such harsh revision, nor would the general Consumer. Extensive study of the risk will not make people feel better, and will not accomplish any long-run reduction of the risk, at great expense better used for design and construction of safer Products. REAL THREAT LEVEL: No higher than some dozen other threats, and thirty times more expensive to correct than the War on Terrorism. lgl
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