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Creating Jobs in the Booming Corporate Executive Sector

8:57 am in Uncategorized by Omnipotent Poobah

High ticket CEOs often complain those who object to their squeezing blood out of the nation turnip for their personal gain are simply jealous. I suppose that is true in many cases, but even if people are jealous it is understandable. It’s hard not to be jealous when the mortgage company is kicking your family to the curb – just as the CEO buys a multi-million dollar summer “cottage” in Aspen. But there are others, and I am one, who object on business grounds.

Much of the CEO’s “compensation” comes from companies that take the concept of corporations-as-people far past any original intent. Under the CEO’s direction, corporations reap record-breaking profits, even in recessions that crush those who buy their products or citizens that pay hefty taxes (which captains of industry caterwhal are breaking America’s back) to fund the profits through not insubstantial corporate welfare.

For all the talk about the value of small business, we could fund thousands of small businesses for years just on what a single multi-national gets in tax breaks in a single quarter. It’s a vicious cycle – multi-nationals take billions in taxes from just-plain-citizens to prop up corporate values to pay hefty dividends and fund expensive lobbying efforts to continue getting our money from the people who don’t live tax-free. In turn, CEOs get massive compensation to hire lawyers and accountants to make sure they get their money as tax-free as possible, and so on. This is not robbing Peter to pay Paul. This is robbing Peter and then complaining Paul wasn’t carrying enough cash for Paul to steal.

Creating Jobs in the Booming Corporate Executive Sector

The moral implications for our society aside, it’s also bad business…and it is consumers and regular taxpayers who are partly complicit in creating and perpetuating the problem. Notice please, that corporate welfare and substantial loss in consumer buying power comes from people and industries that demand cuts in “entitlements” (I hate that misnomer) and not cuts in the programs that benefit them. They do this under the guise of “creating jobs”, the code words for “trickle down economics” that create no jobs  – unless one means jobs in the booming corporate executive sector.

Trickle down economics falls more and more into disrepute by economists more intelligent than the ones hired to justify the blood they squeezed from the national turnip. Even David Stockman, former St. Ronnie of Reagan acolyte and one of the  architects of the scheme, thinks it is one of the biggest mistakes he ever made. And, he was able to see this mistake not from bar charts and pie graphs, but by observing corporate behavior. A rising tide can’t lift all boats if someone steals the boats.

It’s hard to convince me that a corporation with more money than they’ve had in their history is too afraid and poor to create American jobs because they aren’t making enough money. It is doubly hard to believe they are shipping the few American jobs left, along with much of the corporate welfare I gave them, to Bangalore and not investing in real jobs in Pittsburgh.

This is where bad business and irresponsible consumerism come in.

Big Deals at Bill’s Bargain Barn and TV Emporium

America’s Christmas buying orgy begins earlier each year. At the current rate it will begin on Jan. 2 in 5 years. People stab each other for the chance to buy a must-have widescreen TV made in China fer Chrissakes! Last time I checked, I don’t know of a single occurrence of someone stabbing anyone to get into the local appliance store to buy the TV – and that’s even after the local guy provides ample parking and takes a bath on the sale price to get you into the store to buy something you can live without and that shipped the entire widescreen TV industry off to China.

This sort of rampant consumerism is voting against your own interests, and it is bad business whether you are the consumer or the local appliance shop. Few of us actually “need” a wide screen and if we can afford buy it Walmart, we can afford the extra few bucks to buy it Bill’s Bargain Barn and TV Emporium. If the price different is too big to afford, you shouldn’t buy it anyway. Perhaps you could buy something you really need, like a new fridge (get the through-door water dispenser, I love mine).  Besides, they might even still make it here. You win. Bill wins. Someone gets to keep a job, and we can all make a better case that GE really doesn’t need a huge tax cut to survive. Even GE wins. Bill makes a few bucks and you get to keep your job in GE’s fridge factory. And that CEO who makes more money than the deity of your choice? He still gets to build his umpteenth cottage, which coincidentally, might actually “create” a job for a drywall hanger making minimum wage.

This is not class warfare. This is not trickle down economics. This is not socialism, income redistribution, or jealousy. This is the grease of a free(er) market. The problem isn’t that America has too little money, it’s that the vast number of people don’t have it to spend because all of it is in the hands of a few instead of out actually being invested in America.

I’m not jealous of the people who make the big bucks. I’m pissed off at people who consistently vote against their own self-interest.

Cross posted at The Omnipotent Poobah Speaks! More than politics, more than pop culture & humor.

Regardless of Economic Plan America Can’t Compete

2:08 pm in Uncategorized by Omnipotent Poobah

Both Republicans and Democrats jabber a lot about jobs, even when times are relatively good. When times are bad the talk turns into a nasty shite-storm. The mantra for both sides is America can’t compete if we don’t [fill in the blank]. But here’s a dirty little secret: America can’t effectively compete regardless of which ideology you prefer.

Republicans argue that if we didn’t tax the wealthy or corporations and got rid of regulations we’d be trickling jobs like Ronald Reagan’s pissing down Donald Stockman’s leg.

The Democratic vision is to tax the hell out of the wealthy and make corporations pay dearly, but oddly considering their constituency and history, get rid of regulations too. Dems also like to retrain those with unmarketable skills into those with different unmarketable skills. Turning steel makers into assembly line workers doesn’t gain much unless you only need workers to assemble steel Big Macs.

We Unbombed Them Back From the Stone AgeAfter WWII, America spent a lot of money rebuilding the world economy. We rebuilt countries we bombed back to the Stone Age. Sure it was altruistic, but more importantly, there was plenty of economic benefit for America too.

Made in Japan” used to be code for cheap crap – items from faux Stucky’s gift shop Indian drums to transistor radios that barely lasted through the voyage to American shores. Crap made cheaply, sold to relatively wealthy Americans, kept the money flowing and built a unified international economy that replaced the chaos of dozens of national unequal economies.

By the late 60′s, Japanese cheap crap became a flood of very good Japanese products. There was still a fairly vibrant US economy where heavy industry provided adequate jobs for adequate pay. Japan was still cheap enough to compete with American companies, but that was rapidly changing. As America exported more jobs, we also became a nation of consumer debt ridden, credit-crazy, not-saving orgyists buying stuff like 5-bladed razors and houses we couldn’t afford.

The collapse was on.

But the Japanese were no fools. As their fortunes rose. they began to demand the same sort of money and working conditions as Americans. American corporations responded to their demands and continued to send jobs even as their products became inexorably more expensive.

Eventually, both America and Japan became too expensive. Jobs moved from there to places like Korea. Then by the same route, Korean jobs moved to places like India, and lately, China. Radically low costs may draw jobs to places like Uganda next.

Truth is,  America can’t compete with foreign sweatshops and Chinese prison labor on cost. If Americans worked for those wages they’d have even less money than we do today.

What about deregulation? We’ve already moved most high paying American jobs to Third World countries. Their lax or unknown regulations make their sweatshops and factories some of the most dangerous jobs on the planet.

Doing Anything to Turn a RupeeFor example China, on behalf of American companies, push Chinese workers to the point of suicide. The air in most Third World countries is too thick to breathe. Workers die from exposure to toxic chemicals or crushworthy machines and when they do are replaced with other destitute people willing to do anything to turn a Rupee – regardless of the danger and damage to their health and safety. If you don’t provide adequate health care, the cost of dead and disabled workers doesn’t matter much.

It’s often said that Americans won’t take some jobs. That may be true, but there’s a reason. American corporate sweatshops may make products cost competitive with India or China, but do it at the expense of worker safety while producing less and less money to buy their own goods.

You got no money, you can’t buy a color TV…from anyone.

The economic pendulum has swung one direction for a long, long time – perhaps too far to swing back. We should expect recessions to be deeper and last longer than ever before, regardless of the Democratic or Republican plans.

The War on the Middle Class is true, but so is the War on the Wealthy. Sadly, these are but the first battles in the War on Everyone, rich and poor alike. It’s united we stand, divided we fall time. Absent some agreement between waring political factions, we’ll all be killed in an economic holocaust.

And, that benefits no one.

Cross posted at The Omnipotent Poobah Speaks!