Might as well be teaching from this old thing. (photo: Terry McCombs via Flickr)

My oldest child came home from school the other day with a problem from their economics class; the poor kid was frustrated and asked for some guidance to make sense of the assignment.

Their textbook contained a graphic depiction of the concept outlined in the text, showing a relationship between spending and jobs creation in the community. The graphic noted that consumers spent money on local goods, the money went to the business owner which in turn created the goods.

And then the business owner made more jobs.

Uh-huh. No wonder my kid was confused.

Right there, on the face of it, is a fundamental problem with our entire economy. What they teach in school has absolutely little to do with reality, and it’s this way across the entire spectrum of business and economic curriculum from K-12 through college.

Worse, kids today are taught to learn to the curriculum. They aren’t encouraged to think independently and question the curriculum, although it’s not the teachers’ fault. Deviations from the curriculum are viewed as time-sucks since the instructors are required to produce students with XX percent achievement rate on YY number of tests by the end of the year — and deviations may reduce these statistics. . . . Read the rest of this entry →

If you can read this sign and want manual labor, you're probably not welcome. (photo: J. Stephen Conn via Flickr)

Today’s issue of Louisville, Kentucky’s Courier-Journal has a front page article that helpfully explains many jobs in the area must be filled by illegal immigrants because no American has applied for them.

The story appears to be spawned out of the fears expressed by employers like the area’s horse farms that the state’s legislature may crack down on hiring illegal immigrants, cutting off their last source of labor.

Employers say they have little choice but to bring on immigrant workers when filling positions.

“All of us are in a position of needing employees. We don’t want to hire illegals,” said David L. Switzer, executive director of the Kentucky Thoroughbred Association. Based in Lexington, the KTA represents the $4 billion annual horse breeding industry and 52,000 employees, according to the nonprofit’s website.

Asked how pervasive the presence of undocumented workers is in the horse racing industry, Switzer declined to comment. But he added that openings for stable hands, grooms and night watchmen are extremely difficult to fill.

“A significant number of foreign born are working in our industry,” Switzer said. “At some of our farms, they have not had a Caucasian or African American apply for a job in eight years. Nobody applies. What are we supposed to do?”

What a crock of potted baloney.

Try this yourself: browse through some of the job posting sites like Monster.com, Indeed.com, and SimplyHired.com and look for jobs with the keyword “horse” in the “Lexington, KY” area.

You’ll find nothing in the way of stable hands, grooms, watchmen or “equine staff” advertised for folks without a degree; you might find one job for a nonprofit equine advocacy manager, but that’s about it.

I went to the Courier-Journal.com’s website for the paper which carried this story and clicked on their Jobs listing. Apparently they use CareerBuilder.com to run their jobs page. Guess what? One job listing for keyword “horse” and location “Louisville, KY” — a sous chef position at The Blue Horse.

If I spread a slightly wider net, I can pull up a job listing under a category called “equine staff”; there’s a posting for a “driving stable assistant” which appears to be in Germany, IN. But that’s not in the neighboring state of Indiana; the posting is for an international job, location: Germany.

That’s why no Caucasian or African American has applied for their jobs: they aren’t advertising openings, and for a reason.  . . . Read the rest of this entry →

Cloris Leachman appears in an ad for domain registrar Network Solutions; the ad promotes a service offered by the registrar which competes with GoDaddy.com. Most Super Bowl fans will recognize GoDaddy’s ads with little prompting; they generally feature a young and prominently endowed woman dressed scantily while breathlessly promoting GoDaddy’s brand. GoDaddy has also featured ads with Indy Series/NASCAR driver Danica Patrick, but the ads still revolve around a young woman. In at least one recent case, a GoDaddy ad featuring Patrick was rejected because of its reference to beavers; one might well ask what beavers have to do with domain registrations.

The Network Solutions’ Leachman ad represents anti-marketing, which Geoff Livingston wrote about yesterday, discussing a trend in “unselling” products. The Volkswagen ad with the tiny Darth Vader wannabe (see at bottom of this post) could also be seen as an anti-marketing ad; there’s little effort made to push the product, only a subtle appeal through the ubiquity of the subject across a range of potential buyers, made in a way which cuts through all the other advertising — targeted buyers of the Volkswagen in the ad are familiar with Star Wars and are likely of child-rearing age, and can readily relate to the ad. This isn’t a new approach; it’s been more common among European companies to use an indirect approach to selling. New, though, is the uptick in this kind of marketing, intended to break through the deluge of promotions pushed through regular broadcast and cable outlets, and now social media.

What’s particularly important about the Leachman ad is not unselling or anti-marketing, but the pointed pushback at advertising which uses young women as objects to promote a product while doing little to convey anything about the product’s merits. One might well wonder what it is that GoDaddy offers customers after watching one of their well-endowed ads — what does GoDaddy have to do at all with the internet?

The advocate at the end of the YouTube ad above is a critical point of departure as well; BlogHer.com’s CEO Lisa Stone dispels the notion that women are only window dressing for a technology product. Women are purchasers of domain services, and are among those customers that want to “get serious” as the ad’s tagline says are those who want trustworthy and effective technology products and services, not breast-enhanced glitz.

Women have been given short-shrift in technology for a very long time, even though they have become a driving force in technology consumption. The disparity in how women are treated by the technology has been the focus of several organizations, among them the Anita Borg Institute for Women and Technology, and Women Who Tech, an organization which hosts an annual summit focusing on parity in the technology industry. The work of these organizations may finally have paid off — 15 years after the Borg Institute launched — if a member of the technology industry is finally willing to stake a sizable chunk of marketing cash to go after the market segment which doesn’t want or need sexist messaging to promote products and services.

But perhaps the raw numbers convinced Network Solutions to do the Leachman ad:

As of 2005, there are an estimated 10.1 million majority-owned, privately-held, women-owned firms in the U.S., employing 18.2 million people and generating $2.32 trillion in sales. Women-owned businesses account for 28 percent of all businesses in the United States and represent about 775,000 new startups per year and account for 55 percent of new startups.

That’s an awfully big market segment to insult with bimbo-laden ads to promote products and services.

photo: mhaithaca via Flickr

If you’re buying something already on the store shelves in the way of chocolate sweets for your Valentine, your wallet may not suffer. But if you’re buying something chocolate which hasn’t yet been made, you may be paying more and soon now that the Ivory Coast’s newly-elected and internationally recognized president has called for a ban on cocoa exports.

Bloomberg reports:

Alassane Ouattara, the internationally recognized winner of a Nov. 28 election, suspended all cocoa and coffee shipments as of today to cut off funds to incumbent President Laurent Gbagbo, who refuses to stand down. The country’s main exporters agreed to the ban, Malick Tohe, an adviser to Ouattara’s government, said by telephone from Abidjan yesterday.

The ban is for a one-month period and has already boosted cocoa prices on commodity markets by 10%. The prospects for continuing increases in cocoa prices are quite strong since Ivory Coast produces nearly a third of the world’s entire cocoa crop, and uncertainty alone will encourage speculation.  . . . Read the rest of this entry →

source: Wikipedia

In all the hubbub over Keith Olbermann’s exit from MSNBC’s Countdown and the chatter over President Obama’s appointment of General Electric’s CEO Jeffrey Immelt as chair of the President’s Economic Recovery Advisory Board (PERAB), a very important point has been overlooked.

The Comcast-GE deal regarding ownership of NBC and its holdings like MSNBC is not a merger or an outright sale.

It’s a joint venture.

This means Comcast and GE are partners in a media company. They are not equal partners since Comcast will hold 51 percent and GE will hold 49 percent of ownership in the new joint venture entity, NBCU (the entity formed from GE-NBC’s acquisition of Universal back in 2003).

Which means that Immelt — who was seated at the state dinner for China’s Premier Hu Jintao, who is now responsible for encouraging economic growth in the U.S. as the chair of PERAB — remains a co-leader of a powerhouse in broadcast, cable and other forms media in this country.

While Comcast claims it didn’t pull the trigger on Olbermann, NBC’s parent company may well have had some input into the termination of Olbermann’s contract.

And while GE may have availed itself during the previous administration of Karl Rove’s encouragement and the Bush administration’s blessings toward corporatist media, the Comcast deal doesn’t terminate GE’s access to similar aid from the Obama administration. Rather, Comcast now gets to play the heavy for an additional two percent of ownership while realizing the same benefits GE received over the last ten years. . . . Read the rest of this entry →

photo: spike55151 via Flickr

If you read dakine01′s reaction to economist Casey Mulligan’s post at The New York Times Economix blog, you’ve read only part of the reality check.

dakine01 points out that Mulligan’s uninformed advocacy of a reduced minimum wage does not necessarily lead to more employment; it only means more stress on already strained household economics for anyone trying to subsist on minimum wage.

Realistically, full-time employment compensated at the current federal minimum wage means that one may not be able to afford a car, life insurance, health or dental care, put any money into savings — assuming they are lucky enough to have a full-time job.

The numbers on the employer’s side of the desk put the lie to Mulligan’s suggestion as well. They make it clear that Mulligan has never really had to deal with the real world task of creating actual jobs and keeping people employed and productive while making a profit.

For every new hire employee a company brings on board, there is a baseline expense. There’s advertising and recruiting fees, there’s the cost of screening and testing, there’s the loss of money due to time invested by management and workers in the interview process. There’s the cost of training workers to get up to full productivity; even seasoned white collar professionals and experienced blue collar journeymen will require some amount of investment in getting comfortable with their new environment.

The last Fortune 100 company for which I worked estimated the average cost to bring on board a new employee was $50,000. That’s a big chunk of cash sunk into a worker — and not all workers pan out during their first year. Granted, not all jobs will require such an investment; this particular company required a lot of safety training because of the work environment. Hiring a burger flipper at a fast food place will incur much less expense per new hire, but turn over is very high because the wages are low and benefits virtually non-existent. It’s still a hurdle to bringing workers on board.  . . . Read the rest of this entry →

[Ce n'est pas un bug. (photo: soltenviva via Flickr)]

We’re already hearing a lot of excuses and faulty framing in media reports about foreclosure fraud, not unlike that we’ve heard for years about mortgage fraud. Some of this stems from ignorance, some from willful misunderstanding.

But it’s important for us to understand that the record keeping outcomes found in foreclosure fraud were intentional. They weren’t errors, they weren’t accidents.  . . . Read the rest of this entry →

I had to do a double-take after wiping my monitor after reading this at BoingBoing about Ex-Apple CEO John Sculley’s recent interview with Cult of Mac editor and publisher Leander Kahney:

Looking back, it was a big mistake that I was ever hired as CEO. I was not the first choice that Steve wanted to be the CEO. He was the first choice, but the board wasn’t prepared to make him CEO when he was 25, 26 years old.

Wow. When was the last time you heard a bigwig ever admit a mistake, let alone be honest with themselves and the public about their limitations? Granted, the mistake was really made by Apple’s board of directors, but Sculley is a pretty big man to own up to his frailties and his own role.

Go read the entire interview at Cult of Mac, it’s not only damned good reading but enlightening.

What about you, have you ever heard a business figure of this stature make such a big admission?

And what’s on your mind tonight?

This past week angry Republican senators demanded to know whether a senior official in the Obama administration had gone through the tax filings of an entity Politico characterized as a "privately held corporation run by some of the country’s biggest conservative political benefactors." The firm was identified as Koch Industries. You may recognize them as significant contributors to Republicans and conservative issues, including the Tea Party’s organization.

The focus of the senators’ anger is Austan Goolsbee, who’d recently been appointed as chairman of the Council of Economic Advisers. During a conference call with reporters Goolsbee referred to Koch Industries as an example of a corporation which doesn’t pay corporate taxes.

At no point in either of the articles in the New York Times or Politico does it say that Goolsbee admitted to accessing IRS records, yet Senator Chuck Grassley (R-IA) and six other unnamed Republican senators are in a dither about this assumed invasion of Koch’s privacy.

What a crock.

Koch Industries is quite obviously a conglomerate of smaller firms, and the smaller firms are structured in a number of different ways, including limited liability companies (LLCs) and partnerships. And the structure of each of Koch Industries’ subsidiary entities is public information, filed with the states in which each entity organized. Oh, and this information is right there on their damned web site, if you care to poke around at Koch’s businesses’ home pages.

LLCs and partnerships in particular don’t pay corporate taxes. There’s no rocket science here, no digging through IRS filings required to determine this.

Any wet-behind-the-ears second-year business school student could tell you that LLCs and partnerships don’t pay corporate income tax. Income is instead passed through to the owners of these entities, and the owners pay personal income tax.

At least they pay personal income tax when there’s a profit — and any third-year business student will tell you how to ensure there’s no profit.

(And they’d certainly be able to tell you why an LLC is preferable to a partnership; liability is limited to the assets held by the corporation, unlike partnerships, and corporations can live forever if set up properly.)

What’s disturbing about these two articles is a lack of pushback by the journalist; why didn’t they question the complaints of the senators? why didn’t they push Koch Industries a little harder, when they replied indignantly that they paid their taxes; did they not think to ask what kind and how much tax Koch paid?

And why didn’t the senators — the men responsible for making laws related to the establishment and regulation of corporations — know that Koch Industries is no different than an overwhelming number of businesses here in the U.S. with regards to their tax payments?

Or was this really just an opportunity to do several things at once: reject and punish the Obama administration and Austan Goolsbee as a proxy while providing cover for one of their biggest donors?

Or were they anxious that the Tea Party’s largest and best-known benefactor might take issue with them should these Republican senators not come to their defense?

Or do these Republican senators not want anybody to look too closely at Koch Industries?

One might wonder why they are so upset about Koch Industries’ tax filings, when the largest companies in America share their financials as required of publicly-held entities. General Electric also paid -$1.1 billion in corporate taxes in 2009 — yes, a negative number! — as highlighted in Forbes Magazine.

And yet you don’t see these same Republican senators getting their shirts in a knot over this information.

Although emptywheel smacked up conservative economist Greg Mankiw earlier today, I feel there’s something more to be said about his op-ed in the New York Times.

Mankiw used himself as an example of the kind of person who’d pay more taxes if the Bush tax cuts weren’t extended on the wealthy; he claims the taxes would demotivate him from writing more of his patented brand of crap.

And while emptywheel cheers the potential for fewer Mankiw op-eds, I don’t think we’re going to be so blessed. In fact, I’m sure Mankiw will not only continue to write regardless of the increased tax burden — the same one he would have had in 2000 — but he’s expecting us to feel sorry for him and continue to ignore his attempt to bullshit us.

Seriously, the man is either an incredibly stupid economist, or he expects that we’re stupid enough to buy his bullshit.  . . . Read the rest of this entry →