Thursday Reads: GOP Wars on Democracy, Social Safety Net; Russia and Syria; MacDonald Follow-Up; and Ancient Cheese making

Posted: December 13, 2012 | Author: | Filed under: Crime, Criminal Justice System, Foreign Affairs, Republican Tax Fetishists, Russia, science, Social Security, Syria, The Media SUCKS, U.S. Economy, U.S. Politics | Tags: , , , , , , , , , , , , , , , , , , , , | 13 Comments

dog_reading

Good Morning!!

Now that Rick Snyder has succeeded in turning Michigan into a right-to-work-for-less state, he and his Republican House have passed a supposedly “new and improved” emergency manager law. The Detroit Free Press reports:

The House passed the Local Financial Stability and Choice act in a 63-46 vote late Wednesday, with Rep. Kevin Cotter, R-Mt. Pleasant, as the only Republican to join Democrats in voting against it.

Immediate effect for the new bill was rejected 63-45, meaning it would take effect around the end of March if passed by the Senate, likely to happen Thursday, and signed by Gov. Rick Snyder, as expected.

The legislation introduced by Rep. Al Pscholka, R-Stevensville, is similar to a draft Treasurer Andy Dillon and Gov. Rick Snyder had released. The administration said it’s designed to address shortcomings in Public Act 4 by giving local officials in financially troubled cities and school district more input in decisions.

Incoming House Minority Leader Tim Greimel, D-Auburn Hills, said it is a “mirror image” of what voters just rejected and “another slap in the face to democracy perpetrated by this House.”

It appears that both Wisconsin and Michigan are now totally owned by the Koch Brothers. Think Progress reports on How Michigan Voters Can Repeal The GOP’s Anti-Union Powergrab, but this is starting to feel like whack a mole. Republicans seem determined to kill democracy one state at a time.

The New York Times Fed Ties Rates to Joblessness, With Target of 6.5%

The Federal Reserve made it plain on Wednesday that job creation had become its primary focus, announcing that it planned to continue suppressing interest rates so long as the unemployment rate remained above 6.5 percent.

It was the first time the nation’s central bank had publicized such a specific economic objective, underscoring the depth of its concern about the persistence of what the Fed chairman, Ben S. Bernanke, called “a waste of human and economic potential.”

To help reduce unemployment, the Fed said it would also continue monthly purchases of $85 billion in Treasury securities and mortgage-backed securities until job market conditions improved, extending a policy announced in September.

But the Fed released new economic projections showing that most of its senior officials did not expect to reach the goal of 6.5 percent unemployment until the end of 2015, raising questions of why it was not moving to expand its economic stimulus campaign.

Ben Bernanke indicated there isn’t much more the Fed can do at this point. Perhaps its time for GOP lawmakers to quit trying to destroy the economy?

I couldn’t believe this story about cops gone wild in New Hampshire. Raise your hand if you knew it was illegal to buy “too many” iPhones.

Police in Nashua, New Hampshire say they were forced to use a Taser on a 44-year-old Chinese woman who does not speak English after she was told to leave an Apple Store because she was trying to buy too many iPhones.

Through a translator, Xiaojie Li told WMUR that she had bought two iPhones from the Pheasant Lane Mall Apple Store on Friday and returned on Tuesday to buy more to send to her family in China.

“The manager of the Apple Store came and told her something, but she didn’t understand,” Li’s daughter explained.

Soon after that, shoppers captured cell phone video of police — who were providing security at the store’s request — using a stun gun on Li as she laid on the mall floor screaming.

The Apple store employees had to call the police because a customer was spending too much money in their store? That’s just one more reason I’ll never buy an Apple product.

Senator Bob Corker has introduced a bill that would cut Social Security, Medicare, and Medicaid by nearly $1 Trillion in reture for raising the debt ceiling.

Corker said the Dollar For Dollar Act would include $937 billion in savings from Medicare, Medicaid and Social Security, with an equivalent, dollar-for-dollar hike to the debt ceiling.

Corker offered some details about his bill during a speech on the Senate floor Wednesday. Corker said his bill would raise the age of Medicare eligibility to 67 and would include the Medicare Total Health package that would increase private-sector competition for covering the elderly. Corker also said there would be a form of means-testing, making wealthy Medicare recipients pay more of their healthcare needs.

Corker said he’d also “slowly” raise the age of eligibility for Social Security benefits, but did not specify an age.

“We should address [Social Security] now because it’s causing the government to spend more than it takes in,” Corker said. “It will be bankrupt by 2017 if we do nothing.”

Izzat so. Social Security will be “bankrupt” five years from now? Prove it, Corker. What an asshole. And this is the guy the corporate media has been presenting as a GOP moderate who is willing to work with Obama.

According to the Washington Post, Russia is admitting that: Assad is losing control and rebels might win in Syria

MOSCOW — Syria’s most powerful ally, Russia, said for the first time Thursday that President Bashar Assad is losing control of his country and the rebels might win the civil war, dramatically shifting the diplomatic landscape at a time of enormous momentum for the opposition.

While Deputy Foreign Minister Mikhail Bogdanov gave no immediate signal that Russia would change its stance and agree to impose international sanctions on Assad’s regime, his remarks will likely be seen as a betrayal in Damascus and could persuade many Syrians to shift their loyalties and abandon support for the government.

Russia’s assessment could also further strengthen the hand of the rebels, who have made some significant gains in their offensive, capturing two major military bases and mounting a serious challenge to Assad’s seat of power, Damascus.

“We must look at the facts: There is a trend for the government to progressively lose control over an increasing part of the territory,” Bogdanov, the Foreign Ministry’s pointman on Syria, said during hearings at a Kremlin advisory body, the Public Chamber. “An opposition victory can’t be excluded.”

Here’s an interesting follow-up to Gene Weingarten’s excellent story about the Jeffrey MacDonald case, which I wrote about recently. Weingarten did a live chat at the WaPo on Tuesday in which he was a little more revealing of his own opinions. I learned that he had the same incredulous reaction when he heard the words supposedly chanted a by “hippie intruder” to MacDonald’s home, “Acid is groovy…kill the pigs.”

This is an odd thing to say about a 6,400-word story, but I found myself without the space to tell it as completely as I’d have liked. The introduction to this chat is mostly for those of you who have read the story and are still not persuaded, beyond a reasonable doubt, that MacDonald killed his family and that “A Wilderness of Error” is a deeply flawed and manipulative book. All the rest: Feel free to plow ahead into the questions.

I remember the killings. I was an 18-year-old hippie at the time, roughly the same age as Helena Stoeckley. I didn’t do as many drugs as she did, but I did plenty, including mescaline, LSD, and heroin. When I read in the newspaper that Jeffrey MacDonald – still presumed an innocent victim – told police that his attackers had been vicious hippie intruders who chanted “acid is groovy – kill the pigs,” I knew he had done it. As did every hippie in every city who read that statement with any degree of analytical thought. No self-respecting killer hippie would ever have uttered, let alone chanted, that uncool, anachronistic thing as late as 1970. That was exactly what some ramrod-straight 26-year-old Ivy League frat-boy doctor who was contemptuous of the counterculture would have thought a hippie would say.

Not to mention that hippies, um, didn’t kill people, at least not while stoned in drug-induced trances. The Manson gang were not hippies. They were weirdo murderers. They went around murdering people, not just Sharon Tate and her friends. They did not come out of the dark, descend on a house, do their savage thing, and then disappear back into the world never to be heard of again. That’s not how it works with murderous gangs who would kill sleeping children. Oh, and hippies also don’t arrive at a house intent on mass murder without remembering to bring along any weapons, relying on whatever knives and pieces of wood they might happen to find inside the house. The Manson people brought a shotgun.

But, okay. Forget all that. That’s just me bloviating. Maybe the MacDonald killers were different from all other killers. Maybe they were really disorganized, absentminded murderous hippies who talked funny and only killed just this once. Oh, and who came to hassle the doctor for drugs because they were drug addicts, and who killed his family, but never opened a closet to discover a big stash of syringes and drugs, including amphetamines. Or maybe they saw that stuff but didn’t steal it because murder may be one thing, but stealing is just plain wrong.

After that, he goes through the evidence and responds to readers’ questions. Check it out if you’re interested.

A fragment of a sieve that researchers say were used as cheese strainers.

A fragment of a sieve that researchers say were used as cheese strainers.

Finally, the Wall Street Journal had a fascinating science story yesterday: Europe’s First Cattle Farmers Quickly Added Cheese to Menu.

Researchers on Wednesday said they found the earliest known chemical evidence of cheese-making, based on the analysis of milk-fat residues in pottery dating back about 7,200 years. The discovery suggests Europe’s early farmers added a cheese course to their diet almost as soon as they learned to domesticate cattle and started regularly milking cows.

Scientists led by geochemist Richard Evershed at the U.K.’s University of Bristol tested ancient, perforated clay pots excavated at sites along the Vistula River in Poland, and found they had likely been used by prehistoric cheese mongers as strainers to separate curds and whey—a critical step in making cheese.

The pots have long puzzled archeologists, but their new analysis, reported in Nature, revealed unique carbon isotopes of milk in the traces of fatty acids that had soaked into the ceramic sieves.

“It is a no-brainer,” said Dr. Evershed. “They have to be cheese strainers.”

No one knows exactly when or where cheese-making began, but experts said the traces of milk fat on these unglazed clay strainers are the clearest evidence yet of the origins of this basic biotechnology, which launched a dairy trade that today produces more than 11 billion pounds of cheese every year and as many as 5,000 different named varieties world-wide, from Appenzeller to Zamorano.

As a cheese lover, I was very interested to learn about this.

That’s all I have for you today. What are you reading and blogging about?

Deval Patrick Gets It Just Right on Romney’s Record

Posted: June 3, 2012 | Author: | Filed under: 2012 presidential campaign, Barack Obama, U.S. Economy, U.S. Politics | Tags: , , , , , , | 10 Comments

Massachusetts Governor Deval Patrick appeared on Meet the Press this morning. I haven’t seen the whole program; but from what I’ve read about it along with what Patrick has said about Mitt Romney in other interviews, I think he’s getting it just right. Here’s what he said on MTP, according to The Boston Globe:

Patrick, a co-chairman of Obama’s reelection campaign, said the presumptive Republican presidential nominee had a poor record of job growth as governor, repeating the familiar statistic that Massachusetts ranked 47th in the nation in that category when Romney was in office.

But, Patrick said, that “doesn’t mean he was a failure as governor.”

Really? What specifically did Romney do well as governor? Why he signed the nation’s first universal health care law and pushed for the individual mandate that citizens must purchase health insurance. Patrick knows full well that Romney doesn’t want to be praised for that accomplishment. Every Obama surrogate should hammering health care achievement home, again and again. Back to the Globe article:

Host David Gregory asked the governor to respond to former President Bill Clinton’s statement Thursday that “there’s no question that in terms of getting up and going to the office and basically performing the essential functions of the office, the man who has been governor and had a sterling business career crosses the qualification threshold.”

Gregory suggested Clinton’s remarks undercut one of Obama’s major arguments.

“It undercuts the spin on the argument that the president has made,” Patrick replied. “The president has never attacked Bain. It’s not about Bain. It’s never been. Bain’s a fine company.”

Really? What’s it about then?

“He had a terrific career creating wealth,” Patrick said. “There is very little evidence that, either in the public or the private sector, he’s had a terrific career creating jobs.”

The corporate media is comparing Patrick’s approach to what Cory Booker said previously on MTP. But I think they’re wrong. More Obama surrogates should follow Patrick’s lead. Sure, Bain is a terrific company and Romney deserves credit for his role in building the business. But at Bain and as governor, Romney didn’t create jobs. But, hey…he led the way to socialized medicine in Massicusetts! Isn’t that great?

Here’s an opinion piece that Patrick wrote for CNN a couple of days ago. In it he spells out a very clear argument against Romney as POTUS. Of course he leads with Romney’s failure to create jobs in the state. Everyone knows by now that Massachusetts ranked 47th among the states in job creation.

and that was in relatively good economic times. Real wages declined (while rising across the nation). Instead of helping workers and small businesses adjust to changes in the global economy, Romney cut critical work force training programs and millions in economic development funds. Instead of promoting Massachusetts to attract jobs, he used the state as a punchline on the national Republican political circuit.

When Patrick took office he had to clean up Romney’s messes.

He left behind a bureaucracy whose work force grew during his term, an unsustainable public pension system and a culture of poor accountability throughout state government.

Young people and jobs were leaving our state. Our roads and bridges were crumbling, and his Republican predecessors’ poor oversight of the infamous Big Dig project in downtown Boston resulted in billions of dollars of cost overruns, substandard workmanship and debilitating debt that he made no effort to remedy.

In the face of budget challenges, what did Romney do? He raised nearly every fee and surcharge that didn’t bear the title “tax” and cut funding for the schools. In a state where education is our calling card, Romney was responsible for the second largest per pupil cut in education funding in America during his second year in office.

Sure Romney’s a nice guy, Patrick says, and he was very successful in business. But in his only time in office Romney failed to create jobs or stimulate the economy. Why did this happen?

Romney sincerely believes that people are better off on their own: on their own to deal with their unemployment; with under-resourced public schools and no way to pay for college; with neglected infrastructure; with a job market that needs skills they didn’t have. He does not fundamentally believe that government should help people help themselves. And he has a record as governor of Massachusetts to demonstrate how much damage his leadership does to people, their families and our future.

Finally, here’s a recent interview that Patrick did with John King in which he makes similar arguments.

I think the Obama campaign should have their other surrogates emulate Deval Patrick’s approach–call it hitting Romney with a velvet glove that has a steel lining. You don’t have to yell and scream to get your message across. Patrick is calm, cool, and collected. He’s not “nauseated” by attacks on Bain or private equity, like Corey Booker. He doesn’t call Romney’s career at Bain “sterling,” like Bill Clinton did. He explains why Romney’s career at Bain is irrelevant to job creation, while his time as Governor is. And he strongly praises the one achievement Romney doesn’t want to talk about: health care reform.

I don’t know if this can all be boiled down to a 30-second sound byte, but Deval Patrick is coming pretty close with this:

“He had a terrific career creating wealth,” Patrick said. “There is very little evidence that, either in the public or the private sector, he’s had a terrific career creating jobs.”

The Obama campaign should keep Patrick front and center, hammering home the message that Romney knows nothing about job creation–and in fact really doesn’t care about it–but he sure deserves all the credit in the world for leading his state to universal health care.

Real Job Creation Policy vs. Bizarro World

Posted: September 7, 2011 | Author: | Filed under: 2012 presidential campaign, Surreality, Team Obama, U.S. Economy | Tags: , , | 15 Comments

I just can’t step back from the crap being pushed by politicians as “jobs” policy these days.   I can’t believe any one is actually falling for the line that basic corporate welfare programs and subsidies are actually going to create jobs because there’s never been any evidence of that being correlated in the past and there is certainly no evidence of that happening today.  Lest we forget, we have about 11 years of experience with corporate tax largess, deregulation of financial markets, and low taxes on capital gains. Yet this century has seen nothing but miserable job creation.  We’ve got nothing to show for it but the biggest recession since the Great Depression.

Here’s Robert Reich calling Romney’s job creation approach “bizarre”.  However, it doesn’t really sound any different from that offered up by any of the other candidates either and that includes the President.  This bothers me to no end and hence, I keep blogging on about it.

“Mitt Romney kind of has the odd idea, and it is a bizarre idea, that at a time when corporations are scoring record profits. At a time when you’ve got them sitting on $2 trillion of cash they don’t even know what to do with, that somehow if you give them more tax cuts and deregulate so you reduce their costs even further, they will then create jobs.

“They don’t create jobs now, he assumes, because their costs are too high or they’re not making enough money. Well, the reality of course is just the opposite,” former Secretary of Labor Robert Reich said on MSNBC’s “The Last Word.”

“They don’t need more money, companies are doing very well,” Reich said later on in the segment.

Corporations are flush with cash at the moment.  They just aren’t doing anything with it because they won’t expand unless there’s demand for their products and services.  As I demonstrated yesterday, the bottom has fallen out of consumer demand and that’s stymied economic expansion.  We do not need to appease some imaginary confidence fairy.  Businesses need paying customers. One of the primary drivers of economic activity in this country since World War 2 has been construction.  The housing market is still in big trouble and we have excess supply of both commercial and consumer real estate.  What business person is going to hire more people and produce stuff that no one buys?

We’re going to be live blogging both the Republican debate tonight as well as the President’s job speech.  Neither promise anything more than distinctly unproven economic policy.  Even the President is thought to not believe what he’s going to be saying if you believe this. What kind of leader pushes policy he knows to be wrong?

The centerpiece of the job creation package that President Obama plans to announce on Thursday — payroll tax relief for workers and perhaps their employers — is neither his first policy choice nor that of many economists. But it is the one that they figure has the best chance of getting Republicans’ support.

Mr. Obama has signaled that he will propose to extend for another year a reduction of two percentage points in the 6.2 percent Social Security payroll tax that employees pay, which means about $1,000 more for the average household. And he is considering a proposal to expand the tax relief to employers’ share.

In his prime-time address to a joint session of Congress, Mr. Obama is expected to call for a package totaling several hundred billion dollars that would also extend other business tax cuts, put federal dollars into building and repairing roads, rails, airports, schools and other infrastructure projects, and provide aid to states to avert more layoffs of teachers.

But the single biggest stimulus measure he will propose is likely to be temporary payroll tax relief. If the current tax cut, due to expire at the end of the year, is expanded next year to employers as well as employees, it would pump roughly $200 billion into the economy, with the aim of stimulating much-needed demand for goods and services from consumers and businesses and, additionally, of giving companies an incentive to hire.

For the White House, its appeal is that it may be the only large stimulus measure that can pass Congress this year given Republicans’ preference for tax cuts.

And if Republicans oppose him, the White House figures Mr. Obama has the better of the political argument because he will be trying to block a tax increase that otherwise would apply to virtually all households on Jan. 1.

Republican leaders have said they might support the payroll tax cut’s extension if its cost is offset by equal spending cuts, a condition they did not apply for extending the Bush-era tax cuts on high incomes. Mr. Obama has said he will propose long-term deficit savings to offset the short-term costs of his stimulus proposals, though that is not likely to satisfy Republicans.

Look, what in his 2 1/2 years in office should leave him with the impression that he’s going to get anything past the Republicans in Congress?  Half of them are indicating they probably won’t show up for the speech.  Ever since the man’s taken office he’s offered one Republican plan after another.  I still can’t believe after years of fighting Dolecare in the 1990s, the Democrats were forced to pass that stupid thing and it now wears the Obamacare label.  What kind of leader pushes policy that his own party fought for decades?

I have no idea what trade agreements or patent reform or reducing regulations have to do with job creation either.  None of that has ever been shown through research to be germane.  But again,  all you have to do is look at the amount of cheap money and the excess cash sitting on corporate balance sheets right now to know that businesses don’t need any more incentives to do something they aren’t doing any way.

The other thing that is most confusing is that the President’s plan will rob Peter to pay Paul because he’s going to make this ‘revenue neutral’ to appease Republicans.  Again, with this appeasing pipsqueak Cantor and the rest of the whackos in the Republican caucus.  Supposedly, some direct infrastructure spending and some direct aid to states to keep teachers in place is going to some how magically turn around a 9.1% unemployment rate.  I don’t see how that’s going to do anything on the level that he’s talking about –$300 billion–is a token amount of money in a $15 trillion economy and the offsets will likely take away jobs from wherever they’re pulled. The other simply confusing proposal has to do with tax breaks for equipment which is really strange given that it’s likely to increase current worker productivity making hiring additional workers questionable.

In his speech on Thursday night to a joint session of Congress, Obama will also consider a tax benefit to those businesses that hire the unemployed, with a price tag of around $30 billion. Public works projects will be included, but the AP reports that this will be less than $50 billion of the package.

The president also will continue for one year a tax break for business that allows them to deduct the full value of equipment.

The local aid that Obama intends to propose it aimed at preventing teacher layoffs, officials said.

The New York Times said the cost of the package would be “several hundred billion,” while the Washington Post estimated it to be “at least $200 billion.”

This is clearly a set of tax giveaways that the government can’t afford that won’t achieve much of anything other than further the Republican agenda of starving the beast.  What on earth does this president have in his head?  I can’t figure out any logical, reasonable strategy for doing these things.  Every time he furthers the Republican agenda it basically makes things worse for his reelection outlook.  His actions are completely unpopular when measured by polls. He’s numbers are approaching those of Bush by basically repeating the Bush-Cheney policy on steroids.  Unless he’s trying to become the President of the Chamber of Commerce, I’m not seeing any strategy here.  It’s like he so desires bi-partisan approval that he’s willing to throw anything up against the wall to see what possibly sticks.  Meanwhile, the Republicans are getting Republican policy without even putting any skin in the game. I just don’t get it.

Anyway, Minx and BB have promised to watch and liveblog the Republican debates tonight.  I don’t think I can do that because it will just be a contest to see who can be the meanest in a contest to beat up modernity, science, and people that aren’t rich.  I frankly see no purpose in continually watching people talk about issues that the civil war settled. I will watch the President’s speech because at this point, I’m looking for any sign of lucid economics and a strategy that doesn’t just infer faulty marketing.  Who knows, maybe the sky will open up, a choir of celestial beings will start singing, ray of sunshine will start streaming out of gold-rimmed clouds, and all my questions will be answered.  OR NOT.

Did White House Push for $535 Million Loan to Now Bankrupt Solyndra?

Posted: September 2, 2011 | Author: | Filed under: Republican politics, Team Obama, U.S. Economy, U.S. Politics, unemployment | Tags: , , , , , , , , , , , , , , | 18 Comments

Obama visiting the Solyndra plant

Minkoff Minx highlighted this story earlier today, but I thought I’d expand on it a little bit. As Minx wrote earlier, Solyndra is a solar energy company that the Obama admnistration has hyped as an example of the potential of green energy technology to create jobs in the U.S. From the LA Times editorial page:

Solyndra was the first company to be awarded a federal loan guarantee under the stimulus, worth $535 million. Taxpayers are likely to end up on the hook for much if not all of that amount, a highly embarrassing development for President Obama because he was among the company’s biggest cheerleaders. He visited its Fremont plant in May 2010 even though PricewaterhouseCoopers had weeks earlier raised doubts about its plans for an initial public offering by questioning whether it could continue as a going concern.

That’s especially troubling because Solyndra is backed by one of Obama’s key fundraisers, George Kaiser of Tulsa. Congressional Republicans were raising alarms about Obama’s connections to Solyndra well before Wednesday’s announcement, with GOP members of the House Energy and Commerce Committee voting in July to subpoena documents from the Office of Management and Budget on the loan-guarantee decision.

Two important questions are raised by Solyndra’s failure: Should the government be in the business of picking winners and losers by providing loan guarantees to risky energy ventures? And is Obama using stimulus funds to reward his political contributors?

The Times says “yes” to the first question and “maybe” to the second, pending the results of the House investigation.

As the LA Times noted, questions were being asked about the Solyndra loan even before the bankruptcy announcement. Brian Ross and his colleagues at ABC News have also been looking into the White House connection.

ABC News and the Center for Public Integrity’s iWatch News first reported on questions about the choice of Solyndra for the loan in May after the Department of Energy disclosed it was being forced to restructure its loan package for the company, which was showing early signs of financial distress. One of Solyndra’s major investors was George Kaiser, an Oklahoma billionaire who raised between $50,000 and $100,000 for Obama during the 2008 election.

Following the ABC News and iWatch News reports, the House Energy and Commerce Committee opened their own investigation into the loan and into the Kaiser link, which Stearns office said in a statement “raised concerns that politics may have played a role in putting taxpayer dollars at risk making this loan guarantee.” ….

White House officials deferred ABC News’ request for comment on this report to the Department of Energy. There, officials told ABC News and iWatch News that it used objective factors in selecting Solyndra. The department released a statement Wednesday on its website blaming changing economics in the industry — including a major push by Chinese firms to drive down solar panel prices — for the company’s collapse along with two other domestic firms. According to the Energy Department, the price for solar products dropped 42 percent in 2011.

I don’t know why anyone would be surprised to learn that Obama was using government money to help his big donors. Isn’t that what he’s been doing with Wall Street since the fiscal crisis began? Even before he was elected, Obama whipped for TARP. If he hadn’t convinced members of the Congressional Black Caucus to vote for it, the bailout bill never would have passed. So now Republicans control the House, and they can’t wait to investigate.

House Energy Committee Chair Fred Upton (R-MI) sent a letter to the White House

which calls on the White House to turn over correspondence between administration officials, Solyndra and its investors….”How did this company, without maybe the best economic plan, all of a sudden get to the head of the line?” Upton told ABC News in an interview this week. “We want to know who made this decision … and we’re not going to stop until we get those answers.”

The White House denies any involvement in the approval of the loan, although members of the administration have enthusiastically and publicly praised it. Yet more neutral observers have been critical of the deal.

While Energy Department officials steadfastly vouched for Solyndra — even after an earlier round of layoffs raised eyebrows — other federal agencies and industry analysts for months questioned the viability of the company. Peter Lynch, a longtime solar industry analyst, told ABC News the company’s fate should have been obvious from the start.

“Here’s the bottom line,” Lynch said. “It costs them $6 to make a unit. They’re selling it for $3. In order to be competitive today, they have to sell it for between $1.5 and $2. That is not a viable business plan.”

Furthermore, OMB considered the loan to be “risky,” according to ABC News.

The White House’s Office of Budget and Management viewed the arrangement as a riskier bet to taxpayers than DOE had. That forced the government to set aside millions more in case of a default, iWatch reported last month.

I guess we’ll have to wait and see what happens, but I can only assume that Republicans in the House are going to be on this like white on rice. They hate Obama and they hate green energy.

It’s the Jobs, Stupid!

Posted: June 22, 2009 | Author: | Filed under: Global Financial Crisis, U.S. Economy | Tags: , , , | Comments Off on It’s the Jobs, Stupid!

joblossesOne glance at the national income accounts for the U.S. gives us the bottom line. Approximately 67 % of the spending in the country comes from households and nearly the same proportion of the source of that spending comes from wages and salaries. It may be all about oil revenue in places like Venezuela and Kuwait, but in the United States, it’s all about job creation. The job losses in this Great Recession–when compared with the other post-WW2 recessions–are much worse as you’ll see in the graphic on the left.

The news from the jobs market is bleak and that is one of the reasons I have trouble buying any green shoot hoopla. Take this headline from the Wall Street Journal “Cuts are Here to Stay, Companies Say”.

Many companies that have cut jobs, pay and benefits during the recession may not be quick to restore them.

According to a new survey, 52% of companies expect to employ fewer people in three to five years than they did before the recession began. The survey of 179 companies was conducted this month by consulting firm Watson Wyatt Worldwide Inc.

Among employers who have cut salaries, 55% expect to restore the cuts in the next year. But 20% expect the cuts to be permanent. Of employers who have increased employee contributions to health-care premiums, 46% don’t plan to reverse the increases. Of all survey respondents, 73% said they expect employees to shoulder more of the cost of health care than before the recession began.

The job market always lags the business cycle since companies are really slow to both fire and hire near the turning points. Companies like to insure they are not letting trained workers go needlessly and they don’t like to take on any costs if their revenues aren’t trending upward. Of course, recessions hit different segments of the labor market differently. A Weekly Standard headline “No Country for Burly Men” has one of the most interesting examples of the demographics of the Great Recession.

A “man-cession.” That’s what some economists are starting to call it. Of the 5.7 million jobs Americans lost between December 2007 and May 2009, nearly 80 percent had been held by men. Mark Perry, an economist at the University of Michigan, characterizes the recession as a “downturn” for women but a “catastrophe” for men.

Men are bearing the brunt of the current economic crisis because they predominate in manufacturing and construction, the hardest-hit sectors, which have lost more than 3 million jobs since December 2007. Women, by contrast, are a majority in recession-resistant fields such as education and health care, which gained 588,000 jobs during the same period. Rescuing hundreds of thousands of unemployed crane operators, welders, production line managers, and machine setters was never going to be easy. But the concerted opposition of several powerful women’s groups has made it all but impossible. Consider what just happened with the $787 billion American Recovery and Reinvestment Act of 2009.

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