2/28 It's a Global Mess. What's a World to Do? by David Sanger, NY Times, 3-1.
...Grand political pronouncements [are being heard] here, in Europe and in Asia - about the need to build a "new global financial architecture." The rhetoric has its appeal:...
[Watch the movement of the language here. We start right off poking fun at the very posing of the Big Question as "grand...pronouncements" and they're not even economic or honest - they're "political". Sanger goes on to dismiss them as "rhetoric" even as he admits their appeal. But throughout, he just gets down to business in discussing low-level fixes. Ah me.]
...Most everyone agrees that the system for governing the world economy that emerged from a hotel ballroom in Bretton Woods...a half-century ago - in the era of the gold standard and fixed exchange rates - is hopelessly outdated. But there the agreement ends. Some say that what the world financial system needs is not a new design but better wiring, in the form of greater communication among investors, regulators, governments and international oversight agencies....
[Well, others say the problem itself is that communication is already too good for the "system", and the resulting capital flight in particular and quicksilver capital in general were the very things that started the "contagion".]
...Over the last few months, a plethora of [narrow] fixes have been proposed, everything from "exit taxes" to make investors think twice about bailing out of troubled markets to "early warning systems" to make them think twice about the stability of the countries where they invest.
[Now these narrow solutions Sanger takes somewhat seriously, only injecting a note of ambivalence when he describes them as "small-bore" where we substituted the less complicated adjective "narrow". But look what happens when he gets back on the broader level again - ]
Then there are the far grander designs - so many, in fact, that it might be possible to build another ballroom at the old Mount Washington Hotel in Bretton Woods out of bound reports describing what a new financial system should look like.
[Well, did it ever occur to you, David, that your job is to cut your own verbiage and give us a synopsis of the high-level ideas, as you did so readily with the low-level ones?]
In the last two months alone, the World Bank, the IMF and the UN have all published analyses of what's gone wrong in global finance, each coming to different conclusions about responsibility for the continuing crisis. The [New York-based] Council on Foreign Relations...has put together a high-powered commission to propose an overhaul of the system [which proposal will compete with those of] a dozen other prominent research centers. The Group of Seven [G-7] industrialized nations...announced the creation of a "Financial Stability Forum" to...bring order to the chaos [by] providing a place for [national and international] market regulators to set] common standards for dealing with financial concerns. [Is that "concerns" as in crises or "concerns" as in investment banks?] To keep the forum "manageable" [what a chance!] dozens of officials from each of the seven nations will be joined by...three members from each of [4 agencies, 2 members from each of 3] international regulatory groupings [and 1 member from 2 last agencies].
What will change?.... Not much. While some modest changes are already under way - mostly tougher disclosure requirements for countries and their central banks - a broad remaking of the system seems unlikely. President Clinton, who during the market swoon in September described the "new architecture" drive as a top priority of his second term, has spoken about it...only intermittently since December. And while the Treasury Dept. says long-term solutions will be the focus of the [G-7] in early summer, skeptics abound.
[Hey, at least somebody finally mentioned a key phrase of the dawning Ecological Era, "long-term", compare "sustainable." Then we get the usual complete copout - ]
"Crises are endemic to our system...," Kenneth Courtis [of] Deutsche Bank...said recently.
[Translation - they're an act of God about which we can do nothing anyway = the pre-emptive declaration of defeat.]
..."After every [crisis] there is always talk about [redesigning] the system, until the markets get better. Then people forget about it...."
[I.e., the usual human instinct outside of high tech - much patience with problems, little patience with the solution process. Then Sanger does gives a synopsis of ideas, but the first two are the ones he mentioned as narrow fixes. Only his last two are broad, and they are respectively ruinous (#5) and vague (#6) except for focusing on the long term for once. Here they are - ]
2/28 Smile...or else - Forcing employees to be nice to customers is how some big chains hope to win brand loyalty, by Peter Canellos, Bos Globe, C1.
...The lowest paid, least trained workers are the ones who interact with the consumer. But instead of raising their workers' status, or training, or pay to make them either more capable or more inclined to impress the public, they've simply asked them to repeat certain sugary phrases.
[Again, this is an argument from weakness. It's hopeless to say chain stores "should" raise their workers' status or training or pay when workers are a surplus commodity. And the only way to change their cheap surplus status and make them a more valued, less common commodity short of war or pestilence is to shorten the workweek and ration their availability to the job market. Wage controls such as minimum wages fight market forces and lead employers to circumvent the controls by finding ways to work employees harder. Workweek controls engage market forces and lead employers to raise wages and benefits on a flexible and gradual basis. So wage controls undermine themselves, exclude worktime improvement and stress the workplace. Workweek controls are self-neutral, include wage and benefit improvements, and relax the workplace, often with productivity dividends.]
"There's a sort of 'Stepford Wife' quality about it," says Ralph Whitehead, a social critic and journalism professor and the University of Massachusetts at Amherst. "Twenty years ago it was enough to get these people to put a button on their shirt with a happy face. Now they have to be the happy face."
...Can it be a coincidence that employee "friendliness" is on the rise at just the moment that chain-store ownership has washed any mark of local color or distinctiveness from the service landscape? And is the true competition not between chains but between the entire chain-store mentality and customers' memories of the individual stores now vanished?...
And, of course, friendliness doesn't equal good service. At Staples, the office-supply giant, employees are strictly assigned, corridor by corridor, to a particular part of the store....Thus, in an area Staples store on a recent Saturday, about a half-dozen customers waited in frustration in the office chair section, while workers in the adjacent sections looked on numbly....
[The more technology, the more mergers, the less service, the less quality.]
[The Dumbing of America dept. - ]
2/28 Distressing news from never-never land, by Alan Lupo, Bos Globe, City3.
...It may well be that but for a handful of journalists..., nobody really cares any more about getting it right..\.. [A] newspaper story noted that construction in the 1950s of the elevated Central Artery which the [Big Dig] will replace, destroyed Boston's West End. No. What destroyed the West End was an urban renewal program of the early 1960s.... Later in the same story, the reporter writes that Frederick Salvucci, the man who stubbornly pushed the Big Dig from a dream to reality, was state secretary of transportation in 1969. No. In 1969, he was transportation adviser to Kevin H. White, then mayor of Boston. Salvucci did not become state secretary of transportation until 1975, after Michael Dukakis became governor....
There is a tangible sense of depression among serious journalists...that we are shouting into the wind, that the [citizenry] is becoming...too consumed with personal consumption, too apathetic, too self-indulgent to give a rat's behind about whether what they might read...is right or wrong....
[Reminds us of the lazy treatment of politics by the Boston media. It took 10 weeks after Joe Kennedy resigned from Congress on March 13/98 for the Boston Globe to mention the Republican candidate's name (Phil Hyde), 11 weeks for the Boston Herald, the supposed conservative paper of Boston. And you can count on a least one article per year from each of them crying crocodile tears about the death of the two-party system in Massachusetts.
[Just last week (2/25/99) we had an editorial in the Somerville Journal decrying the "passivity" of the city's mayoral campaigns - an editorial that lacked the energy to cover any but the three "leading" candidates in the race, thus omitting two candidates duly nominated by the voters and promoting some of the most thought-provoking positions (Phil Hyde and Matt Hoey).]
Citizens need not be engaged in the pursuit of historic trivia, but darn well ought to be consumed with the pursuit of collected knowledge. It's a nice way to run a republic.
[That's true, Alan, but citizens need leadership, and you in the media are well-placed to provide it. How about directing your ire at your colleagues, instead of "grounding" it in criticism of the public?! No accurate information, means no accurate feedback, means no appropriate "maintenance and repair," means further deterioration of America. Is it possible that media consolidation has increased the subtle pressures on you from Murdoch and Turner? Or that downsizing has tainted you as well as most others in the republic? Maybe reporters don't have time to get it right any more. Cost cutting may have left them carrying double loads, like so many other people who still have a "full-time" job in this supposedly ideal economy. One answer? Timesizing, not downsizing.]
2/28 Higher Education at a Crossroads, Bos Globe, C7.
[When is good news not good news? - ]
2/27 GDP closed year with 6.1% growth - Inflation fell to 50-year low despite rapid pace of economic gains, by Steven Wilmsen, Bos Globe, C1.
...The Commerce Department's broad inflation gauge, known as the price deflator, rose just 1% last year, the smallest increase since 1949....
[Hmm, 20 years after 1929. 20+50=70. That would put us right on schedule for a downer according to Kondratieff wave theory. And why is "inflation" so low? Because everybody's too scared to ask for a raise. Why scared? Because of the pervasiveness of downsizing. The big boys have really perfected this scam. Scaring the raises out of people by fostering job anxiety, but spinning the job market as rosy so "it must be my fault" if I'm having a hard time getting rehired even at lower pay, especially if I'm over 50. But says Frederick Breimyer, chief economist at State Street Bank...]
"There's some concern that with unemployment so low [4.3%] that there's going to be pressure on wages to rise...."
[Unemployment is "low" because it's not counting the problem. We changed it a few years ago to count part time as full time, one to one, instead of calculating its full time equivalence, and we don't even try to include welfare, homelessness or prisons. Everybody knows unemployment is high - except the statisticians and their comfortable "don't bother me with complaints" employers. On the other hand, prison construction is not excluded from the GDP. Make up your mind, guys!]
Breimyer added that some indicators are showing a slowdown in the first quarter of 1999.... Employment growth, for example, appeared to be slowing slightly in the first two months of the year.
2/27 Europe's slowing economies - Cracks in the single currency's design are already appearing, The Economist, 20.
[We would argue that it's not just a design issue here, but a timing issue. Trying to merge currencies before you have even defined a standard workweek range and a standard income/week range (i.e., designed reinvestment thresholds to solve the diminishing marginal utility of concentrated work and income) is asking for greater distortion, imbalance and unsustainability.]
...There is a real concern that, in its zeal to burnish its anti-inflationary credentials, the ECB [European Central Bank] will tolerate weak growth too easily and so be too slow to cut rates. The ECB retorts that inflation is its sole responsibility....
[That's like saying, "We're going to let the income gap widen uncontrollably (and with it the diminishing marginal utility of concentrated wealth) and we're going to block any general trend to narrow it (e.g., via rising wages for any but top executives)."]
It is true that the euro area's 11% jobless rate is largely the result of high taxes, overgenerous welfare benefits and rigid labour and product markets....
[The only substantial reason for joblessness is rigid, obsoletely long workweeks and whatever legislation is supporting them, for example, rigid overly rewarding overtime legislation and legislation tying benefits to a rigid definition of "full time."
[As for blaming high taxes and welfare benefits, you can't cut taxes without cutting welfare benefits, and you can't cut welfare benefits without an American-scale prison-building program cum national debt cum government lottery system. What is "rigid labour markets" complaining about? If it is downward wage rigidity by legislation, we agree, but then some way (such as timesizing) must be designed to enable market forces to raise wages at large, and not just top executive wages. But what can "rigid product markets" be complaining about? We would remind The Economist that rigid product markets are predictable and sustainable product markets, which is more than we can say for many product markets in the USA. Predictability is the basis of business, as Howard Stevenson points out in his "Do Lunch or Be Lunch". The rest of this article's fiscal thrust is based on a trivial, peripheral and obsolete economic paradigm.]
2/26 Mogul worship, by Jason Gay, Boston Phoenix, p. Styles 4.
...When American Heritage magazine last year named its 40 wealthiest Americans of all time, Gates, the Microsoft chief and currently the world's richest man, came in a paltry fifth. (Though with his net worth currently approaching $100 billion...)...
[Wealth is getting so concentrated that the decisionmakers are in a position to almost completely insulate themselves from any negative consequences of their decisions. Result? Distorted feedback. Flawed cybernetics. A system adrift.]
Another important factor fueling mogul worship.... While the business world churns with excitement...the political world is offering . . . nothing. You don't have to live in Washington to sense a leadership void; the landscape isn't exactly dotted with budding Churchills. Nor are there any prominent social activists or reformers tugging at the culture.
[But then, how would we know if there were? - the media doesn't cover them. Seems to us there are plenty of small parties and low-budget candidates - the Greens, Labor Party, Libertarians, Socialists, independents - who can't get coverage to save their lives, not to mention candidates like Yancey and Rodriguez in the Democratic primary last fall, and Hyde, Schinella and Morell in the general election for the 8th Congressional.]
The closest thing we have to a national conscience right now is probably Jay Leno's nightly monologue.
[And don't forget Jimmy Tingle's weekly monologue on Sixty Minutes II. And Dave Barry's occasional jab. And don't forget Dilbert - now available in a half-hour movie every Monday night. And don't forget Michael Moore.]
...Corporations and their leaders disguise the obvious: that the gap between them and the rest of us is widening. Real wages are down, many people cannot match their parents' standards of living, debt is skyrocketing, and personal bankruptcies are at an all-time high....
The other day, I watched Gates and Buffett on C-SPAN talk to students at the University of Washington School of Business. Both men wore khakis, cotton polo shirts, and casual shoes.... The unbuttoned image helps defuse class resentment....
Today...the critics are much harder to find.... Part of it is attributable to the media - the more that articles and TV segments extol moguls and their private lives, the less people focus on their business practices.... Let's ignore for a moment the fact that many of the media decisionmakers are moguls themselves, or at least work for Rupert Murdoch [or Ted Turner].... What these stories are really selling - and what the media are peddling in all those fawning mogul profiles - is false hope....
[Yes, "bread and circuses," just like the last days of the Roman Empire.]
What's most dangerous is that apart from the occasional academic or iconoclast (Noam Chomsky, et al.), contemporary mogul worship lacks any kind of meaningful, organized challenge. Unlike the titans of the Gilded Age [but exactly like the titans of the Roaring 'Twenties], most of today's superrich entrepreneurs enjoy a happily unquestioning public, even as the chasm between the haves and have-nots widens.
[It would help, Jason, if you suggested a way to narrow it. No matter, we have one.]
How much attention, for example, is paid to the fact that the vast majority of moguls are male? Or white?
[Well, Jason, do remember and relish Dave Barry's definition of the U.S. Senate - "white male millionaires - working for YOU."]
As widespread as mogul worship is in contemporary society, it's as fragile as the [casino economy] itself. The recent volatility in the stock market - along with economic unrest in Asia, Russia, and South America - has already started to rattle public confidence. Anxiety about a crash looms. That could take the shine off the moguls' image. When times are good, Ron Chernow [author of a recent biography of John D. Rockefeller] believes, the middle class identifies with the upper class; but when the economy sours, [they]...identify with the lower class. That's what happened in 1929.... It might not even take an actual crash.... Bill Gates, in particular, is increasingly under siege.... Last year...political activists [twice pushed a custard-creme? pie in his face while he was visiting in Europe]. (Noel Godin, the mastermind of the creamy attack[s], said that Gates got the dessert-in-the-face treatment because he "chooses to function in the service of the [disappointing] status quo.")
[Noel needs a more viable program than socialism though - try timesizing, monsieur. We unwittingly followed it for the first 3/4 of American history, it's independently re-invented in every U.S. recession by dozens of isolated companies, and Lincoln Electric and Nucor have standardized forms of it.
[And CEOs, timesizing enhances not only market stability but also your personal security. How safe are you when you've got sooooooooooooo much more than you can use and so many people are so desperate for the tiniest amount of it?]
Moguls are hearing it from the public in the area of giving, too. To his credit, Ted Turner set an impressive standard with his $1 billion pledge to the UN, but others have not been so generous.... General Electric CEO Jack Welch...earned $138.6 million in 1997 but gave away just $134,168.... Indeed, says Paul Schervish, the BC sociologist, the public should question not just how much today's moguls are giving away, but whom they are giving to..\..[Welch's] largest single donation being to the Sankaty Head Golf Club on Nantucket to provide college scholarships to caddies.... There's a difference between using wealth in a way that benefits society as a whole and using "philanthropy to advance status privilege and...the status quo...."
[What criteria does Jason suggest for defining "a way that benefits society as a whole"? How long can an economy based on skimming and charity survive, regardless of how high-quality the charity? Any economy that relies for vital functions on charity is lethally flawed. And centrifugal functions to offset the constant pervasive centripetal forces that are concentrating wealth and power into a tinier and tinier Black Hole are indeed "vital functions" because past a certain point, "the more concentration, the less circulation." How do we determine that point? Timesizing.]
Mogul worship, ultimately, is less about fame than it is about the public's faith in continued prosperity. Moguls themselves, then, are less celebrities than they are canaries in a coal mine: when they sing, we [except high-unemployment minority workers and prison inmates] sing along. When they expire, we're all in trouble.
[Excuse me but the idea of the "canary in the mine" is that the canary expires before everyone else, not after everyone else!]
2/26 Brazil governors meet for crisis talks, Reuters via Bos Globe, E2.
...Pres. Fernando Henrique Cardoso needs their support as he tries to save Latin America's largest economy from collapse....
[Except he's still trying to do it the wrong way - outside loans from the poison-pill strategy of the IMF, instead of inside reinvestment in consumer markets at the appropriate massive level via wages driven by worksharing.]
2/26 Falling[?] bonds threaten to KO stock market - With earnings slowing, low rates appear to be all that's holding equities up, Syre & Stein, Bos Globe, E1.
Two forces have driven stocks higher in the 1990s: rising corporate earnings [due to 'saving money' on employees] and falling interest rates. Earnings are no longer climbing very fast [fewer employees, less mass spending power, smaller markets, and now] interest rates have reversed course and are going up. "I don't know what is going to keep stock prices up now," said Mark Zandi, chief economist at Regional Financial Associates, a Pennsylvania forecasting firm....
[Only the fact that there's nowhere else to put that kind of astronomically concentrated wealth except the vault.]
The US economy [i.e., the misleading GDP which gives points for many deteriorating factors like doctors treating black lung disease...] grew at a stunning 5.6% annual pace in the last three months of 1998.... The jobless rate [the official one that counts part-time as full-time and doesn't count homelessness or prisons] dipped to 4.3% and could go lower still, say analysts....
2/25 Rubin, Greenspan urge Europe to aid world economy [=approx.headline from memory], by Gerard Baker, London Times, front page.
[Hey, wasn't it just a few days ago that Clinton was urging Japan to pull itself together so it could aid the rest of Asia? What's with all these Americans urging somebody else to do it?! How about America passing some market-boosting work-sharing laws so it is in a position to help others again (and permitting a record trade deficit doesn't count because that just means that soon we'll be on the ropes as well - of course, that would have its pluses in terms of convincing the upper crust that we really need to do something different - like worksharing aka timesizing).]
2/24 Less capital spending, hiring seen by owners, by Jerry Ackerman, Bos Globe, D4.
Optimism is softening among owners and managers fo small businesses, according to NFIB Education Foundation, an affiliate of the National Federation of Independent Business, with a handful of respondents to the organization's January poll reporting reductions in hiring and capital spending plans.... The net number of companies expecting sales to improve during the next six months was 23%....
2/20 Deflation - The New Danger, The Economist, cover stories, 15, 19-22.
For many years the main economic enemy was inflation. Today, prices are rising more slowly in the G7 economies than for half a century. As Japan has learned, and Europe may soon find out, there is a new danger - that falling prices may lock countries into a spiral of economic decline [contents blowout].
[Re what "Japan has learned", compare 3/13 story in Bos Globe, A9, "...Said Andrew Shipley, economist with Schroders Japan Ltd, 'Japan is in a negative spiral where layoffs and salary cuts lead consumers to spend less and companies to invest less, leading in turn to more layoffs and on it goes.'"]
2/20 Global crises push trade deficit to record levels - Exports suffer first drop in 13 years, by Martin Crutsinger, AP via Bos Globe, F1.
WASHINGTON - The economic crisis that has pushed one-third of the globe into recession caused US exports to drop for the first time in 13 years and sent the nation's trade deficit to its highest level in history.
[Ooooo, unlucky thirteen! And highest in history! And fancy them admitting 1/3 of the world's in recession! Let's see how long it takes them to start talking "depression."]
The Commerce Dept. reported yesterday that...America [imported] $168.8 billion [more than it exported] last year, 58% above the old record of $153.3 billion set in 1987....
[Ooooo, 1987 - the year of the last big stock "tumble" before last summer!]
"There is no way that you can conclude the worst is over," said Lawrence Chimerine, chief economist at the Economic Strategy Institute, a think tank.... Growth is expected to slow markedly this year, reflecting less consumer demand and continuing troubles in the trade sector. Most economists aren't expecting a [US] recession unless renewed global turbulence causes a big stock market tumble that frightens consumers....
[There you have it. The media and their two super-rich owners (Murdoch and Turner) don't notice a thing until stocks "tumble."]
2/18/99 Group: [Massachusetts] Real wages dropping, AP via Boston Globe, p. C6.
BOSTON - ...the Tax Equity Alliance for Mass. Education Fund said low-wage workers' pay in Mass.
fell 8.2% from 1989 to1998 when adjusted for inflation, while nationwide the same group saw wages increase by nearly 3.5%.... Mass., with a minimum wage of $5.25, is ahead of the national rate of $5.15..\.. Brian Gilmore, exec. VP of Associated Industries of Mass., said his group opposes an increase in the minimum wage because it is concerned the state's rate will get out of line with the national rate and the rates in surrounding states.... also...that most of those paid the minimum wage are younger people [agism] and part-time workers [an hour is an hour] and not people who are supporting families [none of employers' business anyway].... also...a high minimum wage could deter businesses from hiring new people. "...One of our concerns is to help young people get experience in the world of work."
[Hey, we're all getting experience all the time in this rapidly changing "world of work," so why don't we all just pay employers for the continuous training they are constantly providing us all. Soon we'd all run out of savings and credit and be forced to stop spending, and maybe then employers would grasp the connection between employment, pay, spending, and market demand for their products.
[Note, however, the good news here - that "nationwide the same group saw wages increase by nearly 3.5%" - of course, technology-boosted productivity probably increased by ten times that, and all that extra value is being compacted in the Black Hole represented by the top income brackets - who thereby suction the market demand away from their own huge investments and investment targets, inducing general economic downturn.]
2/17 Japan moves to lower rates - Steps aimed at reversing sharp declines in government bond price, boosting growth, by Martin Fackler, AP via Bos Globe, D3.
[Now they're indirectly pulling their long-term interest rates down by cutting back their sales of 10-year bonds by 22%. Hey, wasn't their short-term (overnight) call money rate near zero 4 days ago? Our 2/13 story below placed it at 0.15%!
[Whatever, we are seeing an invaluable experiment - the exhaustion of the interest-rate solution in the world's second-biggest economy. But that's all right because it's a superficial solution anyway, leaving mostly untouched the underlying problem of wealth concentration. You can't "boost growth" without boosting sales, and if nobody has any money but the top income brackets, you ain't gonna boost sales. "The more concentration, the less circulation."]
[Americans, behold your future! - ]
2/13 Brazil's poor see 'reforms' as threat - As pay dips, first beef goes, then beans [our quotes], by Richard Chacón, Bos Globe, A2.
RIO - The financial whirlwind that trashed Russia and Asia last year has blown onto the porch of Cassio...Almeida's ramshackle two-story house.... Almeida [a city chauffeur retired after 35 years] broods about how he'll support his [family] in the face of rising inflation and the sinking value of his monthly pension check.... Brazil has become the latest laboratory for imposing strict ["reforms"].... A cost-cutting policy [was] recently approved by Brazil's Congress to reduce pension benefits....
[Is it pure coincidence that every time the IMF comes up with "reforms," it's not the rich who have to give up a little of their grotesque super-abundance but the poor who have to suffer and starve? And guess what, the problem never goes away because the poor aren't the problem, the concentration of wealth is the problem, and the "reforms" never go near it except for the unwary wealthy who aren't fast enough to avoid the inflation.
Many specialists now predict an inflation rate for Brazil this year of between 10 and 20%, more than the single-digit rise people have seen in recent years but far less than the 3,000% rates of the nightmarish 1980s.... "I think it's going to be worse this time," [said Almeida.] "In the '80s, you had inflation but when costs went up, your salary did too. Now inflation is going up again but our earnings are going down"...
Welcome to the stagflation of simultaneous high unemployment ("stagnation") and inflation, common in 3rd-world countries (As Jane Jacobs points out) because of (this she does not point out) great and growing global labor surplus. Why pay more for a dirt-common item, like people? Timesizing solves this problem by engineering a shortage of people - a scarcity of labor on the job market. It essentially rations the availability of labor hours to employers by gradually cutting the workweek as we did throughout American history right up until 1940 (when against all precedent, we effectively froze the workweek with the perverse incentives of the Federal Labor Standards Act, overtime section). This rationing harnesses market forces to support and raise wages and benefits, and gives people more time to spend the money. Contrast our current situation where we're splitting further and further into those with money and no time vs. those with time and no money.
Denise Pereira, a 28-year-old mother of three, feels betrayed by [Pres.] Cardoso. "I have to pay 2 reals for good beans when before it was only 1," she said. "Even the bad beans cost 1.70 reals, but they have insects and rocks and you can't eat them"..\.. Almeida['s] roughly $270 pension payment will be reduced soon - [he doesn't know] when or by how much.... If things get worse...the beef will go from future meals, followed by the beans [leaving only the rice].... [He's] willing to go back to work, but he wonders how he can cmpete with so many other peole who are also looking for a job. "If you're over 50...no one wants to hire you"..\..
Government officials argue that tough measures are needed to cut the country's swelling deficit - now at 9% of GDP - in order to spur economic growth and keep Brazil attractive to international investors.
[But it's wealth concentration, domestic and international, that is killing Brazil and every other country in the world. And what the IMF is preaching is exactly the same kind of circulation-slowing belt-tightening for the poor (never the rich, who wouldn't notice it) that Herbert Hoover preached in the early Depression, unconscious of the power and centrality of his shorter hours ideas and unaware of the pace and scale on which he had to implement it. And guess what, his belt-tightening made the Depression worse, just as the IMF's belt-tightening is making the global recession worse. (But the American media, wealth-directed, are too insulated and self-absorbed to notice.) Even continued Keynesianism (artificial government makework and spending) would be better than belt-tightening, but sooner or later we've got to centrifuge wealth out of the tiny concentrated "Black Hole" represented by the top income brackets - there's simply no other way. So why not design the wealth-centrifuging process to be as easy and gradual and win-win as possible every step of the way? - the Timesizing does.
The solution is not outside the country. It's not in "international investors" or infusions of money from outside. That money comes in and immediately gets absorbed by the huge unbalanced centripetal force on wealth. Same problems. The solution lies inside each country, from Russia to Brazil to Harlem. The wealth is already there. It's just not spread around, like manure, doing some work. It's just sitting there, in the vaults of the rich. "The more concentration, the less circulation." But "the Kingdom of Heaven is within" and Timesizing is the most gradual market-oriented win-win way to unlock it.
2/13 Japan's central bank cuts rate, AP via Bos Globe, C5.
Seeking to lift its economy out of a dogged recession, [the Bank of Japan] cut the country's already record-low interest rates once again...from 0.25% to 0.15% - the lowest rate ever. By cutting its target for [the rate banks charge each other on unsecured overnight loans or the "overnight call money rate"], which serves as a benchmark for interest rates on other types of loans, the central bank hopes to lower borrowing costs...also for companies and individuals.
[This is a superficial "appetizer only" solution to the deeper problem of wealth concentration. It does cut the incentive to hold money inactive in bank accounts, but at these low levels what incentive is there anyway? And the real problem is still intact because the tiny group of super-rich still own the claims to wealth so the wealth is still concentrated and relatively inactive. In other words, a loan solution is inherently only a temporary solution, because sooner or later it has to be repaid, thus restoring the problematic wealth concentration that we started with in the first place.
[The Timesizing approach starts with pushing the superficial interest-rate "solution" as far as it will go just to get it out of the way once and for all, and then designs, not redistribution but reinvestment in stability. See chapters 7 and 8 of Timesizing, Not Downsizing.]
[Greenspan goofs again - ]
2/12 Greenspan backs GOP banking reform bill [make that banking "reform" bill], by Marcy Gordon, Bos Globe, C2.
[Why is undoing all the hard-learned banking reforms of the Great Depression now suddenly called 'banking reform' - don't these guys read their own banking history? Are they really determined to make the next Great Depression as huge and complete as possible? Greenspan doesn't have the common sense of a 2by4!]
WASHINGTON - Federal Reserve chairman Alan Greenspan waded into this year's debate on overhauling the nation's financial services laws, brushing aside concerns that encouraging the creation of one-stop shopping [in banking, insurance, stock brokerage, financial services, and God knows what else] would bring a dangerous concentration of economic power.
[And this is not primarily dangerous to us little guys. It's dangerous to them! They have a lot more to lose! Do they have a death wish or something?! Truly Al Pesso of Psychomotor Therapy had it right - people are kids looking for limits. They have to learn the hard way, again, and again, and again.... Can't we make some movies about the Depression and how it got here so these guys can satisfy their death wish indirectly? Do we really have to keep repeating the nightmare?!
[Or why don't you guys speed it up. Why don't you just merge all the banks into one mega-humungo Planetary Consolidated Bank & 'Trust' and then absorb every company in the world, automate every function and fire every employee but yourselves. If you guys are really intent on a complete economic meltdown with all those 'neat' features - starvation, revolution, misery, terrorism - why prolong the process. Do it quickly and surgically!]
[A whining CEO? - not really "good" news! - ]
2/11 Incentives from Vt. help employer expand, by Kimberly Blanton, Bos Globe, C7
Vermont officials announced that Vertex Corp. has accepted nearly $950,000 in incentives in return for expanding its Burlington-area operations....
[Another case of the "free" market at work, as if we needed one after Raytheon and Fidelity came whining to Massachusetts legislators for 'incentives' in the last few years - really to blackmail taxpayers or they'd take their jobs out of state. Vermont 'officials' ought to be ashamed of themselves for this unfair market-intervening favoritism, and Vermont taxpayers ought to be furious and 'throw the bums out'!]
Vertex...plans to double its Vermont staff by year-end to 300 employees....
[Whoopeedoo]
"We believe in hiring talented local individuals, training them well, and giving them the tools necessary to make them successful," said Vertex's president, Jim McCormick.
[No you don't, you slimeball. You believe in posing as a victim and ripping off taxpayers to get money-crutches for your sick 'growth strategy.' If anything at all annoys you, spoiled child, you merely say you can't find enough 'talented local individuals' and move out of state anyway. You need to look at a book called The Suicidal Corporation by Paul Wever (Simon&Schuster, 1988), which tells where all this corporate whining to government is leading us.]
2/08 A population time bomb, lead editorial, Bos Globe, A14.
...Since the [1994 Cairo] summit on population...the planet's population has increased by 400 million. This is less that...projections thanks to...better access to family planning and improved education...for women and girls. But reports that the crisis is over are premature...because...an unprecented one billion teenagers are just entering their reproductive years.... Population is growing most rapidly in...countries that can least sustain it. In sub-Saharan Africa, parts of the Mideast, and Southern Asia, birthrates are doble the average..\.. In 70 developing nations more than 40% of the population is under 15. The only way to curtail new population explosions is to offer these teenagers contraception...and fast.
...Given the influence of social conservatives in Congress, the United States is running well behind the targets adopted in 1994. Last year Congress killed a $25 million appropriation to the United Nations Population Assistance Fund on the false belief that the money could be used for abortions overseas. Overall, US family planning aid is down 30% since 1994.
Smaller families are healthier families and help build a healthier world. The Cairo agenda [needs] broad-mindedness from the world's richest nations [i.e., us].
[Scapegoating social workers for welfare cuts - ]
2/08 House of Horrors: What reporters didn't tell you, letter to editor by M. Murphy, G. Kuist and 49 other Malden, Mass. DSS employees.
[Five young girls in Everett, Mass. were found living in atrocious conditions so their social worker and her superior were suspended without pay, even though she had a (22/17=) 30% larger caseload than she's supposed to have due to welfare cuts.]
...The news reports...failed to tell readers about these two social workers' years of true dedication, commitment, and compassion... the countless families and individuals that they have brought healing to... how tragedy can hit any of our caseloads and we are powerless to prevent it. We have a government that prioritizes "fiscal responsibility" over "social responsibilities."
[Ah, we have that government, folks, because we voted for it. And we voted for it on the wild assumption that all we had to do to force a better alternative to bigger and bigger government was to strangle it with a tax revolt.
[That's not the way it works. We have to DESIGN a better alternative, TRANSITION to it, and ONLY THEN cut the present, worse alternative. The first step is the DESIGN. "It's nasty work but somebody has to do it." And The Timesizing Wire has done it and presented it in a book called *Timesizing, Not Downsizing .]
...People don't realize that [Dept. of Social Services] workers...are asked to...'fix' families that have generational dysfunctions, without any tools. Welfare reform...has been the equivalent of...an amputation where a tourniquet would do.... Everyone seems to be asking, 'how could this happen?' The reality...it is surprising that it does not happen more often. When was the last time you gave of yourself to a stranger in need? Whatever [your answer, it] pales in comparision to the daily efforts...by the two DSS workers who were suspended.
[If we want to blame someone, blame the legions of comfortable mainstream economists who have collectively erected an excuse for an economic design that 'externalizes' (ignores) welfare, homelessness, disability, prisons, forced part time... in its dangerously misleading "unemployment rate." It doesn't register the pain and they try not to notice it.]
[Erratic financial markets continue - ]
2/05 [Technology-heavy] Nasdaq tumbles more than 3% [ - 3d largest point loss in its history], Globe Wire Services via Bos Globe, C2.
2/05 Britain's rate cut is 5th since Oct., Reuters via Bos Globe, C2.
LONDON - ...cutting its key interest rate to 5.5%, a larger-than-expected reduction of 0.5 percentage points.... The decision took rates to a 4 1/2-year low and means that the central bank has more than reversed its rate hikes of 1997, after being given responsibility for rates by the new Labor government.... The Bank of England's latest rate cuts came in spite of the US Federal Reserve's decision Wednesday to leave the federal funds rate at 4.75%. Later yesterday, the European Central Bank [also] decided to leave its rates [alone -] at 3%.
[Them Limeys must shore see trouble acomin' - and the sooner that standard economists (A) exhaust the superficial ratecut "solution" and (B) face what's really wrong, the better. The US and the EU seem to have reached point (A) - at the moment (but they have backslid plenty of times in the past). As the concentration of wealth intensifies, it gets harder and harder to maintain mass spending and the spread widens between the mega scale of productivity sought for investment and the mini scale of sustainable markets for any productivity whatsoever. "The more concentration, the less circulation."]
[Driven by fads, not fundamentals - ]
2/04 Internet boom reverberating in business schools, by Ross Kerber, Bos Globe, frontpage.
[Never mind that the only websites that have made money so far are the porn sites and the folks with the tumbleweed 'farm' in Colorado - never mind that Amazon.com keeps selling more and more books without making a profit - JUMP RIGHT OVER to the big hype area of the future - like drowning rats grasping at straws because the overall business schools' short-sighted teachings about people-unrelated efficiency and downsizing have injected so much unpredictability into the nation's and the world's business that we have to make decisions based on herd-mentality 'sexiness' of business areas now instead of sound and sustainable business basics.]
2/03 Soros lieutenant nominated to head Brazil Central Bank, by Richard Chacón, Bos Globe, C1.
RIO - Brazil removed its [2d] top banking official [in less than 3 weeks] yesterday, then moved to calm fears that the world's 8th-largest economy was rocking toward recession, hiring a chief aide of billionaire investor George Soros as new Central Bank president. Arminio Fraga, the nation's 3d Central Bank chief in less than 3 weeks, becomes a key player in the fight by Latin America's biggest economy to avoid the economic slide suffered by Asia and Russia last year. The switch was made on the same day government leaders met with officials from the IMF to discuss the 2d installment of a $41b financial plan for Brazil....
[Ah, the linguistics of damage control - Only with today's concentrated ownership of the media would we get "rocking toward recession" - heck, a "recession" ain't serious enough to "rock" toward! Let's get honest with ourselves & spit it out - "rocking toward depression"!]
Since [Jan. 13] the réal has already lost 32% of its value against the dollar and has already brought price hikes in everything from new cars to beans and rice.... "The situation in our country is disastrous because the government has tricked us again," said Carlos Henrique Azevedo...the son of an orange farmer, as he walked through a bustling square in downtown Rio de Janeiro.
[Vs. mounting pressures to deglobalize, dinosaur brains fight to save "big is beautiful" - ]
2/03 Trade fears voiced by leaders - In wake of Asia woes, world figures worry about protectionism, LA TImes via Bos Globe, C2.
DAVOS, Switzerland - World leaders...voiced fears [of] a wave of protectionism not seen since the Depression-bound 1930s.
[The LA Times (and many current Republicans) seem to forget that protectionism was a bipartisan way of getting OUT of the Great Depression of the 1930s, not for getting INTO it. The Smoot-Hawley Tariff Act was not passed until late 1929 AFTER the Great Crash of Oct. 29/29. The operative foreign problem was not the foreign-domestic manufacturing issue prosperously slanted toward domestic factories and a favorable trade balance by the Fordney-McCumber Tariff Act of 1922. It was rather the concentration of wealth and the increasingly risky, massive foreign investments carried on by the wealthy, increasingly desperate to do something, anything, with all the money that was rolling in from technologically boosted productivity throughout the 1920s whose windfall profits were not being passed through into wages. Result? Lotsa products, little purchasing power or time to shop.]
With near unanimity, world figures ranging from Kofi Annan [see Good News on 2/01] to...Henry Kissinger say conditions are ripe for a broad retreat from world trade [so much for all the chatter about "the REALITY of globalization"], a development that would risk economic stagnation or worse.
[Wake up and smell the coffee, LA Times! Economic stagnation is already here. Trade, at most 14% of the US economy, has not stopped it. And "free trade" has made it worse, serving simply to provide the top income brackets with ever larger vistas from which to skim money and concentrate it in their own unspending hands.]
The stakes are particularly high for the US, whose economy has so far fended off the Asian crisis [except for the hedge fund bailout and our biggest-in-the-world prison population] but could withstand neither a shutoff of world markets nor an unimpeded flow of imports.
[Where do they get these reporters?! World markets are already virtually shut to us because Asia and Latin America cannot afford to buy our exports with their fallen currencies. And we already have a flood of imports because no domestic producers can compete with foreign exports denominated in these fallen currencies. And this self-same article says as much just three paragraphs below - ]
...the Clinton administration...wants to revive overseas growth to reverse the slide in US exports and reduce the tide of imports.
[Why not solidify the US growth bubble by reinvesting in our own spending activity with shorter hours and higher wages, instead of taking on the hopelessly messianic scale of "reviving overseas growth"? Surely it's a lot easier for a US president to solidify US growth than to remanufacture a growth bubble everywhere else in the world!]
In Gore's words, the United States has become the "importer of last resort"..\..
[Make that the "importer of first resort"!]
"Protectionism is the single greatest threat to global prosperity," said US Trade Representative Charlene Barshefsky.
[No it's not. Labor glut and resultant unbalanced concentration of wealth is and always has been. "The more concentration, the less circulation." Of course, you won't get billionaire investor George Soros to see that angle, but at least he's saying that the rising US trade deficit "is not sustainable".]
As countries ship goods to the United States, they earn dollars that they then reinvest in US government and corporate securities [yet another source of our stock inflation]. And that is creating a situation similar to the financial "bubble" that arose in Japan in the 1980s, Soros said. Japan's "bubble economy" has collapsed slowly throughout this decade; Soros offered no prediction when the US bubble would begin to deflate [nor prescription how to solidify it.]
[One word - timesizing.]
[Another college goes suicidal - ]
2/03 As [president's] pay rises, UMass plans fee hikes - Wm. Bulger one of top-paid in public ranks, by Kate Zernike, Bos Globe, frontpage.
University of Massachusetts Pres...salary will rise to nearly $300,000 within 17 months under a three-step plan approved by the university's board of trustees.
[= the ongoing delinking of CEO performance and reward. Compare Tufts' behavior in firing long-serving custodians. And "raising tuitions should ROCKET admissions" (downwards).]
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