1 It's pronounced Piss-a-Reid-ease

2 SECOND! Thats the highest I ever got!

3 "Start with the fact the Postal Service is a great jobs machine..."

Huge fallacy, and one that has had awful consequences for our country. It is a great transfer payment machine -- because how else would you describe a situation in which the work received for the wage is unnecessary in some cases, inefficient in all cases, and self-perpetuating?

4 80K plus a year to deliver mail, and sell stamp books. What exactly is it that postal workers have to go postal over?

5 We've crossed the Rubicon and are now entering Obamanomics Stage II, the Austerity of Hope.

6 Monty: Very nice assortment of articles & links (again) today. Thank you very much!

7 funny, all the postal workers I know are very, very conservative.  But they don't want to protest how postal union spends money because they want to keep their job.  I say that unions are the root of all evil.

8 Good Morning Monty:

Ah corn missing in a government report??? Seriously, does anyone with two working brain cells believe a single report issued by our government anymore?

I sure as hell do not.

9 In 2010, almost 90 percent of the approximately $4 million contributed to campaigns by postal unions went to Democrats.

I remember when it was against the law to be a member of a union and work for the government. Who changed that?  JFK by executive order and a huge payback to the unions for delivering Chicago and the Presidency.

That started the whole thing with government unions. No JFK, no SEIU. So piss on that whole Camelot myth BS.

10 Snark and DOOM for breakfast is back!

11 On sunny days my postman sticks to the sidewalks with a determined but measured pace.

On rainy days he comes two hours earlier and cuts across the lawns.

Later you can find them hanging out at the loading dock at the Post Office drinking coffee (I hope).

I used to complain about teacher's 75K for nine months work, but now I can see that the postmen, at 83K for half a day's work, are screwing us more.

83K to sort and deliver mail?  At least teachers have a degree, such as it is.

12 In the Democrat mind, this is somehow a net economic gain. (Actually, they'd have to hire two hole-diggers and two hole-filler-inners, because it's probably a union gig and you know how that is.)

I posted this in the other thread but it is perfect for this because it illustrates Demoncrap spin and thought:

Study: Local sales tax would bolster economy

http://tinyurl.com/27odutx

One wonders how many stupid people will actually believe that.  A tax increase will improve the economy.

The average family in Richland County could end up saving more money on car maintenance than they would spend through an additional sales tax to improve roadways, according to a new economic impact study.

13

The only thing I took away from this is that Pissarides must have been a tough name to grow up with....

 

Thanks for the laugh, Monty...good post.

14 vic, thanks for telling us who legalized govt. unions.  JFK. 

15 One wonders how many stupid people will actually believe that.  A tax increase will improve the economy.

Well, every time Massachusetts raises its taxes, our economy improves.

16 vic, thanks for telling us who legalized govt. unions.  JFK. 

Posted by: kelley in virginia at October 12, 2010 08:11 AM (MEs24)

You're welcome. He did start it but if I am not mistaken LBJ pushed a bill through congress later that made it permanent so it couldn't be rescinded by later Republicans. 

17 So the French are rioting over an increase in retirement age to 67. Didn't we do that decades ago?

18 Business Insider Clusterstock

...as income becomes what payment the government allows transferred your way, euphemism clusterfuck

19 On the professor and the increase in taxes. He really doesn't even scratch the surface, probably because he is a government worker himself.

The real killer in these tax hikes is to the average small business owner who employs two or three workers. His business may have a gross sales of 500K. Out of that return he most likely has a total operating cost $400K except that BS tax laws only allows him to call 300K a real expense so on paper he has a $200K "profit" which he pays tax on as if it were personal income. His margin is already so thin that with a tax hike it goes negative. He has two choices at that point because he can not print money like the government.

He can lay off a worker (causing his unemployment premium tax to go up) and work harder/more himself or he can go out of business and get a government job himself.

So every time the lying assholes say something about "taxing the rich" over $250K think of Joe store owner down the street.

20 I don't buy it (entirely), but it certainly seems to be consensus among Fed, Treasury, and White House officials.

If the Obamanites are for it, it is probably a BS ripoff.

21 Atlas isn't shrugging; his back is broken.

IOW, we're boned

22 It's obvious, Watson. The MFM dog did not bark in the night because it knew the Democrat who had entered the stable to castrate Silver Bush Economy. Ah, for the days of 4.5% unemployment, Watson. Ah, for those happier days.

23

Things will get worse before they get better, and the new republican congress (if that's how the election turns out) will catch the blame. 

24 he last time this problem cropped up was during the 1982 recession: the old manufacturing jobs were gone, and the hundreds of thousands of Rust Belt factory workers -- many now middle-aged, with high union wages and benefits packages they didn't want to lose -- either could not or would not re-train into other fields.

The "demise of manufacturing jobs" is a myth promulgated by the MFM to avoid laying out what the real problem was.

If you look at actual manufacturing output in this country it really did not decline until this latest collapse. The growth slowed and in come cases leveled off over the long term, but it did not "disappear and turn into this "service economy" thing. At the time of the collapse our manufacturing output was still by far the largest in the world, including China.

What the MFM media did not want you to know is that it shifted from huge union factories located in the Midwest to smaller workshops located in the South and other "right to work" States.

The auto factories were the last holdout and they would have collapsed without the Dems.

25 The line is "feels like being cloned."  That's why, later in the video, he looks into the audience and sees every seat filled with him.

26 And don't forget the sheeple, Watson. Many of them had been coming up mysteriously lame until the Tea Party movement began.

I suggest you search the neighbourhood for Kenyans, Inspector Gregory. They shouldn't be too difficult to find in Dartmoor... unless all trace of their backgrounds have been hidden by the MFM dog.

27 The report found that some San Diego pensioners are receiving four public pensions at once, many are receiving more in retirement than they earned while working, and some politicians are receiving retirement payments at age 35.

And they expect, not just want, expect a bailout from the feds. As far as I am concerned they can kiss my ass.

28 Another good one Monty; thanks.

Now time for the morning walk.

29

From the Mankiw Article:

"Reasonable people can disagree about whether and how much the government should redistribute income."

I think this is one of the problems of liberalism we must stamp out quite vigorously, very, very soon.  We really need to get it into the heads of the moocher class that they have no right to our labor.

During the health care debate, I had conversations with a cupple of odumacrats who kept talking about the "right" to health care.  I would respond with "You have no right to the product of someone else's labor, so unless you can provide it yourself, how do you get that "health care" is a right?"  I wish more people had listened...

30 What a wonderful idea for a short story, Holmes!

But it will have to be sold in the fiction section as no one could possibly believe such crimes against the economy could be allowed to happen in the first place, let alone that an unqualified, total incompetent had been allowed to become President without a thorough vetting by all concerned.

31

Holmes never says "put your pistol in your pocket." Or are you glad to see me.

He says, "Take precautions."  'Precautions' is the name of Watson's Webley.

32 "You have no right to the product of someone else's labor..."

Posted by: AllenG at October 12, 2010 08:42 AM (AWX5Z)

That pretty much sums it all up.

33 There's gonna have to be some serious revision of the 'Golden Years' mentality.  Actually-working workers aren't going to be taxed to death to support non-working ones-- there can be either revolt, or the whole system can collapse and the retirees can starve in a post-apocalyptic wasteland. 

34

The line is "feels like being cloned." 

The internet has let me down...

I never could get all the lyrics right to that song. For years the phrase "My beacon's been moved under moon and star" sounded something like "My bacon's been moved to rum and star". Very bizarre song, but still one of my faves.

 

35 @35- Or, we can accept that it's going to suck for a while, pay for the retirees currently in (or very soon to be in) the system, and tell everyone else: "Sorry, the Government laundered your money, you've got (x) years to prepare for retirement."

36 We've known for at least a year that the inflation numbers are bogus. I check Drudge this morning and out of the blue Google has decided to create their own independent inflation index.

Two questions:

1) Why?

2) Will it produce a more accurate number?

37

DeMaio reports that 70 percent of San Diego's payroll budget goes to benefits for retirees, which leaves little for current employees. In the private sector, any company with this imbalance would find itself answering to a bankruptcy judge. But in the public sector, which operates mainly for the benefit of the people in the system, services get cut so the employees and retirees don't have to scale back their lifestyles. The report found that some San Diego pensioners are receiving four public pensions at once, many are receiving more in retirement than they earned while working, and some politicians are receiving retirement payments at age 35.

California is fucked. Period.

The leftard public unionists and the corrupt Jackassocrat machine had it codified into California law that the pension funding takes precedence over any and all other funding..

...over funding the operating budget..over schools...over infrastructure...over social spending..over every fucking thing

The Jackassocrats and unionists are looting the state...literally...and nothing can be done unless the legislature acts to change this..which they obvioulsy won't do since it's their own beds they're feathering

I mentioned this yesterday. Rep. Jean Schmidt (R) OH-2 came knocking on my door doing some retail politicking and during our conversation she said that a priority for the Donks during the lame duck will try to find a way through legislation or some fucked up back door measure to nationalize 401Ks to in order to fund the union / civil service pensions

38

beedubya:

One problem with excessive benefits being paid out to retirees from municipal and state plans is that often, the retirees aren't even living in-state any more: thus the payout doesn't even have the kiss-from-your-sister benefit of retiree spending in the local economy. From the taxpayer perspective, the money might as well be burned up in a fire for all the good it does.

In my town, the school district wants to nearly double the school levy from last year. Why? Teacher salaries, pensions, and healthcare. It has fuck-all to do with actually, you know, educating kids; it's all about the adults. (Our public school system is a jobs program for adults, not an educational system for children.)

At some point, the taxpayers are just going to say "No more!" At some point retirees and public employees are going to have to accept that they were lied to over the years by corrupt politicians. It is immoral and unrealistic to expect generations not yet born to be bound by promises made by their forebears. At some point, people are going to have to take responsibility for their own lives. If you want to retire at 55 and live 35 or 40 years in retirement, you better have a hell of a nest-egg saved up, because I'm not going to break my back paying takes to make sure that you can make the payments on the summer condo in Florida. I love grandma and grandpa as much as the next guy, but grandma and grandpa are also adults and are responsible for their own actions.

 

39 Do you sell deerstalker caps, too, moncler jackets? I'm going up North soon and could use a new one.

40 None of this crap would be happening if I were the U.S. government.

41 Begging the Chinese to strengthen their monetary unit, pretty please with sugar on top.

Aside from Michael Savage's layman's opinion, the Canadian economist pitching his own book this week promotes the equalization of labor tax be placed on Chinese imports. It isn't as if anyone wants Chinese imports to cost more than American made counterparts. But how else to promote industry occurring within the USA? Aside from Libertarian arguments against anything resembling tariffs, I think there's a valid argument to "level the playing field" at the expense of China's economic protectionism that refuses American imports.

42

Monty:

Check out this WaPo article

The nation's largest municipal pension plans are carrying a total unfunded liability of $574 billion, which comes on top of as much as $3 trillion in unfunded pension promises made by the states

and

each household in the 50 cities and counties they studied owes an average of $14,165 to current and past government employees for their pensions.

You wrote:

At some point retirees and public employees are going to have to accept that they were lied to over the years by corrupt politicians

The point is that in many cases the pensioners were not lied to. The law in many cases say that the pensions have to be paid before any other spending can be made...they are first in line for your tax dollars. In these cases the pensioners will be gliding over us in their golden parachutes while we work are asses off to pay them...

43 But how else to promote industry occurring within the USA? Decrease labor costs. China can often deliver a finished product for less than an American manufacturer pays for the raw materials. The only way to compete in a labor-glutted global market is to reduce labor costs. Another alternative is to focus our energies on stuff the rest of the world either cannot build or lacks the technological base for. But what technology gives, it also takes away: the same technology that boosted Silicon Valley in the 1990's has also made manufacturing cheaper and more reliable than ever. Tariffs, currency debasement, and other defensive measures won't work. They never work. But they're more palatable than doing the hard thing, which is resolving to compete, no matter what it takes. And what it's going to take is lower labor costs above all.

44 Anyone know what the hell is going on with oil prices? The price on gasoline jumped 15 cents between today and last week up here in the Northeast.

45

For years the phrase "My beacon's been moved under moon and star" sounded something like "My bacon's been moved to rum and star".

Heh! I had a friend from Messico who thought the line to the Billy Joel song was "You make the rice, I'll make the gravy"...

....and thought Aretha was singing "Change..change..change......Change the fuse"

46 Heh! I had a friend from Messico who thought the line to the Billy Joel song was "You make the rice, I'll make the gravy"...

Re: Joel:

'Called this old friend of mine, he was makin' a rib roast...'

47 One problem with excessive benefits being paid out to retirees from municipal and state plans is that often, the retirees aren't even living in-state any more: thus the payout doesn't even have the kiss-from-your-sister benefit of retiree spending in the local economy.

Ain't that the damn truth.  Those retired government workers leave a State like CA that makes their retirement "rich" and move to a low cost of living "right to work" State and live high off the hog.

They do that at the same time they vote for laws and policies in the new State to implement the same socialist crap that ruined their home State.

48

  Those retired government workers leave a State like CA that makes their retirement "rich" and move to a low cost of living "right to work" State and live high off the hog.

The Arizona retirement communities are just lousy with former Californians.

49 For Krugman and his ilk, who believe we haven't spent beyond our means in an extraordinary manner: I'm sure you, personally, will be therefore willing to cut a personal check to cover this 'myth'. ... ... Yeah, didn't think so.

50 'Called this old friend of mine, he was makin' a rib roast...'

Posted by: nickless at October 12, 2010 09:26 AM (MMC8r)

Wait

What?? That's not the lyric?

51 Decrease labor costs. China can often deliver a finished product for less than an American manufacturer pays for the raw materials. The only way to compete in a labor-glutted global market is to reduce labor costs.

I keep saying this and it keeps getting ignored. The manufacturers keep saying that it is NOT labor costs on the average that are killing them. And that makes a lot of sense since unions only control a few of the manufacturing jobs now.

The manufacturers ALL now say that it is the cost of over-burdensome regulations that are killing them. Healthscam is just the latest on top of all the others that have been continuously added since the 60s.

And the real killer???? They are 99.9% worthless for their stated intention. For the most part all they do is provide a worthless drone a job (union too), make honest factories pay more for the same output, and allow the same old crooks who were the excuse to pass the regulation continue to be crooks.

We need TRUE deregulation and NOT more "reregulation" that is called deregulation by the lying f*ckweasels in office.

52 The price on gasoline jumped 15 cents between today and last week up here in the Northeast.

Posted by: Gaff at October 12, 2010 09:22 AM (PRm1Y)

Probably the annual switchover from summer blend gasoline to winter and at the same time gearing up for heating oil.

53 The manufacturers keep saying that it is NOT labor costs on the average that are killing them. I think manufacturers are picking gnat shit out of pepper if they're saying that. Ask yourself why there are almost no American toy factories (or any other low-margin manufacturing concern, really). "Regulations" have a lot to do with the overhead, of course, but the bulk of the expense is manpower. If you have a line-worker who is making $15/hr (plus benefits) compared to his Chinese counterpart who makes $2/day, you're going to get killed in the market, no matter how efficient the rest of your operation is. Many specialty manufacturing houses are largely automated, and thus their costs are indeed constrained primarily with overhead not related to salaries; but these concerns are not large employers almost by definition. One of the most profound manufacturing changes in recent decades is the introduction of relatively-cheap CNC machines, CAD/CAM systems, robotics, and other technologies. I took a tour of the Fender guitar factory in Corona some years back, and I remember hearing that in 1958 it took like twenty people to take a guitar from raw lumber to finished product; not it takes only four or five (and could be done with as few as three). And this is a low-volume, high-margin manufacturing business; and even Fender sent a lot of it down to Mexico because labor costs were killing them.

54 That makes sense Vic. The price has been so volatile all year though its easy enough to think it may have been something else.

55
Heh! I had a friend from Messico who thought the line to the Billy Joel song was "You make the rice, I'll make the gravy"...

Re: Joel:

'Called this old friend of mine, he was makin' a rib roast...'


Or the old classic: s'cuse me while I kiss this guy

56

In Illinois the public pensions were written into the state constitution back in 1970 when they had the last constitutional convention.

Can states go bankrupt or could the courts force a state to raise income taxes dramatically to cover those pensions?

57

Structural unemployment is a pain..  I got laid off from a job at Ford, went back to school, got an accounting degree and now I'm halfway through my MBA and just now realizing a fundamental flaw in my master plan.  26 and 28 year old in-charge accountants don't want to manage 30 year old first years.

So I'm looking at doing what I'm more uniquely suited to do and opening a franchise tax shop or something else with a bit less prestige.  And before ya piss on Ford/UAW, my plant was one of the fastest and most effecient auto plants in the world, no Toyota plant has ever hit our numbers.

58 If you have a line-worker who is making $15/hr (plus benefits) compared to his Chinese counterpart who makes $2/day, you're going to get killed in the market, no matter how efficient the rest of your operation is.

Not if your factory makes ten or twenty times the output as the Chinese factory. That is the key, productivity and the American factories are way more productive than the Chinese.

And what kills productivity; useless work and costs that do not contribute to getting a product out the door. And I can tell you Monty from working in one of those over-regulated industries, it defintiely is NOT gnat shit.

59 Heh.  Ezra thinks there is no difference between Heavy Laborers and Carpenters.  It's all just proles "working with their hands" to Pretty Mouth. 

60

It's not important that postal employees cost $83000 each...what's important is revenue per employee. A well run fortune 500 company will return over $500000 per employee. You get your profit from that number. Maybe the postal service needs to pay more to get more efficient employees....if they are losing money.

When management treats its employees fair and compensates them well there is no need for unions. Government employs shit for managers, treats employees shabally, breaks its own laws, marginalizes rank and file, cuts pay & benefits to rank and file while enhancing administrators...and people wonder why there are public sector unions? Government is a shitty place to work...unless you are an Administrator.

Don't give me that shit about " why don't you quit then?". Do YOU, as a taxpayer, really want a shitty worker to replace ME? I like what I do and am very good at it... that's what keeps me here. It ain't unions or the agency I work for that motivates me.

61 That Mankiw article does something I've seen before, but more people need to see regularly: he takes an income, and runs it through the entire ringer of State and Fed taxation and then holds up the decrepit leftovers for you to see. 

Part of the evil of our nation's tax scheme is the way it hides the actual tax rate. 

Also, we are so boned, unless we bone someone else hard.  I'm thinking the pols and the unions should "lean forward" on this one.  Nobody is entitled to a gravy train.  Make them sound like the villains, because they are. 

62 59

In Illinois the public pensions were written into the state constitution back in 1970 when they had the last constitutional convention.

Can states go bankrupt or could the courts force a state to raise income taxes dramatically to cover those pensions?

Posted by: Boots at October 12, 2010 09:47 AM (06JTY)

There is no need for any government entity to go bankrupt or raise taxes. The state, in a pinch, merely has to stop doing things that cost money elsewhere to service its obligations. They can't go bankrupt. They have taxing power. This issue needs settled by the courts. Vallejo (city in Kaleeeforneeha) recently filed...that should be illegal. They need to pay their debts. So what if the streets don't get swept or the streetlights don't work? Pay your fucking bills!

63 Monty,
Was it you that posted a graph last week comparing tax cuts to total spending over 10 years?  If so, can you post a link to that?  Thanks!

64 My boss is a hobby farmer and about to ship a shitload of beans and then harvest his corn. For some reason since I read the internets and read futures he asks me when to sell. Fuck. This shit says sell this shit right now and lock in profits, but 2 weeks from now this shit will strait collapse.

I'm thinking perhaps hold the corn for a while and fill the cattle out. Catch the secondary rally as that shit rolls down hill perhaps. 

65 Posted by: torabora at October 12, 2010 10:00 AM (hbFXn)

Frankly?  Yes.  Inasmuch as I don't really send mail very often, and what I do send I could (almost- but only almost) as easily fax or email, I don't much care if the USPS goes completely pear-shaped.

OTOH, if the USPS was finally forced to admit it needed to make a profit, and that it had to operate like a real company to do so, things might get better for people like you, and the truly incompetent would be let go or (better) never hired in the first place.

66 Not if your factory makes ten or twenty times the output as the Chinese factory. The Chinese will always beat you if you focus on volume. They can throw almost limitless numbers of people at the problem, and their unit costs are *always* going to be lower than yours.

67 Was it you that posted a graph last week comparing tax cuts to total spending over 10 years? If so, can you post a link to that? Thanks! Might have been, but if so, I forgot. I'll have to look back in the archives. Geoff is the charts guy, usually, but I know I've linked some chart-fu stuff from elsewhere. If I find it, I'll either post it here or in a future Financial Briefing thread.

68

Speaking of socialist failure, I spent a few minutes this morning standing on line at a post office in Philly.  Long line, 3 postal employees working one speed.  Everyone had their own little nickel and dime letter or box to post.  Took forever.  My own mailing will likely take several days to get from here to the other end of the state.

When I walk into a post office I think, Just add snow, you have the Soviet Union of 30 years ago.

Most frustrating to me is the reaction of the people on line, just like the old USSR.  Passive acceptance.  Nothing else to do.  I often see posted here comments like "Americans will never stand for...."  Hogwash.  Urban America has been neck deep in eastern European socialism for at least 4 decades.  They accept it, and can't imagine life otherwise.  Its why I keep coming back to the notion that folks who not only imagine but expect a more tradional American (ie, non-socialist) life for themselves and their kids are going to have to find a way to part company peacefully with the socialists.  They and we are headed two different directions.  You can't get there, from here.

 

69 Thanks!  It was a great visual for rebutting the Dems claims that "tax cuts for the rich" will bankrupt the country.. The GOP line this year should be:  "Its the SPENDING, stupid!"

70 Vallejo (city in Kaleeeforneeha) recently filed...that should be illegal. They need to pay their debts. So what if the streets don't get swept or the streetlights don't work? Pay your fucking bills!

Nope.  Doesn't work like that.  For one thing, California addresses municipalities in its bankruptcy code.  It's not the first time a city or county has gone bankrupt, and there is a legal framework to handle it.

As a practical matter there's a limit to how much you can squeeze out of the local citizenry.  You can move to a different city without even finding another job.

71 Monty it is not a question of "volume". It is a cost per unit produced. If a Chinese factory uses 100 workers to virtually hand build 100 units per day at 5 dollars per unit while a U.S. factory uses 5 workers to produce the same 5 units in an hour using machines at 1 dollar per unit the Chinese can be beat.

But if you add 5 more workers to take care of regulatory paperwork, provide site required first responder , MSDS label coordinator, safety training and retraining, EPA paperwork, and ten million other regulatory requirements. Then add 20 million dollars worth of regulatory required EPA and OSHA equipment, that lead goes out the window.

The American public has no earthly idea how much regulatory burden contributes to the cost of their stuff.

72 What if the Postal Service runs out of money?
We've said it before, but we'll say it again: The U.S. Postal Service is teetering on the brink of financial collapse and is very close to running out of money. It's fate appeared sealed on Tuesday [Sept 28] when Congress decided not to give USPS about $4 billion in financial relief as part of the temporary spending measure it will pass before the recess.

73 Thank you Monty for that blast from the past.  Ah memories, hazy, foggy memories driving Pacific Coast Hwy with that blasting at 2am in the morning.

We must meet for cocktails.

74 Vic - Agreed - but some of that regulation is necessary.  I don't want third world working conditions for American workers..

The problem is that we do not insist on an even playing field.  We allows jobs to move to China without any care to what conditions under which they are produced.

75 Monty it is not a question of "volume". It is a cost per unit produced. It's both, actually. Musical instruments are a good example -- and happen to be an area of interest of mine, so I know a bit of the history. Musical instruments are "high craft" items that until relatively recently were built in small batches by master craftsmen. Many still are. But the revolution in manufacturing that took place in the 1970's hit musical-instrument manufacture as well, which is why most low-end musical instruments are now made in Asia. Japan first, then labor costs got too high; then Korea, then labor costs got too high; now China. And the weird thing is that the instruments themselves are pretty damned good (at least above a certain price-point). A $500 Chinese-built guitar is competitive with a US-made instrument costing two or three times as much. The quality of manufactrure is almost identical (in spite of what the purists allege). It comes down to labor costs. Efficiency is dicatated these days by automation, and the Chinese can afford just as much of that stuff as we can -- more, actually, since they have more impetus to squeeze profit. Manufacturing these days is highly automated, but some people are necessary. It will take an American factory roughly the same number of people to produce a widget as a Chinese factory, so all things being equal, the lower Chinese labor costs means I can scale up my output in a Chinese factory much more than an American one because I don't have to pay my workers nearly as much. The notion that five US workers can produce goods as profitably as five Chinese workers is just wrong -- the wage gap will kill the profit margin faster than anything else. This is not to say that regulation doesn't leach profitability out of US corporations (not just manufacturing concerns, either). It does. But labor costs are a much larger part of it. Ask companies as diverse as Ford, Fender, Microsoft, and Georgia Pacific why the outsource to Mexico and Asia, and the answer is always the same: the workers there are just as skilled, but far cheaper than American ones.

76 Vic - Agreed - but some of that regulation is necessary.

99.9% of it is totally worthless paper and book-keeping. Believe me, regulation really have little to do with keeping 3rd world working conditions out of our workplaces.

77 It will take an American factory roughly the same number of people to produce a widget as a Chinese factory, so all things being equal, the lower Chinese labor costs means I can scale up my output in a Chinese factory much more than an American one because I don't have to pay my workers nearly as much.

That is where we have our basic disagreement whether it is guitars or widgets, the average Chinese factory has many more people than the equivalent American factory except for ONE thing.

That is the number of people added for nothing but regulatory requirements. Also, add all the per unit cost for capital shit associated with regulations alone.

78 The question in manufacturing is also, "What can we build that the world wants to buy, and build it at a profit?" It's not electronics, surely. It's not home appliances, or lawnmowers, or cars, or clothes, or even raw materials like steel. We still have the edge in certain niches: aerospace (Boeing), medical devices, farm equipment, and so on. If we're going to become a manufacturing powerhouse again, we need to figure out how to serve the world market, not just the domestic one. We're not going to get the jobs because we deserve them in some abstract sense; we have to compete for them, and heed the market we're trying to sell into.

79 I've driven truck for 38 years. I get a kick out of people saying we don't make anything in this country any more. Sure, we don't make a lot of the cheap stuff, but the bigger stuff is doing pretty good. Where I used to work, we had one customer that made lawn tractors. There were about a dozen suppliers like small machine shops that made specific parts that we hauled in and hauled the finished product out. There was another company, Polaris in Osceola, that we just hauled in to. They just announced they were moving production to Mexico. The reason, taxes and regulations that are killing this state. That's 500 good union jobs gone, not because of labor so much as the business climate in Wis. They had no problem paying employees all these years, but state and federal gov. has just run wild. That means a lot of small employers are also losing business and closing. And that's just one company we're losing. I'm not so worried about the cheap things we don't make but losing the stuff like snowmobiles, appliances, cars with a better return are killing us. Unfortunately, since you can't negotiate with government, the only place you can make up what gov. takes away is in labor or materials cost. Harley Davidson got hit for $22 million in higher state taxes this year. They are building a new plant, but not here. We've got to quit killing the geese that lay the golden eggs.  

80 It's not electronics, surely. It's not home appliances, or lawnmowers, or cars, or clothes, or even raw materials like steel.

What I am saying Monty is that it does not have to be that way. We still lead in some areas despite all the government imposed regulation because of either one of several things:

1) Most likely the foreign companies haven't been able to buy or steal the needed expertise to make the stuff (aircraft)
2. The government hasn't moved in yet with excessive regulation (very little of those left since the government regulates damn near everything in the country now).
3. The company has managed to latch on to the government tit for tax breaks and actual government subsidies.

We could still be making a lot of those things in this country and some cases we are. For example NUCOR steel has a factory fairly close by here. How are they able to stay in business and compete?

Number ONE, they keep in operation multiple small factories instead of a few big ones. This enables them to avoid a lot of the more onerous regulations. Number two they get tax breaks from the locals. Number three they locate those small factories in right to work States and employ non-union workers. Number 4, they do NOT use coal fired furnaces which would bring in the EPA big time. They use electric furnaces and negotiate cheap electrical power over long term contracts. 

81 bigred - I read about Polaris a while back.  They were trying to convince them to stay in Wisconsin, if I recall correctly.

Appliances have been hit really hard the last ten years or so.  Amana and Whirlpool are gone from Iowa and Michigan and are now in Mexico.

Government is a very big part of the problem..  But, we also have to get a handle on health care costs in this country.  As much fun as it is beating up the Dems for their idiotic "health care" reform bill, something really needs to be done about the spiraling costs.  An employer can no longer afford to insure their workers and are passing more and more of the costs on to the employee.. until they can take it no longer and the jobs get shipped off to Mexico or China where employers don't give a flying fuck about the health of their workers.

82 And what kills productivity; useless work and costs that do not contribute to getting a product out the door. And I can tell you Monty from working in one of those over-regulated industries, it defintiely is NOT gnat shit.

Let me tell you about how unions kill productivity. My husband works as a quality engineer in a unionized steel mill. Last year he and some of the other young engineers were put on a special assignment to increase productivity in a certain area of the mill. They spent a week and a half watching the union guys do their thing, taking notes. They came up with 5-10 suggestions that could be implemented to save the company a bunch of money and time. The company's response? "Nice job, boys, but the union won't let us do this." Because it would actually require more work from the union guys...not a ridiculous amount of work, but more work than they wanted to do.

Another time he was on an assignment and he noticed that one of the union workers wasn't at his post. Waited around for the guy for a good hour, finally called up the shift manager and said, "Hey, so-and-so isn't in the shanty like he's supposed to be." The guy got fired. A few months later my husband got laid off. When my husband came back, guess who had been hired back because the union pleaded for him?

There are union guys who make significantly more money than my husband, a degreed engineer. Now a steel mill is a hot, nasty place to work and I don't begrudge them a good wage, but seriously? That kind of system is no longer sustainable in a global economy. These are no longer highly skilled jobs as they were back in the day. With the rise of automation it's very hard to justify those kind of wages anymore.

83 Record high profits on Wall Street we just have to wait for them to "trickle down"

84 Government is a very big part of the problem..  But, we also have to get a handle on health care costs in this country.

And who caused health care costs to spiral out of control? 

Answer - the government.

85 Record high profits on Wall Street we just have to wait for them to "trickle down" Governmental welfare isn't "profits".

86 Posted by: Angry Beaver at October 12, 2010 11:53 AM (z1utB)

There is no doubt that unions killed the big steel mills and other manufacturing sites. But overall now that impact is mostly over. Unions in the actual manufacturing sector are now less than 10%.

I am surprised that you still have a steel mill that is union. No doubt that your husband will be asked to relocate to a "red state" soon.

87

Chi'Town, I've hauled out of both of them years ago. Loved Amana. We used to drop trailers at the plant and bobtail down the road to this restaurant that had a family style breakfast to kill for. All you could eat and just like mom used to make.

Yes, health care is part of the problem, but just a part. My co-pay last year was $28 a week, which went up to $69 on Jan.1st. Of course, I and others were laid off the following week, so we dodged that bullet. I think part of the problem is we want so much out of our insurance, but don't want to pay for it. Is it too much to pay for an occasional office visit or some medications out of pocket and have the insurance cover more serious problems? Right now I pay all meds myself. I have two generic prescriptions that cost me ten dollars for a three month supply at Walgreens. Maybe we could try not nickle and diming insurance and see how that works. I made over a thousand a week when I worked and now pay for them easily on unemployment. Plus I've found you can get things for less when you pay cash. I can pay for dr. visits and most meds myself, just glad I had insurance for my wife's cancer surgery.

88 Angry Beaver. Try unloading at a grocery warehouse or pier and deal with union rules. I told my last dispatcher every time she sent me to a grocery warehouse, I had to play the radio loud to drown out the voices. "Voices" she asked. Yeah, the ones that kept reminding of the correct ratio of ammonium nitrate to diesel fuel.

89 Manufacturing's biggest problem now is environment regulation. Not the monitor and scrub for the bad stuff -- but the water out has to be as clean as the water in; and site remediated back to pre-Columbian status, and both State and Federal paperwork, and associated NIMBY lawsuits. If the regulatory burden doesn't come off, then the sector with wither and die. If the unions aren't going to help fix it, then they need to go as well. Maybe we need a new union - one that stays out of abortion and mobbed up pension plans - and stays focused on blue collar job issues and like the NRA supports those who vote their issues.

90 The leftard public unionists and the corrupt Jackassocrat machine had it codified into California law that the pension funding takes precedence over any and all other funding.. Does it take precedence over tax collection? CA towns could move all critical functions off of the general ledger; into a fee-paid status, then just stop collecting general taxes.

91 but the water out has to be as clean as the water in; and site remediated back to pre-Columbian status, and both State and Federal paperwork, and associated NIMBY lawsuits.

Hahahaha. That reminds me of something that happened at my old workplace a few years ago. We had to drain a tank of "pure" water. I do mean pure boiler grade "distilled" water. Because this water was pure it at a pH of 7.0. We were goinfg to drain it to storm drains that would eventually make it to a stream that had a pH in the 6 range (acidic).

Before we could drain that tank we had to climb up on top, remove a cover, and pour sulfuric acid in the tank, and recirculate it until the pH was the same as the stream. IOW, we had to pollute the damn water to meet EPA regs (at high costs in both labor and material).

And as far as actual pollution goes, most streams in the US are actually as clean or cleaner than they were in old days. The EPA is carrying them as "polluted" either because of e-coli from natural wildlife (which has always been there) or the State refuses to carry out the extensive sampling campaign the EPA wants so the EPA calls them polluted.

92

Jean, a few years ago, Ashley Furniture in NW Wis. wanted to double their production. Turned out the land behind the current plant was a mosquito infested marsh. You guessed it, a "wetland" . They built the plant, in Kentucky. 400 or so more jobs run out here.

Same thing just happened to Menard's in Eau Claire. Their land had two small retention ponds on the property. They designed the plant around them. Not good enough. About 500 jobs to Iowa. Democrats are good at creating jobs. They just don't create them here.

93 bigred - so you now have 900 jobs leading canoe tours of the marsh and teaching how to hand tie lures?

94 I am surprised that you still have a steel mill that is union. No doubt that your husband will be asked to relocate to a "red state" soon.

Many of the younger more talented engineers have headed to greener pastures. (Just in case anyone that works for Nucor is reading this, he has a few years experience under his belt and would love to work in a non-union environment...)

We had to drain a tank of "pure" water. I do mean pure boiler grade "distilled" water. Because this water was pure it at a pH of 7.0. We were goinfg to drain it to storm drains that would eventually make it to a stream that had a pH in the 6 range (acidic).

Before we could drain that tank we had to climb up on top, remove a cover, and pour sulfuric acid in the tank, and recirculate it until the pH was the same as the stream. IOW, we had to pollute the damn water to meet EPA regs (at high costs in both labor and material).

LOL, this reminds me of another stupid steel mill story. They deal with the same thing, waste water going into the lake has to be "pure." The company was fined by the EPA for having too high of mercury levels in the waste water. The crazy thing is, they didn't put the mercury in there! The mercury levels in the feed water from Lake Michigan were already too high! So they either spend millions they don't have on an elaborate water purification system that does nothing to help them make more steel, or they continue to suck it up and pay more EPA fines. Senseless and a perfect example of how excessive regulation hurts manufacturing.

95 Turned out the land behind the current plant was a mosquito infested marsh. You guessed it, a "wetland" .

One time, my husband asked me what exactly a "wetland" is (because I'm the one who took all the biology classes in college). I deadpanned, "It's a swamp that the government has suddenly become interested in."