Fwd: Egos and Immorality

Interesting reading...

Op-Ed Columnist

 

Egos and Immorality

 

By PAUL KRUGMAN

 

May 24, 2012

 

Paul Krugman

 

In the wake of a devastating financial crisis, President Obama has enacted some modest and obviously needed regulation; he has proposed closing a few outrageous tax loopholes; and he has suggested that Mitt Romney's history of buying and selling companies, often firing workers and gutting their pensions along the way, doesn't make him the right man to run America's economy.

 

Wall Street has responded — predictably, I suppose — by whining and throwing temper tantrums. And it has, in a way, been funny to see how childish and thin-skinned the Masters of the Universe turn out to be. Remember when Stephen Schwarzman of the Blackstone Group compared a proposal to limit his tax breaks to Hitler's invasion of Poland? Remember when Jamie Dimon of JPMorgan Chase characterized any discussion of income inequality as an attack on the very notion of success?

But here's the thing: If Wall Streeters are spoiled brats, they are spoiled brats with immense power and wealth at their disposal. And what they're trying to do with that power and wealth right now is buy themselves not just policies that serve their interests, but immunity from criticism.

Actually, before I get to that, let me take a moment to debunk a fairy tale that we've been hearing a lot from Wall Street and its reliable defenders — a tale in which the incredible damage runaway finance inflicted on the U.S. economy gets flushed down the memory hole, and financiers instead become the heroes who saved America.

Once upon a time, this fairy tale tells us, America was a land of lazy managers and slacker workers. Productivity languished, and American industry was fading away in the face of foreign competition.

Then square-jawed, tough-minded buyout kings like Mitt Romney and the fictional Gordon Gekko came to the rescue, imposing financial and work discipline. Sure, some people didn't like it, and, sure, they made a lot of money for themselves along the way. But the result was a great economic revival, whose benefits trickled down to everyone.

You can see why Wall Street likes this story. But none of it — except the bit about the Gekkos and the Romneys making lots of money — is true.

For the alleged productivity surge never actually happened. In fact, overall business productivity in America grew faster in the postwar generation, an era in which banks were tightly regulated and private equity barely existed, than it has since our political system decided that greed was good.

What about international competition? We now think of America as a nation doomed to perpetual trade deficits, but it was not always thus. From the 1950s through the 1970s, we generally had more or less balanced trade, exporting about as much as we imported. The big trade deficits only started in the Reagan years, that is, during the era of runaway finance.

And what about that trickle-down? It never took place. There have been significant productivity gains these past three decades, although not on the scale that Wall Street's self-serving legend would have you believe. However, only a small part of those gains got passed on to American workers.

So, no, financial wheeling and dealing did not do wonders for the American economy, and there are real questions about why, exactly, the wheeler-dealers have made so much money while generating such dubious results.

Those are, however, questions that the wheeler-dealers don't want asked — and not, I think, just because they want to defend their tax breaks and other privileges. It's also an ego thing. Vast wealth isn't enough; they want deference, too, and they're doing their best to buy it. It has been amazing to read about erstwhile Democrats on Wall Street going all in for Mitt Romney, not because they believe that he has good policy ideas, but because they're taking President Obama's very mild criticism of financial excesses as a personal insult.

And it has been especially sad to see some Democratic politicians with ties to Wall Street, like Newark's mayor, Cory Booker, dutifully rise to the defense of their friends' surprisingly fragile egos.

As I said at the beginning, in a way Wall Street's self-centered, self-absorbed behavior has been kind of funny. But while this behavior may be funny, it is also deeply immoral.

Think about where we are right now, in the fifth year of a slump brought on by irresponsible bankers. The bankers themselves have been bailed out, but the rest of the nation continues to suffer terribly, with long-term unemployment still at levels not seen since the Great Depression, with a whole cohort of young Americans graduating into an abysmal job market.

And in the midst of this national nightmare, all too many members of the economic elite seem mainly concerned with the way the president apparently hurt their feelings. That isn't funny. It's shameful.

 

Every Single Vote Counts Every Single Time

For all of the non-believers out there... There was a special election on April 3rd for Oklahoma House District 71.  On election night the Democrat won by 3 votes out of about 2850 votes cast.  The Republican candidate asked for a recount and ended up winning by 1 vote. There was a problem. The total votes counted didn’t match the total votes cast as reported by the voting machines;  the number was off by four votes. 

After more investigation the election board discovered that two of alleged four missing ballots was actually a human error with the machines and the total was now off by two.  No one could account for the missing ballots, so the election board certified the election.  That should have been end of story, but by now you know it was not.

After the County Election Board had certified the election, the missing ballots were found in one of the voting machines.  If the missing ballots were counted the Democratic candidate would have won by one vote.  The issue is now before the Oklahoma Supreme Court.  It just goes to show that every single vote does indeed count. 

Houston Professional Fire Fighters Association - Local 341 - Message from the President

Houston Professional Fire Fighters Association - Local 341 - Message from the President

Firefighter Nation - "From Firefighter to Politician"

This is worth a read by all firefighters...

http://www.firefighternation.com/article/command-leadership/firefighter-politician

Indiana House Approves ‘Right to Work’ Bill
Day After Senate Clears Companion Measure
 
January 26, 2012
 
By Nora Macaluso

 
LANSING, Mich.—The Indiana House Jan. 25 approved legislation (H.B. 1001) that would make Indiana the 23rd state—and the first in 12 years—to prohibit mandatory union dues or fees.
 
The vote was 55-44, according to the House Republican Caucus, and came over the objections of Democrats. Several stood to denounce the bill, saying it would drive down wages and hurt unions, and claiming the legislation was rushed through without a fair hearing. The Republican-controlled Senate passed its version of the bill (S.B. 269) Jan. 24 by a vote of 28–22.

Lawmakers have said the two are nearly identical.
 
The House vote was largely along party lines. One Republican, Rep. Ed Soliday, joined a string of minority Democrats in speaking out against the bill.
 
“I believe in the right to property,” he said, and “one of the key components of the right to property is the right to contract.” Government, he said, should not interfere with a business owner's right to sign a contract under any terms he or she deems reasonable.
 
Chants from protesters outside the door could be heard throughout the three-hour House debate. “This won't bust unions, because these people are fighting to pay dues,” the bill's sponsor, Rep. Gerald Torr (R) said.
 
Attempt to Pass House Bill Failed Day Earlier
 
An attempt to pass the bill in the House was thwarted Jan. 24 when Democrats declined to show up, preventing the needed quorum. A day earlier, House Democrats complained that they had not been given the chance to finish offering amendments to the bill after some amendments—including a proposed change that would have put the issue before voters in a referendum—were defeated along party lines.
 
“The Republicans told the people of this state that they do not deserve the right to decide whether or not to bring ‘right to work for less' to Indiana through a statewide referendum,” House Minority Leader Patrick Bauer (D) said in a Jan. 23 statement. He said the legislation was being pushed through in “a brute force demonstration of the tyranny of the majority.”
 
But House Speaker Brian Bosma (R) said the legislature “can't afford to not address this issue this session.” A referendum, he said, would result in “decisions being made based on 30-second commercials rather than through open debate and vote by those elected to lead.”
 
Labor union supporters have been at the state capitol in Indianapolis protesting the legislation, cheering or booing lawmakers from chamber galleries. The Indiana AFL-CIO said Jan. 24 it had collected more than 6,000 signatures in 24 hours on a petition urging Democratic lawmakers to “continue to stand strong.”
 
Construction Industry Amendments
 
Both chambers approved amendments stipulating that certain portions of the law would not apply to the construction industry. The provision, however, is “not a carve-out” exempting the building trades, Tory Flynn, a spokeswoman for the House Republicans, told Bloomberg BNA Jan. 24.
 
“What we're doing here is recognizing and preserving the unique nature of the relationship that exists between the construction industry and the building trade unions by exempting their training and hiring-hall processes,” Rep. Eric Koch (R), sponsor of a House amendment on the construction industry, told Bloomberg BNA Jan. 24.
 
Unions, he said, still could negotiate agreements with construction companies, as long as the agreements did not cover dues or fees or require union membership. The House approved the amendment 57-41, Koch said.
 
Pete Rimsans, executive director of the Indiana State Building & Construction Trades Council, called the amendment “double-speak” and said it does not change the way the law would affect the industry. “We find it very disconcerting,” he told Bloomberg BNA Jan. 24. Union-employer relationships, outside the ban on requiring membership contemplated in the legislation, are outside the authority of the general assembly, Rimsans said.
 
“We think (the sponsors) are trying to fool some people and tell them they're doing something [the legislation] doesn't in an attempt to get some final votes for passage,” he said. “It's a little bit of misdirection.”
 
Gov. Mitch Daniels (R) is in favor of the legislation.
 
Meanwhile, a union-funded group—“A Working Person Like You”—that is opposing the Indiana right-to-work bill ran a television ad critical of Daniels following his response to President Obama's State of the Union address Jan. 24. Eddie Vale, a spokesman for the group, told Bloomberg BNA Jan. 24, that the ad cost about $30,000 to air and ran on broadcast networks in Indiana and nationally on CNN and MSNBC following the Indiana governor's response.
 
The ad features Daniels telling members of the International Brotherhood of Teamsters in 2006 that he is opposed to any changes to labor law in Indiana. He told the union: “I'm a supporter of the labor laws we have in the state of Indiana. I'm not interested in changing any of them. Not the prevailing-wage law, and certainly not a right-to-work law.”
 
The ad asks viewers to call Daniels and ask him why “he no longer supports working people.”

Average after-tax income

A good place to start

This article is as good a place as any to start the discussion regarding the recent attack on public employees.

JANUARY 24, 2011

Government Employees Are Not "Over-Compensated"
The War on Public Workers
by STEVE BREYMAN

Government worker bashing is nearing a crescendo as we stare into the abyss of American public finances. There’s nary a mayor, governor or president who hasn’t found his or her work force an irresistible target of criticism for "greedy unions," "extravagant benefits," "unaffordable pensions," and "shared sacrifice."

Why is this?

Are teachers, fire fighters, snowplow drivers, and environmental regulators really that well paid?

Do FBI agents, state troopers, and local cops really have "overly generous" health benefits? Do health care aides, prison guards, and those who protect our drinking water really have platinum-plated pensions?

To answer these questions we must do some comparisons and some contextualizing. There are countless tendentious manipulations of the private vs. public sector compensation data by corporate-backed think tankers out there. That’s what they get paid to do. Simply looking at public vs. private pay averages is deceptive.

Governments do not have many minimum-wage jobs, whereas the private sector offers at least 10 million of them. Government work forces tend to be older and better educated, and thus better paid.

The vast capital gains of America’s billionaires do not count as wages or benefits; this makes private sector compensation appear lower than it actually is.

The private sector generates temporary jobs that tend to be lower paid, part-time and without benefits (80 percent of the jobs created by the private sector in November are temporary). Governments generally produce positions that tend to be more secure, full time and with good benefits.

One study of federal government vs. private compensation for nearly 600 comparable positions found that civil servants make 20 percent more on average. But again, averages are often deceptive. Another study, which adjusted for the variables of age and education, found that pay for local and state jobs is about 7 percent lower than in the private sector. Government pay scales often are higher for lower skill jobs, but lower for higher skill jobs. Look at the pay for physicians, IT types, engineers, lawyers and other professionals in the public sector. It can be half or less of what one finds in the private sector.

This partly explains the "revolving door" of non-career government executives spending years in the private sector to make up for a comparably meager public paycheck.

But the ultimate test is individual. Do it yourself: go to http://www.usajobs.opm.gov/ or http://www.cs.state.ny.us/ to see what the job most like yours pays.

As to public vs. private sector health benefits, the data are even trickier. There are no large, nationally representative databases. There’s no doubt that most small businesses do not offer health benefits as generous as those found in government, if any at all. But if you compare public employee benefits to those for staff at large corporations (500 or more employees), the benefits are nearly identical.

A fair comparison? You decide.

What about pensions? The fundamental issue is the difference between defined-benefit plans (prevalent in government jobs) and defined-contribution plans (e.g., a 401k, the standard in most of the private sector). The former promise a certain monthly pension check, the latter leave you at the mercy of Wall Street. Defined-benefit plans clearly cost employers more than defined-contribution plans. That explains why 85 percent of private-sector workers do not have them.

At the same time, about 30 percent of state and local workers do not receive Social Security retirement benefits. They see their defined-benefit plans as making up for that.

Is a guaranteed pension really too generous? Or should one’s old age security not be left to a rigged casino?
 
Today’s claims over what are fair or affordable public employee compensation packages must be seen in political-economic context. We’re in the midst of another jobless recovery. Despite record corporate profits, "American" companies are not hiring in America. Instead, they created 1.4 million jobs overseas last year. Gone are the days of life-long employment at a single firm with good pay, adequate benefits and a guaranteed pension. Welcome to the era of temporary, deskilled, part-time jobs with few benefits and a lousy pension. We’ve witnessed the deliberate restructuring of America’s private sector work force; government employees are next.

People are worried about holding onto jobs they hate. Almost every state’s budget is in crisis. The federal government is set to raise the debt ceiling again. Tax burdens grow much more often than they shrink even with cynical gimmicks like Obama’s one-year cut in the payroll tax that funds Social Security. We’re encouraged by much of the corporate media to resent the benefits of civil servants rather than the bonuses paid at Goldman Sachs. Decades of redistributive policies–forcing income from the bottom upwards–have fewer Americans eating more of the pie than ever before.

Elite interests allied with Andrew Cuomo set up The Committee to Save New York to press hard for givebacks, cuts, and other "reforms." Even with their strong unions, it will be very difficult for public sector employees to resist the current onslaught.

Let’s be clear now: beating up middle-class public servants will not slow the growing economic inequality underlying many of our present problems. Governments under the sway of powerful lobbies have avoided progressive taxes on all the income of their millionaires and billionaires for far too long. This is fair? "Shared sacrifice" begins when those at the top no longer pay lower tax rates than their secretaries.

STEVE BREYMAN is Associate Professor of Science and Technology Studies at Rensselaer Polytechnic Institute in Troy, New York.