Why are we all so glum?

[olds442jetaway]

The old fashioned pressure cooker only has so many rings on it. Three if I remember correctly watching it for my mom while she was busy doing other things around the house. So many things are not counted now when considering inflation. I think we are at about two and a half rings now. Printing endless currency runs and fudging statistics released to the liberal press will not solve the problems. When over half of the population does not contribute to funding the running of the ship and at the same time demanding more and more services, something has to give. Regulation upon regulation thrust upon business and professions like teaching just add to the problems. Young adults cannot compose a decent sentence in their own handwriting never mind adding up a column of numbers or doing basic calculations in their heads. Flooding our country with illegals taxes everyone. International tensions and wars mostly over religion are not going to be solved permanantly as they have been going on for thousands of years for the same supposed causes. Somehow, this great nation hopefully will survive in spite of our leaders if you want to call them that. Unfortunately, as always over history greed, corruption, appetite for drugs legal or illegal will always be there and just perpetuate the nations problems. In spite of all of this, relaxing with a little vp does seem to take the edge off and even gives one some hope for something good to happen even if it is for ourselves for the moment. Ok...enough rambling for now. Got some beautiful weather on tap for the next few days in the East. Places to go, people to meet, stuff to get done and hopefully some fun times too.

[DaBurglar]

Not to prolong an economic discussion on a VP site, but your view of the Federal government 'helping' during the Great Depression is inaccurate. According to a WSJ article published in Feb/2009, history now shows that policies implemented during The Great Depression actually slowed the normal recovery that would have taken place.

Take a look at the article. The key was the NIRA, which set aside antitrust acts and permitted price hikes commensurate with wage hikes. This distorted the normal economic forces, restricting output and productivity. Well, I am very familiar with Howard Cole and his "theories"....that article, while certainly interesting and thought provoking, is, at the end of the day, an "Opinion piece" (op-ed)   He states that the "FACTS" do NOT support the claim that FDR and his "new deal" helped end the depression.    There are MANY facts he does not even mention, and he lumps ALL WORKING HOURS TOGETHER, across all fields and industries, which is totally misleading.    The America of 1929, while becoming industrialized, was no where near the country it was 10-15 years later during WW II (and certainly NOT the country we live in today!)COle does not even discuss the simultaneous "Dust Bowl" and the devastation to the farm industry that persisted from 1929 thru 1936.....many Americans who remained unemployed during the 1930s were former farmers, farmhands, and related workers (like the guy who fixed the farmers tractors!)......furthermore, many americans who lived in cities like NYC, Boston, Chicago, Philly, who lost their jobs, simply "vanished" and became migrant......constantly moving around the country from odd-job to odd-job.  Obviously, the time spent moving from a Job in Tennessee on the Tennessee Valley Authority project to the HOOVER DAM project does not count as time "working or employed"....and remember, things (and people) moved much slower back then!   Plus, you need to remember, which Cole apparently does not, the world was in a Depression not just the USA...so when the USA started to show a LITTLE, slight uptick aroung 1935-36, it was quickly snuffed out in part due to persistent depression overseas in every country except Nazi Germany!  oyThe world moved a lot slower back then too, so his claims that the depression persisted in spite of FDR is unfair......things were still "bottoming out" (like the aforementioned farming/food industry example) and served to dilute much of what FDR was trying to do.Ahhhhhh!   this is a very complex and deep topic, but I love Billyjoes posts, they are engaging and interesting.

[Tedlark]

And not nearly as long and drawn out as yours. For THAT   we THANK billyjoe.

[BillyJoe]

[QUOTE=billyjoe] Not to prolong an economic discussion on a VP site, but your view of the Federal government 'helping' during the Great Depression is inaccurate. According to a WSJ article published in Feb/2009, history now shows that policies implemented during The Great Depression actually slowed the normal recovery that would have taken place.

Take a look at the article. The key was the NIRA, which set aside antitrust acts and permitted price hikes commensurate with wage hikes. This distorted the normal economic forces, restricting output and productivity. Well, I am very familiar with Howard Cole and his "theories"....that article, while certainly interesting and thought provoking, is, at the end of the day, an "Opinion piece" (op-ed)   He states that the "FACTS" do NOT support the claim that FDR and his "new deal" helped end the depression.    There are MANY facts he does not even mention, and he lumps ALL WORKING HOURS TOGETHER, across all fields and industries, which is totally misleading.    The America of 1929, while becoming industrialized, was no where near the country it was 10-15 years later during WW II (and certainly NOT the country we live in today!)COle does not even discuss the simultaneous "Dust Bowl" and the devastation to the farm industry that persisted from 1929 thru 1936.....many Americans who remained unemployed during the 1930s were former farmers, farmhands, and related workers (like the guy who fixed the farmers tractors!)......furthermore, many americans who lived in cities like NYC, Boston, Chicago, Philly, who lost their jobs, simply "vanished" and became migrant......constantly moving around the country from odd-job to odd-job.  Obviously, the time spent moving from a Job in Tennessee on the Tennessee Valley Authority project to the HOOVER DAM project does not count as time "working or employed"....and remember, things (and people) moved much slower back then!   Plus, you need to remember, which Cole apparently does not, the world was in a Depression not just the USA...so when the USA started to show a LITTLE, slight uptick around 1935-36, it was quickly snuffed out in part due to persistent depression overseas in every country except Nazi Germany!  oyThe world moved a lot slower back then too, so his claims that the depression persisted in spite of FDR is unfair......things were still "bottoming out" (like the aforementioned farming/food industry example) and served to dilute much of what FDR was trying to do. Ahhhhhh!   this is a very complex and deep topic, but I love Billyjoes posts, they are engaging and interesting.
[/QUOTE]
Two last comments: (1) NIRA was ultimately declared unconstitutional (not an opinion). NIRA, incidentally, did not apply to the agricultural industry (2) WWII saved the US from an even longer depression by kick-starting industry again. I just don't see an event like that in our near future this time around.

I, for one, would love to see the WPA again, instead of just handing out money. But, like the VA and Medicare, I doubt that our Federal Government could run it effectively.

[Minn. Fatz]

[QUOTE=Minn. Fatz] [QUOTE=billyjoe]If minimum wages were increased drastically, you would see a significant and immediate cut in staff. Employers will not absorb that extra cost. The people left behind may make more, but they will be doing more work.

I don't see it working that way in food service. Say I own a restaurant. Today, I pay my wait staff minimum wage. They depend on tips to make something more than that. I charge my customers some amount for their meals. Because I pay wait staff minimum, I can charge them less than I might otherwise.

Tomorrow, minimum wage goes up so my wait staff can make a living on what they earn from me. I have to charge my customers more for their meals. But they don't have to feel obligated to add on a tip to make up for the lower minimum I used to pay my staff; arguably, their meal costs the same as it used to.

The best servers might be earning less than they did from their old low minimum plus tips, but they could also negotiate for a higher wage based on the business they bring in.

Makes sense to me.[/QUOTE]
Passing an increased cost DIRECTLY to the customer for an increase in minimum wages is a recipe for disaster. A good portion of your business will move to lower cost food outlets, since the customer has seen no benefit or added value to them (same food, same servers) for the increase in prices.[/QUOTE]

Here's a recent business column from the local blats with a pretty good overview of the issue. Bottom line, if wages go up, either charge more for the food, cut expenses somewhere or...wait for it...take a hit to profits (e.g. owner's return). Or my suggestion, let customers know servers are being paid more so they don't have to tip as much and so will pay the same for their meals as when the "price" was lower. Or the suggestion in the piece, which one restauranteur seems to have tried, add a small fee to every tab to cover the increased wage cost.

None of that is an argument against raising minimum wages.

[Lucky Larry]

A couple of observations from 41 years in the profession of teaching in public schools (20 as a school principal) and now at the University level. Today, many students can't read or compute like in the old days-most can do it better. First, more kids and different groups of kids are being educated and graduating now than ever. In the past it was often OK to drop out. A generation or two ago you were able to get a good paying manufacturing, construction, or oil field job without graduating. Now oil patch instrument techs are required to have two year degrees and instrument tech certification They are running billion $ plants. Second, in the old days many moms stayed home with the kids preparing them for school. Now they are in the work force trying to make ends meet. Dad's income used to do that but salaries have not kept up with inflation or company profits over the past 30 years.

As far as "schools" some of the biggest changes came when state legislatures started "believing that schools should be run like a Business" - public schools aren't about making a profit. They are about educating and preparing students for society. The problem is that "business people" don't seem to understand that kids are not a raw product that comes into the factory meeting the company's minimum specifications. Each one is an individual who needs to be taught to optimize their skills and abilities.   

Legislatures however, like the Texas legislature believe schools should be ran like a business. For example, the Texas legislature changed the mandated "school funding first constitutional requirement" to funding when we get to it. As a result, Texas often funds only 60-70% of what's required by state mandate. But we lowered state taxes! As a result, schools have been placed under Court review several times and are now headed back to Court after Gov. Perry reduced school funding by another $5billion. Texas schools now often rank in the 40's when compared to other state per capita funding. In the 1970's we were in the Top Ten. All the while, Texas is experiencing enormous annual student growth (19% over the last 10 years) and also some of the highest % low income students in the nation. Texas leads the nation in Oil Production and number of new "minimum wage jobs" but also lead the nation in number of citizens who are uninsured and is amongst the lowest in student funding. It's suppose to be "long term investing" you know an old antiquated "business concept".

A second major problem came when non-educators took control of State Boards of Education and Certification. I'm always amazed how Lawyers and Doctors are allowed to control their guiding professional boards - AMA, etc. but non-educators control many State Boards of Education. If you ever want to watch a soap opera check out the State of Board of Education for Texas argue whether Thomas Jefferson should be included in US History texts or Evolution should be included in science books.

Accountability: On the Soap Box!
Lets talk school accountability. In my 41 years I seen the tremendous harm done to education in the name of accountability. First, it is almost impossible to measure student growth using one or two days of high stakes state testing. The end result is lowered curriculum to meet a state's minimum expectations and incredible stress on a system burdened with correcting society's ills. Try taking your state's released math or reading assessment and tell us how you scored knowing you could be fired "held back" if you aren't developmentally ready to master the tasks. A balance has to be struck between 16 year olds in middle school and accountability. That is not a job for non-educators. Let us do what we know best which is educate kids and run schools. I won't tell you how to wire a house or design a new software program or perform surgery - so quit telling me how to educate kids.

BTW: My student teachers and most school teachers in Texas start tomorrow. Have a great year.

Taxes:
Everyone should pay a share of taxes. First linked article on 26 national companies who didn't pay US taxes. Including: General Electric, Boeing, and Verizon for the past five years - Duke Energy, Apache Energy, Verizon, Consolidated Edison, Corning, Tenet HealthCare...


http://www.reuters.com/article/2014/02/ ... 4Q20140226

or this USA Today article:

Large Companies Find Ways to a Zero Tax Rate
http://www.usatoday.com/story/money/bus ... s/2480281/

Ok, time for me to get ready for school year number 42!

[DaBurglar]

wow!     Larry you really do have a formidable "Soap box"!     I enjoyed that post, all of it!Texas is a state closely associated with the current Republican party as well as the Tea (bag) party.....and you quite nicely exposed them for what they are!                                                                                                                                            

[chattycattty]

Ditto what Daburglar said. My wife is from a family of schoolteachers. Both of her brothers taught for about 35 years. One was a coach as well and the other was a principal the last 10 years. As soon as they were eligible for full retirement they got out with no regrets. My wife
taught for about 10 years but left in 1993 after we started our own business. We have spent many family dinners cussing and discussing the current state of education in Texas, teaching to the test, the career ladder, etc. etc. etc.

[royal flush]

the teachers whom get out get a pension that is about 1/3 over inflated as the states guaranteed investment results beyond market returns. they should adjust that phasing out pensions giving a 5% contribution with a 5 year vest plus whatever the employee contributes either on a pretax or (roth) after tax putting the states out of promising excess returns leaving the present and future folks of breaking those promises. what i would do would be to use a chapter 9 bankruptcy model to value the payouts rollovers for current workers and current retirees. rolling the actual value of the current pension payout and reducing it and the the workers in the system giving them an ira rollover for actual value and starting the 403b plan

[Minn. Fatz]

the teachers whom get out get a pension that is about 1/3 over inflated as the states guaranteed investment results beyond market returns. they should adjust that phasing out pensions giving a 5% contribution with a 5 year vest plus whatever the employee contributes either on a pretax or (roth) after tax putting the states out of promising excess returns leaving the present and future folks of breaking those promises. what i would do would be to use a chapter 9 bankruptcy model to value the payouts rollovers for current workers and current retirees. rolling the actual value of the current pension payout and reducing it and the the workers in the system giving them an ira rollover for actual value and starting the 403b plan

Here's my take on public sector pensions. For years public employers, mostly legislatures, got public employee unions to settle for lower, or no, wage increases in return for more generous benefits, including pensions. Now that state government, along with everyone else's, finances are, well, iffy, legislators are looking to back out of those promises, mostly by declaring bankruptcy. Unfortunately with the union movement in a sad state and with no discernible difference on the issue between Republicans and Democrats on the issue it looks like public servants are about to be screwed wholesale.