Sunday, July 31, 2005

Don't Just Blame Wal-Mart

How China Will Change Your Business

Big news can be found in little places. In its November 2003 circular, a dryly written four-page publication, the Chicago Federal Reserve Bank noted complaints from American makers of automotive parts that "automakers had been asking suppliers for the 'China price' on their purchases." The bank's analysts observed that U.S. suppliers had also been asked by their big customers to move their factories to China or to find subcontractors there.

Over much of the business world, the term China price has since become interchangeable with lowest price possible. The China price is part of the new conventional wisdom that companies can move nearly any kind of work to China and find huge savings. It holds that any job transferred there will be done cheaper, and possibly better.

It is plainly understood that asking suppliers to lower prices is merely another way of telling them they ought to be prepared to meet the best price out of China, even if they are making their products in Japan or Germany. General Motors, which buys more than $80 billion worth of parts a year, now has a clause in its supply contracts that gives its supplier 30 days to meet the best price the company can find worldwide or risk immediate termination.

Teamsters' Hoffa on the right track by leaving AFL-CIO

The UAW has an abysmal organizing record in the industry that bears its name. It can claim no new members in foreign-owned auto plants and only last-minute efforts to save jobs at suppliers.

GM and the domestic automakers are sending tens of thousands of jobs overseas and the UAW is ineffectual at protecting jobs (many of the Supplier plants where the Union has kept the jobs have had massive wage give backs).

I think the other side of the "bubble" in Second Mortgages is workers having to borrow more to keep it going. Not only are wages being held down, but more medical costs are being offloaded onto the workers.

They got the Gold Mine, We got the Shaft...

How Wall Street wrecked United's Pension

Companies do not generally invest their pension money themselves, but instead farm out the work to an array of outside professionals. There are pension consultants to help set an investment strategy and recommend the money managers who actually pick the stocks and other particular investments. There are actuaries to design benefits packages and calculate how much companies need to contribute each year.

Custodial banks hold the assets in trust. Brokers execute trades. Once a year, an outside auditor is supposed to review the plan and issue an opinion about its conformity with generally accepted accounting principles.

Problems can arise when there are undisclosed relationships among these different service providers.

"Asset allocation is very much driven by hidden financial considerations," said Edward A. H. Siedle, the president of Benchmark Financial Services, a company that audits pension funds. He said one reason that pension funds tend to invest heavily in high-turnover, active equities is that "those investments have commissions and fees that can be shared with gatekeepers and others that pave the way." Companies that sponsor pension plans can also reap accounting gains if they increase the risk of their pension investments.


The S.E.C. monitors investment advisers but has no legal standing to enforce the pension rules. In a study, released in May, of pension consultants, it found the industry vulnerable to abuse and referred a dozen consultants to its investigative branch for possible enforcement action.

The advisors and the Corporate executives ride off into the sunset a bit wealthier and the retirees try to plan around a dramatic drop in income. Of course the union bears plenty of responsibility, too. They signed off on riskier investments in the Pension plan to free up money for wage increases. Irresponsible corporate governance (not direct class warfare) could be a strong issue for Democrats in the next election. Business is being driven by short term gain, usually at the expense of the future health, even survival of the enterprise. How about a 5 or 10 year waiting period for those stock options and mega bonuses? Just to be fair, Governance in Unions and Non Profits could be much better as well.

Why should a Republican get a pro-life vote?

US stem cell sponsor sees veto-proof Senate backing

Looks like we're going to have to yank their chain again in '06 just like in '94 to remind them who their base is.

One question I haven't heard is "why are so many extra embryos are being created?".

Saturday, July 30, 2005

Parameters: The New Strategic Trinity

If a culture does not assign a high value to the unimpeded flow of factual information, it cannot make competitive decisions.

Informational dysfunction generally cripples two types of states or cultures. First, those which embrace comfortable myths over painful reality--such as most of the Islamic world and much of the former Soviet Union--and, second, those which attempt to restrict the flow of information, such as China or North Korea. Often, as in the cases of Saudi Arabia or Nigeria--and even otherwise-promising Turkey--states manifest both failings: the forcible exclusion of threatening information and the propagation of comforting myths. This amounts to volunteering for failure.

Information is a liberating tyrant. It insists on universal access and enforces an often-painful mental sobriety; in turn, it allows receptive states and cultures to compound their success. It is difficult to bring the vital importance of informational freedom home to Americans simply because it is taken for granted. Even those who would remove Darwin from our schools comparison shop for automobiles and expect that the available information will be accurate. We are so informationally privileged that it is difficult to get a perspective on the richness that pervades our daily lives. The news in the papers, on radio, or on television will be amazingly accurate by international standards, and even the most lunatic talk show is constrained in the lies it can proclaim. From stock market reports to the contents list on cereal boxes, information disseminated by business will be accurate. We even learn from television commercials--which today have an amazingly high standard of factual presentation, thanks to the competitive nature of our economy, our laws, and watchdog agencies. Our textbooks are as factual as we imperfect humans can make them, and even our politicians are usually forced to tell the truth. Our waking hours are passed in the most accurate environment in history, and access to the information that enables us to operate in our professions and improve our lives is nearly universal. When we choose, we can make informed decisions. We are part of a small minority of present-day humanity.

Economic data is the most difficult to accumulate and verify, and the speed of today's national and world economy makes the problem ever greater, despite our marvelous informational tools. Yet, we do a superb job of measuring that which can be measured. When Alan Greenspan makes a decision, the data on which it is based is imperfect--but superior to anything previously accumulated and filtered by mankind. Elsewhere, societies are designed to conceal data, or to obfuscate. Consider Russia, with its insurmountable economic problems. A concealing peasant culture formed the basis for the dishonest Soviet regime--and now "capitalist" Russia is plagued by inaccurate reporting and hidden assets at all economic levels. A state cannot move forward without sound data on which to base developmental and fiscal decisions. With its addiction to mythic data, Russia has no hope of gaining full economic health in our lifetimes--since each day it falls farther behind in relation to the states with which it must compete. We may, in the coming decades, see a return to autarchy among failing states, which may provide the highest level of poverty available to them.

Since at least the Civil War period, our economy has towered over our military. In time of crisis, that economy has enabled the creation of military establishments other states could not afford or sustain. While the paradigm has changed to the extent that the technological sophistication of some forms of warfare forces us to maintain a more substantial force-in-being than we did prior to the Second World War, even that larger force is dwarfed by the post-industrial, information-driven economy it serves. We will continue to need a strong, ready military. But our military today is less important to our nation than is our banking system--to say nothing of our educational system. Our military is essential--but it is essential only for limited purposes. It is the medicine we keep in the cabinet for emergencies. On a daily basis, our media has vastly greater effect on the world than does our military.

Yet even our military is information-based and, when it is allowed to fight, its informational adeptness is a force multiplier so strong it cannot be measured (even by our measuring culture). A long time ago technologically, in Operation Desert Storm, we fielded an information-based military and won a victory so lopsided historians strain to find a precedent. Although our casualties could have been greater had we made worse decisions in some areas (and we could have been even more successful, given other potential decisions), the outcome of the conflict was never in doubt--not because we had the better troops or training or equipment (although we did, and each of these things matters), but because we had fielded a new kind of military. The fighting in Mesopotamia was as lopsided as any engagement of Maxim guns against spears.

Fascinating Stuff. Provincial thinking and self censorship seem the two greatest perils to our "information edge"

Wagons South?

Parameters: The Atlantic Century

Throughout the previous decade, strategists and statesmen asserted that we were about to enter the “Pacific Century.” Global power and wealth would shift to East Asia. American interests, power, and investments would follow. The Atlantic would become a dead sea strategically, its littoral states and their continents declining to marginal status. Economic opportunities, crucial alliances, and the gravest threats would rise in the east, as surely as the morning sun.

An alternative view of the evidence suggests that the experts were wrong. Although the United States will remain engaged in the Far East—as well as in the Middle East, Europe, and nearly everywhere else—the great unexplored opportunities for human advancement, fruitful alliances, strategic cooperation, and creating an innovative, just, and mutually beneficial international order still lie on the shores of the Atlantic. The difference is that the potential for future development lies not across the North Atlantic in “Old Europe,” but on both sides of the South Atlantic, in Africa and Latin America.

Especially since 9/11, the deteriorating civilization of the Middle East has demanded our attention. But we must avoid a self-defeating strategic fixation on the Arab Muslim world and self-destructive states nearby. Any signs of progress in the Middle East will be welcome, but the region overall is fated to remain an inexhaustible source of disappointments. While Africa suffers from an undeserved reputation for hopelessness (often a matter of racism couched in diplomatic language) and Latin America is dismissed as a backwater, the aggressive realms of failure in the Middle East always get the benefit of the doubt. When the United States places a higher priority on relations with Egypt than on those with Mexico or Brazil, and when Jordan attracts more of our attention than does South Africa, our foreign policy lacks common sense as much as it does foresight.

Interesting Premise. Obviously getting out of the cycle of death in the Middle East would be a good thing. Europe and China have varying amounts of hostility toward us and are unlikely to reconsider any time soon. Developing the Americas likely would relieve some pressure on our Southern border. Leaving Africa as a train wreck is likely to have negative long range consequences. Also Latin America has much better near term prospects of building responsive democratic governments that will protect human rights than China.

Bait and Switch?

What annoys me about the "What's the matter with Kansas?" Spiel is this assumption that Republicans are using "Bait and Switch" with Traditional Social Values being the bait and anti-progressive economic policy being the Switch. The same folks will turn around and advocate using Progressive Economic Policy to get folks to vote for anti-Traditional Social Values.

Ahem, Pot is to Kettle what Bait is to Switch?

Bull Moose

Labor needs to focus on bread and butter issues and not be diverted by secondary concerns. Many working people are "progressive traditionalists" - socially conservative and economic progressives. They may be pro-life and pro-gun but also experiencing deep anxieties about their economic plight. Can labor connect with them? The Moose certainly hopes so.

What about the Democratic Party? If the Democratic Party is only big enough for one hand clapping. Cheney in '08 isn't impossible.

All Out Effort?

Parameters: National Mobilization:An Option in Future Conflicts?

Following the terrorist attacks of 9/11, some commentators drew a parallel between al Qaeda’s strike and Japan’s bombing of Pearl Harbor, and between the ensuing struggle and the Second World War. There was sporadic talk of mobilization, which was easily enough dismissed as out of step with the realities of the War on Terror. Unconventional warfighters like terrorists are by definition immune to the massive concentrations of power that are the traditional object of a mobilization. At the same time, conventional war is generally regarded as oriented toward smaller, more professional, and high-tech forces fighting in “demassified” conflicts. However, despite a great deal of hand-wringing on the part of social critics, the really difficult question was not asked: Would a World War II-scale mobilization even have been possible after 9/11 if it had been deemed an appropriate response?


Mobilizing in the Post-Industrial Era

It may seem counterintuitive to question the capability of today’s advanced economies to mobilize relative to where they stood a half century or more ago when they were much smaller and less sophisticated. In 2002 the US economy was ten times as large as it was in 1940, and roughly five times as large as it was in 1945.5 Nevertheless, that growth has partially been fueled by changes which are trade-offs from the standpoint of mobilization.

The first is that geography offers less advantage today than it did in the 1940s, as the case of the United States makes clear. The fact that the United States was richly endowed with natural resources and physically isolated from the main World War II battlefronts by two oceans allowed its industrial base to mobilize unimpeded by fighting, in contrast with Britain or Japan, each dependent on vulnerable sea lanes, or Germany, subjected to strategic bombing. A greater reliance today on imported natural resources and manufacturing practices dependent on outsourced components makes the United States much more susceptible to such interference. This goes not only for attacks by an adversary, but the precautions involved in tightening up the borders, as demonstrated in the wake of 9/11. “Transportation issues played havoc with order flows and drove up shipping costs,” and the plants practicing just-in-time manufacturing, like those belonging to Ford, Honda, and Toyota, came to a halt.6 At the macroeconomic level the result was a one-percent drop in American industrial production, largely due to the disruption of industry in the week before a semblance of normality returned.

Changes in military technology also make it more difficult for the United States to insulate itself from a conflict abroad. Long-range aircraft and missiles permit attacks on the US homeland. This includes not only strategic forces like those of Russia and China, but the prospect of crude cruise missiles launched from offshore freighters by smaller opponents, a feat arguably within the reach of terrorist groups. It also includes the widened possibilities for infiltration and attack by saboteurs, terrorists, and special forces units, given easier transport and more effective, compact weapons, even if they do not possess weapons of mass destruction. A sophisticated adversary could dispatch a large number of such teams to infiltrate the United States and cause havoc in wartime, a threat against which elaborate missile defense schemes would be useless. Computer attacks, similarly, are undeterred by distance, and attacks by single viruses in the past, like the “Love Bug,” are estimated to have caused billions of dollars in damages. Should such attacks be staged by a large, determined force of cyberwarriors rather than a single cracker, the damage to the economy could be substantially greater.

Second, several studies in recent decades have pointed to a neglect of traditional manufacturing and heavy industry as a problem.7 Manufacturing now provides 14 percent of America’s Gross Domestic Product (GDP), rather than the nearly 27 percent it provided in the aftermath of World War II.8 Indeed, the problem of the United States in the 1930s was underutilization of its vast industrial capacity, due to a lack of demand. Factories were left at a standstill and a quarter of the labor force out of work in the Great Depression. With the war effort providing new demand, America’s economic output grew 75 percent during the conflict, after adjustment for inflation. By contrast, a recent RAND Corporation report has noted that should it become necessary for the US Army to equip and arm more than the 26 heavy divisions for which equipment is already available, the lack of industrial capacity would represent the biggest problem for further expansion.9


Third, critics have frequently pointed to diminished civic militarism as an obstacle to such efforts, noting the formidable political resistance among citizens to paying higher taxes or serving in the military. The widespread support for military action following the 9/11 attacks did not translate into an equally widespread willingness among Americans to enlist, or make conscription less unthinkable politically.This trend is variously attributed to a culture of consumption and self-indulgence, the “law of the increasing cost of war,” cultural change from the 1960s on, a lack of leadership on the part of elites generally eschewing military service, or some combination of these factors.


Slack and Mobilization

While commonly discussed in a much more limited sense, the concept of slack carries over to entire societies, which depend on untapped human and material resources for pursuing new endeavors or meeting emergencies. The level of governmental activity as a part of overall societal activity—specifically its patterns of taxation, spending, and debt—offers a guide to how much slack a society has. The reason is simple. Endeavors like mobilization represent an abrupt enlargement of government spending, and have to be paid for by redirecting the nation’s resources, typically by raising taxes or borrowing money. Looking at how much a government taxes, spends, or owes in relative terms under normal circumstances gives a clue to what resources are not being exploited at the time, and therefore how much more it might be able to do in the event of an emergency. A higher level of untaxed income, lower spending levels, and a lower debt burden are representative of greater slack, and vice-versa.

Given the popularity of comparisons of the present with World War II, during the last two years of which the United States devoted 37 percent of its national income to the war effort, it would be useful to contrast today’s fiscal situation with that era’s. Gross debt was equal to 52.4 percent of US Gross Domestic Product in 1940, and that was after a decade of economic contraction in the Great Depression. By contrast it was 60 percent in 2002 at the end of a prolonged economic boom and years of what were by some measures budget surpluses—unusually good times in the view of economists, rather than unusually bad ones. More important, overall tax levels were far lower. Federal revenue levels in 1940 were 6.8 percent of GDP, compared with 18 to 20 percent of GDP in recent decades, or three times as much.


By contrast the national debt spiked upward sharply in the 1980s, with defense expenditures at levels of only 5 to 6.5 percent of GDP, these relatively lower expenditures apparently less supportable than the higher spending of a decade or two earlier. It took World War I to turn Britain from a creditor nation into a debtor nation. The 1980s, with their comparatively much lower level of strain, were sufficient to effect that transformation for the United States. The short-lived fiscal optimism of the late 1990s aside, it is clear that any conceivable combination of defense cuts and economic growth would be insufficient to pay down the debt the United States accumulated during the late Cold War. Moreover, today defense spending in the area of only four percent of GDP goes along with budget deficits and increases in the debt comparable to those of the 1980s.

The heightening of security spending since 9/11 is responsible for only a fraction of recent deficits (about a fourth of it, according to one estimate), but that this spending is contributing to the debt is still indicative of the problem of a tighter fiscal situation. Additionally, consistent with this picture, the direction in which the US economy is moving is toward more spending, more debt, and, at least proportionately, less slack, for a number of reasons which have nothing to do with the War on Terror. The most widely discussed of these is the pressure which aging populations are putting on the social safety net, already a major driver of deficit growth.21 The federal debt is expected to almost double to $11.8 trillion by 2013, at which time the retirement of the baby boomers could send the debt spiraling still higher. By 2030, spending on the elderly could rise by 80 percent relative to national income, threatening peacetime deficits dwarfing those of the 1980s or today.22 Such straight-line projections have their limitations, but today it is difficult to conceive of alternative scenarios given the drivers of such change. Social Security payouts aside, essential services like health care are becoming more expensive relative to income.23 Also consistent with a trend toward older populations, though not entirely due to it, savings rates have declined24 and private debt has risen,25 placing other strains on the tax base. No one expects the cost of health care to drop in the foreseeable future, or the trend toward an older population to reverse itself, but the contrary.

Another reason which should not be overlooked is the rate of economic growth, so crucial to absorbing and recovering from shocks, as after World War II. Despite the hype about a global economy turbo-charged by integration and information technology, epitomized by authors like Thomas Friedman, world economic growth has actually slowed in recent decades. The rate of world GDP expansion fell from 5.3 percent a year in the 1960s to 3.9 percent in the 1970s, 3.2 percent in the 1980s, and only 2.3 percent in the 1990s.26

This pattern has been evident throughout the developed as well as the undeveloped states, so that it cannot be explained away as simply an object lesson in the advantages of backwardness, or the gap between “competitive and noncompetitive” states. Certainly, China’s and India’s comparative underdevelopment is a strong contributor to their high growth rates, and US competitiveness explains its having stronger growth than Europe and Japan.....


Of course it is frequently claimed that should the need arise, the United States could muster the political will to raise taxes or slash spending in other areas. However, an honest look at the historical record shows that partisan and domestic politics have not simply been swept aside in the name of national interest during mobilizations, even in the 1940s. Where taxes are concerned, the fact remains that today’s tax levels are broadly equivalent to those levied during the Second World War. Federal revenue levels peaked at 20.9 percent of GDP in 1944, compared with the 20 percent raised in peacetime in recent years. The political challenges facing those who would rewrite the bills authorizing mandatory spending, particularly those affecting the elderly, need no elaboration. Rather than a tax hike or Social Security reform, what has materialized thus far in this decade is a sizable tax cut and the passage of a prescription drug benefit for Medicare recipients, the largest entitlement since the Great Society programs of the 1960s. Moreover, according to the various explanations given by observers concerned with the economic and fiscal picture, this may be the rule and not the exception in the years to come.

In short, the United States of World War II and most of the Cold War was a substantially less-taxed, lower spending, and less indebted society than today’s, giving it more fiscal slack on which to draw in the event of an emergency. Along with its higher rate of economic growth, this enabled a rapid fiscal recovery after the spending surge. There was little sign of this happening after the Cold War, and even less than that today with deficits of $400 to $600 billion a year projected for the next several years, and which will grow greater still as the baby boomers retire. It would be going much too far to say that this makes a substantially enlarged military or even outright mobilization impossible, but it is safe to say that it makes it harder to come by the necessary resources. Since it would be more difficult to raise taxes today than in the 1940s, more of the money needed to sustain a war effort would have to be borrowed. These additional loans would come on top of a rising structural deficit and higher debt burden, as is happening today.


In other words, the United States, aside from still enjoying by far the largest economy, remains a faster-growing, less indebted society than the other technologically advanced nations, and this is likely to remain the case for the foreseeable future. The stresses posed by aging populations and the like are also milder in the case of the United States than in Japan or Europe, with their older populations, earlier retirement, and more generous benefits. Of course this leaves open the question of China, said to be rapidly becoming “the workshop of the world.” The hype surrounding China’s economic expansion, however, tends to minimize its significant problems, such as its own aging population, insolvent banking system, growing reliance on costly energy imports, and mounting debt. The statistics reporting ten percent growth are notoriously spotty, and numerous observers suggest they have been exaggerated for years. Even were they accurate, such growth rates cannot be sustained forever and will likely fall dramatically before China attains a per-capita income remotely comparable to that of the United States or other industrialized nations. This may make it less likely to be a peer competitor to the United States anytime soon than is widely imagined.


The question of just what a developed economy can or cannot do, of course, is by no means a simple one. Nevertheless, a look at the key facts—such as changes in economic structures, technology, and cultural attitudes—raises serious questions about the capacity of the United States to mobilize to meet security needs. The crucial factor may be that the slack required for sustaining a military mobilization is gradually being depleted, at least as measured by slowing economic growth and the worsening fiscal picture for the United States and other major nations. If this is problematic today, it is likely to be far worse by 2020 or 2030, given current trends. It also should be noted that this disappearing slack additionally affects the ability of the United States to respond to other problems or seize other opportunities, like undertaking an ambitious program of space exploration or coping with an environmental disaster.


The United States consequently will retain a position of leadership indefinitely, in large part because of the weakness of other states, including China. Nonetheless, while America’s tax, spending, and debt levels remain below those of most other advanced states, and its economic growth rate higher, the overall trends are cause for concern. The United States, less able to count on the means of its allies even when they are willing, needs to acknowledge the limits of its own resources in providing for security at home and abroad.

Again, as was the case in the late 1980s, America’s finances must be seen as a security issue as well as an economic one. While defense spending now plays only a partial role in alleviating or increasing the present and future fiscal difficulties, those fiscal problems must be recognized as limiting how much of a burden the United States could take on in the future. The danger of “overstretch,” highlighted by the nearly singlehanded conduct of the war in Iraq, should not be lightly dismissed. It is certainly true that the United States can hardly escape involvement abroad. Nevertheless, at a minimum, a conservatism toward acquiring additional commitments is overdue.

The whole article is very worth a read. This does not just affect defense but also our ability to respond to an energy crisis or depression. One point not raised by the author, but by others, is that the increased number of women in the workplace means there are less spare workers laying around to make up for the manpower drain of conscription. To be sure the increased lifespan and health of our retirees perhaps offers another form of slack in the employment marker. If the "alarmists" are right about peak oil we'd be hard pressed to retool our crumbling infrastructure to be less petroleum based.

Monday, July 18, 2005

Penny Wise, Pound Foolish

Ezra Klein: Condemning CostCo

Via Nathan Newman comes this NY Times article on how Costco became the anti-Wal-Mart. These pieces pop up every so often to contrast Costco CEO Jim Sinegal's pro-worker philosophy with Sam Walton's throw-them-in-pits attitude. What I love, though, are the clockwork quotes from analysts upset at Costco's good labor practices. Even though Costco's stock price has jumped more than 10% in the last year, even though they sell stock at 23 times what their earnings would predict (Wal-Mart is 19 times), it's not enough. If you're not squeezing the workers, say the analysts, you're not doing your job:

Costco's average pay, for example, is $17 an hour, 42 percent higher than its fiercest rival, Sam's Club. And Costco's health plan makes those at many other retailers look Scroogish. One analyst, Bill Dreher of Deutsche Bank, complained last year that at Costco "it's better to be an employee or a customer than a shareholder."
Emme Kozloff, an analyst at Sanford C. Bernstein & Company, faulted Mr. Sinegal as being too generous to employees, noting that when analysts complained that Costco's workers were paying just 4 percent toward their health costs, he raised that percentage only to 8 percent, when the retail average is 25 percent.

"He has been too benevolent," she said. "He's right that a happy employee is a productive long-term employee, but he could force employees to pick up a little more of the burden."

That reporters can regularly solicit quotes condemning the CEO of a wildly successful business for being too attentive to consumers and workers is such a perfect window into the skewed values informing business that I feel I should frame each and every one. But much to my surprise, I never need to. There's always another analyst willing to play Greed's advocate.

I have, incidentally, a personal affection for the Costco-Wal-Mart feud as a metaphor for Democrats and Republicans. In some ways, the economic divisions in this country really are about who you favor: owners and shareholders, or workers and consumers. And, Democrats who're always trying to figure out how to talk about better wages and benefits without being labeled anti-growth, would do well to keep the Costco example in mind. What's hurting workers in this country, by and large, isn't the need for business to remain competitive, it's the pressure on CEO's to squeeze out a few more dollars for shareholders at worker expense. With the decline of the labor movement, workers have no powerful counterforce speaking for them: for Democrats, that should be the role of government.

One of the things that makes me nuts about the contemporary scene is the idea that it is an affront against God and Nation to pay a worker a decent wage for their work.

Sunday, July 17, 2005

Trade agreement with Thailand threatens US Automakers

Detroit News

Thailand is the World's 2nd largest producer of pickup trucks, who knew? Is interesting, because it points out a big issue: the country where something is produced is only one factor. Japanese companies use Thailand for offshore production, so our trade talks with Thailand are being complicated by issues with Japan. Much like many of the Chinese imports are US companies behaving badly rather than indigenous businesses.

Border Security?

The CounterTerrorism Blog: Border Madness

So far this year, the Border Patrol has apprehended some 119,000 non-Mexican illegal aliens along the SW border. That is an increase of 175% over last year, which was itself a record year for such apprehensions. What is the reason Homeland Security officials give as why they believe these numbers have risen so dramatically? Incredibly, it is the Federal Government’s own policy of “catch and release.”

“Catch and release” refers, of course, to the policy of releasing on personal recognizance the vast majority of these non-Mexican illegal aliens after they are arrested and processed for removal proceedings. The aliens are served with “Notice to Appear” charging documents and then released, often being driven in Border Patrol vehicles to the nearest bus or train stations for onward transportation to wherever they are destined.

How long will it take for our elected officials to take Homeland Security Seriously? The Senate just voted to cut the number of new Border Patrol Agents and detention beds. Bush's open endorsement of an amnesty/work visa program encourages more illegal immigration (you only get a free pass if you're already here). The Mexican Government refuses to offer more help with Boder Security and threatens to agitate "militant" protests in the U.S. unless we offer another round of Amnesties

Neither the Democrats or the Republicans are Pro Life

Mark Roberts talks about The NAE's For the Health of the Nation: An Evangelical Call to Civic Responsibility.

In Part 16 He makes a very good point:

I've saved for last one of the lines from this subsection on justice that I find most telling and quotable:

God measures societies by how they treat the people at the bottom.

The vulernable who are "at the bottom" include: "not only the poor, but women, children, the aged, persons with disabilities, immigrants, refugees, minorities, the persecuted, and prisoners." I think this accurately portrays God's self-revelation in Scripture, though I'm a little surprised the NAE Statement didn't include the "unborn" in its list of vulnerable people who deserve our care. As I said in my last post, I think the Statement would be stronger and more biblical if it linked the sanctity of life and justice issues more closely.

Being pro life isn't just opposing abortion and the culture of death, it is being for people (born and unborn, dying and healthy). Whether you agree with their choices or not, every person deserves to be treated as a bearer of the image of God. This cuts both ways, Sanctity of Life folks should be progressive and progressive folks should be pro life. Right now we have one party who wants to get you here alive and then let you fall to the pavement and another who supports any and all means to kill you when you are helpless but at least claims to be concerned about what your life is like.

Saturday, July 16, 2005

House of Labor: Up to Five Million Unemployed Not Counted

Interesting quote in the comments:

Also compounding the problem is that our economy has become increasingly a "service economy". The less goods we make the bigger the divide becomes between white collar workers and Walmart employees, with the middle shrinking. I don't think I can think of one single growth industry that requires skilled labor. In the 90's I thought it was going to be "e-commerce" but I don't see the growth in that industry presently. Not to be cynical but the Defense industry looks good for future growth. But can that sustain our economy?

Why Do we Call them "Friends"?

A senior general in the Chinese army threatened to use nuclear arms against the United States in a conflict over the Taiwan Strait, prompting the Bush administration to call the remarks "highly irresponsible."
    "If the Americans draw their missiles and position-guided ammunition onto the target zone on China's territory, I think we will have to respond with nuclear weapons," Maj. Gen. Zhu Chenghu said in yesterday's editions of the Financial Times and the Asian Wall Street Journal.
    The comments were the most explicit statement of strategic intent by a Chinese military official since 1995, when another officer, Gen. Xiong Guangkai, implicitly threatened to use nuclear arms against Los Angeles if the United States intervened in a Taiwan conflict.
    "If the Americans are determined to interfere ... we will be determined to respond," said Gen. Zhu, head of China's National Defense University. "We Chinese will prepare ourselves for the destruction of all of the cities east of Xian [in central China]. Of course the Americans will have to be prepared that hundreds ... of cities will be destroyed by the Chinese."

Why do we do business with our enemies? Mr. President, fix the deficit, end MFN status for China.

Monday, July 11, 2005


Also the FMCSA website has links to the comments posted by various participants

I read with interest the comments of (in no particular order)
American Trucking Associations
Advocates for Highway and Auto Safety
Truckload Carriers Association
Public Citizen
Schneider National
CVSA (Commercial Vehicle Safety Alliance)

Those are some I recall as having useful information

Hours of Service

As a truck driver, I have a vested interest in the Hours of Service Rules put out by the Federal Motor Carrier Safety Administration. These rules govern how many hours drivers can work in a day and over a 7 and an 8 day period (60 and 70 hours respectively).

That is why I am concerned about September 30, 2005.

On January 4, 2004 new Hours of Service rules were put into place by the FMCSA. These rules cut the number of hours a driver could work in a Workday from 15 hours to 14 consecutive hours (so now breaks count toward your clock for the day and the clock is a little shorter), increased the break between Workdays from 8 to 10 hours , and increased the number of hours you can drive in a workday from 10 to 11. The seven and eight days rules nominally remained the same, except that 34 consecutive hours off you could restart 60/70 hour limit. This was the most significant change to the Hours of Service rules since they were created in 1935 (they were significantly modified once in 1962).

The new rules were drafted in response to a mandate from Congress to draft rules that enhanced safety, allowed for productive operations, and cared for the health of Truck Drivers.

In July 2004 the D.C. Circuit Court struck down the new rules because they did not account for driver health as required by Congress. The Plaintiffs in the case (Public Citizen and the International Brotherhood of Teamsters, among others) wanted an immediate return to the old rules followed by a new rulemaking process. The Industry, the FMCSA, and the State Agencies tasked with enforcing Truck Safety Laws all asked the court to keep the current rule while a new rule was drafted. Before a decision was made Congress intervened and codified the new rules until September 30, 2005 or until a new(er) rule could be drafted that took the court ruling into account.

The January 4,2004 rule change was the culmination of a long series of false starts, going back to at least 1978. So, to expect a rule to be created in a year is a bit of a long shot. But, the FMCSA thinks they have done it.

Having failed to get Congress to codify the new rules permanently or to remove the driver health provisions from the mandate, the FMCSA plans to announce its changes (if any) to the Hours of Service rules by "Early Summer 2005" and to be ready to go September 30. Indeed the Agency administrator is on record that the decisions were all made by the end of April and are currently on hold for approval by the OMB and Transportation Secretary Norman Mineta.

Some points:

The Commercial Vehicle Safety Alliance noted the 2004 rules were announced in April 2003 and time was very tight getting enforcement personnel up to speed before the rules took effect. One would assume they will be quite unenthusiastic about a much smaller window to get ready for the new new rule.

The FMCSA by all appearances seems to think the court ruling was for a "failure to use footnotes" (to steal a catchy description of Pelagianism) . However the court seemed to find more than just a failure to explain why the new rules were better for driver health, rather they seemed (to my untrained eye) to have found defects in the rules themselves.

The Plaintiffs from the previous legal action clearly are gearing up for another lawsuit. Most of their Comments on the FMCSA's new new rule are attacks on the agency.

So then, I see a very nasty scene unfolding. The FMCSA posts new rules later this summer (We're already below 90 days to September 30). Drivers and enforcement personnel scramble to learn and apply the new rules in the middle of the busy season for van freight. Meanwhile fresh lawsuits roll forward. The Rule is once again set aside in short order. The industry is threatened with Chaos again.

Is the FMCSA hoping Congress will legislate the whole mess away next time or do they intend to fight this up to the newly reformulated Supreme Court?


Well, Firefox likes my posts. They are tasty. It toys with me and then after I have composed for a good half hour or so, it checks out. Perpetual Spinning Beachball.

Camino doesn't care for this whole blogging thing.

Enter Safari Stage Right.

Let's try this again.

Sunday, July 10, 2005

We'll see if this works.

Well shucks, a blank page. Guess I better type something here else no one will know I was here. Where's the Spray Paint? Oh, never mind. I have a couple topics to hit but I think serious posting will have to wait till tomorrow...