How to Ruin the Environment: Green It With Solar Panels

Covering the lovely desert landscape with ugly solar panels is one way to make the environment “green.” Though you may profess love for nature.

All of which does not work anyway. When solar panels get covered with desert dust and dirt they do not accomplish their goals. They have to be washed down with water every month. Yet, precious water is not available in the desert.

The Wildlife Conservancy and other clear-minded environmentalists are against solar panels in the desert. That, in addition to the fact the process still has to be subsidized by taxpayers.

Government Bungling of Student Loans

The Obama Administration is telling us how a publicly operated health insurance system can please the health consumer while cutting health insurance costs.

Here is the perfect example why this can never work as advertised.

The government has been slowly taking over the student loan business. And it is costly. Private lenders are being forced out of business. And what’s more, students are not happy with the government efforts.

On July1, 2010, private lenders will no longer be able to make government guaranteed student loans. The government now has 20% of the market and is moving to take 80%. Read into this a complete takeover.

Taxpayers will put up $100 Billion as a start.

The problem here is that private lenders do a better job of evaluating risk and collecting bad debt, than does the government. Any estimates of “savings” by the government is a fantasy. Government figures, for example, never have those the private lenders include, such as two-year college programs with much higher default rates. What is more, the government has a poor service record among student borrowers.

Thus: A harbinger of what can happen to our health system.

Why Change Of Venue?

Very few judges approve defense lawyer requests for change of venue. That is where a trial location is changed to another site in order to prevent possible prejudice against a defendant.

But judges, for the most part, do not like to offer this request.

Yet, it is important for cases in the public eye that a defendant be tried where he or she can have jurors who have not been bombarded with information about the case. Or where they may be fairly judged on the merits of the case arguments.

Particularly, where information comes from populist and perhaps ignorant-of-the-facts media, that may already have prejudged that defendant.

I find a basic prejudice exists against defendants who happen to be in finance or business. Most jurors, and I may add, judges, harbor innate prejudice against such individuals.

Many jurors simply do not understand basic finance or business. And they have been influenced by years of populist thought. A change of venue does not help change the harm done by such ignorance, but the change of venue principle is, at least, a step in correcting the judicial system.

What About the Shortage of Doctors?

All the talk and action from the Obama Administration about how government can make health coverage better, merely makes the situation worse for all of us.

Liberals are born to think as liberals always think. They are never aware of unintended consequences.

Example: For years, they have been vehemently against changing tort and malpractice excesses that drive doctors out of the system. Doctors just find it getting too expensive to pay ever-rising insurance premiums, especially in some specialties such as obstetrics and surgery. And it’s not because doctors are more derelict in their work. Plaintiff lawyers are more creative in their briefs.

Secondly, doctor fees are being drastically reduced where government control is already exercised in Medicare and Medicaid. Or in Medicare Advantage.

Yet, the Obama Administration wants to treat up to 50 million new insured with extra doctors. A new report from the American Association of Medical Colleges says the U. S. has a shortage of 15,000 doctors . What is more, this shortage will probably grow to 125,000 by 2015. And 150,000 by 2025.

The doctor shortage will lead to the rationing of medical care. This will happen so long as government policy interferes with the ability of doctor earnings to attract more qualified students for adequate training.

There Are Jobs and There Are Real Jobs

Know the difference between a government job and a private job?

A private job has an economic purpose, so it is more stable. And is therefore more productive. If it were not, it would not be permanent. Companies strive on reality, not political talk and jive.

Government jobs are usually interim if they are used only to make work. They are more costly and less productive. They are often unionized so have less consumer-interest. Union jobs are not necessarily priced for consumer preferences, but primarily to accommodate the labor interests.

You do not build productive society with government jobs. If you could, the Soviet Union would have been a great success.

They had grandiose plans for workers and production goals. Eventually, their entire mirage ran out of fantasy and steam.

The Unelected Global Warming Enforcer

Polls show the American public has overwhelmingly turned down having anything to do with global warming. The science behind it is sketchy at best.

The public certainly wants little to do with the enormous taxes that will be imposed on everyone when controls on energy are imposed.

The American public is against the imposition of heavy energy costs to reduce ”global warming.” Yet, the Obama Administration has its Environmental Protection Agency come up with non-Congress-approved edicts that have burdened industry with massive, costly regulations, far beyond what the electorate has said it does not want.

We now have a holy war being waged against the new enemy, CO2 emissions. Just a few years ago, we were taught in school that CO2 gas that we expel with every breath, was food for our trees. We somehow cannot associate it with true toxic materials around us.

The Obama Administration has simply come up with another means of imposing taxes within the global warming scenario.

Health Care and Big Business

Many big companies are backing the Obama Administration’s efforts in health care. Because they believe such government action would actually make their financial burden easier if government took over its health care obligations.

On the other hand, small business would be heavily taxed for heath care that they did not provide. Whether they could afford it or not.

This is bound to cost jobs which the Obama Administration promises the public with every speech.

Inasmuch as government bureaucrats could not operate a pushcart to make a living, they cannot envision how many jobs this can affect.

Why Doctors Really Give Expensive Tests and Services

The accounting firm PricewaterhouseCoopers says that about 10% of medical cost owes to medical malpractice lawsuits. About 2% is caused by direct lawsuit costs. Add to that about 5% to 9% because MDs have to practice defensive medicine. They add tests just in case a plaintiff asks in court why they didn’t have work performed.

The American College of Obstetricians and Gynecologists found in a study in 2003, that cerebral palsy could not be blamed in the vast majority of cases concerning baby delivery. Yet, it has resulted in enormous liability damage in lawsuits suffered by obstetricians and gynecologists.

The Los Angeles Times has reported that the most performed operation in America is the cesarean section. This procedure is now done in 31% of births, up from 4.5% in 1965.The increase is because of lawsuits.

The New York Times has reported that such lawsuits have influenced doctors into changing the way they deliver babies, calling for an immediate cesarean when seeing only relatively minor fetal heart anomalies.

Just a sample of how ”thoughtful” politicians, intentionally avoiding tort reform, are able to influence our health and medical costs.

How Much Debt Do College Graduates Need to Incur?

I have read of college graduates taking courses which lead to something as mundane as law, where a student can incur debts as high as $180,000. I wonder if this figure includes lazying around the campus for years. drinking and idling about.

As I often point out: Up to World War II, you could take a Bar Exam in a tough licensing state as New York without going to college at all. Abe Lincoln and other lawyers of his veracity never went to college in order to practice. It is a profession studied by reading law, comments, and adjudications.

In fact, so many degrees given by colleges are for courses which can be learned in the library or over the Internet. These can be achieved far more cheaply than at formal institutions.

But without the on-campus social amenities.

The Rare Earth “Bomb"

Rare earth minerals are exotic materials used in the production of sophisticated batteries such as those environmentally-acceptable in cars we are planning. Unfortunately, those minerals are available mainly from Inner Mongolia Autonomous Region, part of China.

Rare earth export is strictly controlled by China, which thus makes rare earth politically and economically-sensitive for the U.S. The use of the minerals on a large scale puts us at an immediate disadvantage.

Do we have any rare earth? Yes and no.

We have a deposit in California but the environmentalists will get first crack at preventing its development.

Don’t they always?

The impractical Alternative Fuel Industry

The so-called alternative fuel industry, other than oil, gas and coal, may be preferred by environmentalists, but is unrealistic from a practical point of view.

Wind power is not too bad. It’s cheaper than solar power and it also takes less land. Yet, it still is subsidized and not comparable to what we can get for our immediate needs at low cost, and without taxpayer help

New solar thermal power, which also is not cost-competitive, requires lots of empty land which is not always available. It uses the sun as a means of heating water. That turns turbines. Silicon-coated photovoltaic method is not as good.

The alternative fuel industry we hear so much about is not practical, in so many ways.

Are Medical Boards in Your Future?

One version of the complex, pending universal health care bill would require seniors to submit to a counseling session every few years. More often, if they become sick or have to go into a nursing home.

The proposed administration's cost controls are similar in many ways to the British and Canadian systems. The purpose is to decide which treatments the patient should get, whether they should get them, and when they ought to be available.

Example: In 2006, a U.K. board said that elderly macular degeneration patients had to wait until they were blind in one eye before they could get a costly new drug to save the other eye.

It stands to reason: When you have a set number of MDs and medical providers and you increase the number of covered patients, you must ration the amount of care you provide.

But then politicians parse basic economics to suit themselves and their party line.

Cronyism When Government Runs Business

When the government takes over business, it stands to reason, you expect bureaucrats to hire top officers and the board of directors. Why expect them to independently ask for qualified resumes?

Or not to appoint friends from school, or those with whom they party? Or look to lists of political contributors? Or possibly same party members? Cronyism is the password when government runs business.

And when you start the whole ball of wax, you make sure your party affiliation rules the roost from the start. That way the bureaucracy has your folks intact and ingrained in government, no matter which political party wins the following elections.

Am in describing what is going on in the Obama Administration with their executive appointments today?

What Differentiates Businessmen?

Top-level business executives all have pat answers. These are pretty much all the same. They want the best for customers. They want the best for employees. It is found that there are about 10 values all CEOs hold important. Repeating them so that they can be memorized by aspiring executives would be foolish. That’s because these stated aims are simplistic.

In my experience, I find there are a few that are so basic they do not require college training or an MBA.

Basically, a top executive always has to be to focus. One has to set a goal and stick to it. Not having a firm plan with a business budget that guides you and has you adapt to its requirements is a business and executive killer.

I also found that an executive has to be able to micromanage a business while refusing to micromanage, especially as the business grows. (Mull this over!!)

Think of this choice bit of advice. You won’t get it in graduate school.

Be Careful of Ever-Changing Expert Advice on Business

Experts on child care are known to be faddish, as are other advisers we consult. So is the case of those in the line of business management techniques. Business management ideas often change every few years.

They should be looked at with a wary eye.

Most management techniques become fads as marketing ploys, something, wet-behind-the-ears management types dream up to open doors for new business.

Their customers are business executives who are looking for something to impress their bosses. Or their shareholders. They may also feel they are buying insurance against potential stockholder arguments, when they use such new “strategic” ideas.

New Business is Important

New Business ventures are always important for getting an economy out of recessions. Unfortunately, the development of enterprise has been lagging behind the experience of past recessions.

According to the Bureau of Labor Statistics, in their first 90 days, new businesses produced about 14% of hiring between 1993 and 2008

Because banks are not making sufficient loans, small business formation today is in a major funk. Furthermore, they are afraid to hire because of the increasingly oppressive tax picture. Add to this the constant barrage of threats from Washington of health insurance legislation and the higher federal and state minimum wage regulations.

Left-leaning politicians talk jobs. The only ones they like revolve around government and the big union varieties. Small business is not in their vocabulary.

A Salary Czar for Subsidized Sports Figures?

Major league ball clubs have government-subsidized stadiums. But their high-priced employee salaries are not regulated as in government-hated industry.

Almost every major league ball club has been given funds in some way to build ball parks with funds which have come from local or state taxpayers. Much of that money can be traced from federal stimulus funds. So, a logical interpretation of law by politicians overlooking those funds would declare that salary controls of executives earning a few million a year should also apply to star athletes.

One player having a poor year got $100,000 for every six pitches he faced. A total of about $30 million. The short-sighted Obama Administration could have 30 top-level execs for that money, producing jobs in a depressed economy.

Why Must We Have Unionized Government Workers?

A question I have never heard asked, but it should be:

Why should city, state or federal government workers be unionized? They have the right to join whatever fraternities or organizations they like under the constitution, but why must they have to join a union to fight their government ?

I can see unions in private industry, to fight for working conditions, grievances, salaries and other benefits. For government employees: Vote evil politicians out. Political parties on the left supposedly are there for many of those workers. We hear their petitions every day.

Union redress against government can only be political.

The chief weapon of unionism today is the way they wield their power in government, in addition to the power of the voting booth. Private industry unionism is weak because most workers have not chosen them. Union power today is in the form of government programs.

So, unionized government workers are merely a tool of that movement.

High Cost of Government Administration

It has been estimated that each dollar taken from taxpayers, and sent to Washington, is then returned to the beneficiary at a loss of about 70 cents. That is in the form of salaries, rent and other expenses.

If this is the case, why can those who believe in strong central government make any case that Uncle Sam can do a better job with a tax dollar than an individual who earned that dollar could do, on his or her own initiative?

Individuals cannot easily defend or police themselves. But there are many functions the government in Washington has taken over, or wants taken over, that would be better accomplished privately, or locally. Or nearer to home by the state.

Like health care, as just one example?

Economic Forecasting Over the Long Term

Economic Forecasting of the world economy is most difficult to make.

Business conditions are in a constant state of flux. Besides, it’s tough to know what is going to happen in a country domestically because of politics that change, sometimes drastically, every two years in the House of Representatives and six years in the Senate.

You also have complex interrelationships across countries, some very volatile in their political makeups. Any one country, in any one region can materially affect the forecast for what we expect for the U.S.

Short-term changes are certainly far more difficult. Entire global scenarios can change almost overnight!

Nevertheless, so much planning and budgeting that our government relies on, that affects business, is based on such economic forecasting. Is it any wonder that government estimates of deficits are usually so far off?

Particularly, when politicians fib to fit their promises to reality?

Today’s Commercial Real Estate Market

Usually, commercial real estate cycle booms and busts are affected by the construction of too much space. In this cycle, problems have arisen from the financial sector, seeping into that of commercial property.

The financial lending crisis and not overbuilding as in the past, has been the problem.

The weak economy is now driving down rents. Many property owners are finding it difficult to refinance short-term financing when due this and next year. Property values will move down, as in residential housing.

But many larger commercial owners, such as publicly owned real estate investment trusts (REITs), will do better. Especially those with substantial equity and access to public funds. It will be an opportunity for them who can take advantage of marked-down available assets at lower cost.

When the economy turns, the real estate industry will have relatively little supply. The upturn will fill the vacancies and rental rates will move up drastically once more.

An Economy Booms with New Business

In the last 30 years net job gains have come from companies less than 5 years old. In fact, about two thirds of new jobs have come from this group.

This is not happening these days. Despite all the talk and the disastrous spending that is coming from the Obama Administration. Because nothing, absolutely nothing is being done to create the environment for small business to prosper.

On the contrary, everything that impedes the small business operator has been created in the past year. Higher minimum wages on unskilled labor, higher income taxes and a drastic cut in the availability of credit from banks and alternate sources

Just as importantly, there are constant anti-business diatribes from Washington which scare the daylights out of would-be entrepreneurs.

The MBA Program Misunderstanding, Part 4

In three previous blogs I mentioned a number of ways how and why graduate schools are revamping their MBA courses.

Some may be doing it for sound critical needs, while others may have cynical reasons to simply attract students.

Education should have to do with regulation. We are overly regulated. And the Obama Administration and Congress want even more of the same. We need MBA students who can learn more about regulation in practical terms.

I repeat what I have said many times before from my own graduate school and executive work experience: The public always has the false assumption that government bureaucrats, and that includes the Treasury Secretary and the Federal Reserve head, are really completely on top of it all. They know more than 99.9% of the public, but that does not mean they are aware of practical business that their job involves.

Research On Global Warming Up to Now

Apart from recent headlines about science data research. much global warming research has actually been suspect for years, simply because the mathematical models used are deficient. There is not sufficient computer capability, nor is there enough bonafide data for input.

Though warming proof is poor, those who believe in global warming theory insist that the information they have has to be considered in its entirety. no matter the cost of implementation of what data they have.

All of which can be economically devastating.

However, research is being done to see if some of the major legitimate climatic defects can be corrected quickly and at lower cost. Such as the use of a sulphur dioxide in-the- upper-atmosphere approach at minimal cost.

But the industry built around global warming pessimism does not want to hear of such smaller but valued corrective measures, if any are truly necessary.

There is simply too much politics involved. Global warming controls translate into government controls, the chief handle being the use of the taxation tool.

The Ethanol Boondoggle

Climate change enthusiasts have problems with data from different research sources these days, whether it be poor interpretation of science or scandal involving research.

The noted journal Science, in a study of biofuel emissions, found an error in the way climate-change studies are being made. It discovered that ethanol produces the same amount of greenhouse gas as fossil fuels. or more such gas per unit of energy. However, ethanol was always considered to be better than oil or gas as a fuel, in this regard,

Also, the fact ethanol displaces and raises the cost of a food product was always a negative. Along with the fact that it is a relatively poor source of energy, compared to conventional fuels we use.

Without my getting into the mathematics of the scientific report, the entire hastily created political boondoggle of using ethanol has been proven to be just that. Pure politics dressed up to appear an environmental bonanza.

The unintended consequence will be that land will be used for wrong purposes, and rain forests will be converted for the production of this poor energy substitute for conventional, but maligned sources.

MBA Program Misunderstandings, Part 3

In previous blogs I pointed out how and why graduate schools are revamping their MBA courses. And that some may be doing so for critical needs, as well as cynical purposes.

And that some on the left make ethics the sole instruction issue when ethics should be taught no matter the course. Capitalism, after all, is not the only economic system beset by occasional problems brought on by poor ethical standards.

There are valid areas where MBA courses can be tweaked. Examples; The use of mathematical models and their shortcomings, liquidity in pricing securities, global interdependence within the world economy, the problem of over-regulation by government, and so on.

Cost Benefit Analysis Should Be Applied to Health Care

The National Highway Traffic Safety Administration reported 43,443 highway fatalities in 2005. If the maximum speed law were reduced the death toll would be sharply reduced.

So, if the Obama Administration wants to save lives at what they claim is little cost, here is a suggestion.

Independent observers estimate the proposed health care plan will cost trillions, in order to save to levels which the Obama administration’s lives protection estimates are fairly comparable.

Why not reduce interstate speed laws? Why not educate drivers to be more safety-minded? That would save lives with even better cost benefit.

The same can be said about health. Why not better obesity control, as one example?

The MBA Program Misunderstandings: Part 2

In a previous blog I mentioned that graduate schools are revamping their MBA courses.

Some may be doing it for critical needs, while others may have what I feel are mere cynical reasons.

Educators may truly feel they are responsible for the type of student they have turned out. Or they may be trying to promote their MBA course in a depressed graduate school market.

Be alert to any school that makes ethics and excessive greed the fundamental lesson to be learned.

Every course in school has to encompass the idea of ethics. But it is not a basic MBA tenet. It merely tips off a student that the school has a leftist view of capitalism.

When the prime focus is on ethics and the so-called “sins of capitalism” are front and center, there is a theme that has permeated much of educational thinking.

After all, even scientists these days have occasionally been known to cheat and hide facts.

The MBA Program Misgivings

The all-coveted Master of Business Administration degree, that students feel is so necessary for a top financial or business position, is getting a revamped look by graduate schools, in the face of the recent financial meltdown.

Educators are doing this, I feel, for two reasons. One is as a critique of MBA programs to date, and the other, I fear, is rather cynical.

The schools truly think they may be partly responsible for the calibre of student they have turned out. And secondly, they may be trying to merely promote their MBA courses because of a depressed graduate school market.

Their approach in doing this speaks much about each school. In coming blogs I will go into detail. Stay tuned.

The Post Office as an Efficiency Standard for Government Health Insurance?

It takes lots of chutzpah to push for government health insurance when all around us we have government-operated foul-ups.

One of the many sparkling examples we are in contact with, is the U.S. Postal System.

Losses each year run about $7 billion, despite constant increases in charges across the board. Postage stamps alone have gone up well above the rate of inflation. A large number of post offices are slated to be shut to cut expenses along with delivery days and hours. Still losses mount.

And the Post office retains its first class monopoly because, Heaven Forbid, there are private carriers ready to compete if the government would allow it.

Need I say more about this Government Option Postal Service? And what it portends for Government Health Insurance?

Be careful of Sexual Harassment Suits

My experience as a major corporate employee-contractor taught me that treating employees was good business. It kept them happier on the job and they performed better.

I know that from workplace experience. I am not a politician. Unlike politicians who never truly create real jobs. By the time I sold my interest in the company I created, I had over 10,000 permanent employees and well over 100,000 temporaries at any given time.

I had also written instructions for my employees to conform to Federal Equal Employment Opportunity Commission standards. To be certain they knew the ground rules while at work.

Example of potential problems: Close to 100,000 complaints were filed by workers in 2008 on sexual discrimination of some sort. It can be bathroom issues of illicit advances, etc. based on gender.This can also be expensive because of attendant lawsuits.

Particularly for employers trying to overcome a deep recession when jobs are important.

Therefore, it does make good business sense as well as decency to be careful.

How to Keep the Young Jobless

The young suffer from unemployment to a far greater degree than the rest of the population. How does government bumble, to make it worse for them?

For one thing, left-leaning politicians raise minimum wages, in federal government and the 10 states where minimum wage levels are higher than federal.

Teen unemployment is about 26%, the worst since World War II, compared to 24% in July of 2009. Black male unemployment is about 50%, up from about 39% in July, 2009.

Union pressures. through the White House and Congress, add to the burden of minimum wages. That is also a significant factor in adding to teen joblessness. Low-rung workers are not directly affected, or even unionized, but union contract wages get adjusted upwards with higher minimum wages. Thus, the logic for union pressure.

So, the cycle of unemployment among the youth will continue as politicians seek favor from ignorant voters.

The Government is Always Clueless

The public always has the false assumption that Government bureaucrats, and that includes the Secretary of the Treasury and the head of the Federal Reserve, are really completely “in the know.”

Let’s say they know more than 99.9% of the public, but that does not mean they know what it takes to perform their job.

They are, after all, merely human beings. They may have little more information than we all do. But they may have no more expertise, and far less practical experience than many of us do. Many bureaucrats have never had top-level corporate experience. Or even operated a pushcart.

I know, because I attended graduate school evenings, 3 1/2 years studying money markets and the Treasury and the Federal Reserve, while I was a Senior Analyst. And I was a very-top corporate executive, and know the failings of often inexperienced, yet highest-level bureaucrats and academics.

They often make mistakes everyday. Unfortunately, they cannot admit flagrant mishaps, for the sake of their jobs, or their political party. So, they blame everyone but themselves. Past administrations, the media, and their critics.

They haven’t really a clue and will never fess up to that. The damage they do to us all is immeasurable.

The Department of Veterans Affairs and Government Health Coverage

If you want to see how poorly the government supervises health care look at its record of treating veterans over the years. If the government covers veterans so poorly, how do you think it will treat the general population?

Apart from general neglect of needs, this includes experience with health care rationing and questionable episodes during the Clinton Administration, which were remedied in part during George W. Bush’s tenure.

Add to the mixture the pressure of enormous additional scope of coverage and the potential for fraud, which now is a major factor in Medicaid and Medicare, and you have one gigantic mess.

Notice that the media have swept this scandal under the rug while the health insurance debate has been unfolding?

More College Entrance Tinkering

To make sure more dumb kids get into college when they are unable to pass SAT tests, many colleges, including the fabled Ivy League schools, have announced they are going to give credit to a college applicant’s personality, for his or her evaluation, as part of testing.

From what I see, this could add about 200 points to the SAT score for those who fail minimal SAT standards.

I have been saying for years, college kids are getting dumber, colleges are getting fatter, and the country is suffering for it.

No one is being fooled except the citizens of the country. They are beset by below-grade college graduates, and it shows in our workforce, institutions and government.

College Kids Continue to Get Dumber

It’s been reported that only about 23% of 2009 high school graduates who took the ACT college-entrance test have the skills to succeed in college. That is not a misprint. It is a harbinger of our future as a second-rate nation.

Most college-bound kids do poorly in math and science. About half flunk reading. About one third flunk English.

Forget about training more doctors so we can treat all those new patients the government wants to cover under their vaunted government insurance program. That will mean health coverage with second-rate medicine and medical practice.

Forget about scientists. We can watch them operate only in scripted Hollywood movies. And other concocted fantasies.

But we can get more of the easy-stuff kind of college graduates. Such as lawyers and community organizers!

Micro-Finance and the Hypocrisy of Its Use

Micro-finance has gotten lots of publicity about its use overseas, particularly in countries such as India, Latin America and eastern Europe. This is a business of making the smallest of loans to the tiniest entrepreneurs, who usually run one-person operations.

There are said to be about $2.5 billion invested by private investors in such projects, on the assumption that borrowers who take as little as $100 or so at a time are good risks.

Some borrowers are said to receive a total of as much as $400 over a few years. Fund investor return is supposedly about 5% and the default rates are said to range a bit more than 2%. Much better than from the past financial meltdown records.

Problem: Well over 230 micro-finance investment institutions are now in the business. There is an acknowledged bubble forming. Little regulation exists. Furthermore, the reported default rate is suspiciously low.

When push comes to shove, a decided moral hazard exists. Even the most determined entrepreneurial but poor of the borrowers will have to feed themselves and their families before loans are repaid.

The potential losses for investors can then be serious.

Unrealistic Liberal Politicians

Leave it to politicians to pile on with idiotic schemes during a deep recession. They see to bash business so that less people are employed.

How do you get business in this predicament? Make it more expensive to hire, especially with small business. After all, they may have fewer lobbyists to pester politicians.

Example: In the most liberal of liberal bastions, New York City, their inept City Council decided to give mandatory sick pay to all, whether small business could afford it or not. If you have over 10 employees you must give 9 sick days, if less than 10 employees, 5 sick days. Or pay $1,000 fines. So, if you are a small operator, and you cannot afford the added costs, you go out of business. For that burden goes with ever-increasing minimum wages.

Small business is suffering acutely from the Great Recession, so even if they remain in operation, small business just hires less help.

Yet, everyone in Washington on the left is happy, particularly those who show voters how they are out to help “workers.”

Are We Hiring and Firing Too Often?

I find that most companies normally fire help too readily, simply because they hire too readily.

My experience, as a co-founder and top executive officer of an international employee-contracting firm, leads me to that conclusion.

Most managers do not leave themselves sufficient flexibility. Poor planning is the culprit in most instances. Though these days, I may give companies in dire straits some slack.

Too much firing and rehiring is expensive in the long run because of wasted know-how, severance costs, training expense, etc.

The Basic Cause of the Housing Bubble

In case the public has forgotten, let’s reprise the basic cause of the housing bubble and the financial meltdown that has culminated in our current Great Recession.

Wall Street was saddled with subprime loans which it marketed, thanks to the liquidity promoted by the Federal Reserve.

Those subprime loans were given birth by:

One: The 1992 Federal Housing Enterprises Financial Safety and Soundness Act (GSE Act)

Two: Fannie Mae and Freddie Mac who were to buy $6 trillion of single-family loans over 16 years.

Three: The 1977 Community Reinvestment Act (CRA) to low income and moderate income communities.

Four: All aided by Acorn (Association of Community Organizations for Reform Now)

It would thus appear the deep recession we have is a product of our Congress and its pandering populist politicians who, to this very moment, blame everyone but themselves for the imposed disaster.

CO2 Limits Hurt the Economy

Anyway you slice it, CO2 limits hurt the economy. Clean-air regulation is a mishmash of non standard gobbledegook's. Especially when it comes to CO2 when it is not even clear that CO2 actually is a pollutant.

The Clean Air Act was written to satisfy a group whose nebulous religion dictates that something be done about so-called global warming. There are poisonous materials in the air, without doubt. To what extent CO2 is a pollutant that does damage is confusing, even to most scientists. Particularly when cost-benefit analysis is applied to the subject,

What is clear is that environmentalists religiously undertake enormously expensive, economically disastrous projects that attempt to curtail CO2 and other emissions, without any idea of the unintended consequences.

Retail Health Clinics

Amidst all the constant chatter of the high cost of medical coverage and health insurance, there are alternatives which hardly ever get attention.

There are health clinics already being used, whereby folks can see a registered nurse quickly for emergencies, at a for-profit, licensed facility, that can be easily found, usually at malls. The nurse can refer the seriously ill patents to doctors or hospitals. The facilities are supervised by doctors.

These facilities are more comfortable for those who are not sick or hurt enough to go to emergency rooms of hospitals, The private clinics are set up to be low cost and can be covered by forms of insurance.

Forget About Unleashing Employees to Do Their Thing

The idea that a company does best when employees are free to operate with ideas of their own, sounds good and acceptable to most employees, but is often thought up by those who have never run a real business.

Besides, this management feature depends on the nature of a business. It may sometimes be o.k. for a creative type of operation, but not the average business, where a creative mess would be unthinkable.

Employee suggestions are always useful and should be considered. But if they were bosses, employees would have been the real employer in the first place.

Government-Operated Health Care and Forced Union Membership

Little-noticed possibilities in a public option or “coop” type of universal health care would be the facilitation of unionized hospitals and other providers. This could be the end of any vestige of so-called lower-cost health care.

Union objectives and not consumer interests will take preference as it does today with education, as one glaring example. Further, It could do to any government plan what Big Unions did to GM and Chrysler.

Such strike threats on state or regional levels will blackmail at will, at all times, whatever and whenever union demands come up for contract renewals.

Predictions by Market Futures?

Executives always make predictions. They are not always happy making them because accuracy is difficult, especially the longer they extend into the future.

On the assumption that those who are more certain of their prediction will bet on it, actual prediction markets have been created. They are not new, having been used to anticipate winners of presidential elections and Super Bowls. But now we have what have been called business futures, for forecasts on GDP and unemployment.

Check out www,cfo.com for more information.

Why Not Natural Gas?

The U.S. has vast supplies of natural gas but refuses to develop them. Algae, bio-diesel, solar power, and wind, are subsidized, but still will not be sufficient sources of energy. In twenty years, almost 80% will still come from fossil fuels.

The U.S. is extremely fortunate to be rich in shale deposits in many parts of the country. Nevertheless, left-leaning politicians refuse to develop those riches which can give us energy for the next century. while alternatives become more practical.

High-tax New York State is a further example: High-tax New York City’s watershed has natural gas deposits which have not been developed. Tax relief as well as energy solutions are overlooked by their politicos.

Recessions Start and Continue with Dumb Political Thought

Recessions are bound to happen in normal economic cycles. They are not the fault of capitalism. They are remedied by free markets. Only those who do not understand free markets act in a way that prevent normal corrections from being made. And when normal corrections are not permitted, you get prolonged recessions and even depressions.

Stupid politicians force the hands of economists who should know better, and thus we get bailouts instead of normal corrections, which may include self-correcting bankruptcies. What is worse, however, is the ongoing poor psychology that persists among the population, as the result of political machinations.

That, along with knee-jerk higher taxation to make up for lower government tax revenue, adds to the bad psychology that sustains these severe conditions.

And when you are really a dumb politician you add legislation the majority of the public does not want, at a cost that imposes even more enormous taxation, plus budget deficits that cannot be reigned in, short of raging future inflation.

Environmentalists Should be Taught Practical Economics.

Everyone wants a clean environment. Everyone wants verdant forests, clean lakes and rivers, with abundant fishing. Everyone wants to protect species to see that they continue to exist.

We know that many fall by the wayside due to varying reasons, some having to do with human existence. After all, we must compete for living space.

Also: Everyone wants jobs for those who want to work. Everyone wants cheap and plentiful food.

Somewhere, there has to be a distinction made by us, about which of the above takes preference.

An example: Right now, because of fish we do not eat and which are insignificant except to botanists who study them as part of their curricula, we are suffering a severe water shortage and drought in the San Joaquin Valley of California. The shortage has produced conditions which sharply reduce fruit production, and raise fruit prices.

The only ones happy about this human disaster are environmentalists in the U.S. government. They feel they have accomplished their objectives of saving that tiny inedible fish for posterity.

Humans? I guess they don’t count.

Companies Are Conserving Cash While American Industry is Foundering

By paying less dividends and not buying in their stock, companies are conserving cash in a way they had not done in recent years. That is because banks are not making loans. And it is hurting industry.

Corporations have to sell stock whenever possible to raise cash. In the past, such funds were sourced from commercial banks.

This is another indication of the failure of the Obama Administration to properly repair the banking system. In its attempt to clean up banking books, they have done two things:

One: They have made banks gun shy, afraid to make loans, and

Two: They have made funds available to banks at practically no cost, so banks produce tremendous earnings merely investing in U.S. bonds instead of American industry.

This is especially true of the banks that “were too big to fail” and were bailed out. Many of the smaller banks cannot freely lend funds because of the tight rein put on them, by their regulatory agencies.

The Tort System and High Price of Medicine

A 2006 report in the New England Journal of Medicine said that 54% of the malpractice dollar went to Lawyers and administrative costs. At the same time, many would-be clients could not find a lawyer because the claim would not be high enough to warrant any lawyer to take the claim.

It is obviously a poor system and needs correction. Yet, despite the heated efforts of the Obama administration and left-leaning politicians to impose health care reform, nothing has been included in their plans to impose any reform to this malfunctioning medical tort system.

As evidenced by how the Swiss operate health care and medical malpractice, and noted here by me, it is possible for impartial judges to see that patients seeking redress are compensated when injured. And without fraud or hefty legal fees.

Should You Buy Gold Coins?

I have in the past commented on the subject of gold as an inflation hedge because the Federal Reserve will be hard-pressed to monetize the huge debt that is bound to augment future inflation.

But I told readers to look at gold prices over the years. The price today is really not much higher than that of the 1980’s. With simple compound interest, gold ought to be about twice what is today.

There are many ways to beat inflation. But if your decision to do that is to buy gold, and you decide on gold coins, which do you choose?

Gold comes in different forms; plain coins, rare coins, and bullion, all of which must be safely stored in bank vaults or at home. That can be dangerous because of potential theft, and thus require expensive insurance. Storage costs can mount.

Gold is a good holding in dire emergencies. Excellent in rare coin form. For example, refugees fleeing Europe in the 1930s used them. But their value can be erratic and gold pays no interest if just sitting around.

Furthermore, there is a big spread between the price one gets when selling coins and one pays when buying, what the trade calls bid and ask prices.

My suggestion: No matter what choice you make, select by coin condition, in addition to rarity. Condition, however, is sometimes very subjective, depending on whether you are the buyer or seller, but it is a rule of thumb to keep in mind.