Stockton and San Bernadino were both made weak by similar money manipulations in the housing market leading to boom and bust. Airline pensions were taken in a similar fashion. Time to be honest about pensions and social security. Either provide safe haven for the money paid from paychecks or do not collect the money. Too many cities in the US will be next if Detroit wins the game the judge set up making loans, bonds and pensions just contracts to be renegotiated by selected judges and courts.EPer: LillithMc
This is a real problem in that most often the worker has already paid into the pension, case in point was Hostess. So, this is basically theft of deferred wages. By allowing anyone to not pay pensions through bankruptcy law is really glorified theft and the impact of this is probably showing up now, but is going to be a hell of a wallop as people age with nothing but social security left (which is also under attack).
It shouldn't be a question of public employees still getting pensions instead how private employees have been systematically royally screwed and the entire stripping of earned pensions should be made a criminal offense.
Kills me how theft by law, spreadsheets and figures is perfectly legal yet the idiot with the gun at the convenience store for $100 bucks is going away for 20 years in prison. It is the same act.
Corporations and corruption are destroying America at this point and most of America from the polls knows this and knows Congress is corrupt, yet districts are so gerrymandered and the political corruption so deep, no way to get them out with sane public service minded people. Worse, it is obvious most of America is easily hoodwinked, manipulated by media/propaganda, which these days are pretty much what political campaigns are. I think that frightens most, how easily the masses are manipulated.
The same banksters and corporate honchos from around the globe that donate to both D & R still run the show. I mean would any politician of any stripe that collects loot from Dimon, Blankfein, etc. really care what the "little people" do or how we struggle? They have their meetings at the House or on the golf course or in the clubs, the pols tell the honchos, "Look, I need to bash you in the press for a few days, but I still love you guys and keep the money flowing." It's a puppet show that I no longer buy tickets for because it's been played out thousands of times by now.
If Bill Gates claims he can't find a single American in the entire globe that is willing to work or has an IQ over 100, by God, his puppet(s) will go along with the lie. If Bill Gates can testify in front of his Congress that he needs to flood America with millions of visa recipients because Americans can't tie their own shoes, his Congress will issue more visas. If he says he'll ship every job in the US overseas if he doesn't get his way with more tax breaks, by God his Congress and President and state pols will go along with the lie and for the ride. We don't matter except for a throw-away line in a speech here or there. Yup, despite all the degrees and experience and work ethic, many of us can look forward to busting ass in jobs that would break people like Gates or Dimon or Pelosi or Obama within the first week. And we ain't all morons that sit their in awe of these people in power either, see, we CAN TIE OUR OWN SHOES! Look at me, I can think too and I don't sh*t on fellow Americans, wow! It's possible!
We look forward to being unemployed when we dare ask for a living wage. We look forward to being slandered by our sell-out corrupt politicians and treasonous CEOs. And we look forward to being physically broken with no medical coverage when we can no longer work or can't find work anymore because we reached our expiration date. Politicians? CEOs? Who cares, I trust people that bust their asses struggling every day from all walks of life before I'd ever trust one of those clowns to not screw me over or steal my $ when my back was turned.EPer: Kurtz
Detroit presents an extreme case of pension instability because of its combination of scale, corruption of both private and public officials, and underlying economic weakness. However, the underlying problem applies to all public pensions and both workers and public officials need to address them sooner than later.
The underlying problems of public pensions include:
1) Public employees are the largest and most cohesive bloc of voters in most local elections. There is an inherent conflict of interest between the politicians who approve pension increases and the voters (workers) who receive them. Pensions that allow employees to retire at any age with 20 years service, that include automatic COLAs, and/or include health benefits are common, although disappearing fast, in the public sector. The increases in life expectancy in the United States, and the associated increases in health care costs that have facilitated that increase, have added a huge burden to the cost of existing plans.
2) Public pension expenses are set by actuaries who use smoothing techniques to amortize the current cost of the pension over what is generally a 3-7 year period and the longer term unamortized, unfunded cost that accrues over the life of a pension plan is amortized over 20-30 years. The stated purpose is to minimize the fluctuation in funding requirements for governments but the consequence is that when an inevitable economic downturn occurs, the cost is smoothed away into the future, a technique that fits government's proclivity to delay difficult decisions. Today in Florida, the average local pension plan is only funded at about 80%, the same as quoted for Detroit. Conversely, under this actuarial smoothing, the funded ratio almost never goes above 100% because only any long-term unfunded liability is amortized, not any long-term contingency fund to account for the next downturn.
3) Public pension plans are historically very generous, although is rapidly changing as well. Multipliers for years of service of 2-3%, and even 4%, are common, meaning an employee can retire with 70-100% of final salary at age 55 or 60 provided they have put in 35 years. It's a nice benefit if you can afford it but it is not sustainable.
4) Public pensions only became prevalent in the past 75 years. The pension plan lifecycle is such that in the early years, benefits are being earned but nothing is being paid out. But as plans age, the balance starts to tip. Along the way, all of the accumulated benefit increases, funding shortfalls, and bad investments multiply one another. At the same time, a slowing birth and immigration rate and longer life expectancy slows the growth of the cities and states that fund plans and creates more demand for services other than funding pension plans.
The biggest problem for public employees who have a pension, life myself, will be the precedent set in Detroit, San Bernadino, Jefferson County, and other local governments over the past 5 years. It is not so much whether pensions are sacrosanct in bankruptcy proceedings as it is the fact that governments contemplate bankruptcy at all. 20-30 years ago, it was nearly unthinkable that any city, or even individual, would countenance the shame of bankruptcy. But the stigma is gone from individuals and now is disappearing from governments.
Faced with huge deficits that require significant tax increases above already-high rates, elected officials can now go to their voters and say "Which would you prefer, increasing your taxes or paying pensions for a bunch of people who no longer work here?" There is little shame left in our society at any level to make anyone do the right thing. The only hope is that public officials and public employees will recognize the depth of the problem illustrated in Detroit and make meaningful changes in their own plans to make them affordable and sustainable. I'm not too optimistic about that happening.EPer: Pete Paradigm
This is really bad folks, Congress is supposedly going to approve fast track and therego TPP with nary a review of any kind.
#inequality, Of course beyond changing the corporate and personal tax code to tax the rich and yes, this it the #number one cause of income inequality is the U.S. tax code, Obama is promoting policies to further destroy the U.S. middle class. His top focus is to increase massively foreign guest worker Visas and foreign workers who are, yes they are, competing for the meager amount of jobs in the U.S., enabling labor arbitrage. Yes, this is why #Facebook wants massive immigration, not any social-moral reason.
Obama is also promoting more bad trade deals which offshore outsource even more jobs and subtract from the economy. Finally, we have Wall street getting all of the perks from the Obama administration, same as Bush. So, we have some nice rhetoric going with a few good ideas in front of a slew of bad ones.
After spending my total career in the 'high-tech/computer' industry (mostly management), I totally agree with the findings in this article. At this point in time, when one changes jobs, there is seldom a significant salary increase. Rather than pay an American engineer prevailing US wages, corporations will either hire a contractor from a firm such as Tata or outsource the job itself to India.
If you are looking for an example of a country where this 'outsourcing' is much less prevalent and the corresponding results, look at Germany.EPer: Paul Nelson (not verified)
standard operating procedure for the elites ... divide and conquer the poor and middle class by pitting them against one another.
As Jay Gould so eloquently phrased it: "I can hire one half of the working class to kill the other half."
same old playbookEPer: allen
We moderate and limit anonymous comments on this site, for example, no links, for good reason. We have people, Americans, claiming it is true that other Americans are fat, lazy and stupid! These are not allowed on the site as abusive, but may I just say this to those commenters:
Maybe YOU are, but no, that is clearly and obviously false. The U.S. workforce has the least amount of vacation days, terrible benefits and busts their ass more than almost every other country. Goes to show how the great propaganda war to put down the U.S. worker and blame the victim has succeeded.
Hmmm, let's see, do you also care to call all veterans the same names?
Care to comment on high fructose corn syrup or putting empty calories and fat calories in most foods, including trans fat in most baked goods, in America, commonly banned in other countries?
Just unbelievable how hypnotized Americans are to name call and put down their fellow citizens.
He could have won that election with a better campaign and by choosing a VP who was prepared for the national stage. Clinton, just like Obama, gave some campaign promises early on to be against NAFTA and then switched of course, made infamous by Al Gore/Ross Perot debate.
Amazingly enough the press claimed Gore won that debate, which goes to show again how marketing and PR are used to spin and lie and these "elections" are about that, not substance.
In the primaries we wrote many a piece that the better bet for trade was actually Hillary, but needless to say not by much. On healthcare she was miles above Obama. History has proved us right, Obama is a corporate puppet, so many policies are a continuation of the Bush administration, including trade.
In 2008 it was horrifying to see how easily hoodwinked so many people were, they were like in a trance, hypnotized when campaign Obama all pointed to "more of the same".
Warren Buffet sure isn't convincing his billionaire bridge pals to hire Americans and manufacture in America now is he?
is supposedly functioning now, although what functioning is yet to be seen. They did bring in someone from Google, so I expect this will start to get fixed, although how fast he can do it is in question. That still leaves the coverage, the lack of available physicians and higher premiums, which should actually be the focus on the problems, not the website.
in 1992, one of only 2 presidential elections i have voted in, i pulled the lever for Ross Perot ... i saw his debates with Al Gore and his shtick w/ Larry King ... i suppose i helped elect Clinton ...
in 1994 i graduated with a degree in mechanical engineering and guess what, everything Perot said was going to happen did happen right before my eyes ...
for all his shortcomings when was the last time a billionaire actually cared about the American Worker? You'd be hard pressed to name one today outside of Buffett perhaps.
The american people saw what was coming and 19% of the voters tried to stop it. 2nd highest percentage in US history.
Our mfg base is decimated, an entire generation is entering adulthood with the worst job prospects in 80 years. Free Trade has been absolute destruction for people who sell their time to make a living. It has wiped out the middle class.
Perot was right and history has proven that. It's time to destroy both parties and start from the ground up.EPer: allen
ProPublica did an article just on California and it's fairly shocking. They confirm in California what we report here, yet they also expose some serious spin by the press. CA is not the success touted.
This is simply more excuses for bad trade deals. The reality is on the China PNTR is Fast track, aka TPA, was not in effect when it was passed. Fast Track was reinstated in 2002. The Final trade agreements are indeed fait accompli as in they cannot renegotiate or negotiate elements of these pacts and no, it is very clear from the Congressional letters to the trade representative as well as POTUS, they are not privy to ongoing negotiations to TPP. That is the point of this article, how they are being kept in the dark, along with the American people and Congress is self reporting this (see links).
Not to say that Congress isn't bat shit crazy, but even the implication of "Smoot-Hawley" is suspect for international trade was not enough to impact the national economy back in the 1930's. It was not the cause of the Great depression and the tariffs were not that historically high.
Mr. Oak makes some good points regarding IPR in the TPP. Unfortunately this is not just a question of a trade agreements, Congress and administrations both Republican and Democratic have leaned way over too far to protect intellectual property. Where Mr. Oak really gets things wrong is on Fast Track, now called Trade Promotion Authority. The last time Congress was able to amend a tariff bill was the 1930 Smoot-Hawley tariff law. The result was the most protectionist tariff law in our history. There nothing special interests would like more than getting their hands on detailed trade legislation. When they were finished the trade agreement would be unrecognizable. Mr. Oak was wrong with regard to the U.S.-China WTO accession agreement. There was no need for TPA since the only concession made by the U.S. was to give China permanent MFN or as it is called now called Permanent Normal Trade Relations. Hence all Congress had to do was to vote up or down on whether to grant China PNTR. When final trade agreement implementing legislation is presented to Congress it is a not a fait accompli. Congress authorizes trade negotiations as part of TPA legislation and sets out clear negotiating mandates. In addition, Congress is continually briefed and consulted as negotiations move forward. Congress is closely consulted when the proposed implementing legislation is drafted and before it is sent to Congress.EPer: Jonathan Menes (not verified)
isnt it curious that the report continues to refer to changes in house prices as "returns", as if a house were not a home, but rather an investment vehicle which could be flipped as soon as a profit could be realized...ie, they report that "twelve cities posted double-digit annual returns..with Las Vegas gaining 29.1% year-over-year followed by San Francisco at 25.7%, Los Angeles at 21.8% and San Diego at 20.9% and that "San Francisco and Los Angeles showed their highest annual returns since March 2001 and December 2005".EPer: rjs
I could not agree more. We are living in a nation of zombies, too busy yapping or texting on their f'in cell phones, usually while driving. Personally, I'm hoping for the best but, I'm preparing for the worst. I'm not a wacko doomsday nut, but I do believe there is a revolution coming and unfortunately I think it's going to be a war of the haves and have nots now that Obama has so successfully divided the nation into economic class warfare. I've worked hard all my life to provide for my family , nothing was handed to me on a silver spoon. By the same token the entitlement mentality that so pervades our country is despicable. Frankly, I'm preparing to protect what I've earned by purchasing an assault rifle and as much ammunition as I can get. When the rioting in the cities spreads to the suburbs, it's shoot first ask questions later. May sound radical, we'll just have to wait and see. Obama still has three years to declare Marshall law, a strong potentiality.EPer: RFM (not verified)
Anybody over the age of 50 can clearly see what we termed middle class during our teenage years is clearly a memory in more ways than one. Jimmy Carter said it best when he stated that today's middle class resembles the lower class of the 1970's. Want something interesting to read that explains much of this?....http://politicalgates.blogspot.com/2011/12/citigroup-plutonomy-memos-two...EPer: Bernie (not verified)
But the application of CPI to Retail Sales is published by the Census, so place to start to detail is probably them and you can ask why they don't apply the individual CPI for categories to the subcomponents of retail sales first. In other words, CPI has values for all sorts of services and goods, different inflation figures for eggs, veggies, trucks, regular autos, even diesel fuel. So, one could take the corresponding CPI subseries and apply it to the subcategories of retail sales.
The PCE price deflators I believe break down similarly but I haven't studied the handbook enough. (hey, someone PAY ME to do that!) ;)