Tuesday, December 03, 2013

I hate to say he told you so, but, he did tell you so.

From the very beginning of the passage of the law President Obama stated, "This law will bend the cost curve of health care down in the USA." He said it and everyone that cared to comment argued and argued that he was naive and wrong. 

Guess who is "W"rong now?

Posted Dec. 3, 2013 @ 1:45 pm
Canandaigua, N.Y.

...But the news is better (click here) on another major health care front: reining in the rising costs that have made American health care the most expensive in the world.

A report released last month by the Council of Economic Advisers pronounced health care spending growth at record low rates. “According to the most recent projections, real per capita health care spending has grown at an estimated average annual rate of just 1.3 percent over the three years since 2010,” the report says. “This is the lowest rate on record for any three – year period and less than one-third the long-term historical average stretching back to 1965.”...

Roger Smith took a relatively successful company and gutted it.

Correction Appended

In a sweeping move (click here) to cut costs and regain its competitive edge, the General Motors Corporation announced yesterday that it would close 11 plants in the United States that employ about 29,000 people, or more than 5 percent of its work force in this country.
Calling the shutdowns ''the first phase'' of a reorganization and modernization program, G.M. officials said at a news conference in Detroit that they were also studying the possible closing of other assembly, stamping, engine and component facilities. ''I wouldn't say this is the end of the plant closings,'' said F. James McDonald, the company's president.
Roger B. Smith, G.M.'s chairman, said the shutdowns were part of G.M.'s $10 billion program to replace obsolete facilities with modern, efficient plants. By making the company more competitive, he added, these moves would improve its ability to maintain market leadership and enhance the job security of its remaining work force....

Roger Smith was CEO of GM for 9 years and from the beginning of his leadership the company began to lose money; every year got worse. It isn't like these guys are in leadership as if an act of congress. Yet, no stockholder bothered to come forward to fire the guy. GM was going down the tubes under Smith's leadership and no one stopped him. Amazing. Little tin gods. Untouchable. 

...But the closings were seen as a hard blow to Michigan's economy and extremely damaging to other states in the region....

...But U.A.W. officials noted that many of the most senior employees at the facilities had already transferred to other plants, reducing the chances that the remaining workers, with less seniority, would be offered jobs elsewhere.
Harvey E. Heinbach, an analyst at Merrill Lynch & Company, estimated that the plants to be closed accounted for 10 percent of G.M.'s annual North American production capacity of nine million vehicles....
You, know the USA demands 'Fitness Tests' for large banks; it isn't a bad idea for companies this large that the USA economy and citizens rely on. 
Smith came into leadership at GM at the time Japanese cars were taking a larger percentage of the market in the USA. Smith had no skills and never understood the intricacies of making cars. He was a hatchet man. Nothing else. 

He rid the company of many top managers and came up with an idea that PRODUCTION COSTS could be cut by homogenizing parts of the assembly of the cars. In other words, the exterior of the car would have a different style design. Even the interiors were custom to the style of the cars. But, the mechanical works of the cars were to be more and more similar, hence, less factories would be needed and he could get rid of much of the cost currently experienced by GM, namely the employees. Look, payrolls are a large part of production plants, so all one has to do is look at a company the size of GM and see answers to financial losses by ridding it of employees. It is an easy fix. IF, the company didn't rely on well skilled employees that had loyalty to the company and the cars.

The employees were great people. My father had a friend that worked in design for one of the Big Three. He loved cars. He loved every aspect of cars. Cars are personal when purchased, but, to build and have them perform on the road was a real thrill for many people. The car employees loved their work. Exciting. The American Road and their participation in it. Without working within the car industry not only hurt towns and the State of Michigan, but, the people, too. With the loss of their jobs they faced unemployment, but, there was also that huge loss of pride gone. To say there was depression among entire segments of Michigan populous was an understatement. Their culture was crushed and then GM seeks an understanding as to why the American people are loyal. It is cultural. 

But, what occurred under Roger Smith was extremely tragic. Not just to the people losing their jobs, but, to the company itself. Smith spent something like 8 billion dollars. Not the 2013 billion, but, the 1990s billions. It was nuts. He never transitioned his ideas, he sledged hammered the company. 

He was a dictator. He made people believe 'his vision' was the future and it needed time to mellow. Talk about ego, was there a room big enough? He retooled the entire company to make homogenized automobiles while the car market took off around him. It left him behind in a larger way than existed with GM before his leadership. He retooled the company without the experts that built it in the first place. He knew nothing about running a company that size and knew even less about car design and how they are built. He absolutely had no respect of the reputation of GM or the financial resources it had and once he had destroyed what was good in the company before his leadership he had no recourse but to continue to increase debt to make his vision work.

In his last years with GM he never achieved any of his visions and the company fell more and more into irretrievable debt.

When I look at Ford and realize the leadership of the company has been a decent of the first Ford car maker, it all makes sense to me. They lived cars, breathed cars and loved cars. The Ford Family has been a guiding light to that company and it shows.

It can't be phony. US industrialists have to know the industry they are in, the market, but, they have to know the product intimately. I am convinced of that when looking across the spectrum of time during the industrial revolution. The companies that did well were lead by their founders and continued the high quality that began it's reputation.

I am not saying successful companies only come from family based entrepreneurship, but, it does come from within the company by employees with many, many years of loyalty.

Today, there is a Wall Street that 'components' the market, extrapolates it with margins and assaults the money through complicated equations. There is really no loyalty to that 'system.' It takes on the philosophy of disloyalty. There is nothing permanent about Wall Street anymore. It is all about riding the bubble and making obscene money without conscience.

Economies of countries are about BUILDING permanence in Large Capital investments. Wall Street is paper. The two clash. They don't compliment each other anymore and the people of a nation is left in the breach.

If the USA is to be successful it has to rid itself of the Roger Smiths and seek loyalty to a product in companies that span the country. I wish GM never knew Roger Smith. One of the most successful investors in the USA has had many successes, but, his investments are NOT bubbles. Warren Buffet is one of the most successful investors in the world. The products his investments produce have been on the shelves of the USA for decades. They are cultural. They have loyalty. 

The rewards of company leadership has to include a degree of loyalty to the product, but, also the people that work for that company. If there is a lesson about Detroit it is that no one cared about the people, the products the people made, the culture surrounding that product and the permanence of economic engine of that loyalty.

Roger Smith was a failure and until recent years GM has been the victim of his whims so long ago. When GM finally opened itself to the opinions of the people it found some success again. That is the lesson of Detroit. It all could have been avoided FOR THE RIGHT REASONS.

I have a question. What reassurances does any government have that a private contractor is incapable of a payload of nuclear material?

On Tuesday, Hawthorne rocket maker SpaceX lifted the SES-8 telecommunications satellite into geostationary transfer orbit -- nearly 50,000 miles from Earth. It was the first time the company reached such a distance, which is about one-quarter of the way to the moon.
Before the launch attempt, SpaceX said it would be the most challenging mission to date, and technical issues cropped up early....

After GM left, it was a one way street for Detroit with the name Failure Avenue.

Article IX § 24


§ 24 Public pension plans and retirement systems, obligation.

Sec. 24.
The accrued financial benefits of each pension plan and retirement system of the state and its political subdivisions shall be a contractual obligation thereof which shall not be diminished or impaired thereby.
Financial benefits arising on account of service rendered in each fiscal year shall be funded during that year and such funding shall not be used for financing unfunded accrued liabilities.

History: Const. 1963, Art. IX, § 24, Eff. Jan. 1, 1964

© 2009 Legislative Council, State of Michigan

Detroit was placed between a rock and a hard place. GM abandoned good governance of it's own industry and outsourced the jobs that created Detroit in it's best days. While GM was viable and under good management the city grew and grew and grew. Then the worst happened, the tax base was lost along with the failure of it's largest private industry, GM.

Detroit was far too large both in square miles and population to continue to carry out services with an ever shrinking tax base. I blame GM's Roger Smith. He engineered the beginning of the decline of Detroit. He didn't care and if he was any kind of CEO he would have improved his product and not looked for cheap profits.

As the tax base shrank and services couldn't be carried out to support communities the city continued to deteriorate. The Detroit government began to skip funding into the pension funds and the short fall never stopped. There was also corruption that certainly didn't help the city, but, it never amounted to the monies the pension fund was suppose to be worth.

The rest of the narrative is all to familiar to Americans whom lost homes.

Politicians (click here) made a habit of skipping payments pension contributions, effectively stealing from the pockets of retirees, to fatten the wallets of corporations and business interests through subsidies and tax expenditures. At the same time, Wall Street pushed politicians to shift pension fund assets into risky "alternative" investment classes to reap millions in hedge fund management fees. Now, underfunded from a combination of these factors and the 2008 market crash, public sector retirement plans are under further attack from reform groups that vastly overstate plan underfunding in hopes of converting defined benefit plans to defined contribution plans. 

Skipping payments was a matter of fact. The Detroit Treasury could not keep up with the loss of tax incomes. There aren't many other cities in the USA that have major auto manufacturers as a local industry either. The loss was monumental. Detroit had little to chance to recuperate.

The subsides were to attract new business to Detroit to recover from the loss of it's major local industry. There was no way there would be any other industry coming into the region that would employ all the workers once employed by GM and provide the tax base those employees supported. Detroit was doomed. 

The city's government was doing everything it could to rebuild. As the tragedy became more and more real, the city became desperate and the faux security of Wall Street under Bush was the carrot and stick that pushed the city into 'risk' where it never had before.

Then came the market crash of 2008 and the handwriting was on the wall. It was going to destroy Detroit.

The problem for some time was that Detroit wasn't alone in it's ability to survive. When GM left Michigan the state also became vulnerable to rising unemployment and loss of a strong tax base. The holes in the Michigan economy were far to large to be mended. So, the state in the early years was mostly unavailable for any bailout, loans or restructuring agreement. Michigan was hit hard, and it was as though every city was traumatized without exception.

So, when people want to point fingers at who's fault it is, the real answer is Wall Street Greed without a conscience to respect the people hoping something would work out in time.

When Snyder came into office it was simply a matter of manipulating the circumstances to make it possible to destroy democracy and slice and dice the city into manageable lots for sale to his friends.

There was no big picture that a Wall Street genius is suppose to bring with him when elected to a public office. Snyder is not an innovator. He is not a builder. He is, however, one who believes in destroying an entity for the sake of profiteering . He isn't a beam of hope. He is Republican that believes in shrinking and eliminating government. Detroit didn't have a chance. 

Snyder has been the most negative governor Michigan has ever had. Michigan needed big ideas to replace the one that left. One would think someone like Snyder would seek to build and bring industry to the state to turn it around. He could not do that, he doesn't have the DNA. Michigan is evidence of it and Detroit the  best example.

Flattery will get you nowhere.

Goldman has that reputation as being a busybody. An international busybody. Goldman, as a financial firm, has more members and former members (if there is such a thing) involved in government around the world. Goldman definitely likes hands on control of their investments.

I congratulate Commission Chairman Montek Singh Ahluwalia. He is correct and obviously does not relish the hint of corruption portrayed in Goldman's assessment. Goldman is an imposing presence globally. In this instance, they don't understand the Indian culture and it's sense of status. The people require a trust relationship with their government and with a population of more than one billion people that is important. 

India's growth is not new. What is new is the recognition of the financial sector since they have become scared skinny of the variability they are seeing in the Chinese economy. Why do I feel like I have written this before? Deja vu.

But, the remarks by the Deputy Chairman is more than appropriate. India's government is interested in improving the conditions of their people, not just adding income to investment firms and banks that are not interested in the people so much as their own pants pocket lining.

I mean let's face it, if India didn't learn from the American experience with these jerks after 2008 then one would consider them fools. Why is it these financial banks think they are actually reputable when they are nothing but parasites to the people of any nation?

Deputy Chairman Montek Singh Ahluwalia

NEW DELHI: Planning Commission deputy chairman (click here) Montek Singh Ahluwalia on Saturday said US investment bank Goldman Sachs should not be commenting on political matters.

"I don't agree with Goldman Sachs. Lots of people have said they should not be pronouncing on these things," Ahluwalia said on the sidelines of a function organised by the Institute for Defence Studies and Analyses here.

Goldman Sachs had in a recent report upgraded the Indian markets on the likelihood of Narendra Modi coming to power.

"The truth of the matter is we are perfectly aware what needs to be done, at least as far as the Planning Commission is concerned. We have laid out a very bold agenda, which has been approved by the Cabinet, NDC (National Development Council) and so on," he said.

"In the last six months before a general election, that's not when all these things are implemented. So, I have no idea what Goldman Sachs means," he added.

Goldman Sachs, in a report titled "Modi-fying Our View: Raise India to Marketweight," upgraded its outlook for domestic equities and revised its end-2014 target for the Nifty index to 6,900 points, implying a 9 per cent rise from current levels.

The report attributed the optimism to the opposition BJP-led alliance gaining ground in opinion polls in the past few months, suggesting a higher probability of a BJP-led alliance forming the next government.

The 18-page report described the BJP's prime ministerial candidate as more business-friendly.

Commerce and industry minister Anand Sharma had said the report was "most inappropriate and objectionable." Goldman Sachs stood by the report, saying it was based on investor sentiment and does not reflect political bias.
The Associated Press
December 1, 2013 

 — A southwest Missouri zoo (click here) is evaluating its elephant program following the death of a zookeeper and nationwide changes in how the industry is caring for the animals.
The Springfield News-Leader reports that a 41-year-old female named Patience remains out of the view of visitors to the Dickerson Park Zoo more than a month after she knocked elephant manager John Bradford to the ground as he leaned in between the bars. He was killed immediately.
Staff hasn't determined whether Patience will return to the public eye.
"We're not sure at this point what the structure is going to be," Zoo Director Mike Crocker said in a recent interview. "We're having to do a lot of evaluating of our program, our numbers — where we're going to go from here."
Nationally, elephant programs are in flux. Facing continued pressure from animal rights groups and increased regulations, some zoos are spending tens of millions of dollars on high-profile expansions of their elephant exhibits. Other programs are being shuttered completely....
Elephants are considered a vulnerable species. (click here)

The picture to the right is the Forest Elephant and the far straighter tucks than the Savanna Elephant. It is a genetic adaptation. The straight tusks prevent trees from catching on them. 

...There are two subspecies of African elephants—the Savanna (or bush) elephant and the Forest elephant. Savanna elephants are larger than forest elephants, and their tusks curve outwards. In addition to being smaller, forest elephants are darker and their tusks are straighter and point downward. There are also differences in the size and shape of the skull and skeleton between the two subspecies.

Forest elephants, a distinct subspecies of African elephants, are uniquely adapted to the forest habitat of the Congo Basin, but are in sharp decline due to poaching for the international ivory trade. It is estimated that probably one quarter to one third of the total African elephant population is made up of forest elephants.

Read more here: http://www.bnd.com/2013/12/01/2935706/springfield-zoo-evaluates-its.html#storylink=cpy