DoomwatchTM vs. Timesizing®

Collapse trends - July 16-31, 2002
[Commentary] ©2002 Philip Hyde, The Timesizing Wire, Box 622, Cambridge MA 02140 USA (617) 623-8080 - HOMEPAGE


7/28-29/2002  headlines from hell -
  1. 7/29 An economic double dip...lurking on the horizon? by Daniel Altman, NYT, front page.
    Only once in the last half-century, 20 years ago, has the US suffered two recessions in quick succession....
    [50 years is simply too short a time horizon for the profound changes that are going critical in our current economy, despite indexes that monitor them little or not at all. The last time we had this much flab in the economy due to lack of workweek trimming to match our technology level was the 'Roaring 1920s.']
    [The Wall St Journal version -]
    Long [stock] slump would slam tech regions, by Ken Gepfert, WSJ, A2.
    [And right below -]
    Consumer confidence takes a hit, Dow Jones via WSJ, A2.

  2. 7/29 Technology climate is gloomy, but its future still seems bright, by Steve Lohr, NYT, C1.
    [Only if we start timesizing in response to it and retain our consumer base, instead of downsizing our workforce - and our domestic markets.]

  3. [another big problem? - no feedback]
    7/29 Marketplace - Despite a summer under intense heat, Martha Stewart's own nest remains well-feathered, by Constance Hays, NYT, C8.
    ...A glance at the 2001 proxy statement, filed in April, shows that Martha Stewart Living Omnimedia paid about $2.7 million to Ms. Stewart in salary and bonus and to cover premiums for a pair of life-insurance policies valued at $27m. In addition, she received another $2 million in rent for allowing her various homes to appear in company publications and TV programs. And then there are the company's 30.6 million Class B shares, of which Ms. Stewart is the sole owner....
    [In short, we have a situation where some people have sooo much money, they can make all the important decisions AND completely insulate themselves from any negative consequences of any of those decisions. Not a feedback system.]
    [and again -]
    7/29 New economy - Like Narcissus, executives are smitten, and undone, by their own images - Mesmerized by the mirage on the balance sheet and in the company profile, by Tim Race, NYT, C4.
    ...Few of the nation's executives now accused of fraud may have set out initially to break the law. What's more likely is that they became lost in a narcissistic fog in which they imagined that they were above the law - that the rules no longer applied to people as grand as themselves.... [Will we really put them away and prevent their damaging the economy again?]
    Mad as hell: Hard time for white-collar crime, by Johathan Glater, NYT, 4-5.
    Should executives who defraud investors face life in prison?...
    [But what did we teach them by letting Milken back? - see 7/25 #3 below. How about, "There are no serious penalties. Go for it!"]
    [Never mind penalties for fraud. There aren't even taxes on the way "up" -]
    7/28 Living tax-free at the top rungs - Among the wealthiest, 2,525 paid no federal income taxes, by David Johnston, NYT, 3-11.
    [and again -]
    7/28 In loophole, death still certain but not taxes, by David Johnston, NYT, front page.

  4. [And how isolated and insulated and narcissistic are all of us Americans by our own soothing media?]
    7/28 In oversight we trust - Why we're really the envy of the world, op ed by Thomas Friedman, NYT, 4-13.
    [Ah, does Europe envy us? No. Does Japan envy us? No. Does Canada envy us? Surely you jest. So where is this "world" that we keep thinking envies us?]
    ...What distinguishes America is our system's ability to consistently expose, punish, regulate and ultimately reform those excesses - better than any other. How often do you hear about such problems being exposed in Mexico, or Argentina, Russia or China?...
    [In short, we're the envy, not of the world, but only of the most pathetic countries in the world. One-two-three, organized cheer. And as we demoed in the previous point, Friedman's whitewashing of our performance on this issue is profound - not to mention his standard American ignorance of anywhere else in the developed world. We are ruled and taught by morons. Watch our vrille.]

  5. [And just to be sure we continue our downward careen, we let the biggest jerk in the race steal the presidency and then give him fast-track powers -]
    7/28 Bush hails vote in House backing trade legislation - Senate passage is likely - pResident says bill allows him to negotiate agreements to create additional jobs, by Alison Mitchell, NYT, front page.
    [Yeah sure - and if you believe that, we got a bridge to sell ya. Here's the inside head -]
    Bush hails close vote in House backing wider powers for pResident in trade deals - The pResident made a rare lobbying visit to Capitol Hill, NYT, A10.
    [Our mixed-casing, of course - ed.]
    [And the Wall St Journal's version -]
    7/29 Fast-track bill clears House by narrow margin [215-212], by Michael Phillips, WSJ, A3.

7/26/2002  headlines from hell -
  1. Nasdaq falls 4% [to 1240.08], resuming slide; Blue chips ease, by E.S. Browning, WSJ, C1.
    [more -]
    Markets falter as unease lingers - Nasdaq gives up huge portion of Wednesday gains, by Adam Shell, USA Today, 1B.
    [more -]
    Investors turn selective in frenetic day on Wall Street, by Gretchen Morgenson, WSJ, C1.
    [more -]
    Data suggest weak spots in economy - Big-ticket orders and home sales fall, AP via NYT, C8.
    [more -]
    Treasury prices rise on economic data, Bloomberg via NYT, C8.
    [because people are switching from company stocks to government bonds.   = from right to left?]

  2. As time goes by, Argentina's problems deepen, op ed by Mary O'Grady, WSJ, A11.

  3. Brazil's currency hits a new low amid uncertainty, by Matt Moffett, WSJ, A8.
    [That takes care of an A and a B country. We had C yesterday (Canada's phone giant). Now all we need is the other 23 letters and we'll have the whole alphabet.]

7/25/2002  headlines from hell -
  1. Nasdaq market short positions inch up 0.9% - Usually bearish indicator..., by Peter McKay, WSJ, C10.
    [So to answer the question in the subheadline of our Headline from Heaven today, "Question for investors is whether worst is over" - don't hold your breath.]
    [More -]
    Despite rebound, fears of corporate cash crunch linger, by Gregory Zuckerman, WSJ, C1.
    [In other words, nobody wants to lend these clowns any money.]
    [More -]
    Bottom still far off for energy traders, by Neela Banerjee, NYT, C1.
    [such as Williams Cos., Dynegy and AES....]

  2. Phone giant in Canada writing off $5.7 billion, by Bernard Simon, NYT, W1.
    [That would be BCE Inc., Canada's biggest telephone and media group.]

  3. Milken to proceed with leapfrog IPO despite Nextera fall, by Kate Kelly, WSJ, C1.
    [Oh nooo, he's ba-a-ack!   This doesn't bode well for any current government efforts to clean up da joint, especially in view of the following -]

  4. Eyes wide shut - Millions stolen, and no one noticed, op ed by Bob Herbert, NYT, A19.
    ...When Samuel Glazer, the co-founder of Mr. Coffee, received his monthly statements from Lehman Bros. in 2001, they showed that he had nearly $24m in extremely safe bonds, mostly U.S. Treasuries. [But] Mr. Glazer's money had been stolen.... He really had just $15k in his account.
    Mr. Glazer was one of many SG Cowen and Lehman Bros. customers whose assets were lost to the frenzied thievery of a broker named Frank Gruttadauria....
    [And the host brokerages aren't responsible for making things right?!]
    Federal investigators have said that over a 15-year period, Mr. Gruttadauria looted as much as $125m from investors, papering over his scheme year after year with phony account statements....
    [On the other hand, if they weren't using it.... "L'usage seulement fait la possession," as La Fontaine opines (only usage makes for possession). On the other other hand, did Gruttadauria himself really use it, i.e., spend it?]
    So how, you may wonder, could such monumental thievery go undetected for so long at firms of the stature of SG Cowen and Lehman Bros.? ...Only one conclusion...rings true. The people who should have known what was going on didn't want to know.... Who's safe if a broker can steal money by the millions and get away with it for a decade and a half? In a letter...to the FBI in January, Mr. Gruttadauria said, "I can hardly believe that I could have done this without detection for so long."...
    [Clearly we need a much stronger integrating principle in this economic system than just greed - something a little more incentivizing of honesty, for example. The barebones minimum would be a common workweek range à la Timesizing, and on that we can eventually build a common income range, and maybe ultimately a common wealth range.]
    [You want more? Oh you masochists, you!  How's this? -]
    Adelphia founder, 2 sons, 2 others arrested in fraud - Investigators say company was 'personal piggy bank' - Rigases 'stole hundreds of millions' official says, by Lieberman & Farrell, USA Today, 1B.
    [It goes on ... and on ... and on.]
    [Bonus - 'something completely different' - well, sorta -]
    Catholic youth [at Toronto conference] told to defend church, by Cathy Grossman, USA Today, 5A.
    [Give 'em a break! These poor kids can't even defend their own butts.]

7/24/2002  headlines from hell -
  1. Darkening mood, chart title, Wall Street Journal, front page.
    [and more -]
    Markets fall in tumultuous trading, by Gary Strauss, USA Today, 4B.
    [and when the dust cleared -]
    Another day, another $300B loss to investors, by Adam Shell, USA Today, 1B.
    [and the result -]
    Who can trust the stock market? letter to editor by Michael Gorman or Whitestone NY, USA Today, 11A.
    [and all together -]
    Investor pessimism fuels cycle of declines - Blue chips and S&P 500 slide, Nasdaq composite falls 4.18% in biggest one-day loss of 2002, by E.S. Browning, WSJ, C1.
    [and again -]
    Markets continue downward trend; Banks lead way - S&P 500 hits 5-year low - O'Neill goes to Wall Street - Inquiry into Citigroup and Chase adds to jitters, by Norris & Fuerbringer, NYT, front page.
    [and more -]
    Rise in program trades fuels stock volatility, by McKay & Talley, WSJ, C1.
    [and specific industries -]
    Jolt of reality - Amid collapsing power market, energy companies are reeling - After remaking themselves into freewheeling traders, sobered utilities retrench - Caught in a speculative frenzy, by Armstrong & Caffrey, WSJ, front page.
    [and again -]
    Mutual-fund firms see shares caught in market downdraft, by Bridget O'Brian, WSJ, C1.
    [and again -]
    European insurers are hurt by weak stocks - ...Pounded by downturn in equity markets, by Fleming, Walker & Oster, WSJ, C1.
    [and specific companies -]
    Williams Cos. plunges as Russell 2000 sinks, by Karen Talley, WSJ, C8.
    [and also]
    AT&T posts a loss of $12.7 billion - Firm takes big charges to write down investments and value of cable assets, by Jesse Drucker, WSJ, B9.
    [and right below -]
    Lucent posts a wider net loss and plans to slash work force, by Dennis Berman, WSJ, B9.
    [which guarantees the fundamental UNsoundness of the American and global economies, as CEOs think nothing of responding to technology by downsizing - ultimately their own consumer base - instead of timesizing and keeping their consumer base level and confident.]
    [and USA Today's 'sneaker-upper' -]
    Amazon books rise in revenue - [but] Tyco reports $2.3B loss; Duke lowers forecast; [MGM loses $121.8m], by Byron Acohido, USA Today, 7B.
    [Geez mabeez, 14 headlines from hell on one topic. This has gotta be a record!]

  2. [and a new wrinkle -]
    Why it's tough to indict CEOs - Crimes at heart of collapsed businesses are hard to prove, by Joan Biskupic, USA Today, front page.
    [Specifically -]

  3. [and what about 'glorious leader'?]
    Bush vacation plans draw heat from leading Democrat, by Jill Lawrence & Kathy Kiely, USA Today, front page.
    WSHINGTON - A leading Democrat [Md. Gov. & Chair of the Dem. Govs' Assoc. Parris Glendening] criticized pResident Bush on Tuesday for planning to spend a month at his Texas ranch while the stock market plunges and foreign affairs remain volatile....
    [Hey, at least Dubya has a healthy (tho' distinctly UNamerican) respect for time-off and, gosh, maybe he even, at some deep brainstem level, realizes his own expendability, his fundamental 'zerohood'. So just as Nero fiddled while Rome burned, our top Zero plans to fiddle while USA fries. What a guy! Bin Laden must be splittin' his sides.]

7/23/2002  headlines from hell -
  1. Despair grows as markets plunge - Investors stampede out of stock funds, by Adam Shell, USA Today, front page.
    [and again -]
    Stocks tumble, and the fallout is going global - Fears of a slowdown in the world's economy, by Norris & Sanger, NYT, front page.
    [and again -]
    Investors keep jittery watch, some grasping for humor, by Sherri Day, NYT, C1.
    [and more -]
    Throwing in the towel? - Some investors head for the sidelines to escape bear market - " 'I just can't risk any more losses" ', by John Waggoner, USA Today, 1B.
    [and specifically -]
    WorldCom [bankruptcy filing]woes ripple across bank stocks, by Michelle Kessler, USA Today, 3B.
    [and also -]
    Filing fallout drops shares of telecoms, by Andrew Backover, USA Today, 3B.

  2. Living-wage movement takes root across nation - Controversial effort aids lower-income workers - Economists debate whether benefit of living wage offsets loss of jobs, by Stephanie Armour, USA Today, front page.
    [When will we ever learn? Minimum wage and maximum is what we went with in 1933 instead of just spreading the vanishing work with a maximum workweek low enough to allow everyone a share. The only reason we "need" a living-wage movement is because of the failure of the minimum-wage approach, which is always too little too late, market-bucking and job-destroying. When will we ever learn? Labor's traditional goals were higher pay and shorter hours. They focused exclusively on higher pay the last 62 years and they've won neither. If and when they focus exclusively on shorter hours, they'll get both. Shorter hours harnesses market forces instead of bucking them. Cutting the workweek creates a shortage of labor hours that market forces reward with higher pay automatically, without a fight, just as they raise the price of anything scarce. Trying to force up the price of something common is a goosechase, a fool's errand, doomed to failure, and that's exactly what minimum wage and living wage do and are.]

  3. U.S. to withhold family planning money from U.N., by Harry Dunphy, USA Today, 7A.
    [and again -]
    U.S. blocks money for family clinics promoted by U.N. - Powell's view rebuffed - Administration ties program to forced abortion in China despite earlier finding, by Todd Purdum, NYT, front page.
    [and again -]
    Population-control politics, editorial, NYT, A22.
    ...Cutting off [$34m in] funds to the agency [the U.N. Population Fund] is an inexcusable sop to the rightwing anti-abortion activists in an election year. It will increase the number of abortions worldwide by depriving poor women of the education and help they need and that the U.N. agency provides....
    [But the "leftwing" Democrats are no better -]
    Democrats bill would legalize many immigrants, by Paul Leavitt, USA Today, 7A.
    [or the Times' version -]
    Gephardt is preparing a measure to legalize illegal immigrants, by Carl Hulse, NYT, A13.
    [Thus nullifying our immigration laws and undermining our overtaxed INS - again.]

  4. Israelis hit home of a Hamas chief; his fate unclear - 11 are said to have died [including 9 children] - Missile strike comes as Arabs are said to press group to halt its suiicide attacks, by James Bennet, NYT, front page.
    [Der neue blitzkriegische Reich von Israel continues its violent careen toward self-isolation and self-destruction. Listen up, Washington - CUT OFF THE MONEY!!! We're tired of being forced to finance a race war.]

7/21-22/2002  headlines from hell -
  1. (7/21) The incredible shrinking stock market - More than $7 trillion, gone, NYT, 4-14.
    [And more -]
    The confidence crisis, editorial, NYT, 4-12.
    Wall Street's alarming dive in recent weeks, capped[???] by a 390-point drop in the Dow on Friday, may just be another example of the irrationality that can sometimes grip the markets.
    [or, the common sense that the markets very occasionally return to.]
    The recovery [what "recovery"?!], after all, has been progressing fairly well,
    [Are these guys blind?]
    and Alan Greenspan advised Congress last week that the economic outlook was reasonably promising.
    [Then why did he himself get out of the market in the early 90s?]
    But economic fundamentals are being overrun by a host of uncertainties,
    [No, economic fundamentals have been overrun since 1933 by a load of technology-denying rhetoric, such as "work hard to get ahead," "technology reates more work than it takes over," and "it is a fallacy that we must share a limited or diminishing amount of market-demanded employment" and "to cut working hours per person is simply to spread the unemployment."]
    which began with doubt about America's corporate elite
    [No, they began with FDR's blocking of the Black-Connery 30-hour work week bill in 1933 and his subsequent propaganda campaign against the shorter hours movement - despite his admission of error in 1935.]
    and end with concern about shaky leadership in Washington.
    [No, they have not yet ended - not by a long shot.]
    [Here's more -]
    Scream! Hold on for a wild ride - Investors hold on as the market heads downhill - During the "boom" [actually bubble], investors learned a dangerous lesson: that investing isn't risky, by Alex Berenson, NYT, 4-1.
    [and more -]
    Wary eyes on Wall St. and Washington - [and one of the really big hallmarks of depression -]
    A torrent of loans becomes a trickle, by Riva Atlas, NYT, 3-1.
    ...For the last 17 months, banks have been cutting back on corporate lending, shunning companies in problem industries like energy, textiles, steel, and telecommunications, and charging higher interest rates and bigger upfront fees on most other loans, even to top-rated companies in healthy industries....
    [So that's the way it goes: new technology, downsizing instead of timesizing, manhour surplus and cheapening, smaller consumer base coupled with huge $$$concentration in the top brackets and booming (but relatively tiny) luxury markets (see "Concerts draw fewer fans, but tickets cost more," by Edna Gunderson, 7/23/2002 USA Today, 1D), then mergers&acquistions, more downsizing, mucho productivity minimo sustainable markets, lender pullback (our current stage), less expansion less sustainability - a few trips round this downward spiral and you've created a major depression, the exit from which is always the same = pull surplus manhours out of the job market either by war and plague etc. or by timesizing. Any of the standard superficial remedies won't work -]
    With stocks in crisis, Greenspan's nostrums fall short, by Gretchen Morgenson, NYT, 3-1.
    [Interest rate fiddling is supremely superficial, though it can hamper a deep-structure timesizing-borne recovery. That's why we get it out of the way in Phase One of the Timesizing program. What else can Greenspan do - preach honesty in reporting corporate earnings?]
    What good is a "P/E" if you don't know the true "E"?, pointer blowout (to 3-8) by Daniel Altman, NYT, 3-1.
    [Preaching doesn't do much good when there's no common interest and the big boys are getting away with daytime megarobbery. It takes a war or a common workweek range to incentivate honesty. Meantime, Greenspan's preachments are getting undermined by the many superficially minded cheerleaders in the economics profession, such as -]
    Stocks are only part of the story - How the economy can be up when the [stock] market's down, op ed by Prof. Alan Blinder of Princeton Economics, NYT, 4-13.
    [Blinder doesn't really answer this question. He just wants you to believe it's true because if you don't, your "illness" will "spread to the larger economy" and the resulting "financial turmoil could become severe enough to damage the economy," [Truly Blinder is aptly named, and he typifies the rest of mainstream economists who have ignored or ridiculed worktime economics for most of last 2 centuries, accusing it of the ludicrous "lump of labor" fallacy and claiming, against all connected evidence, that techology creates more jobs than it destroys., and ignoring the constant dilution of market "demand" as it moves from urgent demand for food and shelter to diffident demand for a new car every 2 years or for a change from analog to digital watches or for a shift from analog to digitized TV. Blinder shakes his finger and urgently calls for us to "stop the market's downward spiral." His answer to how can this be done pauses unworthily at "artfully chosen words," which is what we've had all along, and his ultimate answer to "how" is merely the vague "decisive government actions now," as if it's obvious to everyone exackitally what those decisive actions should be. His whole performance calls to mind G. K. Chesterton's pan-utopian flaw, the blithe assumption that everyone knows what a fair share per person is (and that no one will want to exceed it).
    [Blinder never asks the deeper question, which is the reversal of the one in his subheader - "How can the [stock] market be up when the economy's down?" - because it is the contention of worktime economics that the economy has been heading downward with increasing steepness since around 1970 when the postwar babyboomers hit the job market, wiped out the wartime and postwar balance between jobseekers and jobs on the 40-hrs/wk basis, and induced housewives in their millions to enter the job market as the real wages of primary breadwinners stagnated. But the mass entry of women into the job market only made matters worse, raising our reversed question - how come the stock market parted ways so widely with the economy whose consumer base was a mere shadow of what it should have been, and fading more and more on a weekly and even daily basis as CEOs, desperate to maintain market share, began just buying it through acquisitions. And once acquired, the next step was consolidation, that is, downsizing. Which brings us back to the question, "How can the [stock] market be up when the economy's down?" The decreasing power and leverage of ordinary employees could not keep raises pacing productivity leaps, and the extra profits poured into the top income brackets, giving the wealthy so much money they literally had nothing else to do with it but sink it into stocks. (Well, you can do real estate, but the Japanese tried that and had a real estate bubble nearly 10 years before our dot-com bubble.) And their combined extra injection into the stock market pushed stocks' P/E ratios far above historical norms, until they began to sense, just recently, that it was productivity they were investing in, but not productivity in a vacuum as economists and analysts would have them believe, but productivity that was marketable - and sooo much of it simply was not marketable, because of the shrinking of the consumer base. Blinder does indeed in this op ed try to make the point that "consumers are spending," but if they are spending at anything close to an appropriate level, why are so many CEOs still desperately acquiring market share instead of building it, why is consumer debt so high, and why are personal and corporate bankruptcies so high? Blinder and his colleagues are simply far, far too easily satisfied that consumers are spending - and Blinder doesn't even mention employment - only consumer spending, the housing market and business investment as evidence that "the economy is up." (How he can cite business investment when venture capitalists and lenders are pulling back (see headline above, "A torrent of loans becomes a trickle") is beyond us!)]
    [Blinder and other cheerleaders basically argue that NOTHING can hurt the economy - it can take any amount of punishment and still not only survive but thrive. It can take any amount of downsizing, any lag in rehiring, any amount of CEO shortcutting and window-dressing - not a problem. Not even a ripple in the great economic ocean. But that kind of thinking has led more and more CEOs and analysts to take more and more shortcuts and do more and more window-dressing. "If NOTHING can hurt the economy, then I might as well do ANYTHING I CAN to get as much as I can, and anyone who says different is a bleeding-heart WIMP." A Ted Rall cartoon this weekend (NYT, 4-4) typifies this view. Four boxes. First box - guy at business meeting says, "Let's make a cool product and sell it to lots of people for more than the cost of production, distribution and promotion." Second box - no response from anybody. Third box - guy reconsiders. Fourth box - guy says "Alternatively, we could bribe politicians, lie about our finances and sell our free stock before the truth comes out," to which people respond, "Works for me," "Much easier," "Okey-dokey," and "Sounds great." This attitude spreads and deepens (see "Corporate values trickle down from the top," by Jeffrey Seglin, NYT, 3-4) and pretty soon you have an economic colossus standing on a corrupt and gangrenous pair of legs that no ordinary government bandaiding will strengthen. Then it's either the usual high-key war to take out the surplus labor hours that started the whole burgeoning imbalance, or the alternative low-key workweek reduction raised to a much higher key.]

  2. (7/21) Hardly a vote of confidence, NYT, 3-6.
    Corporate boards are supposed to be the watchdogs of a company. Yet nearly 60% of the 225 executives from Fortune 1000 companies who were surveyed recently didn't think the independent directors on their boards were financially savvy enough to spot any financial irregularities. The poll was taken in late June and early July by Christian & Timbers, an executive search firm, and the results were released last week.

  3. (7/22) Under duress, some C.E.O.'s demand more from the ranks, by McGeehan & Treaster, NYT, B2.
    [The ranks are not the problem. The corporate boards and the CEOs themselves are the ones we need a lot more from. But for them in a time of high tech, flabby long workweeks and grotesque manhour surplus, it's just take take take, no give.]

  4. (7/21) Finding a new job, slowly, NYT, 3-10.
    Many laid-off executives have found new jobs, but it's taking longer. The average job search lasted 3.8 months, based on a poll in the 2nd quarter, up from 2.1 months reported in a poll in the same period last year.... Challenger Gray & Christmas, the outplacement firm, interviewed 3,000 discharged executives nationwide.

7/20/2002  headlines from hell -
  1. Crisis of confidence puts market in a dive - Dow plunges 390 points in sell-off - Market: Worst year since '70s in making, by Jonathan Fuerbringer, NYT via Arizona Republic, front page.
    [Ee-haw - just like summer of '29. Here's the original version of this headline -]
    Market continues its four-month rout; Dow plunges 390 - Down 20% so far 2002 - Questions over the confidence of individual investors as their portfolios shrink, by Jonathan Fuerbringer, NYT, front page.
    [and more -]
    Adding to loss of investments, a loss of faith, by Floyd Norris, NYT, front page.
    [and part of the reason -]
    Tighter rules for lobbing fall victim to lobbying, by Leslie Wayne, NYT, B1.
    [not to mention -]
    S.E.C. suffers from legacy of nonbenign neglect, by Stephen Labaton, NYT, B1.

  2. The road to perdition, op ed by Frank Rich, NYT, A25, via Kate Jurow.
    Wagging the dog no longer cuts it. If the Bush administration wants to distract Americans from watching their 401(k)'s go down the toilet, it will have to unleash the entire kennel.
    Maybe only unilateral annihilation of the entire axis of evil will do. Though the fate of John Walker Lindh was once a national obsession, its resolution couldn't knock Wall Street from the top of the evening news this week. Neither could the pResident's White House lawn rollout of his homeland security masterplan. When John Ashcroft, in full quiver, told Congress that the country was dotted with Al Qaeda sleeper cells "waiting to strike again," he commanded less media attention than Ted Williams' corpse.
    What riveted Americans instead was the spectacle of numbers tumbling as the pResident gave two speeches telling us help was on the way. [But] where his father's rhetoric gave us a thousand points of light, his lopped a thousand points off the Dow....
    Once the market dissed him, the pResident...profess[ed] shock that his fellow citizens would care about something as base as money...."You know, the bottom line and this corporate America stuff, is that important? Or is serving your neighbor, loving your neighbor like you'd like to be loved yourself?
    Easy for him to say. It's hard to engage in lofty meditation about loving your neighbor if your neiighbor is Kenneth Lay or Gary Winnick or Bernard Ebbers [or Marc Rich or Chainsaw Dunlap or Roger Smith] or any other insider in "corporate America stuff" who escaped with multimillions just before the corporation cratered, taking your job or pension or both with it.
    Democrats celebrate the Republican travails as if it were Christmas in July. But the party's chief, Terry McAuliffe, was a Wiinnick crony who made his own killing before Global Crossing tanked, and its most visible presidential candidate, Joseph Lieberman, is fighting to the political death for loosey-goosey stock-option accounting....
    But the hypocrisies of the Democrats, however sleazy in their own right, do not cancel out the burgeoning questions about this White House. Each time Mr. Bush protests than only a few bad apples ail corporate America, that mutant orchard inches closer to the Rose Garden. If there's not a systemic problem in American business, there does seem to be one in the administration, and it cannot be cordoned off from the rest of its official behavior....

  3. [There is a systemic problem in American business, and without identifying its nontimesizing core, Ralph Nader has identified five systemic aspects of it, and we'll say this for the "Arizona Repulsive" - it did carry Nader's 23K gold analysis today -]
    My turn - Government of, by, and for big business - Corporate crime, fraud and abuse have become like the weather [ie: acts of God], op ed by Ralph Nader, Washington Post via Arizona Republic, B11.
    The relentless expansion of corporate control over our political economy has proved nearly immune to daily reporting by the mainstream media.
    Corporate crime, fraud and abuse have become like the weather; everyone is talking about the storm, but no one seems able to do anything about it. This is largely because expected accountability mechanisms - including boards of directors, outside accounting and law firms, bankers and brokers, state and federal agencies and legislatures - are inert or complicit.
    When the established corporate watchdogs receive their compensation directly or indirectly from the companies they are supposed to be watching, independent judgment fails and corruption increases and conflicts of interest grow. Over time, these institutions, unwilling to reform themselves, strive to transfer the costs of their misdeeds and recklessness onto the larger citizenry. In so doing, big business is in the process of destroying the very capitalism that has provided its ideological cover.
    Consider the following assumptions of a capitalistic system:
    1. Owners are supposed to control what they own. For a century, big business has split ownership (shareholders) from control, which is in the hands of corporate officers and rubberstamp boards of directors. Investors have been told to sell their shares if they don't like the way management is running their business. With crooked accounting, inflated profits and self-dealing, it has proved difficult for even large investors to know [how management is running their business].
    2. Under capitalism, businesses are supposed to sink or swim, but larger industries and companies often have become "too big to fail" and demand that Uncle Sam serve as their all-purpose protector. Yes, some expendable companies, such as Enron, do go bankrupt or are bought. But in industry after industry, where two or three companies dominate or presage a domino effect, Washington [ie: taxpayers, without their consent] becomes their backstop.
    3. Capitalism is supposed to exhibit a consensual freedom of contract. Yet the great majority of contracts for credit, insurance, software, housing, health, employment, products, repairs and other services are standard-form, printed contracts, presented on a take-it-or-leave-it basis. Going across the proverbial street to a competitor gets you the same contract. Every decade, these "contracts of adhesion," as the lawyers call them, become more intrusive and more insistent on taking away the buyers' constitutional rights to access to courts in favor of binding arbitration or stipulate outright surrender of basic rights and remedies.
    4. Capitalism requires a framework of law and order: Its rules are to be conceived and enforced on the merits against mayhem, fraud, deception and predatory practices. Easily the most powerful influence over most government departments and agencies are the industries that receive the privileges and immunities, regulatory passes, exemptions, deductions, and varied escapes from responsibility that regularlyl fill the business pages.
    5. Capitalist enterprises are expected to compete on an even playing field. Corporate lobbyists have developed a "corporate state" where government lavishes subsidies, inflated contracts, and natural-resource giveaways on big business. We have a government of, by, and for big business. "Corporate socialism," the privatization [and concentration] of profit and the socialization of risks and [costs], is displacing capitalist canons. Civic and political movements must call for a decent separation of corporation and state, [economics and politics].
      [Backing up Nader's charge of privatizing profit and socializing risk, we have, in the Times, "Losing my stake in the economy - Workers take the risks; executives get the rewards," op ed by Robert Hemsley of the Western Pulp & Paper Workers Union, NYT, A25, via Kate Jurow.]
    At stake is whether civic values of our democratic society will prevail over invasive commercial values.
    [Nader's mistake is to slam big business per se instead of zeroing in on exactly what big business tends to do wrong under our current design of incentives and power gradients. Basically, big business tends to be very short-sighted and narrowly interested. In other words, it's not far-sighted and widely extended in its self-interests. The reason for this is that our old definitions of fair share are gone. "One person, one vote" has been drowned by megabucks, lobbyists and PACs. Seniority (one person, one rate of increasing access to raises and promotions) has been sidelined by job volatility and downsizing. The American dream (one man, one wife, two kids, a car, a TV...) has been sidelined by a lot of things (including diversification of lifestyles and sexuality, both parents working, and the increasing lag of wage raises behind productivity) and has become either suing the deep pocket or hitting the lottery. The American pension has been sidelined by CEOs' breech of the social compact (including longterm career provision and targeting pre-pension employees for downsizing) and has been replaced by dying on the job or dialing 800-KEVORKIAN.   Timesizing replaces all these eroded definitions with a minimally controversial definition of a fair share of vanishing human employment. It thereby abandons the mainstream strain to maintain that robotization and automation, etc. creates more jobs than they destroy, and simply spreads the vanishing work, and funnelling wages, across the whole population, on the basis of a democratically and flexibly defined range of employment, such as 10-30 hrs/wk, to which every adult is entitled, not just by rhetoric but by system design.]

7/18/2002  headlines from hell -
  1. [and speaking of the curious way in which the centripetal forces on money tend to overwhelm the centrifugal forces - commented upon by JC Himself some 2000 years ago ("to him that hath, more shall be given, but from him that hath not,...") - ]
    Lawsuit says Salomon gave special deals to rich clients - More ammunition for those who feel the market favors the wealthy, by Gretchen Morgenson, NYT, front page > C7.
    During the market boom, a handful of top executives at telecommunications companies received big allotments of hot new stocks from Salomon Smith Barney, according to a former [Salomon/L.A.] broker [David Chacon] who has filed a lawsuit accusing the firm of unfair business practices. Jack Grubman, the firm's star analyst covering these businesses, played a central role in deciding which executives got how many shares, the broker said in an interview this week....
    [That's why they call him "Grubman."]
    "I wanted to know how to do business with billionaires," Mr. Chacon recalled.... He was soon going on business calls with..\..Rick Olson, known in the firm as Jack's broker...who he said referred to may customers as "The Telecom Mafia." After a few offerings, Mr. Chacon said that he saw that the allocations were skewed to the telecommunications executives, and he grew concerned that his other customers were getting none of the hot issues. He said allocations were even given to executives at a stock's initial offering price days after the shares had been trading substantially higher in the open market. Mr. Chacon says that he began complaining to his immediate superiors.... He was terminated less than two months later.... The spokeswoman for Salomon said...Mr. Chacon was fired for violating corporate policy....
    [Ri-i-ight. He wasn't a team player. He didn't "go along to git along." He wanted to rock the boat. He wanted to open his big mouth. Etc., etc. Never mind that favored clients already had more money than they could spend and giving them more would damage groundwork consumer markets and help induce a stock market reversal. These morons are to stupid to see the Big Picture and take a whole-systems approach. File this under "How the Overwhelming $Centripetal Force Works."]
    [and a related story -]
    Stock options said not to be as widespread as backers say - Stock options not shared as widely as their defenders have contended - Only about 3m people actually received options in 2001, by David Leonhardt, NYT, C1,C7.

  2. Poll finds concerns that Bush is overly influenced by business, by Richard Stevenson & Janet Elder, NYT, front page.
    [No-o-o kidding!]

  3. Now, a corporate push to avoid [evade?] state and local taxes, by David Johnston, NYT, C4.
    As lawmakers debated in Washington yesterday how to close the loophole that allows companies to avoid U.S. taxes by acquiring a Bermuda mailbox, a bill advanced with a provision that state officials say would let companies avoid state and local taxes using some of the same techniques as the Bermuda loophole. are among the major corporations that are lobbying for the bill, which was approved by a House Judiciary subcommittee on Tuesday at a hearing held on such short notice that state officials said they could not attend....
    [And the sleaze oozes on.]

7/16/2002  headlines from hell -
  1. Stocks fight for stability - Bush praises economy, but Dow swings, dollar falls, rattling markets, pointer headline (to 11A), USA Today (USAT), front page.
    [and the original article -]
    Market slide continues despite Bush speech - Democrats step up criticisms, by Page & Keen, USAT, 11A.
    [and more]
    U.S. gloom sinks dollar past parity with euro, by George Hager, USAT, B1.
    [and more]
    Trust - Americans have great faith in each other, but their trust in CEOs, big business, priests and HMOs is slipping away, by Bruce Horovitz, USAT, front page.

  2. [two op eds on either side of the same page, like two pillars, standing against Bush - Dubya is making Clinton look good]
    Bush and the Texas land grab - Lawsuits focused on deals linked to Rangers stadium, by Nicholas Kristof, NYT, A21.
    [Kristof pulls apart one aspect of Bush's scummy past - Krugman takes it the rest of the way -]
    Steps to wealth - An unusual business career (continued), by Paul Krugman, NYT, A21.
    [Lordy, if this doesn't finish off our scumbag pResident, there's probably a lot more where this came from. Note the understated beginning.]
    Why are George W. Bush's business dealings relevant? As the unanswered questions about Harken Energy pile up - what's in those documents the White House won't release? Who was the mystery buyer of Mr. Bush's stock? - let me now turn to how Mr. Bush who got by with a lot of help from his friends in the 1980's. became wealthy in the 1990's. He invested $606,000 as part of a syndicate that bought the Texas Rangers baseball team in 1989 - borrowing money and repaying the loan with the proceeds from his Harken stock sale - then saw that grow to $14.9m over the next 9 years. What made his investment so successful?
    First, the city of Arlington [Tex.] built the Rangers a new stadium, on terms extraordinarily favorable to Mr. Bush's syndicate, eventually subsidizing Mr. Bush and his partners with more than $150m in taxpayer money. The city was obliged to raise taxes substantially as a result. Soon after the stadium was completed, Mr. Bush ran successfully for governor of Texas on the theme of self-reliance rather than reliance on government.
    [Not even on a city government such as Arlington's?]
    Mr. Bush's syndicate eventually resold the Rangers, for triple the original price. The price-is-no-object buyer was a deal maker named Tom Hicks. And thereby hangs a tale.
    The University of Texas, though a state institution, has a large endowment. As governor, Mr. Bush changed the rules governing that endowment, eliminating the requirements to disclose "all details concerning the investments made and income realized," and to have "a well-recognized performance measurement service" assess investment results. That is, government officials no longer had to tell the public what they were doing with public money, or allow an independent performance assessment. Then Mr. Bush "privatized" (his term) $9B in university assets, transferring them to a nonprofit corporation known as Utimco that could make "investment" decisions [our quotes - ed.] behind closed doors.
    In effect, the money was put under the control of Utimco's chairman: Tom Hicks. Under his direction, at least $450m was invested in private funds managed by Mr. Hicks's business associates and major Republican Party donors. The managers of such funds earn big fees. Due to Mr. Bush's change in the rules, these investments were hidden from public view; an employee of Utimco who alerted university auditors was summarily fired. Even now, it's hard to find out how these investments turned out, though they seem to have done quite badly.
    Eventually, Mr. Hicks's investment style created a public furor, and he did not seek to retain his position at Utimco when his term expired in 1999.
    {What did the Bushes care - he had served his purpose.]
    One last item: Mr. Bush, who put up 1.8% of the Ranger syndicate's original capital, was entitled to about $2.3m from that sale. But his partners voluntarily gave up some of their share, and Mr. Bush received 12% of the proceeds - $14.9m. So a group of businessmen, presumably with some interest in government decisions, gave a sitting governor a $12m gift. Shouldn't that have raised a few eyebrows?
    All of this showed Mr. Bush's characteristic style. So the style of a future Bush administration was easily predictable, given Mr. Bush's career history.
    [We are beholding the raw mechanism by which "the first becomes last" - by which the currently dominant country in the world is turning into a corrupt and weak third-world plutocracy where freedom means nothing - especially freedom of information - and people can just disappear by the hundreds and thousands under a so-called "Homeland Security Agency." We had a bad feeling when Americans "elected" a CIA director as president in 1988 (not to mention the movie star in 1980). Those ominous feelings are now playing out under one of the CIA guy's sons. "Cry the beloved country."]

For earlier collapse stories, click on the desired date -
  • July 1-15/2002 + Jun 30.
  • June 16-29/2002.
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  • May/2002.
  • April/2002.
  • Mar.12-31/2002.
  • Mar.1-11/2002.
  • Feb.16-28/2002.
  • Feb.1-15/2002.
  • Jan/2002.
  • Dec/2001.
  • Nov.16-30/2001.
  • Nov.1-15/2001.
  • Oct/2001.
  • Sep.15-30/2001.
  • Sep.1-15/2001.
  • Aug/2001.
  • July/2001.
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  • Mar/2001.
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  • Dec.21-31/2000.
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  • Dec.1-10/2000.
        Earlier Y2000 months accessible via links at bottom of Dec.1-10/2000 page.
  • Dec.16-31/99.
  • Dec.1-15/99.
        Earlier 1999 months accessible via links at bottom of Dec.1-15/99 page.
  • Dec/98.
        Earlier months accessible via links at bottom of Dec/98 page.


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