DoomwatchTM vs. Timesizing®
Collapse stories - Dec. 1-15/1999
[Commentary] ©1999 Philip Hyde, The Timesizing Wire, Box 622, Cambridge MA 02140 USA (617) 623-8080
12/15/99 3 clunkers -
12/11 2 clunkers -
- [You've already got cellphones keeping you on call round the clock. Now they're gonna be -]
Clocking every move you make - Two Massachusetts firms scramble to update the time clock so that employers can follow their workers anywhere [- Kronos of Waltham and Simplex Time Recorder of Gardner], by Jerry Ackerman, Boston Globe, C1.
[Hey, here's an idea - why not just repeal the Emancipation Proclamation?! Clearly we are learning nothing from -]
Germans to set up $5.1B fund for Nazis' slaves, by Edmund Andrews, NYT, front page.
[And if that doesn't push you over in Unbalanced America Today, how about -]
- Citizens executive gets highest pay package at Royal Bank of Scotland, Bloomberg via Bos Globe, C4.
EDINBURGH - Lawrence Fish, CEO of US bank Citizens Financial Group Inc., was paid...$4.7 million in fiscal 1999, more than anyone at parent company Royal Bank of Scotland Group PLC [including his boss].... The package reflects "...the fact that executives in general are more highly rewarded in the US," said David Appleton, spokesman for Royal Bank....
[No kidding? And how's his "golden parachute"? ... And if THAT doesn't get you goin', how about THIS -]
- Reducing audits of the wealthy, IRS turns eye on working poor - In midst of reform [reform???], IRS shifts focus from wealthiest, by David Johnston, NYT, front page -> C31.
[With "reform" like this, who needs regression? Like we said, why not quit acting, repeal the Emancipation Proclamation and revive the Third Reich in America now that we're starting to act like Nazis - all for the good of the country of course. Never mind Michael Moore's "TV Nation", we're turning into Skinhead Nation! Remember Dave Barry's definition of the U.S. Senate - "white male millionaires working for you"? - and many of them are already bald! Welfare for the rich! Taxes for the poor! Let's see how long that can last in the context of "the more concentration, the less circulation" - of money.]
[Another in our occasional series of iconoclasting, myth-busting exposés (see previous on 666, "the number of the beast" in past doomdujour of 9/9/99) -]
- A second job for fun: that's living? letter to editor by Juna McAllister of the Bronx, NYT, A36.
The people who work second jobs for "fun and relaxation" are perfect representatives of a society that seems to have forgotten how to relax and enjoy life ("Second job is a holiday from real work," Workplace section, Dec. 8).... These people are working at jobs they admittedly do not need. It is safe to assume that there are many who really need these low-paying jobs....
[While we sympathize with June's view, we think it is possible to accommodate such people in a way that harnesses their incentive in an macroeconomically positive way - Let them reinvest their 2nd-job earnings in training or hiring. If they're really just doing it for "fun and relaxation," they won't mind, and their unneeded 2nd jobs will be transformed from a disaster to a boon for the "many who really need these low-paying jobs". Enforcement could come by way of a tax on overwork with an exemption for reinvestment in training and/or hiring. We call this DAR = direct automatic reinvestment. We bring it in on corporations first in the second of the Timesizing program's five phases to get some on-the-job training options going, and then we introduce it on the level of the individual employee to really draw a line "work greed" and get the systemic sharing going in this easiest dimension to share. Because if we can't share Work, we'll never be able to share the thing where we really need to rein in the disparity, Money.]
- Is there too much venture capital? - The Internet startup world has spun out of control by Charles Ferguson, NYT op ed, A37.
[We answer Charles' question with a resounding YES. The grotesque overbalance of venture capital is part and parcel of the huge overbalance of concentrated personal wealth and investment capital in general that is characteristic of a ballooning pre-depression financial bubble. And we're not centrifuging and sharing the money appropriately because we're not centrifuging and sharing the work and skills appropriately. True we've got a private sector that's always crying "Labor shortage," but we've got a public sector that's always desperately trying to find and foster new jobs. Somebody here is lying - maybe not intentionally, but that just means they're lying to themselves as well. And it ain't the public sector. Here's a business writer who is beginning to tell the truth to himself - in one specialized area of the problem -]
...An average issue [of VentureWire] lists about 20..\..new venture capital investments in Internet companies.... What's striking is that VentureWire comes daily - and yet doesn't catch everything.
[That's the way we feel about the New York Times and its coverage of downsizings and takeovers.]
Driven largely by optimism about the Internet, investment in American technology start-ups will probably reach approximately $50B for this year - about 10 times more than in 1994.
[We disagree that it's "driven by optimism." We agree with the Hawaiian newsletter writer a few years ago who sensed that the top 5-10% is garnering so much wealth that they literally have nowhere else to put it, but stocks and ventures. They can't possibly spend it, and therein lies the tinder and fuse of mega-depression. Why are they compacting so much wealth and invoking the fragility of the "marginal utility" thereof? Because the vast numbers of ordinary people have no leverage in the workplace, despite over-publicized spot shortages in (largely high-tech) skills, which themselves are a function of the spoiledness of employers and the floods of resumes they've been receiving. Waves of technology have doubled and tripled and megatupled productivity since 1940. Waves of immigrants have entered the US economy. Vast numbers of women have entered the job market compared to the 1950s. Result? Wages have not gone up for 30 years. Employers can whine all they want about "labor shortage", but until wages go up and on-the-job training sprouts up everywhere, as during World War II, they're just kidding themselves and trying to kid us. Why is their "job blackmail" so effective all over the country against state and city legislatures? "Give us taxbreaks or we'll take our jobs elsewhere!" If we really had a labor shortage, legislators would just bark, "Get outa here and good riddance!" But they cave in, all over the country, to this unenforceable job-based extortion, just like Mass. did to Raytheon and Fidelity in the last few years. Why no "inflation" in the sense of even healthy wage-push price rises? Because too few people are getting raises to make a dint, that's why. Oh the top 5-10% are getting raises big-time, but that just brings us back to our original point, they have NO ALTERNATIVE but to throw it into stocks and ventures.]
...On Thursday, the stock of VA Linux Systems had the biggest first-day gain for any initial public offering in history. This company, which sells computers that run the Linux operating system, faces serious competitors like IBM and Dell, is losing money and will not turn a profit for the foreseeable future. Yet it was valued at almost $10 billion by the end of the day - a gain of 733%....
Fund-raising has become a buyer's market. Venture capitalists now must compete for deals, despite their vastly increased funds and the large number of Internet companies being started.
[We would reword this - "Venture capitalists now must compete for deals because of their vastly increased funds - despite the large number of Internet companies being started. As Dahlberg said in 1932 - we are making "Capitalism operate...under a chronic scarcity of job and business opportunity" (Jobs, Machines and Capitalism, p. x) and they do go together. There's a shortage of business opportunity because there's a shortage of jobs and a surplus of labor. The surplus of labor keeps wages flat despite massive technology-driven leaps in productivity, all carelessly undercounted, and the huge productivity-driven profits are funnelled to the top - hence the "vastly increased funds" of the venture capitalists.]
..\..In 1994, I spent 5 brutal months raising $4m for my first company, and early Internet software start-up.... I recently founded my second Internet start-up. This time, I raised over $3m in the first month.... But the fact that virtually any idea - no matter how dubious - can obtain money, and that so much money is available, is...causing problems.
..\..[On the one hand] business life [is] a lot fairer. [For whom??] You don't have to stay in a big, bureaucratic company anymore. ["Have to stay"?? They downsize and you have to go!] You can join a start-up. ["Can"?? Have to when you're downsized!] You can bypass middlemen and sell directly to the global market.
["Modified rapture" - this assumes that anybody looks at your site.]
...[On the problem side] the glut of money...has companies - and the industry as a whole - growing insanely fast, leading to..\..competition among Internet companies [once capitalized. This] is increasingly a financial arms race. [No, a market-share race.] They must...give away their products, advertise on television...simply because their competitors do.
[No, simply because there are such small markets, so few consumers and so little spending relative to the number of companies selling. But you can hardly ever get an entrepreneur to admit the possibility of a structural customer shortage - he's too much of a cheerleader - too used to hyping himself.]
The glut of money also has companies - and the industry as a whole - growing insanely fast, leading to labor shortages everywhere - of not only engineers and managers, but graphic designers, accountants, headhunters, telephone system installers.
[These are not labor shortages, they're skill shortages, which in turn are shortages of training. None of these get-rich-quick artists wants to bother with something so mundane as training. Speaking of whom -]
Fortune seekers, many of them unqualified, flood to the Internet - both to start companies and to work in them. This leads to sloppy work and some fairly sleazy behavior....
[Best way to balance the whole thing and put some sanity in it? Put some discipline into these guys by drawing a line on how long you can work in a week for freely spendable earnings. Over that, you either have to quit and leave it to others, or reinvest in training and hiring so there's more consumer base out there for everyone on the production side, or get your overtime earnings taxed away from you so the government, the "reinvestor of last resort," can make some attempt to do the reinvesting in training and hiring that you should have done, or quit. We call this approach Timesizing.]
12/10 Technicolor dreamcoats (dreams sold separately), by Roberta Smith, NYT, B45.
[If we're not mistaken, (A) this headline is a ripoff from a recent (or current?) musical by Andrew Lloyd Webber & Tim Rice(?) called "Joseph and his Technicolor Dreamcoat" and (B) Roberta has penned a whole big article of this title WITHOUT mentioning this musical. Of course, we find it so difficult to wade through this artsyfartsy fluff that she may have slipped in a tiny reference somewhere. But our beef is really with the source musical, not with her eye-crossing, name-dropping (but all the wrong names) fluff.
[The technicolor dreamcoat of the musical's title is based on the "coat of many colors" mentioned in the King James translation of the Bible three times in Genesis 37 (vv. 3,23,32). This striking image seems to have seized the imaginations of people ever since the translation was published in 1611. Unfortunately, it is based on a mistransation of the Hebrew words "kethoneth passim" from kethoneth meaning "coat-of" or "robe-of" and pas-s-im meaning "hollow-[convenience doubling]-s", or "coat of hollows". But the translators in 1611 thought that pas meant "color", so they translated the phrase literally as "coat of colors" and stuck in a "many" so it would make a little more sense in English, - hence, "coat of many colors".
[This survived until much further Hebrew scholarship, much of it informed by research on the contemporary and earlier Semitic languages of Aramaic and Akkadian, revealed that "pas" probably meant "hollow" and not "color", so the whole thing should really be translated "robe of hollows", the guess being that this would be a robe that came down to the hollows of both the hands and the feet, in other words, to the palms (hands) and soles (feet). This is how we get to the Revised Standard translation of "long robe with sleeves". The New World translation tries to go both ways at once and comes up with "long, striped shirtlike garment" - which is really kludgy. Guess they just didn't want to take the heat for disabusing people of their lovely multicolor image of the garment in question. Phil Hyde's own mom reacted with VERY satisfying shock when her budding-Biblical-scholar progeny came home from a college course in Hebrew 101 taught by one of the really great faith-shakers at the University of Toronto, old Bill Staples, and informed her, with the whole panoply of academic superiority that a only freshman can muster, that her beloved "coat of many colors" was a complete and total myth. Ah, the wonders of Biblical scholarship, and ancient linguistics in general.]
12/09/99 2 clunkers -
[The exception that proves the rule? - a highschool shooting in one of Europe's most advanced economies -]
- Airbus's superjumbo jet, AP via NYT, C4.
...is expected to have 650 seats....with a first commercial flight by 2005.
[Just what we need, a 650-seat plane when we can't even handle the crowds on our 350-seat planes now. And what size of airport are these flying brontosaurs going to need, and runways, and noise baffles on all neighboring housing? When and where and how do we draw the line on our frenzy for gargantua?]
- A growing inequity seen - Bay State workers earn 5% less than they did a decade ago, pointing to a rising gap between high- and low-paid wage earners, according to a study at Northeastern, bait headline, Boston Globe, D1, leading to -
Study: Mass. median pay down 5% since '89 - Reasons unclear; figures also point to widening gap between rich, poor, by Kimberly Blanton, Bos Globe, D5.
...even though employment has surpassed levels achieved during the 1980s boom, according to...an analysis of federal income data released yesterday by Northeastern [University]'s Center for Labor Market Studies..\.. Last year, the median income of Mass. families was $55,762, a decline of 5% from...$58,656 [in 1989]...adjusted for inflation....
New evidence that workers are losing ground casts a harsh light on the Mass. economy's renaissance, which is being touted as a return to the 1980s heyday.... Prosperity [has] returned in recent years as the number of Mass...employed reached a record 3,231,600 and kept the state's jobless rate - 3.2% last month - below 1987 levels.
[But check out our unemployment page for reasons to mistrust the state's jobless rate. Also -]
...Andrew Sum, director of the Center...said the early-1990s recession in the wake of a near-collapse in the state's computer manufacturing and real estate industries caused sharp declines in incomes. Income levels haven't fully recovered, despite an economic boom that will soon be recorded as the longest in US history.
[Andrew is looking too closely at the trees and missing the whole forest. Besides manufacturing jobs continuing their flight out of state to Mexico and overseas, technology and immigrants have been pouring into Massachusetts and we have not had a big labor-hours-subtracting war, such as WW2 or the Civil War, or a combo war&plague, such as WW1 and the flue epidemic, to cut fast-growing labor down to slow-growing demand in the job market, despite resume-flooded, increasingly fastidious, never-training, never-raise-granting, ever-complaining employers' claims of labor shortage. We are still such primitive cavemen in economic design, we still don't have a dynamically compensating workweek that automatically shares the work on a 'safe range' basis around to every state resident. And Andrew and our small army of labor economists, well-meaning though they be, are still totally clueless on this whole family of "big context" factors. Just look at his next statement -]
"We've not yet caught up, despite the fact labor markets have been restored to as close to full employment as you can yet," Sum said.
[Andrew, have you EVER considered looking back a little further than the 40s, like to the 20s maybe, when we went through EXACTLY this golden rosy booming "full employment" before??? Lord God, with LABOR economists this myopic, we'll never develop the figures we need to know our true situation. They're sooo puzzled -]
...The reasons behind declining incomes over the past decade can't be fully explained, though they may relate to everything from the state's growing reliance on immigrants or young workers to changes in family composition, economists said.
[Oh yeah, we didn't even mention that. The 17% unemployment rate among workers over age 50 in high tech alone - the industry that complains most about lack of qualified applicants so they can get more visas for pre-trained low-wage programmers from Bombay. And then there's this unsettling aspect -]
,,,Randy Albelda, an economics professor at UMass.Boston said a decline in median income indicates that inequality among the state's residents is widening.... Median income is the midpoint in the range of all Massachusetts families' incomes..\.. The average income of Mass. residents has fully recovered to 1989 levels, about $67,000...because pay for professionals in top-flight industries, such as financial services or software, has shot up. These high salaries have pulled up the average income of all Mass. families - but not the median income.... "For the decade as a whole, the gains have basically been in the top 10%," Sum said..\.. The income level in "the bottom 50% hasn't grown as much as the top," Albelda said.
[And here are a couple of other doozies, the fruits, respectively, of transforming Mass. factories into overseas sweatshops and downsizing in the service sector -]
...A decade ago "We had a bigger manufacturing sector. We had a more diversified banking sector...." As a result, Sum said, incomes were more evenly distributed.
[That's the key to solid growth vs. blowing bubbles. The more concentration of wealth, the less circulation. The more even distribution, the more circulation, and the bigger and more diversified the markets. And the more diversified the employment base and the markets, the more stable the economy - all things that Timesizing provides.]
The trends in Massachusetts were repeated throughout News England, Northeastern said. Only Maine has a higher median income today than it did a decade ago.
[But as we see from today's (12/09/99) JailView story, that may just be because they're adjusting their jail population upward instead of their workweek downward.]
12/08/99 5 hurt in Dutch school shooting - Gunman, 17, surrenders in country's first such attack, by Anthony Deutsch, AP via Boston Globe, A14.
VEGHEL, Netherlands - A teenage student apparently bent on revenge opened fire inside a high school...yesterday, wounding a teacher and four students in the first school shooting in Dutch history.
In a drama now chillingly familiar in the United States buy unprecedented in this country known for its strict gun-control laws, the 17-year-old suspect fired more than 10 shots inside the regional vocational school in Veghel, about 60 miles north of Amsterdam. He then surrendered to police.... The suspect was upset over a relationship involving his sister and another student and may have been intent on avenging her honor.... The school janitor...said..."He definitely knew who he was going after. He was chasing him." The suspect's target escaped unharmed....
[And the Dutch are pretty liberal with benefits for part-timers too, so there are more part-timers and there are more parents with more time for their children. So what gives??? Here's an answer we received 4 years later (2/04/2004 10:31:02 AM EST) from Martin Spoek of the Netherlands -]
The boy who shot was of non-dutch decent (Turkish), incited by his father to do so. Cultural differences (Muslim vs West- European) and their ignorance of female liberties is the background of this non-Dutch event. By the way Veghel lies not 40 km north but 110 km south of Amsterdam.
12/07 2 clunkers -
[Another reason why we need a much better wealth centrifuge -]
- [All not "OK in OK."]
Boy shoots 5 schoolmates in Oklahoma - Another shooting, this one not fatal. And the questions again resound. - Shouts of 'I'm crazy' are heard amid more than a dozen shots, by Jim Yardley, NYT, A15.
A seventh-grade boy...opened fire [yesterday morning] in this small east Oklahoma town...firing a 9-millimeter semiautomatic handgun into clusters of students who were waiting outside for the morning bell
to signal the start of classes at Fort Gibson Middle School....
[Kinda makes you wonder what it's going to take to get Americans to wake the h*ll up, kick the gun lobby to k*ngd*m c*m*, and demand a workweek that goes down as work-saving technology goes up (instead of vice versa), giving them more and more time to spend with their kids, not less and less.]
- Panel advises adding to life expectancies - Says Social Security is underestimating, by Robert Pear, NYT, A17.
[Could this be the root of all the doubletalk about Social Security heading for bankruptcy and yet having a "surplus"?!]
12/04 Bank magnate killed in fire laid to intruders in Monaco, by Suzanne Daley, NYT, front page.
Banking magnate dies in fire set by assailants at his Riviera retreat - Attack on Edmond Safra stuns Monte Carlo rich, by Ian Phillips, AP via Boston Globe, A2.
MONTE CARLO [~NYT:] - ...A multibillionaire who built a banking empire that specialized in catering to the rich [died of smoke inhalation ~BG:] when two knife-wielding hooded intruders burst into his [two-story] Riviera penthouse and then set the place on fire after Safra sought refuge in a locked bathroom.... His slaying shocked the banking world and sent shudders through this quiet principality...used as a tax haven by the very rich..\..where royalty, the wealthy, and high-rolling gamblers rub shoulders. [~NYT:] The intruders...escaped.... A [male] nurse, who called police, received two minor knife wounds in his leg and stomach during a scuffle with the intruders.... Officials also reported that the sophisticated security system in Mr. Safra's building sent an alert to the local police about 5:30 am. The banker's bodyguard, who was apparently scheduled to be in the apartment, was being questioned by the police...about his absence at the time of the attack.... [~BG:] "We know nothing...of how the attackers got in and out" of the heavily protected apartment, [the chief prosecutor of Monaco] said. Pieces of burnt wood and twisted metal littered the sidewalk in front of the building....
...[~NYT:] The shock over [Safra's] death was magnified by the timing: just a few weeks ago, Mr. Safra...had [sold] his businesses for $9.9b to HSBC Holdings, the largest bank in Britain.... [~BG:] Said Alexandre Gauci, a doorman at Prince Rainier's private club near the port, as women in fur coats and men in tuxedoes filed in, "This is unheard of in Monaco. There are private cameras filming everything and there is no crime"..\.. Forbes Magazine this year listed Safra as one of the world's wealthiest people - No. 199. He was believed to control more than $2.5 billion....
["What shall it profit a man if he shall gain the whole world and lose his own soul?" (Mark 8:36) - This sounds like a case for Hercule Poirot. So far No. 1 (Bill Gates) has only gotten two Belgian creme pies in the face. But this incident suggests we should get a lot more energetic about implementing a systemic wealth-spreading mechanism, like Timesizing. Extreme wealth can be as dangerous to possess as firearms, and it's something that should be getting plowed back at the grassroots in wages and benefits to dynamize consumer markets and solidify the stock bubble.
[The REST of the story - It wasn't the butler, but it was an inside job. The 12/07/99 NYT frontpage headline tells all, [Male] Nurse is said to admit arson that killed banker in Monaco. Apparently he was envious of the attention other nurses were getting. He faked the masked-intruders story and cut himself a couple of times to make it look true. "Uneasy rests the head that - hasn't figured out how to share all this extra dough."]
12/03 $5.789 trillion debt - The nation's corporations are borrowing at an accelerating pace to finance mergers and investments, pointer headline, Boston Globe, front page.
[Isn't this even bigger than the national debt? Déjà vu the 1920s. Borrowing to play the stock market, that's all it is. Risking borrowed money. And when the mergers don't pan out, the whole house of cards falls down. And they aren't panning out. Check our story below. Plus colleague Kate says corporate debt is worse than consumer or government debt because it worries stock players more (like stock inflation, they think big consumer & gov't debt is just dandy) and can more easily trigger The Big Sell-Off.]
12/01/99 Study says mergers often don't aid investors, Reuters via NYT, C9.
LONDON - Mergers in the corporate world are failing to deliver rewards for the shareholders who are supposed to be the key beneficiaries, the accounting and consulting firm KPMG said in a research paper published on Monday.... "The analysis shows that 83% of mergers failed to produce any benefits for shareholders and, even more alarming, over half actually destroyed value," the report said.
Researchers surveyed more than 100 senior corporate directors worldwide who were involved in the 700 largest cross-border deals between 1996 and 1998. Many of the respondents wrongly assumed a deal had enhanced value and fewer than half had conducted a formal post-deal review to test their assumptions..\.. The tendency to forget people and cultural differences is a major cause of setbacks after companies are combined, [the report] said. Yet boardroom confidence in mergers and acquisitions as recipe for growth has never been higher, with annual global value for such transactions estimated at $2.2 trillion....
[We TOOOOOLD you so. Our top executives, as a group, are seriously ill - they are almost universally infected with several totally unsupported idea viruses - that you can merge (& cut diversity & staff) to grow??? - that free trade automatically protects and raises environmental and quality-of-life standards??? - that technology creates more jobs than it cuts??? - that the entire business community can "gain efficiency" by cutting the workforce without cutting its markets??? - These ideas are just as destructive, in this case self-destructive, as the pandemics listed in our story on World AIDS Day today ( 12/01).]
For earlier collapse stories, click on the desired date -Nov/99.
Aug/98 and before.
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