Category Archives: Jobs
William Cohen: When Romney ran Bain Capital, his word was not his bond
Fortune Magazine’s William Cohen is someone that this editor has always respected. He is all about the free market tempered with personal restraint and personal responsibility, which is one of the themes of this very web site.
Read this carefully….
William D. Cohan in the Washington Post:
Yet, there is another version of the Bain way that I experienced personally during my 17 years as a deal-adviser on Wall Street: Seemingly alone among private-equity firms, Romney’s Bain Capital was a master at bait-and-switching Wall Street bankers to get its hands on the companies that provided the raw material for its financial alchemy. Other private-equity firms I worked with extensively over the years — Forstmann Little, KKR, TPG and the Carlyle Group, among them — never dared attempt the audacious strategy that Bain partners employed with great alacrity and little shame. Call it the real Bain way.
Here’s how it worked. Private-equity firms are always eager to find companies to buy, allowing them to invest chunks of the billions of dollars entrusted to them and from which they earn hundreds of millions in fees. One ready source of these businesses is Wall Street bankers hired to sell companies through private auctions. The good news is that when a banker puts together a detailed selling memorandum about a company, chances are very high that company will be sold; the bad news is that these private auctions tend to be very competitive, and the winning bidder, by definition, is most often the one willing to pay the most. By paying the highest price, you win the company, but you also may reduce the returns you can generate for your investors.
By bidding high early, Bain would win a coveted spot in the later rounds of the auction, when greater information about the company for sale is shared and the number of competitors is reduced. (A banker and his client generally allow only the potential buyers with the highest bids into the later rounds; after all, you can’t have an endless procession of Savile Row-suited businessmen traipsing through a manufacturing plant if you want to keep a possible sale under wraps.)
For buyers, the goal in these auctions is to be one of the few selected to inspect the company’s facilities and books on-site, in order to make a final and supposedly binding bid. Generally, the prospective buyer with the highest bid after the on-site due-diligence visit is selected by the client — in consultation with his or her banker — to negotiate a final agreement to buy the company.
This is the moment when Bain Capital would become especially crafty. In my experience — which I heard echoed often by my colleagues around Wall Street — Bain would seek to be the highest bidder at the end of the formal process in order to be the firm selected to negotiate alone with the seller, putting itself in the exclusive, competition-free zone. Then, when all other competitors had been essentially vanquished and the purchase contract was under negotiation, Bain would suddenly begin finding all sorts of warts, bruises and faults with the company being sold. Soon enough, that near-final Bain bid — the one that got the firm into its exclusive negotiating position — would begin to fall, often significantly.
Of course, some haggling over price is typical in any sale, and not everything represented by sellers and their bankers is found to be accurate under close examination. But Bain Capital took the art of negotiation over price into the scientific realm. Once the competitive dynamics had shifted definitively in its favor, the firm’s genuine views about what it was willing to pay — often far lower than first indicated — would be revealed.
[This is what we call negotiating in bad faith. It is wrong and in other contexts (such as insurance for example) would be illegal – Editor]
At such a late date, of course, the seller is more than a little pregnant with the buyer. Attempting to pivot and find a new buyer — which knew it had not been selected in the first place, but was now being called back — would be devastating to the carefully constructed process designed to generate the highest price. Once Bain’s real thoughts about the price were revealed, the seller either had to suck it up and accept the lower price, or negotiate with a new buyer, but with far less leverage.
Needless to say, this does not make for a very happy client (or a happy banker). By the end of my days on Wall Street in 2004, I found the real Bain way so counterproductive that I no longer included Bain Capital on my buyer’s lists of private-equity firms for a company I was selling.
The real Bain way may be nothing more than a clever tactic to eliminate competition from a heated auction in order to buy a business at an attractive price. After all, Bain Capital is seeking the highest returns for its investors. But Bain’s behavior also reveals something about the values it brings to bear in a process that requires honor and character to work properly. If a firm’s word is not worth the paper it is printed on, then its reputation for bad behavior will impair its ability to function in an honorable and productive way.
Glenn Beck Dismantles Ron Paul
See the video HERE.
Obama Administration Approving Only 35 Percent of Gulf Drilling Plans
A new report from a New Orleans-based group reveals that the Obama administration is approving just 35 percent of the oil drilling plans for the Gulf of Mexico so far this year. It is also taking an average of 115 days — nearly four months — to secure approval from the Bureau of Ocean Energy Management, Regulation and Enforcement.
Those numbers contrast sharply from previous years. This historical average is a 73.4% approval rate. The approval time has nearly doubled; the historical average is 61 days for the government to approve plans.
For plans that require drilling activity, the numbers are even worse. New regulations require all deepwater drilling plans to undergo an environmental assessment process. Those plans have an average approval time of 222 days or more than seven months.
The data were included in the latest release of the Gulf Permit Index from Greater New Orleans Inc. It has monitored this trend since last year’s oil spill in the Gulf of Mexico. The delays have continued for more than 18 months later.
Read more HERE.
Rick Santelli: The Government Manipulates Unemployment Numbers
Obama: I will ensure the free flow of oil…..
Contractors: Obama Administration Pressed to ‘Soften’ Job-Loss Estimates From Mining Rule
More lies and more concentrated efforts by this administration to kill jobs and how many times has the administration used this tactic to try and silence contractors, insurance companies and corporations?
The Obama administration pressured analysts to change an environmental review to reflect fewer job losses from a proposed regulation, the contractors who worked on the review testified Friday.
The dispute revolves around proposed changes to a rule regulating coal mining near streams and other waterways. The experts contracted to analyze the impact of the rule initially found that it would cost 7,000 coal jobs.
But the contractors claim they were subsequently pressured to not only keep the findings under wraps but “revisit” the study in order to show less of an impact on jobs.
Steve Gardner, president of Kentucky consulting firm ECSI, claimed that after the project team refused to “soften” the numbers, the firms working on the study were told the contract would not be renewed. ECSI was a subcontractor on the project.
The government “‘suggested’ that the … members revisit the production impacts and associated job loss numbers, with different assumptions that obviously would then lead to a lesser impact,” Gardner testified before a House Natural Resources subcommittee. “The … team unanimously refused to use a ‘fabricated’ baseline scenario to soften the production loss numbers.”
The CBO Downgrades Obama’s $825 Bil Stimulus Bill
Just when you thought it couldn’t get much worse. Remember what Newt Gingrich and Amity Schleas said about the CBO.
Recovery: After nearly all the stimulus money has been spent, the Congressional Budget Office now admits it cost more than advertised, did less to boost growth and will hurt the economy in the long run.
In its latest quarterly report on the economic effects of the Obama stimulus, the CBO sharply lowered its “worst case” scenario while trimming many of its upper-bound estimates for stimulus-fueled growth and employment.
The new report finds, for example, that the stimulus may have added as little as 0.7% to GDP growth in 2010 — when spending was at its peak — and created as few as 700,000 new jobs.
Both are down significantly from the CBO’s previous worst-case scenario.
The report also lowered the best-case estimate for added growth in 2010 to 4.1% from 4.2%.
In addition, the CBO says the extra infrastructure money didn’t boost growth as much as it previously claimed, because states reacted by spending less out of their own budgets on highways.
So in other words, the CBO now says it’s possible that the stimulus had virtually no meaningful effect on growth and employment despite its massive price tag.
All this comes after the CBO increased that price tag to $825 billion from its initial $787 billion — a 5% hike.
Adding insult to injury, the new report also says the stimulus will hurt economic growth in the long run because of “the resulting increase in government debt.” Each dollar of additional debt, it reports, “crowds out about a third of a dollar’s worth of private domestic capital.”
In our view, even the CBO’s downgraded estimates are too high, because they’re still based entirely on Keynesian economic models that simply assume extra government spending results in added economic growth.
You don’t have to look very hard to see this isn’t what happened.
While Obama promised the massive stimulus would “ignite spending by businesses and consumers,” unleash “a new wave of innovation, activity and construction,” and keep unemployment under 8%, what we actually got was the worst recovery since the Great Depression.
[All emphasis ours – Political Arena Editor]
Of course we cannot forget how the government likes to define “Jobs”. It can include one day jobs and short term temps as jobs created as well. Littering can creates a “job” because someone has to pick it up.
Obama Talking Point on Energy Policy Debunked.
This is a talking point we are going to see a great deal of in coming months. It is a slick talking point with high propaganda value because it utilizes the careful omission of key facts to paint a false picture. Ed has a lefty blog and over the years has attempted to spar with me a few times, but the outcome was always the same.
Ed Darrell (edarrell@sbcglobal.net) writes my old college blog:
But here in December 2011, we find that drill rig counts are through the roof — about double the equal period of the Bush 8 years, and equal to the total Bush 8 years — domestic oil production has increased each of the three years of the Obama administration, in stark contrast to the previous 7 straight years of decline, and in February 2011 the U.S. became an oil exporting nation again.
Gas didn’t hit $4 a gallon, and is declining now.
Would you like to join the Obama campaign?
Political Arena Editor Chuck Norton responds:
No we would not like to join, because we do not join liars. Domestic production in total is up because of permits approved under the Bush Administration. As Democrats always say, we should not drill for new oil because it takes five to ten years to get oil production going once it is approved.
Obama’s illegal offshore drilling ban has Gulf Oil production down by over 13%. He stopped the Canada pipeline project. He used a loophole in the EPA regs to shut down an oil field in Alaska causing Shell Oil to lose $5 billion. Obama is also yanking coal permits arbitrarily and is pushing to have power plants and refineries closed with regulatory catch 22’s.
Obama is also using some lizard as an excuse to shut down new oil finds in Texas.
Nice try Ed, but as usual, I am more informed and just plain more honest than you.
Recent college grads sour on Obama, surveys say
School indoctrination doesn’t have much staying power when students graduate and are faced with reality.
A very large proportion of recent university graduates have soured on President Barack Obama, and many will vote GOP or stay at home in the 2012 election, according to two new surveys of younger voters.
“These rock-solid Obama constituents are free-agents,” said Kellyanne Conway, president of The Polling Company, based in Washington, D.C. She recently completed a large survey of college grads, and “they’re shopping around, considering their options, [and] a fair number will stay at home and sit it out,” she said.
The scope of this disengagement from Obama is suggested by an informal survey of 500 post-grads by Joe Maddalone, founder of Maddalone Global Strategies. Of his sample, 93 percent are aged between 22 and 28, 67 percent are male and 83 percent voted for Obama in 2008. But only 27 percent are committed to voting for Obama again, and 80 percent said they would consider voting for a Republican, said New York-based Maddalone.
That’s a drop of almost 60 points in support for Obama among this influential class of younger post-grad voters, who Maddalone recruited at conferences held at New York University and Thomson-Reuters’ New York headquarters.
The bad news for Obama was underlined May 19 with a report by a job-firm Adecco that roughly 60 percent of recent college-grads have not been able to find a full-time job in their preferred area. One-in-five graduates have taken jobs far from their training, one-in-six are dependent on their parents, and one-in-four say they’re in debt, according to the firm’s data.
Overall, roughly one-third of young voters have some college education, and one-half have college degrees, said Conway. Many are underemployed or unemployed, they’re worried about their debts and economic trends, and they’re worried about the value of their educations, she said. In 2012, she said, “I suspect a fair number will return to Obama, but maybe not enough, and not in the [swing] states where he needs them,” she said.
Those states include Michigan, Nevada, New Mexico, New Hampshire, Indiana, Virginia and Iowa, she said. All were won by Obama in 2008, and all were lost in state-wide elections to GOP candidates in 2010, she said.
The GOP is making some progress towards earning their votes, Maddalone said. For example, 38 percent of his respondents said the GOP is “doing a good job addressing and engaging with young professionals,” and 58 percent said they would consider voting for the GOP “if you felt that Republicans were doing a good job addressing and engaging with young professionals.”
Professor Gary Wolfram: ‘Occupy’ College Students Blind to Benefits of Capitalism
By Gary Wolfram William Simon Professor of Economics and Public Policy at Hillsdale College
Whenever I watch media coverage of another Occupy Wall Street event I am reminded of an exchange between Jewish protesters in the 1979 Monte Python movie Life of Brian. One of the protesters asks another what the Romans have brought to the area and the conversation goes like this:
Question: All right, but apart from the sanitation, medicine, education, wine, public order, irrigation, roads, the fresh water system and public health, what have the Romans ever done for us? Answer: Brought peace? Response: Oh, peace – shut up!
The point is that the Roman institutions brought a good deal to the area that was being overlooked by the protesters. The Wall Street protesters, in their hatred of capitalism, overlook things including the fact that over the last 100 years capitalism has reduced poverty more and increased life expectancy more than in the 100,000 years prior.
Every semester I ask my students: “What would you rather be? King of England in 1263 or you?” Turns out, students would rather be themselves. They enjoy using their iPhone, indoor plumbing, central heating, refrigerators and electric lighting. All of these things are available to the average person in America today and none of them were available to the aristocracy when the West operated under the feudal system.
How is it that for thousands of years mankind made very little progress in increasing the standard of living and yet today half of the goods and services you use in the next week did not exist when I was born? It wasn’t that there was some change in the DNA such that we got smarter. The Greeks knew how to make a steam engine 3,000 years ago and never made one. The difference is in how we organize our economic system. The advent of market capitalism in the mid 18th century made all of the difference.
We need not just rely on historical data. Look at cross-section evidence. I try another experiment with my students. I tell them they are about to be born and they can choose whatever country in the world they would like to be born in. The only caveat is they will be the poorest person in that country. Every student picks a country that is primarily organized in a market capitalist system. No one picks a centrally planned state. No one says, “I want to be the poorest person in North Korea, Cuba, or Zimbabwe,” countries which are at the bottom of the Heritage Foundation’s Index of Economic Freedom.
What does it mean to be poor in our capitalist society that the Occupy Wall Street crowd so hates? Robert Rector of the Heritage Foundation has several studies of those classified as poor by the U.S. Census Bureau. He found that 80 percent of poor persons in the United States in 2010 had air conditioning, nearly three quarters of them had a car or truck, nearly two-thirds had satellite or cable television, half had a personal computer and more than two-thirds had at least two rooms per person.
Contrast this with what it means to be poor in Mumbai, India, a country that is moving rapidly towards market capitalism but was burdened for decades with a socialist system. A recent story in The Economist described Dharavi, a slum in Mumbai, where for many families half of the family members must sleep on their sides in order for the entire family to squeeze into its living space.
The Occupy Wall Street movement has shown a lack of understanding of how the market capitalist system works. They appear to think that the cell phones they use, food they eat, hotels they stay in, cars they drive, gasoline that powers the cars they drive and all the myriad goods and services they consume every day would be there under a different system, perhaps in more abundance.
But there is no evidence this could be or ever has been the case. The reason is that only market capitalism solves the two major problems that face any economy-how to provide an incentive to innovate and how to solve the problem of decentralized information. The reason there is so much innovation in a market system compared to socialism or other forms of central planning is that profit provides the incentive for innovators to take the risk needed to come up with new products.
My mother never once complained that we did not have access to the latest Soviet washing machine. We never desired a new Soviet car. The socialist system relies on what Adam Smith referred to as the benevolent butcher and while there will undoubtedly be benevolent butchers out there, clearly a system that provides monetary rewards for innovators is much more dynamic and successful. The profit that the Occupy Wall Street protesters decry is the reason the world has access to clean water and anti-viral drugs.
The other major problem that must be solved by any economic system is how to deal with the fact that information is so decentralized. There is no way for a central planner to know how many hot dogs 300 million Americans are going to want at every moment in time. A central planner cannot know the relative value of resources in the production of various goods and services. Market capitalism solves that problem through the price system. If there are too few hot dogs, the price of hot dogs will rise and more hot dogs will be produced. If too many hot dogs are produced, the price of hot dogs will fall and fewer will be produced.
Market capitalism is the key to the wealth of the masses. As Ludwig von Mises wrote in his 1920 book, Socialism, only market capitalism can make the poor wealthy. Nobel Laureate Friedrich Hayek in his famous 1945 paper, The Use of Knowledge in Society, showed that only the price system in capitalism can create the spontaneous order that ensures that goods will be allocated in a way that ensures consumers determine the use of resources. The Occupy Wall Street movement would make best use of its time and energy in protesting the encroachment of the centrally planned state that led to the disaster of the Soviet Union, fascist Germany, and dictatorial North Korea.
How is that “Change” workin’ out for you?
Connecticut: Five Years in Jail for Teeth Whitening
Why? Because the State Dental Association used it’s political muscle to get a law passed to criminalize the competition. This is what government does when it gets too powerful and the money gets too fast and loose. So the Institute for Justice is suing in federal court. They made this video to mock the state for this boneheaded maneuver:
Lisa Martinez was forced to shut down her businesses or face five years in prison. Her crime? Teeth whitening.
In 2008, Lisa opened Connecticut White Smile in the Crystal Mall in Waterford, Conn., where she sold an over-the-counter whitening product and provided a clean, comfortable place for customers to apply the product to their own teeth, just as they would at home.
As it turns out, teeth-whitening services are popular and increasingly available at spas, salons and shopping malls all across the country. People are so eager to use these services because they provide great results at a fraction of the cost that dentists charge.
As Lisa puts it:
My customers loved my convenient location and affordable prices. Owning my own business gave me a flexible schedule that allowed me to spend more time with my family.
Unfortunately, as happens all too often, happy customers + happy entrepreneurs = unhappy special interests.
In June, the Connecticut Dental Commission decided to clamp down on teeth whitening. The commission ruled that offering teeth-whitening services is a crime punishable by up to five years in prison or $25,000 in civil penalties for anyone but a licensed dentist.
The ruling even applies to businesses like Lisa’s Connecticut Smile White, where customers apply the product to their own teeth. Some people may be wondering: What’s the difference between whitening my teeth at home with a product I buy online and whitening my teeth at a shopping mall or salon with an identical product? Remarkably, in Connecticut the difference is that the shopping mall and salon entrepreneurs can be thrown in prison for five years.
Thankfully, economic-liberty expert Paul Sherman of the Institute for Justice has teamed up with Lisa and other Connecticut entrepreneurs to change that. This week IJ filed a federal lawsuit to end Connecticut’s government-enforced teeth-whitening cartel. Paul explains:
The Dental Commission’s new teeth-whitening law has nothing to do with public health or safety and everything to do with protecting licensed dentists from honest competition. Rather than trying to compete by lowering prices or improving their services, the dental cartel is using government power to put their competition out of business. That’s unconstitutional. And that’s why we’re taking the dental cartel to federal court.
Allen West to Elite Media: Stop being afraid of President Obama
18 Iconic Products That America Doesn’t Make Anymore
Rawlings baseballs
Last production date: 1969
Rawlings is the official supplier of baseballs to Major League Baseball. The St. Louis shop was founded in 1887 by George and Alfred Rawlings. In 1969 the brothers moved the baseball-manufacturing plant from Puerto Rico to Haiti and then later to Costa Rica.
Etch a Sketch
Last production date: 2000
Etch A Sketch, an iconic American toy since the 1960s, used to be produced in Bryan, Ohio, a small town of 8,000. Then in Dec. 2000, toymaker Ohio Art decided to move production to Shenzhen, China.
Converse shoes
Last production date: 2001
Marquis M. Converse opened Converse Rubber Show Company in Massachusetts in 1908. Chuck Taylors– named after All American high school basketball player Chuck Taylor– began selling in 1918 as the show eventually produced an industry record of over 550 million pairs by 1997. But in 2001 sales were on the decline and the U.S. factory closed. Now Chuck Taylors are made in Indonesia.
Stainless steel rebar
Last production date: circa 2001
Many forms of this basic steel product are not available domestically. Multiple waivers to the Buy America Act have allowed purchase of rebar internationally.
Note: The Buy America Act requires government mass transportation spending to use American products.
Dress shirts*
Last production date: Oct. 2002
The last major shirt factory in America closed in October 2002, according to NYT. C.F. Hathaway’s Maine factory had been producing shirts since 1837.
*We know there are other shirt manufacturers in America. They do not produce in large quantities or supply major brands.
Mattel toys
Last production date: 2002
The largest toy company in the world closed their last American factory in 2002. Mattel, headquartered in California, produces 65 percent of their products in China as of August 2007.
Minivans
Last production date: circa 2003
A waiver to the Buy America Act permitted an American producer of wheel-chair accessible minivans to purchase Canadian chassis for use in government contracts, because no chassis were available from the United States. The waiver specified: “General Motors and Chrysler minivan chassis, including those used on the Chevrolet Uplander, Pontiac Montana, Buick Terraza, Saturn Relay, Chrysler Town & Country, and Dodge Grand Caravan, are no longer manufactured in the United States.”
Note: The Buy America Act requires government mass transportation spending to use American products.
Vending machines
Last production date: circa 2003
You know that thing you put bills into on a vending machine? It isn’t made in America, according to a waiver to the Buy America Act.
Neither is the coin dispenser, according to this federal waiver.
Note: The Buy America Act requires government mass transportation spending to use American products.
Levi jeans
Last production date: Dec. 2003
Levi Strauss & Co. shut down all its American operations and outsourced production to Latin America and Asia in Dec. 2003. The company’s denim products have been an iconic American product for 150 years.
Radio Flyer’s Red Wagon
Last production date: March 2004
The little red wagon has been an iconic image of America for years. But once Radio Flyer decided its Chicago plant was too expensive, it began producing most products, including the red wagon, in China.
Televisions
Last production date: Oct. 2004
Five Rivers Electronic Innovations was the last American owned TV color maker in the US. The Tennessee company used LCoS (liquid crystal on silicon) technology to produce televisions for Philips Electronics. But after Philips decided to stop selling TVs with LCoS, Five Rivers eventually filed for Chapter 11 bankruptcy protection in Oct. 2004. As part of its reorganization plan, the company stopped manufacturing TVs.
Now there are ZERO televisions made in America, according to Business Week.
Cell phones
Last production date: circa 2007
Of the 1.2 billion cell phones sold worldwide in 2008, NOT ONE was made in America, according to Manufacturing & Technology publisher Richard McCormick.
After studying the websites of cell phone companies, we could not identify a single phone that was not manufactured primarily overseas.
Railroads (parts including manganese turnout castings, U69 guard bars, LV braces and weld kits)
Last production date: circa 2008
Here’s another standout from dozens of waivers to the Buy America Act: railroad turnouts and weld kits.
Manganese turnout castings are used to widen railroad tracks, and they were used to build our once-great railroad system. U69 guard bars, LV braces and Weld Kits, along with 22 mm Industrial steel chain are basic items that were certifiably not available in the US.
Note: The Buy America Act requires government mass transportation spending to use American products.
Dell computers
Last production date: Jan. 2010
In January 2010, Dell closed its North Carolina PC factory, its last large U.S. plant. Analysts said Dell would be outsourcing work to Asian manufacturers in an attempt to catch up with the rest of the industry, said analyst Ashok Kumar.
Canned sardines
Last production date: April 2010
Stinson Seafood plant, the last sardine cannery in Maine and the U.S., shut down in April. The first U.S. sardine cannery opened in Maine in 1875, but since the demand for the small, oily fish declined, more canneries closed shop.
Pontiac cars
Last production date: May 2010
The last Pontiac was produced last May. The brand was formally killed on Halloween, as GM contracts Pontiac dealerships expired.
The 84-year-old GM brand was famous for muscle cars.
Forks, spoons, and knives
Last production date: June 2010
The last flatware factory in the US closed last summer. Sherrill Manufacturing bought Oneida Ltd. in 2005, but shut down its fork & knife operations due to the tough economy. CEO Greg Owens says his company may resume production “when the general economic climate improves and as Sherrill Manufacturing is able to put itself back on its feet and recapitalize and regroup.”
Incandescent light bulb
Last production date: Sept. 2010
The incandescent light bulb (invented by Thomas Edison) has been phased out.
Our last major factory that made incandescent light bulbs closed in September 2010. In 2007, Congress passed a measure that will ban incandescents by 2014, prompting GE to close its domestic factory.
Note: A reader pointed out that the Osram/Sylvania Plant in St. Mary’s, Penn. is still producing light bulbs to fill old and international contracts. However, the plant has announced plans to wind down incandescent production.
British Report: Green sector costs more jobs than it creates
With Solyndra and half a dozen other solar panel boondoggles which seemed only to go into business to launder government money from the American people, to the business and pay off cronies who gave big donations to Obama before shutting down, to the money we are paying for electric cars made in Finland, to the battery plant that is about to shut down in Greenfield, Indiana, to the failure of the government subsidized Chevy Volt; this is a lesson that America is learning the hard way. Except the British learned this lesson last February.
Via the BBC:
A study by consultants Verso Economics found there was a negative impact from the policy to promote the industry.
It said 3.7 jobs were lost for every one created in the UK as a whole and that political leaders needed to engage in “honest debate” about the issue.
The Scottish government called the study “misleading” and said 60,000 jobs could be created by the sector by 2020.
The report, called Worth the Candle? The economic impact of renewable energy policy in Scotland and the UK, said the industry in Scotland benefited from an annual transfer of about £330m from taxpayers and consumers elsewhere in the UK.
It said politicians needed to recognise the economic and environmental costs of support for the sector and focus more on the scientific and technical issues that arose.
Richard Marsh, research director of Verso Economics and co-author of the report, said: “There’s a big emphasis in Scotland on the economic opportunity of investing in renewable energy.
“Whatever the environmental merits, we have shown that the case for green jobs just doesn’t stack up.”
Co-author Tom Miers added: “The Scottish renewables sector is very reliant on subsidies from the rest of the UK.
“Without this UK-wide framework, it would be very difficult to sustain the main policy tools used to promote this industry.”
A spokesman for the Scottish government said other studies had shown Scotland’s natural resources and low carbon opportunities could bring “significant” economic benefits.
Oh we have seen the benefits havent we, namely in inflation, souring energy costs and hundreds of thousands of coal, natural gas, and oil workers put on unemployment by this administrations illegal drilling bans and revocation of environmental permits without cause.
48 Out of 50 States Have Lost Jobs since Democrats’ Stimulus Law. Washington DC Gained Jobs.
And these numbers were taken from last December so it is even worse now. We have been losing about 400,000 jobs a week since that time based on new unemployment claims (in fairness this number does not include jobs created which helps to mitigate this number, but with wages going down and inflation goes up, lots of thes enew jobs are part time and/or are people just taking anything out of desperation).
While Democrats promised stimulus would create 3.7 million jobs, the reality is far different. To date, 48 out of 50 states have lost jobs, while the unemployment rate has remained at or above 9.5% for 15 consecutive months. As the nation nears the end of 2010 — when final statistics will be available to compare actual outcomes with the Administration’s pre-stimulus projections — Washington, D.C. remains the only place in America where those job-creation projections actually have been met. Meanwhile, the rest of the nation is left asking “Where are the jobs?”
| State | Administration Projection of Change in Jobs Through December 2010 | Actual Change in Jobs Through October 2010 |
| Alabama | +52,000 | -43,500 |
| Alaska | +8,000 | -1,200 |
| Arizona | +70,000 | -73,800 |
| Arkansas | +31,000 | -5,100 |
| California | +396,000 | -543,400 |
| Colorado | +59,000 | -83,200 |
| Connecticut | +41,000 | -39,200 |
| Delaware | +11,000 | -10,300 |
| District of Columbia | +12,000 | +21,100 |
| Florida | +206,000 | -169,200 |
| Georgia | +106,000 | -126,200 |
| Hawaii | +15,000 | -8,900 |
| Idaho | +17,000 | -16,100 |
| Illinois | +148,000 | -160,900 |
| Indiana | +75,000 | -40,200 |
| Iowa | +37,000 | -20,200 |
| Kansas | +33,000 | -32,800 |
| Kentucky | +48,000 | -7,700 |
| Louisiana | +50,000 | -15,600 |
| Maine | +15,000 | -9,900 |
| Maryland | +66,000 | -13,900 |
| Massachusetts | +79,000 | -33,500 |
| Michigan | +109,000 | -105,900 |
| Minnesota | +66,000 | -24,700 |
| Mississippi | +30,000 | -23,900 |
| Missouri | +69,000 | -66,500 |
| Montana | +11,000 | -8,600 |
| Nebraska | +23,000 | -11,400 |
| Nevada | +34,000 | -79,000 |
| New Hampshire | +16,000 | +5,200 |
| New Jersey | +100,000 | -104,600 |
| New Mexico | +22,000 | -13,300 |
| New York | +215,000 | -127,700 |
| North Carolina | +105,000 | -81,900 |
| North Dakota | +8,000 | +6,600 |
| Ohio | +133,000 | -157,500 |
| Oklahoma | +40,000 | -24,400 |
| Oregon | +44,000 | -41,300 |
| Pennsylvania | +143,000 | -71,900 |
| Rhode Island | +12,000 | -15,600 |
| South Carolina | +50,000 | -22,900 |
| South Dakota | +10,000 | -2,500 |
| Tennessee | +70,000 | -53,700 |
| Texas | +269,000 | -54,100 |
| Utah | +32,000 | -15,000 |
| Vermont | +8,000 | -5,200 |
| Virginia | +93,000 | -44,500 |
| Washington | +75,000 | -70,900 |
| West Virginia | +20,000 | -10,600 |
| Wisconsin | +70,000 | -69,100 |
| Wyoming | +8,000 | -7,800 |
Source: Administration February 13, 2009 projection and actual U.S. Department of Labor data.
API: Recent Studies Show Obama Drilling Moratorium Will Cost 50,000 Jobs; 160,000 by 2032
While Obama tried to stop offshore drilling and exploration here and while his administration puts more of our domestic resources off-limits, the White House is using taxpayer dollars to aid Petro-Brazil’s offshore drilling efforts in waters deeper than the United States. George Soros is an investor in PetroBraz and this falls in line with the view of the academic left, that the wealth of the united states should be redistributed to the rest of the world. One way to do that is to send our jobs overseas and to have us send our money abroad for energy.
“As our country looks for ways out of the hole of lackluster economic growth and job creation, today’s decision shows that this administration would rather keep digging than take the ladder to increased economic prosperity offered by developing our nation’s domestic energy resources. “The oil and natural gas industry is a reliable vehicle for growing the economy and creating good-paying jobs.
This decision shuts the door on new development off our nation’s coasts and effectively ensures that new American jobs will not be realized. It will stifle investment, deny billions in revenue for critical government services and increase our dependence on foreign energy sources.
“The oil and natural gas industry is committed to safe and environmentally responsible operations, and both the industry and regulators have added new safeguards to ensure such operations. This reversal on new lease sales off America’s coasts comes on top of a de facto moratorium, which has all but stopped new drilling in the Gulf of Mexico.”
More from Jan Van Ryan:
For months, numerous studies–such as this one from LSU professor Dr. Joseph Mason and another by Moody’s Analytics–have demonstrated the significant economic impact the deepwater drilling moratorium could have on the Gulf and U.S. economies.
A Southern Methodist University (SMU) study released this week is no different, and it presents some alarming figures on the impact the de facto moratorium is having on shallow-water drilling.
According to Dr. Bernard L. Weinstein, associate director of SMU’s Maguire Energy Institute, the Interior Department’s slowdown in issuing new permits for shallow-water drilling operations could mean:
- 50,000 lost jobs;
- Economic losses of $4.3 billion that would occur if 75 percent of the rigs become idle as a result of fewer issued permits; and
- $12.5 billion in lost income nationwide.
As Dr. Weinstein points out, shallow-water drilling is extremely safe. In the last 15 years, the federal government reports that more than 11,000 wells have been drilled and just 15 barrels of oil have spilled as a result of a loss of well control:
“Shallow-water drillers work in less than 500 feet of water, mainly extracting natural gas. Projects center on well-charted fields of known pressure and geography, using simple and straightforward technology.”
Prior to the moratorium, 10 to 15 permits for new shallow-water wells were approved each month. But since April, only seven permits for new shallow-water wells have been issued, and 15 of 46 shallow-water rigs in the Gulf are idle.
As Jack Gerard mentioned in a blog post last week, a drilling slowdown hurts more than just oil companies. It’s time to put the oil and natural gas industry back to work and produce reliable American energy for Americans
Welfare State: Handouts Make Up One-Third of U.S. Wages
Remember that Clinton/Gingrich Welfare Reform that was so effective at stopping people from gaming the system and helping people get back to work? Did you know it was reversed with the Obama Stimulus Bill?
CNBC:
Government payouts—including Social Security, Medicare and unemployment insurance—make up more than a third of total wages and salaries of the U.S. population, a record figure that will only increase if action isn’t taken before the majority of Baby Boomers enter retirement.
Even as the economy has recovered, social welfare benefits make up 35 percent of wages and salaries this year, up from 21 percent in 2000 and 10 percent in 1960, according to TrimTabs Investment Research using Bureau of Economic Analysis data.
“The U.S. economy has become alarmingly dependent on government stimulus,” said Madeline Schnapp, director of Macroeconomic Research at TrimTabs, in a note to clients. “Consumption supported by wages and salaries is a much stronger foundation for economic growth than consumption based on social welfare benefits.”
“The Forgotten Depression” and How Presidents Coolidge & Harding Turned America Around.
With Glenn Beck, Reagan Budget Advisor Art Laffer, and Chris Edwards from the CATO Institute.
This is very interesting. Why is it that the second biggest domestic economic depression on record is scrubbed from our history books, including many economic texts? What made the Roaring 20’s Roar? And what President’s enacted policy saw an even faster economic turn around than Reagan’s?
UPDATE – HERE
Dick Morris: Welcome to double dip stagflation
Flashback from March 2011
Obama’s EPA: Jobs Don’t Matter
The Obama administration has repeatedly said job creation is a top priority, but apparently the memo seems to have missed the bureaucrats at the Environmental Protection Agency (EPA).
This became evident when EPA Assistant Administrator Mathy Stanislaus testified Thursday before an Environment and Energy subcommittee hearing that his agency does not take jobs into account when it issues new regulations.
“We have not directly taken a look at jobs in the proposal,” Stanislaus said, referring to a regulation that would govern industries that recycle coal ash and other fossil fuel byproducts.
Coal ash is commonly used to make concrete stronger and longer lasting, make wallboard more durable and improve the quality of roofing shingles.
Stanislaus made his comments in response to questioning by Colorado GOP Rep. Cory Gardner looking into whether the EPA is complying with a recent presidential executive order and considering jobs in its regulatory regime. The EPA issued a April 30, 2010 statement in the appendix of its regulatory impact analysis for proposed regulation under the Resources and Recovery Act (RCRA) of coal ash.
That statement said: “The [regulatory impact assessment] does not include either qualitative or quantitative estimation of the potential effects of the proposed rule on economic productivity, economic growth, employment, job creation or international economic competitiveness.”
The statement contradicts Executive Order 13563, which President Obama signed in January requiring rules to take job creation into account when federal agencies issue new rules.
Gardner pressed Stanislaus as to whether or not EPA had done a direct economic analysis on how the rule would affect jobs, to which Stanislaus replied saying that EPA had not included jobs in its cost-benefit analysis of the rule.
“Do you feel an economic analysis that does not include the complete picture on jobs, is that a full economic analysis?” Gardner asked. “I think it is really a yes or no question.
“To me, I don’t see how you can talk about economic analysis without talking about jobs… and you said that you would not promulgate a rule where the costs would exceed the benefits,” Gardner continued. “But if you are not taking into account jobs, I don’t see how that goes.”
Gardner’s line of questioning had Stanislaus visibly dumbfounded, and he repeatedly told the congressman he would have to get back to him with the answers to his questions.
Flashback: Canada Slashes Corporate Tax Rate to 16.5% – US is still 35%
[This is a flashback from December 2010 and Obama is STILL talking about raising taxes on business and so are the Van Jones inspired “occupy” protesters. Remember that “giant sucking sound” that we used to talk about with Mexico?]
Japan is in the process of lowering its corporate tax rate by 5% and just days ago they have proposed to lower it again to 25.5%.
This leaves the United States with the highest corporate tax rate in the world.
Of course the little truth about the corporate tax rate is this, corporations never pay this, you do in the form of higher prices. All expenses of goods and services are passed on to the consumer which is you. Corporate taxes are just a way for government to raise your taxes and hide it in the form of higher prices. Of course some companies cannot raise their prices and stay competitive so they leave the country and go to China, Canada, Ireland, Mexico or Brazil.
President Obama’s own deficit commission said that we need lower rates and a leaner tax code to bring business here and to help spur compliance. Indeed, they said that the tax rates should be made lower so the government could collect more revenue to lower the debt. John Kerry even advocated lowering the corporate tax rate when he ran for president. The high tax rate combined with a 16,000 page tax code allows for government to pick winners and losers which generates corruption and paybacks. This is a no brainer folks, it needs to get done.
Will the Democrats do the right thing and lower the rate to bring jobs here? Or will they insist that the best way to grow the middle class is by waging a war of taxes, regulation, and uncertainty on their employers? And by trashing the currency with policy and monetizing the debt (printing money out of thin air). [See Cloward-Piven Strategy LINK1 and LINK2 – Editor]
[YouTube is nuking conservative vids again – You can see the video HERE]
UPDATE – Steve Forbes on why business is not hiring [YouTube nuked this one as well. You can watch the video HERE] :
Dick Morris Reports: Consumer Confidence Collapses
Consumer confidence has been in the tank since march.
If you want to know what is going on with the economy in recent months, Dick Morris has a very good explanation in this video.
Dick Morris was the political strategist for Bill Clinton for many years.
Speaking of the former President, Bill Clinton seems to have had enough. For a while he was openly criticizing Obama’s mis-steps with the economy, especially the illegal offshore drilling ban, the yanking of coal permits etc.
This may have also been a political shot across the bow. The Obama Administration was jerking Hillary around for months starting with the Egypt/Libya debacle. The State Department thinks it has agreement across the administration on Middle-East policy, makes a cautious yet sensible statement on the position of the United States, and Obama comes out the very next day and contradicts it. This kind of thing happened too often to be an accident and is obviously designed to marginalize her. Niall Ferguson asked if we have two foreign policies and mocked the administration. It shows a great immaturity at the White House. It also confuses and undermines the confidence of our allies.
Being a cabinet Secretary is a brutal job. It is often seven days a week and 13 hours a day. Most Cabinet Secretaries last around 20 months. Obviously there are exceptions but that tells you how brutal the job can be. I have seen recent pictures of Hillary lately and she is not looking well.
I am not saying that Hillary resign because she is doing a bad job, although she is not among the best who had held the position, she should resign because the situation in the administration is intolerable and may be designed to do her political damage.
Workers and companies fleeing high tax, forced union states ran by progressives
Fiscally responsible states usually ran by Republicans and Conservative Democrats gained 10 House seats according to Census data.
People are voting with their feet. Over 150 businesses left California to move to Texas in just the last year. Missouri may now be changing to a “right to work state”. Union over reach and greed has sent jobs overseas. Ford Motor Company has a new high-tech plant that can make five cars on a single line at once. Union rules do not permit the advanced technology Ford needs so they have built these plants in Canada, Mexico and Brazil.
Union over reach in the public sector (government unions) is causing some states to go bankrupt. The states cannot afford the corruption and sweetheart deals that result from abusive public sector unions.
Keep in mind this is census data from late 2010, so one would imagine that the situation is more pronounced today.
[And as is so often the case, when there is a video that is popular with conservative bloggers YouTube makes it go poof. The video can be watched HERE]
Powerful Democrats help Chinese energy firm get $450 million in stimulus money
The Democratic Party has been caught several times taking illegal campaign money from the Chinese ( 1, 2). It seems that money has not gone to waste.
Jackie Walorski warned of this happening. It seems that she was correct.
WASHINGTON — Top Democratic fundraisers and lobbyists with links to the White House are behind a proposed wind farm in Texas that stands to get $450 million in stimulus money, even though a Chinese company would operate the farm and its turbines would be built in China.
The farm’s backers also have close ties with Senate Majority Leader Harry Reid, D-Nev., who, at the height of his hard-fought re-election bid this fall, helped blunt congressional criticism over stimulus dollars possibly going to create jobs in China by endorsing a proposal by the Chinese company to build a factory in his home state. Although his campaign received thousands of dollars in donations from the wind farm’s backers and Reid stood on stage with them at a campaign event they hosted, his office declined to answer any questions about the wind farm’s organizers or their plans for Nevada.
The wind farm, first announced more than a year ago, would consist of 300 2-megawatt wind turbines, each perched atop a 26-story-tall steel tower and spinning three blades — each half the length of a football field. The farm would span three counties and 36,000 acres in West Texas land best known for its oil. Dubbed the Spinning Star wind farm, the project’s 600-megawatt capacity is, theoretically, enough to power 180,000 American homes and would be the sixth-largest wind farm in the country.
It is being planned by an unusual joint partnership between the U.S. Renewable Energy Group, a Dallas investment firm with strong ties to Washington and the Democratic Party, and A-Power Energy Generation Systems, an upstart Chinese supplier of wind turbines. Filings with the Securities and Exchange Commission indicate the Chinese are bringing financing and the turbines.
What the Americans are supplying is the local know-how and political clout in Washington, where decisions on how to distribute billions in loan guarantees, stimulus grants and financial incentives are made.
The clock is ticking for Spinning Star: To claim the stimulus grant it must arrange its financing and begin work on the wind farm by Dec. 31. Besides the $450 million stimulus grant, A-Power’s SEC filings indicate the joint-venture also will pursue a Department of Energy-backed loan guarantee. According to the SEC filings, the project is waiting to hear if it will receive the loan guarantee before financing will follow to build the turbines.
Progressivism Unrestrained: 9 of the top 10 jobless metro areas are in California.
As Governor Rick Perry of Texas has told us, 151 companies left California and moved to Texas in just one year alone.
The recent census data shows us that people are voting with their feet. They are leaving progressive states and moving to “right to work” states.
Via Verum Serum:
Nine of the top 10 metro jobless rates in the nation are California, and seven are in California’s Central Valley:
- El Centro, CA – 29.3% (east of San Diego near border with Mexico)
- Yuma, AZ – 26.7%
- Yuba City, CA – 17.8%
- Merced, CA – 16.3%
- Stockton, CA – 16.3%
- Modesto, CA – 16.2%
- Visalia-Porterville, CA – 15.9%
- Fresno, CA – 15.7%
- Palm Coast, FL – 15.5%
- Hanford – Corcoran, CA – 15.0%
Heritage: Anti-Drilling Policies Costing Federal Government Billions in Lost Revenue
Related:
Obama arbitrarily revoking coal mining permits, putting people out of work, raising energy costs.
Gas prices up 55% under Obama
Press Grilled Bush When Gas Hit $3.00 – Nada for Obama… UPDATED!
API: Recent Studies Show Obama Drilling Moratorium Will Cost 50,000 Jobs; 160,000 by 2032.
CPI: Big Polluters Freed from Environmental Oversight by Stimulus (government picking winners and losers)
Little Truth in President’s Oil Spill Comments
SCANDAL – Administration lies about conclusion by expert panel to ban off shore drilling. “We never said that” expert panelists say. Obama still refusing skimmer ships from foreign countries….
Another Lie: Obama now fully reversed on offshore drilling.
Billions of dollars in potential oil revenue that could help close the federal deficit is being lost as a result of President Obama’s anti-drilling agenda.
Production in the Gulf of Mexico — which normally accounts for about 30 percent of all U.S. production — is expected to drop this year by 220,000 barrels per day, according to projections from the U.S. Energy Information Administration.
With oil currently at $90 a barrel and the royalty rate at 18.75 percent, that equals $3.7 million in lost revenue each day.
If the agency projections hold over the course of the year, the federal government would lose more than $1.35 billion from Gulf royalty payments this year.
The number grows even larger when coupled with a lack of Gulf lease sales and fewer rental payments. Those three components — royalties, leases and rent — make up a sizeable amount of government revenue.
The looming shortfall is raising red flags on Capitol Hill. Sen. David Vitter, R-LA, an outspoken critic of the Obama administration’s drilling moratorium and the subsequent slowdown in permitting, first called attention to it in September.
“It’s not only about job loss along the Gulf Coast — the federal government is losing revenue as a result of the administration’s misguided moratorium,” Vitter explained.
“I’ve been attacking the moratorium from multiple angles and will continue to do so until drilling can fully resume.”Interior Secretary Ken Salazar canceled a Gulf lease sale last October. He postponed another in the central Gulf of Mexico, originally scheduled for March, until 2012. One planned for October 2011 in the western Gulf also could be delayed until 2012. That would make 2011 the first year since 1965 that the federal government has failed to hold a lease sale in the Gulf.
Bonus bids from lease sales averaged about $1 billion in 2009 and 2010, according to data from the U.S. Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE).
The lack of lease sales ultimately means the government will collect less in rent payments by lease holders. Offshore rents currently generate more than $200 million per year.
The Gulf revenue decline comes as Obama’s oil spill commission is recommending new fees for oil companies – a scenario that could be avoided if the government removed barriers to exploration and production.
“Over the years, offshore production royalties have provided billions of dollars to the U.S. government,” saidNational Ocean Industries Association President Randall Luthi, former director of the Minerals Management Service, which predated BOEMRE. “Now, at a time when Congress is looking to maximize efficiency without raising taxes, there sits millions of dollars per day uncollected,” he said.
The Obama administration has dismissed the financial impact. The revenue loss would be “negligible,” Rebecca Blank, under secretary for economic affairs at the Department of Commerce, told a Senate committee in the fall.
“It is difficult to speculate now on the specific impact the moratorium would have over the five- or 10-year budget window, but one would expect the impact on the deficit to be negligible,” Blank wrote to the Senate Committee on Small Business and Entrepreneurship in September.
“Revenues may be higher or they may be lower depending on future years’ oil prices and the time profile of production,” Blank said.
Energy experts said the administration’s policies are certain to have long-term consequences for the industry.
“You continually need new discoveries and new production coming online to replace what’s being depleted,” said Andy Radford, senior policy adviser at the American Petroleum Institute. “These wells taper off over time — the ones that are producing now — so without a continual flow of new discoveries and new production, the number will continue to decrease.”
A report from the economic forecasting firm IHS Global Insight estimated that federal, state and local taxes related to the Gulf, combined with royalty payments, totaled $19 billion in 2009.
Royalties, bonus and rent payments made up more than $6 billion of that number. That pot of money could go a long way toward deficit reduction. And that’s from the Gulf alone.
Significant additional revenues would be generated if the federal government opened access to exploration and production in areas currently closed to development such as the eastern Gulf of Mexico, portions of the Rocky Mountains, ANWR, and the Atlantic and Pacific coasts.
A recent study conducted by Wood Mackenzie for the American Petroleum Institute estimated that increased access to those areas would bring $150 billion into federal coffers by 2025.
Why leave so much money uncollected, especially in a time of rising deficits?
Originally published by the Washington Examiner.
Obama’s illegal offshore drilling moratorium explained. This will infuriate you.
This is an administration that does not act in good faith.
UPDATE I – Debbie Wasserman-Schultz Confirms: Democrat Energy Policy is To Push For Less Energy and More Deficit Spending.
Democrat energy policy: Less drilling, more deficit spending. Pinheads like Debbie Schultz have said that there would be “no immediate” new oil if we started drilling today is cute, but they have been saying that for 20 years. Now if we started more drilling back then, or even five years ago it would be an entirely different story. By the way Obama’s illegal drilling ban has already cost many thousands of jobs.
If I start digging a well, it will not immediately result in more water, so lets all have massive thirst. If you start your car, it will not immediately result in you being at work, so lets ban cars and have trains….
Someone is voting for these idiots.
NOTE – If Sarah Palin had uttered the shear nonsense that Schultz puts out on a regular basis it would be the headline almost every other night on the news.
Schultz has been making these kind of orbital statements for a long time. I think it is time for Rush Limbaugh to start giving her a little of what the Democrats need right now:
Solar and Wind receive 20x the govt subsidies of most other energy. China builds coal plants to make wind and solar tech to sell to us.
Solar and Wind are very expensive, harder to transmit, and inconsistent. Solar is so expensive that solar panels plants in the United States are closing and the work is going to China. China builds a coal plant every week.
All of this money going to these subsidies cannot be used for other things. Mandates on electric companies to get more energy from wind and solar are next to impossible to meet so those companies are fined, which forces energy companies to pass those fines to their customers, which helps to send more jobs overseas.
Reason TV asks, if all of these green energy mandates are going to make all of these 21st century jobs, how come in California that has totally backfired. The reasons above explain why and they are reasons that are explained in any first year macroeconomics class.
If you want to see lower energy costs and business to start coming back home there is only one solution. Throw out Democrats en mass. We have trillions in natural gas, oil and other resources that are off limits that we could use to help pay off the national debt and rebuild the economy. We also need a government that costs less than $2 trillion a year instead of the nearly $4 trillion it costs now.
Political Arena 