Liberals Don't Understand the Simple Economics of the Carrier Deal

Donald Trump said he would work to keep the jobs from Carrier Corp. from leaving Indiana and made it part of his stump speeches. Who can forget this:



Now Trump has done so and employees are jubilant. Those opposing Trump have belittled the plan since it required tax breaks. Here's what the anti-Trumpers will never understand: Yes the cost is $7-million in incentives but the return on investment (ROI) is short and the ultimate benefits far outweigh the initial costs.

Carrier has opted to keep 1,000 jobs in the Indianapolis plant, let's say each job pays $50,000 a year plus benefits so let's take that out to $70,000 per employee. The taxes paid on those salaries and benefits will equal approximately $10,000 each paid to the state, local and federal governments. Plus this is 1,000 more people paying into the nearly insolvent social security fund.

 Let's further look at the buildings these workers will build air conditioners in daily. The property taxes will be paid to the city.

 Let's expand further, the utilities for the building include electric, natural gas and water. The electric needs to be generated and that's a further five people being paid. The natural gas needs to be extracted and piped through several stations to get to the end user, that 10 jobs all down the line. And the water? The local municipal water utility has to pump the water, treat the water and move the water through pipes. Let's say that saves one job.

 But what about ancillary effects: I imagine they have vending machines in the break room of the plants. Let's go low and say that three people stock those vending machines from 3 different companies. And how about the first aid kits, uniforms and cleaners who the company hires. Lets say that is another 3 people. And how about contractors? No plant does all their own work so they may need outside people for welding, motor and tool repair and a company selling them maintenance supplies and equipment. I'll go low again and say that 10 people are utilized for that. And what about transportation to get the product from the factory in Indiana to California. Trucking companies will hire (or keep) drivers who will be dispatched by dispatchers. Let conservatively say that is 3 more people.

 I could go on and on but you see where I'm going. But let's then look at one more aspect of this; all the people named above will buy gas for their cars, drink beer at their local bar, take their families out to dinner, pay property taxes, shop at Home Depot and Walmart, give to charity and simply live their lives. The expanding effect is huge. The $7,000,000 spent now will be looked at as a great investment.

 Finally, every state in the union does the same exact thing to keep businesses local. Liberals act as if this is some sort of bribery and Trump's idea. It's not, he just negotiated better terms than a politician would've. This will prove a successful strategy if implemented the way Trump wants to. He's already working to keep additional jobs in Indiana and elsewhere and if successful he will make good on his promises. Never have we had a president have this kind of effect before even taking office. Companies who got away with shafting employees and had rules allowing them to do so under Obama can no longer expect the same latitude with Trump in office.

Jobs Report a Bummer

The unemployment rate edged up to 8.3% making the the 42nd straight month with the rate over 8%. There are only 3 more reports before the election and if I were a betting man I'd say Obama claims 15-million dropped "off the rolls" and the rate will be 5.2% on election day.

Anyway, this is horrific for those without jobs or under-employed. When the rate goes up, there's no hope and when there's no hope the mood in the country sinks contributing to the spiral that makes the economy tank.

Here's that now-familiar graph showing where Obama said we would be after spending $750-billion on a stimulus that only stimulated his cronies and green jobs hucksters (but I digress) and where we actually are in reality. Three quarters of a million greenbacks down the shitter with nothing to show for it except pain and misery:

Note we are 2.3% above where Obama said we'd be if we did nothing, which was the preferred method or cutting taxes and spending would have been nice as well. Also note the green, which is the rate we'd be at if people supposedly hadn't given up and quit looking for work.

This is devastating and the spin sounds hollow no matter what the media says. America is hurting and Obama doesn't even have a clue how to begin saving our economy.  However, if blaming your predecessor and meeting with your jobs council once in six months is now considered "laser focus", I stand corrected.

I'm going on the record and saying Mitt wins by 6%.

Quoting Obama Verbatim Now a Racist Act

A flustered Obama campaign and their steno media hacks have been thrown on the defensive after Obama's "you didn't build that" line. And no, it wasn't a gaffe, it was Obama allowing us to see what he really thinks.

How worried is the campaign? Worried enough that they've spoken about it numerous times including an ad shot in the White House:

That ad follows two separate ones from his campaign attempting damage control. His campaign appearances are now about backpedaling and proclaiming his love for small business. And the Democratic National Committee produced its own panicked memo, which vowed to "turn the page" on Mr. Romney's "out of context . . . BS"—thereby acknowledging that Chicago has lost control of the message.

But the public just isn't buying the...BS that the DNC and Obamatons are selling and it's adversely affected him in the polls. So that leaves their only fallback as the race one and they get the vile Jonny Chait to bring it up:

Mitt Romney’s plan of blatantly lying about President Obama’s “you didn’t build that” speech is clearly drawing blood. But what makes the attack work so well is not so much the lie itself but the broader subtext of it. Watch Obama’s delivery in the snippet put together by this Republican ad[.] ... The key thing is that Obama is angry, and he’s talking not in his normal voice but in a “black dialect.”
This strikes at the core of Obama’s entire political identity: a soft-spoken, reasonable African-American with a Kansas accent. From the moment he stepped onto the national stage, Obama’s deepest political fear was being seen as a “traditional” black politician, one who was demanding redistribution from white America on behalf of his fellow African-Americans.

 You got that? Chait hypothesizes that when Obama gets mad he switches to "black dialect" instead the nice, soft, calm black professor voice he normally uses when belittling discussing issues with us. You see, us white people are afraid of the angry black man and the GOP and Romney folks are playing on that to help their candidate.

Dude, there are dog whistles that seemingly only liberals can hear and then there is shit just made up out of the air. This would be the latter. Chait goes there because he knows that this was the real Obama coming out, not the carefully crafted populist they want the world to see. This is the Chicago, Bill Ayers-mentored Obama who despises capitalism and wants government bigger than any Democrat could ever have imagined.

Chait wants those who may have taken offense to Obama's attack on small business owners to feel ashamed because according to him they are being manipulated by the GOP tickling their in-bred racist instincts. Unfortunately for Chait and Obama, three and a half years of being called racist for questioning Obama on anything has toughened the skin of most Americans and silly innuendos of racism have little effect anymore.

Horrible Employment Numbers

More cooking of the books by the Obama regime:

U.S. payrolls rose far less than expected in March, keeping the door open for further monetary policy support from the Federal Reserve, even as the unemployment rate fell to a three-year low of 8.2 percent.

Employers added 120,000 jobs last month, the Labor Department said on Friday, the smallest increase since October.

Economists polled by Reuters had expected nonfarm employment to increase 203,000 and the unemployment rate to hold at 8.3 percent.

The slowdown in employment growth last month likely reflected the fading boost from unseasonably warm winter weather. It supported the caution on the labor market from Fed Chairman Ben Bernanke last week.

Obama will spin this as another reduction in the overall rate but at least 125,000 jobs are required to keep the unemployment rate steady and we didn't hit that so in the world of Obamanomics, the rate decreases.

I wonder how many people were excluded from the actually tally this time. The real unemployment rate would be somewhere above 10% if people weren't just dropped from the roles but this is an election year, Obama doesn't have the record of success to run on, his policies have been utter failures so he's forced to lie. He doesn't mind because everything he's done has been smoke and mirrors and he has his old reliable allies at the NY Times and WaPo to back him up.

I leave you with the graph that best epitomizes the lying of the last three years and just how poorly Obama's ideological plans have performed:

The Dire State of Employment

You may recall the heady days back when the press was all over W. because of 5.6% unemployment. It turns out that a tick over 5% was the average for his presidency and it was that high only because of the economic crisis brought on by the Wall St. meltdown (Bush's fault if you ask a lib).

But now that we're at a steady 8+% rate, the press is strangely silent. But wait for Friday when the monthly rate is released and we find out that it goes down to 8.1% and the media gets orgasmic. Of course they won't ever acknowledge that millions have dropped off the rolls.

So just how bad is unemployment and is there any hope in sight? Based on these charts it isn't looking so good. Click through and look at the ugly stats. These are real numbers and ones you'll see no where else because they are horrific.

Think about it, we now have an entire generation of working-age young adults that have no work skills. They've not been hired anywhere except service jobs at a low wage and out of the field they studied in college. They have no resume and have lost valuable experience by not being able to find a job in engineering, chemistry, biology or whatever subject they majored in. Imagine if you just got out of college and all you could get to pay back your student loans is a job at Sports Authority when you spent years studying for your degree in process engineering.

What we will see if the job market ever comes back around is a huge wave of retirements and untrained people filling the ranks.

The Obamanation continues.

Another Key Bloc Abandons Obama

The way things are going, the only people left who will vote for Obama is newspaper writers, self-hating Jews and welfare recipients (although that is a rapidly increasing bloc).

Obama loses another key constituency:

America’s youth vote, which turned out in record numbers in 2008 and gave a historically high percentage of their support to President Obama, has soured on him because they are having a hard time finding work and, as a result, are putting off major decisions like getting married and starting a family

Obama, who won 66 percent of the 24 million voters age 18-29 in 2008, has seen that support slashed. And in a new poll from Generation Opportunity, a nonprofit that seeks to engage younger voters, only 31 percent approve of Obama’s handling of youth unemployment, a number that threatens to rob him of the voter group that pushed him to victory.

“Ironically for President Obama,” said the group’s president, Paul Conway, “the hardcore reality is that young voters are now very dissatisfied with the direction of the country and are becoming more vocal in their demands for real jobs rather than promises of more unpaid internships and unproven programs.”

And, he added, their anger coupled with their social media savvy could be a threat to Obama. “These vocal young voters are even more digitally connected--and politically potent--for 2012 than they were in 2008,” Conway told Washington Secrets.

He ain't winning in November without this crucial demographic. Not that I for one minute think they will automatically vote for the GOP candidate but these are people who have not had the luxury of being young, naive and liberal their first years out of school. These are people who either couldn't go to college because their parents were laid off and can't afford it, did go to college and can't find a job while lugging around the albatross of student loan debt or people who have seen friends and family suffer through the Obama years.

If the GOP candidate can tap into the despair, hopelessness and outright fear these kids are feeling, he'd win 57% of the vote. Santorum needs to quit harping on social issues and go on a steady offensive calling out Obama on his failure with this particular demographic. If someone asks about gay marriage or abortion, redirect the discussion to the lost generation who Obama has failed with his policies. It'll be a winner.

Obamanomics in a Nutshell

No comment needed:

Paul Krugman was unavailable to decipher this for us.

Obama Proves His "Laser Focus" on Jobs was BS

Remember how Obama kept saying he was going to be focused constantly on jobs and do everything possible to create new one? That turns out to have been complete bullshit:

the Obama Administration rejected the controversial Keystone XL pipeline project on Wednesday, scuttling a key energy initiative that would have created an influx of badly-needed U.S. jobs, but one that has also riled environmentalists.
The news, which was first reported by FOX News Channel, sparked a fierce response from Republicans and proponents of the project.

The White House, which faced a February 21 deadline to make a final decision on the project, blamed Republicans for forcing its hand.

"The rushed and arbitrary deadline insisted on by Congressional Republicans prevented a full assessment of the pipeline’s impact, especially the health and safety of the American people, as well as our environment," President Barack Obama said in a statement.

No, it wasn't the GOP forcing his hand, it was environmentalist's forcing his hand. He looked at the jobs situation and saw that it isn't going to get better and possibly may get worse. That left a decision; do what's best for the American people and okay a project that would have put thousands to work immediately or pacify a core constituency. For once he didn't vote present on a hard vote but instead voted against the majority of Americans and voted for his own self interest.

The pipeline was just about as "shovel ready" as any job could be and much more ready to go than any of the stimulus projects were. It would have ensured energy independence and allowed us to buy oil from a friendly neighbor and not have to trust the gouging Saudis or pray the Straits of Hormuz remain open and the Iranians don't restrict the flow.

This was a sop, plain and simple. A sop to his cronies in the environmental lobby.

Nice of Obama spokesman Jay Carney to twist the Nebraska governor's words to give himself cover too.

Spending Our Way Into Oblivion

Those of us who were paying attention knew that an Obama win would equate to massive increases in spending and huge deficits and that was based on the watered down promises he made on the campaign stump. But none of us in our wildest nightmares foresaw what has actually transpired to date and what is now on the verge of being passed.

We have a record deficit of $1-trillion and haven't even taken into account the massive increases in social security yet to come. The stimulus was a sop to Obama's cronies and has decreased jobs since it was passed while the administration is floating the trial balloon of Stimulus: The Sequel. How bad are things? Worse than this graph shows as it's based on things returning to some semblance of normal with regard to the job and housing markets; a not altogether sure thing:


Add to that that there has been no effective decrease in spending elsewhere (with the exception of the military) and you're looking at an IOU that is frighteningly enormous in scope. In just six-months The One has spent us into a hole we'll never get out of. With health care on the horizon and Cap and Tax being rammed through, we haven't seen the end of just what a liberal leader with a perceived mandate can do when he has a compliant Congress and adoring media.

Congressional liberals were mostly held in check under Bush and even Clinton but now they are acting like a scorned wife who has gotten hold of her husbands Visa, Mastercard, Amex and every other card and is spending like crazy and leaving him with the debt load. Every agency has the go-ahead to spend and spend and don't worry, the American people will pay for it whether they want to or not.

Thankfully we're seeing signs the American people are paying attention and saying "enough" even though they've bought into the class warfare rhetoric espoused by the Dems.. Obama's poll numbers are in free-fall and the nation trusts the GOP with the purse strings more than the Dems at this point, a major turn-around (not that the GOP deserves any trust as they were quite reckless themselves when they controlled the cash)

The only way out is taxes and not just soaking the "rich" but taxes on every single American are coming. It may be stealth like increases in gasoline, food or energy but they are definitely coming. That's when the opportunity to expose this massive spending will arise.

The problem is that there's no Republican who has stood up and stated these concerns in a clear, concise manner that will appeal to the fickle middle. Palin may be that person in a few months when Obama's numbers really plummet while the unemployment rate goes up. She can be the neo-Reagan fighting the battles from the far right and exposing every single proposal for the expensive boondoggle it is. Other then her, we don't have anyone with the charisma to hammer the Dems and get the people to not on hear hear her but listen as well.

Lies, Lies and More Damn Lies About Effectiveness of Stimulus

The Obama administration crowed about what the effects of the stimulus plan were going to be. The world would be a more green, wealthy and happier place once we pushed that baby through.
Here we are 100 days later and we are neither wealthier or happier but may be a little, tiny bit greener. Here's Tapper:

The project is described by the Obama administration this way:

"Using $27 million of Recovery Act funding, a public housing development in Washington, D.C., the Regency House, has undergone a green retrofit. As part of this upgrade, the building installed solar panels, a 'green' roof, a rainwater collection system, energy-efficient lighting as well as water conserving toilets, showerheads, and faucets. The greening of this building will allow the Regency House to save money in energy costs, while lessening their impact on the environment."

In reality, the work done on the Regency House that was funded by the stimulus package amounted to $59,000 in parts and labor, according to Dena Michaelson, director of public affairs for the Washington DC Housing Authority.

...In addition, though the White House's "100 Days, 100 Projects" entry for the Regency House work lists "solar panels, a 'green' roof, a rainwater collection system, energy-efficient lighting as well as water conserving toilets, showerheads, and faucets" as what was done as "part of the upgrade," the only parts funded by the stimulus were the solar panels, at a cost of $45,000, and the rainwater collection system, at a cost of $14,000.

I wrote that the stimulus was a bad idea but since it was inevitable, the money should be highly concentrated on construction because it would benefit the most people:

$4.19 billion would pay for a lot of roads and dozens of schools. Just as an example, I was recently working on a $32-million dollar combination middle/grammar school for ages pre-K through 8th. That project is employing 9 different construction trades encompassing about 70-90 workers making good, union wages. Add to that engineers and management and you're looking at another 10 people making upper-middle class wages. Now add to that the people who are ancillary site workers--surveyors, cleaning people, street sweepers, etc. Now add to that the service suppliers like the port-a-potty guy, the roach coach guy, the office cleaners, etc. Now add to that the suppliers who supply windows, doors, steel, roofing materials, mortar mix, fuel and a million other things. Add it up and you have 120-150 people directly associated with the job with double that still to work after this phase is completed including floor guys, finish electricians, HVAC guys, painters, sprinkler guys, etc. All those jobs on a job contracted at $32-million.

Instead, the money was spread to ACORN and other idiotic causes where it will not stimulate anything. The construction industry was pumped for the money and was looking to jump in but instead was left broken-hearted by The One.

History will show that this was the single largest money grab and scam against the American people in history. I suspect we'll see some serious perp walks happening when the government gets serious about finding out where this money is really going.

Economic Tailspin Continues: GDP Shrinks 6.3%

I'm looking for reasons to hope. They're not immediately evident but there are some. Mostly, it's just horrible news piled on top of really bad news:

The U.S. economy contracted at a steeper-than-expected pace in the first quarter, weighed down by sharp declines in exports and business inventories, according government data on Wednesday that showed the economy was still deep in recession.

Gross domestic product, which measures total goods and services output within U.S. borders, dropped at a 6.1 percent annual rate, the Commerce Department said, after shrinking 6.3 percent in the fourth quarter.

CNBC tries to make it sound somewhat heartening but it's a hard sell. This is very troubling:

Investment by businesses tumbled a record 37.9 percent in the first quarter, while residential investment dived 38 percent, the biggest decline since the second quarter of 1980.

The residential number is bothersome but expected. The business investment number is the really scary element. Until businesses decide the paradigm is changing, they will horde cash, not invest in upgrades and capital improvements, not hire and not take on new vendors. The cycle will just continue.

Granted, the fact that consumer spending increased is a good thing but is that more a case of buying things they put off spending money on last quarter and last year or is it a sign that people are feeling better about the economy? A question that is far from being answered right now I'm afraid.

As an aside, I'm seeing some life in the construction sector and that can be attributed to government spending under the stimulus bill. However, Obama didn't put nearly enough money into construction as he should have--instead loading up pork-filled projects--so this may be only a temporary uptick.

The Current State of California

Anyone who had read this blog for awhile knows that I lived in California for a decade while serving in and after discharge from the US Navy. I love the state and most everything about it.

When I lived here, it was during the Pete Wilson years and the economy was strong, jobs were well-paying and spending was mostly in check. Now, not so much.

In the wake of the Grey Davis recall and subsequent Terminator win, things were looking rosy; here we had a popular Republican coming to right the wrongs of the misguided liberal who destroyed the state. If not a social conservative, Arnold was believed to be a fiscal one. That was a falsehood.

Now, walking around and talking with people yesterday, it seems there's a palpable fear that things are going to implode. I'm in the state capitol and I'm not seeing the usual crowds at movie theaters and restaurants that one always sees in the Golden State. Taxes are skyrocketing and businesses are leaving for more tax-friendly environs.

I know it's anecdotal but it felt real. For what it's worth, that was my first impression yesterday.

Calling the Dems Bluff: GOP Should Propose "Green" Jobs

The Democrats have been calling for so called "green" jobs for awhile now yet haven't been too precise in defining exactly what those jobs are. I think it's time we define those jobs for them.

We can knock 1% off the unemployment rate immediately by fast-tracking these projects and it will have an affect in all areas of the country.

First, anyone with a half a brain knows that we are going to need oil for the foreseeable future--I'd say at least thirty more years for diesel, jet fuel, home heating oil, solvents and other fuels used by power plants such as #6 fuel oil. Gasoline use will be severely curtailed in fewer years based on the newest production vehicles coming on line. We should propose a 10-year plan to extract all the oil we can in the most environmentally safe manner science and cost effectiveness allow. Second, we set out an ambitious plan to build new, high tech refineries in every region of the country, for instance: North Jersey/New York, South Jersey/Philly/Delaware, Baltimore/Washington, Boston, Chicago, etc. Say thirty new refineries using the best available technology and designed to meet the strictest environmental standards (see this proposed refinery in S.Dak). The refineries will be able to handle light, sweet crude, high sulfur oil such as that from Venezuela as well as oil sands or shale oil (as much as I hate the bailout bill, there is some good in it). The trickle-down effect would be dramatic as suppliers would immediately revamp and ramp up to supply all the parts needed. The government or whatever banks remain after the financial meltdown offer the oil companies loans at a fair rate and since we know they are much more solvent than the financial sector, those loans will be paid back.

The construction would take three to five years for each facility and would shore up a flagging construction industry at a time it's sorely needed. The Dems would face fierce blow back from the labor unions were they to fight this as they are starting to see huge percentages of their membership "sitting on the bench". Non-working members means no money flowing into the unions, which means that union leaders will have to explain why they are still raising their salary while the rank and file are sitting home out of unemployment benefits while still having to pay inflated dues.

Next, we push hard for new nuclear power plants throughout the country but allowing the individual states the right to say yes or no to construction. Again we streamline the process to ensure the newest technology will be utilized while also cutting the red tape for approvals. Today's plants are smaller, more efficient and safer. We also set strict security guidelines that would make them safer than any existing facilities in the world. With the anticipated opening of the Yucca Mountain site, we have a disposal option for spent fuel available soon.

Next we push for the creation of a natural gas pipeline that can distribute natural gas around the nation. It's clean and plentiful.

Finally, we should propose to shore up the existing electrical grids we have and build or repair those that are in poor condition. A joint effort between the various regional utilities and the federal government would go far to attaining this goal. Again, the loans will be at a fair-market rate and the government could guarantee a portion if need be (but only a portion).

Add to this idea the construction of more wind energy facilities, solar collection centers and research the idea of hydro power through tides or other water sources, we could put a good amount of Americans to work quickly on long-term projects.

FDR did this in the 30's and 40's but paid with government funds, I would propose it be accomplished all with private funds with cooperation between banks, energy companies and the various agencies of the government that stand in the way of progress as a mater of course.

What the War on Poverty Has Wrought

40-years out from the onset of the War on Poverty and we're still no closer to ending need than we were in 1968. Trillions of dollars spent on feelp-good entitlement programs and we still see entire cities left to rot.

I live near one of those cities and I can tell you that decades of Democratic rule have left it worse than it ever has been by breeding corruption and the break down of the family.

Camden, NJ sits across the Delaware River from Philadelphia, what should be a highly strategic location for any city looking to enrich itself through industry. It's home to Campbell's Soup, an international business icon and yet we still read of poverty so grinding as to make one turn away in horror.

Yes, I understand that poverty is a "complex" as defined by the ultra liberal Center for American Progress issue but throwing money at the problem has never worked and never will. Instead, we see 4-year old children shot dead in the streets.

Perhaps it's time for a new approach, one in which we don't just promise new jobs and help every four years then go back to not caring. Perhaps we should take the approach of encouraging urban men to stick with the mothers of their children so the children are raised in a caring, loving home. Perhaps we should take the approach of encouraging young women to not get pregnant at 16 and go to college. Perhaps we should take the approach of training the people in these urban wastelands in real world work skills.

President Bush was blocked from implementing many of these plans but the one he actually did implement worked in ways no liberal could imagine or could have foreseen. Instead of throwing another trillion or two at programs that have had the exact opposite effect, perhaps we can try a new method that may get real results.

Let's try a new approach, one in which 4-year old Brandon Thompson will not die in his mothers arms on a run-down street corner.