RogABlog

9/11: A Personal Reflection

2011-09-08T11:09:00.001-07:00

I remember the day vividly.

As I walked up the staircase from the Astor Place subway station and looked down Cooper Square, I saw a black cloud of smoke blowing from the west. One of those giant oil tanks in Jersey, I surmised; not unusual that one would have a problem now and then.

When I made it to our office at 20 Cooper Square, the doorman told me that a plane had crashed into the World Trade Center. Immediately I asked if it was a small plane. He told me he thought so.

I had a window looking south, everyone crowded into my office to watch the burning tower. Someone said, it had to be a small plane; if it was a jetliner, the pilot would’ve ditched it into the ocean if he had trouble.

Then we gasped: what if the pilot wasn’t actually flying the plane?

When the second one hit, we knew something had gone terribly, terribly wrong. Then we heard about the Pentagon, and then Pennsylvania and suddenly realized the hundred or so of us were stuck together in an office in the East Village with no communications except email and no clue how to get home.

The most macabre experience in my life occurred a few minutes later. There was a TV in my office, positioned right next to the window looking out towards the towers. When the first tower started to wobble, lowering itself down, billowing black dust against a sparkling blue sky, we saw the same image side by side: television and window, electronic and live.

We were about three miles from the Towers. When they slowly collapsed upon themselves – like a giant rocket taking off from Cape Kennedy, except in the wrong direction – we couldn’t see the bodies of those jumping out windows, but somehow knew they were there.

Soon, Martin Sorrell sent me an email from London headquarters asking if all was OK. London? Jesus, it wasn’t just us watching this tragic event from an office overlooking a parking lot at 20 Cooper Square, it was the whole world..

I don’t remember how and when we decided to leave, but it was mid-afternoon. We walked all the way from Cooper Sq and E. Fourth to Grand Central Terminal. On the way up, we saw little kids in front of newspaper stands selling postcards of the World Trade Center, standing magestically over lower Manhattan, for ten dollars.

Just a few hours ago, they were real. Now they were being hawked as a souvenir, never to be real again.

I can’t tell you how scared we were to walk into Grand Central Terminal – a building we had known for years, a safe haven, now the next possible target for a terrorist strike. All trains went north, all stops along the way. I remember getting off in Stamford and members of the clergy – all denominations – were there to greet and console.

At home we were glued to the TV, 24/7. We watched as the NY City Police and Fire Departments and Iron Workers pulled bodies and debris from the morass. For years, we had taken these public servants and laborers for granted, maybe even complained about them at times, but on that day they rose to the ultimate occasion, teaching us lessons in bravery, duty and unselfish service.

Ten years later, something bothers me. It bothers me that we’ve forgotten about the heroism of these dedicated public servants, even villianized them in the last several months.

They make too much, they retire too early, they have cushy jobs, they create budget deficits.

Did any of the police officers, firefighters, or clean-up crews ask for a salary increase that day? Doubt it.

Did they think about their own lives each time they came out of the burning buildings alive, another victim in their arms or over their shoulders? No, most went right back up, many themselves succumbing to the flames and smoke.

Did any of them get a bonus for a job well done? Their only reward for a job well done was a job well done.

In a world increasingly judged by the yardstick of dollars and cents, let us not forget the time, a short ten years ago, when our public and union employees gave Wall Street – and all of us – the ultimate bailout.

And let us never again measure their contribution in mere dollars and cents.

A Few Words of Wisdom From Michael Moore

2011-08-20T07:40:00.000-07:00

A friend of mine forwarded this to me recently. A very interesting perspective which makes a lot of sense

30 Years Ago Today: The Day the Middle Class Died

By Michael Moore

From time to time, someone under 30 will ask me, "When did this all begin, America's downward slide?" They say they've heard of a time when working people could raise a family and send the kids to college on just one parent's income (and that college in states like California and New York was almost free). That anyone who wanted a decent paying job could get one. That people only worked five days a week, eight hours a day, got the whole weekend off and had a paid vacation every summer. That many jobs were union jobs, from baggers at the grocery store to the guy painting your house, and this meant that no matter how "lowly" your job was you had guarantees of a pension, occasional raises, health insurance and someone to stick up for you if you were unfairly treated.

Young people have heard of this mythical time -- but it was no myth, it was real. And when they ask, "When did this all end?", I say, "It ended on this day: August 5th, 1981."

Beginning on this date, 30 years ago, Big Business and the Right Wing decided to "go for it" -- to see if they could actually destroy the middle class so that they could become richer themselves.

And they've succeeded.

On August 5, 1981, President Ronald Reagan fired every member of the air traffic controllers union (PATCO) who'd defied his order to return to work and declared their union illegal. They had been on strike for just two days.

It was a bold and brash move. No one had ever tried it. What made it even bolder was that PATCO was one of only three unions that had endorsed Reagan for president! It sent a shock wave through workers across the country. If he would do this to the people who were with him, what would he do to us?

Reagan had been backed by Wall Street in his run for the White House and they, along with right-wing Christians, wanted to restructure America and turn back the tide that President Franklin D. Roosevelt started -- a tide that was intended to make life better for the average working person. The rich hated paying better wages and providing benefits. They hated paying taxes even more. And they despised unions. The right-wing Christians hated anything that sounded like socialism or holding out a helping hand to minorities or women.

Reagan promised to end all that. So when the air traffic controllers went on strike, he seized the moment. In getting rid of every single last one of them and outlawing their union, he sent a clear and strong message: The days of everyone having a comfortable middle class life were over. America, from now on, would be run this way:

The super-rich will make more, much much more, and the rest of you will scramble for the crumbs that are left.
Everyone must work! Mom, Dad, the teenagers in the house! Dad, you work a second job! Kids, here's your latch-key! Your parents might be home in time to put you to bed.
50 million of you must go without health insurance! And health insurance companies: you go ahead and decide who you want to help -- or not.
Unions are evil! You will not belong to a union! You do not need an advocate! Shut up and get back to work! No, you can't leave now, we're not done. Your kids can make their own dinner.
You want to go to college? No problem -- just sign here and be in hock to a bank for the next 20 years!
What's "a raise"? Get back to work and shut up!

And so it went. But Reagan could not have pulled this off by himself in 1981. He had some big help:

The AFL-CIO.

The biggest organization of unions in America told its members to cross the picket lines of the air traffic controllers and go to work. And that's just what these union members did. Union pilots, flight attendants, delivery truck drivers, baggage handlers -- they all crossed the line and helped to break the strike. And union members of all stripes crossed the picket lines and continued to fly.

Reagan and Wall Street could not believe their eyes! Hundreds of thousands of working people and union members endorsing the firing of fellow union members. It was Christmas in August for Corporate America.

And that was the beginning of the end. Reagan and the Republicans knew they could get away with anything -- and they did. They slashed taxes on the rich. They made it harder for you to start a union at your workplace. They eliminated safety regulations on the job. They ignored the monopoly laws and allowed thousands of companies to merge or be bought out and closed down. Corporations froze wages and threatened to move overseas if the workers didn't accept lower pay and less benefits. And when the workers agreed to work for less, they moved the jobs overseas anyway.

And at every step along the way, the majority of Americans went along with this. There was little opposition or fight-back. The "masses" did not rise up and protect their jobs, their homes, their schools (which used to be the best in the world). They just accepted their fate and took the beating.

I have often wondered what would have happened had we all just stopped flying, period, back in 1981. What if all the unions had said to Reagan, "Give those controllers their jobs back or we're shutting the country down!"? You know what would have happened. The corporate elite and their boy Reagan would have buckled.

But we didn't do it. And so, bit by bit, piece by piece, in the ensuing 30 years, those in power have destroyed the middle class of our country and, in turn, have wrecked the future for our young people. Wages have remained stagnant for 30 years. Take a look at the statistics and you can see that every decline we're now suffering with had its beginning in 1981 (here's a little scene to illustrate that from my last movie).

It all began on this day, 30 years ago. One of the darkest days in American history. And we let it happen to us. Yes, they had the money, and the media and the cops. But we had 200 million of us. Ever wonder what it would look like if 200 million got truly upset and wanted their country, their life, their job, their weekend, their time with their kids back?

Have we all just given up? What are we waiting for? Forget about the 20% who support the Tea Party -- we are the other 80%! This decline will only end when we demand it. And not through an online petition or a tweet. We are going to have to turn the TV and the computer and the video games off and get out in the streets (like they've done in Wisconsin). Some of you need to run for local office next year. We need to demand that the Democrats either get a spine and stop taking corporate money -- or step aside.

When is enough, enough? The middle class dream will not just magically reappear. Wall Street's plan is clear: America is to be a nation of Haves and Have Nothings. Is that OK for you?

Why not use today to pause and think about the little steps you can take to turn this around in your neighborhood, at your workplace, in your school? Is there any better day to start than today?

P.S. Here are a few places you can connect with to get the ball rolling:

Main Street Contract for America

How to Join a Union by the AFL-CIO (they've learned their lesson and have a good president now) or

Change to Win

MoveOn

High School Newspaper (Just because you're under 18 doesn't mean you can't do anything!)

This article was published at NationofChange at: http://www.nationofchange.org/30-years-ago-today-day-middle-class-died-1312662464. All rights are reserved.

A "Sane" Explanation and Approach to our Current Economic and Political Crises from Rep Jim Himes (D-CT)

2011-07-28T13:08:00.001-07:00

I received this very interesting email from my Congressman today. It's worth a read. Finally, someone in Washington with a head on his shoulders:

For the first time since the late 1700s, the United States of America is at real risk of financial default. Other countries have defaulted before, but never as the result of deliberate foolishness. In 1939, in a fit of form over substance, the U.S. Congress created the "debt ceiling," a legal limit on our debt. Since then, that limit has been raised over 80 times. As a tool of fiscal discipline, it has underperformed, to say the least.

As a tool for highlighting political hypocrisy, the debt limit is unimpeachable. Members of Congress routinely vote to cut taxes or raise spending, both of which require borrowing that they then vote against. That's like running to the store, buying a flat screen TV, and then making a big show of not paying your credit card bill because of your mounting debt.

But this time, the sham has become deadly. Should the debt ceiling not be raised, the government will be unable to pay bills such as Social Security checks, Medicare payments, and salaries for our soldiers, judges, and air traffic controllers. Equally worrying, the U.S. would almost certainly lose its AAA credit rating, a national asset we have guarded for two centuries. Once again, middle-class families who can afford it least will suffer most—through increased interest on mortgages, small business loans, and credit cards, and through damage to retirement accounts and other savings.

While debates over the debt ceiling have reached fever pitch, it's been months since Congress seriously considered the problem most Americans see every day: a weak recovery and unacceptable levels of unemployment.

If there's one redeeming feature of the debt ceiling chicanery, it's the discussion it has prompted on how to address the unsustainable path of our nation's finances.

Warren Buffet famously said that "only when the tide goes out do you discover who's been swimming naked." Since 2000, when the Congressional Budget Office projected year after year of government surpluses, we've been swimming naked. We've spent without discipline on two wars, a drug benefit for Medicare, and a stimulus bill to jumpstart the economy. And we've taxed less and less, to the point where the federal tax burden we feel is now at its lowest level since 1958. So when the economic tide went out three years ago, there we stood, our trillions of dollars of debt for all to see.

As usual, the fevered rhetoric surrounding our finances is not helpful. Those interested in allocating blame for the debt find that it must be shared between Presidents and Congresses of both parties and notably, on the Great Recession.

The misinformation and demagoguery have been even worse. No, we are not three months away from becoming Greece. Yes, the magnitude and timing of spending cuts really matters; cut too much too soon, and our hesitant recovery might fall back into recession. And yes, the long term problems in Medicare and Social Security are real and should be equitably addressed sooner rather than later.

Anyone familiar with the details of these challenges knows that success will look something like the proposals made by the Simpson-Bowles Commission or more recently by the Senate's Gang of Six. Both proposals included significant cuts, additional revenue achieved mainly by eliminating tax loopholes and deductions, and proposed reforms to Medicare, Social Security, and Medicaid. Both proposals received bipartisan support from strange bedfellows like Senators Dick Durbin and Tom Coburn. Both proposals were also condemned by both ends of the political spectrum and by many interest groups.

Those (like most of the Republicans in the House) who insist that no additional revenue should be on the table must acknowledge that a "cuts alone" strategy would devastate our nation's investment in the highways, airports, and other infrastructure critical to our nation's prosperity. They must acknowledge that spending cuts will reduce or end the availability of education and health care to many of our least advantaged citizens. This is particularly true if we hesitate to make the huge defense and security budgets share in the effort. And they must explain why taxing the very wealthiest among us at the rates they paid in the 1990s would prohibit the stunning economic growth we experienced in precisely those years.

On the spending and entitlements side, we must acknowledge that because of our aging population and the continuing climb in health care costs, Social Security, Medicare, and Medicaid, if unreformed, will eventually squeeze out all other spending.

Social Security is the lesser and least urgent of these challenges. It is capable of paying promised benefits until around 2037. But ominously, for the first time last year, Social Security paid out more than it took in. That is a clarion call for us to do what Ronald Reagan and Tip O'Neill did in 1983 and reform the program to assure its availability for generations to come.

Reforming Medicare is a larger, more urgent, and more politically challenging issue. Medicare has unfunded liabilities (promises it has made to the Americans alive today) totaling almost $40 trillion. Working Americans pay into the system, but the average American family will receive more than $200,000 more in benefits over a lifetime than he or she pays in.

We all worry about our health care, particularly as we age. As we saw in the health care debates of 2009 and in the response to Congressman Ryan's Republican plan to "voucherize" Medicare, the topic can be used as a powerful political weapon, often at the expense of reform. Fortunately, in a delivery system as wildly inefficient as ours, there is much we can do to cut costs without affecting the availability or quality of care or without simply shifting costs as proposed by Chairman Ryan. Just ask citizens in other industrialized countries who have better health care indicators at roughly half our per capita cost. The federal budget, our economic health, and our capacity to keep the promise of health care for our seniors may depend on another look at how our nation conducts the business of health.

Time is short. As I have said for months, we should never have let the sham of our debt ceiling imperil our credit and our hesitant economic recovery. But if we seize the moment to achieve a comprehensive plan for financial stability, perhaps it will have been worth it. If not, we'll have this discussion again soon, not because of the debt ceiling, but because our creditors will force it.

My Progressive Principles

2010-10-30T18:59:00.000-07:00

As we near the election -- although those of us with progressive leanings may lose -- I thought I would document the political principles I believe in. What the heck?

- The welfare of the human race and real people can never be measured in dollars and cents. The welfare of one human life is worth more than billions and billions of dollars.

- Money is "distributed" by a marketplace that is far from perfect and rewards disproportionately to people's contributions -- sometimes exponentially.

- Markets make great servants, but terrible masters.

- Tax breaks to the rich rarely pay for themselves. Government spending creates jobs.

- America was founded by immigrants and is a country of immigrants. That is its strength.

- Socialism is the ownership of all means of production by the state. Social Democracy is a system of government where private industry, the govt, the unions and other social organizations cooperate for the welfare of society. We could use a little dose of Social Democracy now and then.

- A person's accumulation of dollars should not determine the size and volume of his/her voice in the political process and government.

- The value of the next marginal dollar to a billionaire is far less than the value of that same dollar to society as a whole.

- The poorest persons access to healthcare, education, food and shelter trumps the richest person's access to his or her next dollar.

- Our nation has been polluted by people trying to discredit the source of messages contrary to their views instead of by addressing the issues themselves. These people are outright vile, mean spirited, and untruthful. I call this "Rovian Propaganda" and it is one of the very worst practices in our political arena and one of the biggest threats to our liberty.

- "Progressive" and "Liberal" are tremendously good words. Jesus Christ, Ghandi, Franklin, Lincoln, Galileo, Einstein, Mother Theresa, FDR, Martin Luther King and many more -- that's pretty damn good company and I'm proud to be counted as one of their followers!!!!

Are the top US tax rates too high?

2010-10-21T08:34:00.000-07:00

I was recently asked whether I thought the top US income rates are too high. Here is my answer:

First of all, my issue is more with wealth accumulation than income. However, the two are pretty closely linked. Nonetheless, I will address the issue from more of a wealth perspective than an income one.

In order to address the issue, there are several basic questions to ponder, among others:

1. Is our society inherently fair? Do virtually all Americans have access to the services that will "level the playing field" (i.e. food, shelter, education, healthcare). Are entrepreneurs fairly incented to provide growth and innovation? Do all Americans have access to "life, liberty and the pursuit of happiness"?

2. What is the current skew of income and wealth in the US? What are the long term ramifications of this skew? If negative, what can be done address it?

3. What is the value of an incremental dollar to one of the wealthiest Americans vs. the value of that incremental dollar to society as a whole?

Okay, here's my short answers to those questions (I could probably write a book on them, but this will have to suffice for now):

1. Is society inherently fair?

I'd have to say no. Too many people don't have access to health care. Too many people are falling below the poverty line. Too many people don't have adequate retirement funds. Too many of our schools do not provide the quality of education necessary for our kids to have a shot at the "economic brass ring"

On the flip side, are entrepreneurs fairly incented? I would say yes and would also note that our economy seemed to do pretty well in terms of innovation and growth when the top tax rate was still significantly higher.

In terms of life, liberty and the pursuit of happiness, I would have to say that those at the very top have the opportunity to more fully experience life and participate in our society. With skads of money in the bank, one has more opportunity to take financial risk, drive up prices of "cherished goods" like housing, land, automobiles etc, and the freedom to pursuit almost anything their heart (and ego) desires.

I think even at the middle end, this access to LLPH is constrained -- not only in terms of material goods, but also in our ability to participate in our government. How many millionaires are there in the congress and senate (as a percentage of the total compared to the percentage of millionaires in the US as a whole)? Is it an oddity that the very richest person in NYC is mayor (this is not a criticism of Bloomberg whom I think is great, just a statement of fact)? Does a plethora of dollars from the very wealthy during elections "crowd out" the voices of a concerned majority?

Obviously, there are major inequities here.

2. What is the current income/wealth skew and what are its ramifications?

I know I'll sound like a broken record on this one, but the top 1% controls 42% of financial wealth (36% of total wealth, including housing). The average salary of a CEO today is 400 times that of an average worker vs. 40 times in the 1960s.

If we allow this to continue unfettered, the skew will only get worse. With middle income families only earning enough to "scrape by" and the very high end families having the luxury to save because of their high income (I read an interesting article by an economist comparing savings to a luxury good), I think it's pretty easy to read the tea leaves.

The ramifications? As more and more wealth gets concentrated in the hands of an elite few, we run the risk of becoming a "high tech banana republic." If that ever happens (and I hope not), the masses will begin to feel economically ostracized and will conclude that if the "rules" of society are unfair, why should we follow them? The rest is self evident.

3. The marginal ultility/value to a wealthy individual vs. society as a whole?

I think it's fair to say that the incremental utility/value of the "next dollar" (or million) to a billionaire is much lower than the utility/value of that dollar to society as a whole. To the billionaire, that dollar just represents "monetary gravy" and incremental cushion (to a certain extent encouraging risk, which is a good thing). Given a society with the healthcare, poverty, education and retirement issues that we have today, I would say that that incremental dollar could be put to much greater use.

So, yes, I believe that we do not tax enough at the high end.

My solutions:

- I'd rather tax wealth than income. A dual income household might only make the top income category for several years in their lifetime, after having worked very hard to get there for years.. They should have the right to use it to share in the bounty of our economy/society and just to pay for necessities like college education. However, once their savings accumulates to a certain point (incremental utility of dollar to them < incremental utility of dollar to society as a whole), there should be some sort of taxing mechanism, including, but not limited to an estate tax.

- I would eliminate the corporate income tax completely to spur investment

- I would lower the payroll tax to increase employment opportunities.

- I would surtax any funds earned in the US by US citizens that are transferred overseas.

I can't tell you what is the appropriate mix of these things and what their optimal levels are, but those are the types of economic overhauls I would consider

Battle Hymn of the RepublicansII.mov

2010-10-17T08:50:00.000-07:00

To My Fellow Democrats and My Independent Friends

2010-10-13T18:52:00.000-07:00

I want to urge you to get out and vote Democratic this year. Why? Number One: we need to support our President. Number Two: after 8 years of the Bush/Cheney "reign of terror" we finally have a President we can be proud of. Think about it: he's made more legislative achievements since anyone named LBJ. Were they controversial? Yes. Were they beneficial to middle class America? A resounding Yes. And he's been subjected to more ridicule, subterfuge and mistruths than any President in my lifetime.

Let's examine the issues. Is govt "taking over" healthcare? No. But today children with pre-existing conditions are covered and soon adults will be. Was the stimulus effective? Not as much as it could be, but the only reason is, is that the tea partiers have been on this crusade to say that deficits are "bad" in general. Are they? No. (someone please study Macroeconomics and, please read Keynes) When you build new infrastructure, you hire construction workers, architects, engineers, surveyors, who, in turn, spend their money at supermarkets and dept stores, who, in turn, need to hire more people and buy more inventory etc etc. The only problem with the stimulus, is it should have been significantly more. (Think about it in simpler terms. When your parents took a mortgage for $40K to buy a $50K house, they were probably nervous; when they sold that house for $150K 20 years later, the now reduced 40K mortgage was not that big a deal)

Has Obama been perfect? No. IMHO he should have held out for the public option and the stimulus should have been bigger. But you know what? With the party of NO saying NO just for the mere sake of saying NO, it wasn't easy. After two years, was Bill Clinton the Bill Clinton most people admire today? No. After two years, was Ronald Reagan the "saint" conservatives revere today? Of course not.

Democrats need to vote this November to give Obama some tailwind. Independents: I ask you this question? Despite the bad economy, do you really think the GOP and tea partiers have real answers. No! Their policies (i.e. reduce the deficit NOW and repeal Healthcare) will only make things harder for the middle class and, therefore, most of America.

Again,finally we have a President we can be proud of. Despite the vengeful rhetoric, we need to support him.

Is the deficit and debt necessarily a bad thing?

2010-09-28T12:32:00.000-07:00

I keep on hearing people complain about how we’re living off the backs of our children by creating an insurmountable level of debt that they’ll never be able to pay off destroying America as we know it.

Scary thoughts.

As, a matter of fact, the flames of our beloved Tea Partiers are largely fanned by the words “deficit” and “debt.”

So I decided to take a look at some of the underlying numbers.

First, some facts:

· The current budget deficit stands at about 11% of GDP, about 1 percentage point more than in the last year of Bush’s administration. The percentage of deficit to GDP has risen as high as 28% during WWII, obviously a less-than-normal time in terms of fiscal policy. Right now we’re carrying on two wars (one that’s winding down, thank God) and are hopefully recovering from the greatest economic meltdown since the Great Depression – I think that qualifies as a “less-than-normal” time and justifies higher than usual spending. Historically, the percentage of deficit to GDP has fluctuated in both directions; it will go down again.

· Over the last several decades, much of America’s economic growth has been fueled by deficit spending. During the Reagan years, for instance, GDP grew by 83% while total federal debt grew by 187%; during Clinton’s administration we experienced 45% GDP growth and a 24% increase in debt and during George W Bush’s eight years GDP grew 45% while total debt grew 75%.

· When my parents bought our house for a grand total of $21,000 in 1962, they were scared to death of the $16,000 mortgage they signed up for. 20 years later they sold the house for almost $100K and paying off the mortgage was a non-issue. LESSONS LEARNED: the economy grows, prices go up (hopefully through productivity growth, not rampant inflation), debt is fixed.

· The current federal debt is approximately $15Trillion; it’s hard to get a definitive number for unfunded entitlements through 2050, but I hear that it’s somewhere between $50-80Trillion. If we take total 2010 tax receipts at $2.17Trillion and increase them by 2% per year (about the projected productivity growth for the intermediate term) through 2050, we generate cumulative tax receipts of about $130Trillion over that time (at 3% annual growth in tax receipts, it would be a cumulative total of $163Trillion). Entitlements come out of the budget, so by my simple reasoning we should be able to cover those “unfunded” entitlements as well as pay back the $14Trillion in current debt. Obviously, we would eventuallyhave to get back to a balanced budget or nearly balanced budget for this scenario to play out.

Now let’s ask the converse of the question: what would have happened to our economy 2008-2010 WITHOUT the bailouts, the govt “takeover” of the US auto industry, and the modest stimulus package?

Here’s my prediction:

· Well, if the current unemployment rate is 9.6% WITH all of the above, one would have to predict that it would be significantly higher WITHOUT all of the above. Same for the “real” unemployment rate which most people estimate is somewhere between 15-20%. So let’s say the official unemployment rate goes up to 15% and the “real” unemployment rate to 25-30%. The consequences would be disastrous.

· First of all, tax receipts would plummet and welfare payments, especially unemployment payments, medicaid and medicare payments would rise dramatically. In effect, by not spending we would in effect be creating the very deficit that we were trying to avoid.

· The housing market would take a major nosedive – worse than it is now. People would literally be put out on the street, leading to many social/law enforcement issues. Jobs of anyone employed in construction, the banking industry, the mortgage industry and other related industries would be in severe jeopardy.

· Due to low consumer demand, companies would lay off more people exacerbating the unemployment rate and all of the effects thereof.

· There would be a major sell-off of the dollar.

· The Chinese would probably demand a significantly higher interest rate to buy our debt (if they were willing to buy it at all). This, of course, would increase the amount of the federal budget devoted to interest payments and further exacerbate the “involuntary” deficit we created.

· The balance of trade might actually tip in the US’s favor because of generally less demand, depressing imports. Over time, though, if enough US production capacity was closed down in response to less domestic consumer demand, this situation could reverse, maybe dramatically – hard to tell.

· Multinationals with production capacity in the US (companies like Toyota, Sony, Siemens) would probably shut down over time due to lack of domestic US demand. Instead they would most likely choose to import their products to the US, further weakening the US balance of trade and the value of the dollar

· Public school budgets would be slashed, leading to classroom sizes of 50+ kids in most areas. Same for budgets for law enforcement, sanitation, and public works maintenance.

· Despite, the self-inflicted deficit, the wealthy would scream for a tax cut, which would be counterproductive because 1) they would probably NOT spend the money, but hoard it (most likely they would convert it to non-dollar currencies, further weakening the balance of trade in our Short Term Account) and 2) a tax cut would benefit hardly anyone else because X% of nothing is still nothing.

Perhaps in Milton Freidman’s world all of this is necessary to allow the free market to “adjust” the economy. Yes, eventually the dollar will weaken to such a level where there is incentive to buy US goods, increasing employment and consumption blah…blah…blah….However, I personally would not want to live through such a prolonged “adjustment” period. (According to Keynes, "in the long run we're all dead).

In effect, by not increasing the deficit in the short term with the intent of lessening the burden of debt passed onto our children, we might in fact not only unintentionally increase the level of total debt passed onto future generations but more so be lessening the quality of the America that we pass onto them – if, in effect, America as we know it would exist at all.

A Response to the GOP's "Pledge to America" - Part 1

2010-09-25T15:33:00.000-07:00

The following is a verbatim copy of the preamble to the GOP's "Pledge to America." I've added my comments/responses bold and in parentheses:

America is more than a country.

(Unfortunately, for the last several decades, American has been an oligarchy – a country controlled by and run for the very wealthy)

America is an idea – an idea that free people can govern themselves, that government’s powers are derived from the consent of the governed, that each of us is endowed by their Creator with the unalienable rights to life, liberty, and the pursuit of happiness. America is the belief that any man or woman can – given economic, political, and religious liberty – advance themselves, their families, and the common good.

(Wonderful in concept. However, government policies, particularly during the Bush administration, have made it harder and harder for the lower and middle class to benefit from the resources and opportunities of our great country:

• The Bush administration passed an unnecessary tax cut for the rich, which only served to increase the ridiculous and unhealthy disparity of wealth and income in our country.
• As a result of the tax cut and an unnecessary war, the Bush Administration ran up record deficits, stifling our economy and, consequently, opportunity.
• Republicans zeal for deregulation allowed Wall St to speculate with housing derivatives, which caused the greatest economic downturn since the great depression with disproportionate negative impact on the lower and middle classes.
• Republicans have allowed the bank industry lobbyists to write their own rules, creating laissez-fair “trick and trap” practices in the credit card industry, enabling them to hide behind small print and charge usurious interest rates on an already suffering middle class for specious, arbitrary reasons.)

America is an inspiration to those who yearn to be free and have the ability and the dignity to determine their own destiny.

Whenever the agenda of government becomes destructive of these ends, it is the right of the people to institute a new governing agenda and set a different course.

(The agenda of the government from 2001-2008 WAS, indeed, destructive of these ends. The Obama administration has done everything in its power to address the destructive policies initiated by Republican policies. We’ve already set a new course and the Republican spin-doctors are – and unfortunately succeeding in – twisting the facts, banking upon the fact that it will take time to reverse the excesses of the Bush administration given the vast damage it afflicted on our country, economy and our society and trying to blame it on Obama. In effect, they are trying to create a “Looking Glass” world where up is down and down is up.)

These first principles were proclaimed in the Declaration of Independence, enshrined in the Constitution, and have endured through hard sacrifice and commitment by generations of Americans.

In a self-governing society, the only bulwark against the power of the state is the consent of the governed, and regarding the policies of the current government, the governed do not consent.

An unchecked executive, a compliant legislature, and an overreaching judiciary have combined to thwart the will of the people and overturn their votes and their values, striking down longstanding laws and institutions and scorning the deepest beliefs of the American people.

(Last time I checked, the Supreme Court had a conservative majority)

An arrogant and out-of-touch government of self-appointed elites makes decisions, issues mandates, and enacts laws without accepting or requesting the input of the many.

(Yes, but thank God, we’ve already voted out Bush and Cheney)

Rising joblessness, crushing debt, and a polarizing political environment are fraying the bonds among our people and blurring our sense of national purpose.

(See comment above)

Like free peoples of the past, our citizens refuse to accommodate a government that believes it can replace the will of the people with its own. The American people are speaking out, demanding that we realign our country’s compass with its founding principles and apply those principles to solve our common problems for the common good.

(Again, see comment above)

The need for urgent action to repair our economy and reclaim our government for the people cannot be overstated.

(The only people that your policies reclaim your government for is the very wealthy; you’re hiding behind specious arguments in a vicious, convoluted attempt to convince everyone else it’s in their best interests as well)

With this document, we pledge to dedicate ourselves to the task of reconnecting our highest aspirations to the permanent truths of our founding by keeping faith with the values our nation was founded on, the principles we stand for, and the priorities of our people. This is our Pledge to America.

(Our nation was founded on the principles of equality of opportunity and equal justice under the law. Tax policies that favor the rich, take health care away from the uninsured and compromise Social Security and Medicare are NOT consistent with these values)

We pledge to honor the Constitution as constructed by its framers and honor the original intent of those precepts that have been consistently ignored – particularly the Tenth Amendment, which grants that all powers not delegated to the United States by the Constitution, nor prohibited by it to the states, are reserved to the states respectively, or to the people.

(Okay, that’s reasonable. But why don’t you feel the same way about the Fourteenth Amendment, which you want to repeal – you know, what’s good for the goose is good for the gander)

We pledge to advance policies that promote greater liberty, wider opportunity, a robust defense, and national economic prosperity.

(What has the Obama administration done NOT to promote these goals? They’ve provided much needed stimulus funds to the economy, extended healthcare to the uninsured, and protecting our interests in the middle East.)

We pledge to honor families, traditional marriage, life, and the private and faith-based organizations that form the core of our American values.

(Your economic policies do not honor most American families; it causes their economic destruction – quite the opposite. Most people in “traditional marriages” don’t care about same-sex marriages and, certainly, by the time the younger generation becomes the majority, this issue will become a non-issue. )

We pledge to make government more transparent in its actions, careful in its stewardship, and honest in its dealings.

(Does this mean that the GOP is going to stop conducting most its business in back-office meetings with highly paid lobbyists from the banking and oil industries? If so, bravo!)

We pledge to uphold the purpose and promise of a better America, knowing that to whom much is given, much is expected and that the blessings of our liberty buoy the hopes of mankind.

(The very rich – our “country club Republican “ friends – do virtually nothing to help our society. They hoard their money; they outsource jobs in the workplace, and create economic devastation across our country. They feed off the backs and misery of their fellow citizens with much lower relative wages for those who are still employed, charging them usurious rates when they get behind in credit payments, and they are trying to privatize Social Security which would be disastrous and destroy Medicare – all so that their taxes can be lower!)

We make this pledge bearing true faith and allegiance to the people we represent, and
we invite fellow citizens and patriots to join us in forming a new governing agenda for America.

(There already is a “new” governing agenda for America, but like anything it needs time to work. What this document is espousing is a return to the “old” government agenda that failed big time)

Building Pyramids

2010-02-19T08:47:00.000-08:00

I heard an anecdote the other day. It was about Roosevelt and Keynes. Roosevelt allegedly asked Keynes what to do with the public works monies in the 1930s and Keynes answered and I paraphrase: “Why not build pyramids? Americans like pyramids.”

Okay, on the surface a frivolous use of money. But what would happen if we “built pyramids” today?

- First of all, we’d have to find a place. I nominate somewhere in Michigan outside of Detroit. Immediately we put let’s say 10,000 people to work building our mythical pyramid. At $50K a piece that puts $500 million in the local economy (and saves the government a significant amount in unemployment). So now the local Walmarts, Home Depots and McDonalds et al have to hire more workers too to accommodate the extra demand. And, of course, order more inventory from their suppliers from all around the country. And guess what? Local tax receipts will go up, saving jobs for teachers and public servants. And the real estate market will probably pick up from people coming into the area.

- Of course we need stone to build a pyramid. How about the quarries of Indiana? Now we’ve added a few thousand jobs there. The local businesses prosper. Now the same effect we saw in Michigan is beginning to happen in Indiana on a smaller scale.

- How about cement? From what I understand there’s a very big plant in Texas. Time to up production. More jobs. More money in the local economy.

- Then we need tractors, trucks, tools etc. That means jobs at the Caterpillar plant in Illinois, at the GM , Ford and Chrysler plants in Michigan and the Midwest, Stanley Tool works in Connecticut - and, of course, all the vendors for those companies – the tire companies, electronic companies, sheet metal companies, etc will have to stock up. And more jobs, revenues for the local delis, supermarkets, gas stations, convenience stores in all those areas

- Of course, since all this manufacturing activity will generate greenhouse gases, we’ll need to develop systems to make this growth sustainable. More jobs, more R&D, more ancillary services.

- And once our pyramid is done, now we have a tourist attraction smack in the middle of Michigan. That means hotels, motels, food franchises, convenience stores, etc

- Without doubt, the teamsters and trucking companies will be happy about toting all these needed materials around the country. And, then, we’ll need workmen’s comp – so the insurance companies in CT will get a nice hit, not to mention the financial services industry to finance some of this added growth.

- And what’s happening in the public sector. Tax receipts are going up, unemployment disbursements are going down, maybe some of these workers are even deferring their “retirement” beyond 65, so they continue to pay their payroll taxes and delay their receipt of entitlements.

HOLY COW! WE’VE STARTED A FULL BLOWN RECOVERY JUST BY BUILDING A STUPID PYRAMID.

Now, the reason for this diatribe is not to give everyone a lesson in Econ 101, but rather to counter all those posts that say government spending is necessarily bad. Yes, we need to make the stimulus funds work more quickly, but you can’t argue that they’ll create jobs.

Consider the alternative. Do Nothing? Now you’re looking at an unemployment rate (not counting the underemployed) of about 15%. Do a tax break to the wealthy instead? Well, it would help some, would probably result mostly in luxury good consumption and/or savings/debt retirement. Savings aren’t bad – as long as the banks are willing to loan out the money – in this environment a dubious assumption.
So, if building a “stupid pyramid” can result in all that growth, think what building something really needed might do.

Why the Recent Supreme Court Ruling is Anti-Democracy

2010-01-27T12:17:00.000-08:00

I am still pained by the recent supreme court decision which allows corporations to spend unlimited dollars in political advertising under the supposed protective shield of Freedom of Speech. What was once the country where "all men are created equal," is rapidly becoming the country where "all dollars are created equal."

What do I mean by this?

By this ruling, the court is creating an unlevel playing field in an individuals right to participate in government and civic affairs. Instead of individual having an inherent equal right to participate in our democracy, the court is defining a persons or entity's ability to participate by the number of dollars they have. Not only is this not "Freedom of Speech," it actually stifles freedom of speech because the wealthy few can drown out the unwealthy masses with their dollars. This is not what the framers of the constitution had in mind, I assure you. Right now, Jefferson and Franklin are turning in their graves.

Our democracy is rapidly becoming anything but a democracy; in fact, we are becoming an oligarchy -- where those individuals rewarded disproportionally by the vagaries of an imperfect market are having a disproportionate impact on our government and way of life.

What a shame.

What's Wrong with American Business Today. Part 2: Immediate Gratification

2010-01-18T12:49:00.000-08:00

Last time I talked about The Compartmentalization of Markets and Human Values. This time it’s about Immediate Gratification. Here we go:

2. Immediate Gratification Short Term Focus
It’s true, we live in an immediate gratification society. Unfortunately, it’s even more true in American Business. It’s all about the quarterly numbers and top management’s stock options. So, when the topline isn’t doing well, Sr. Execs make the bottom line look better by cutting staff and programs, like R&D, employee benefits, marketing plans, etc. This begs the question – is eliminating or diluting part of the firm’s human capital (some of whom have been around a long time – longer than the usually transient CEO – and are literally the hearts, soul and minds of the company) and important projects that may spur future growth, really in the best long term interests of the firm? In my estimation, usually not. But it does lead to seven and eight figure bonuses for some top execs. Sometimes a company just has to take the short term hit for the long term good. Unfortunately, management is incented to do exactly the opposite. What a shame.

In upcoming posts, I’ll discuss:

3. Financial Sector as Lord and Master
4. Consumer Schizophrenia
5. Creative Destruction Destroys Creatively.
6. The Rise of “Professional CEOs”
7. The “small business fallacy”
8. The 401K Con Job
9. Bigger is Better and Disruptive Market Power
10. Merger Mania, Leveraged Buyouts and Other Destructive Habits.
11. The Asymetrical Rewards and Punishments of the Business Cycle
12. The marketing afterthought
13. International Sanctuaries for Tax Evaders

What's Wrong with American Business Today? Part 1: Compartmentalization of Markets and Vaues

2010-01-14T12:23:00.000-08:00

I’ve been very critical of American business and its role in the meltdown in many on-line forums, particularly the Wharton forum (and, as a result, have been anointed “Wharton’s Resident Socialist” – which is cute, but I’m definitely not). I am, though, what I would call a “compassionate capitalist” (to paraphrase one of my least favorite politicians). So I thought I would jot down some thoughts on what I think is wrong with American business. I’ll try to send one out every day or so. Okay, here’s the first:

1. The Compartmentalization of Markets and Human Values

Way too often business leaders “compartmentalize” between their business sides and human sides and never in the twain shall they meet. It’s like Bill Clinton, Elliot Spitzer and Tiger Woods compartmentalizing their trysts completely out of their public personas. I think, in many ways they actually think there are two of them ! The same goes with many business leaders. In the workplace, they march to the beat of Adam Smith and the “Invisible Hand.” Out of the workplace, most try to be respectable members of the community and some even Bible-toting churchgoers. But here’s the problem – the decisions they make in the boardroom, when they are driven by the pure profit motive affect the community and society as a whole – many times in a negative way. But in the office they hide under the cover of “profit maximization”, using it as a shield. I’m sure those Enron folks who robbed their employees of their 401Ks - -- or the Citigroup execs who brought the company down but still think they’re entitled to big bonuses -- were good church-going citizens, but it certainly didn’t factor into their business decisions. They’re decisions many times leave people homeless, without health insurance and/or pensions, while the corporate execs live the “high life,” even after they’ve failed miserably. Capitalism without a social conscious is an empty vessel.

Some topics I’ll cover in subsequent posts:

2. Immediate Gratification

3. Financial Sector as Lord and Master

4. Consumer Schizophrenia

5. Creative Destruction Destroys Creatively.

6. The Rise of “Professional CEOs”

7. The “small business fallacy”

8. The 401K Con Job

9. Bigger is Better and Disruptive Market Power

10. Merger Mania, Leveraged Buyouts and Other Destructive Habits.

11. The Asymmetrical Rewards and Punishments of the Business Cycle

12. The marketing Afterthought

13. International Sanctuaries for Tax Evaders

Wealth Inequality on Steroids!

2009-09-30T13:46:00.000-07:00

Do you know how much of the total US wealth the top 1% of households controls? A staggering 34% (as of 2004). Which means that as a nation we onlly have 66% of the total wealth to address the needs of the other 99%. No wonder why we have the health care and other social problems that we do.Think about it -- if the top 1% of HHs only controlled 17% of total net worth, the rest of us would have 27% more resources to attend to basic needs.

How Much Will Boomers Have to Retire On?

2009-09-30T13:44:00.000-07:00

I did a little analysis and keep up with some interesting figures. Let's assume you are a 53 year old boomer today. Based upon the average value of a 401K for this age group, the average net equity in your home, and social security payouts, here's what it looks like:

IF YOU SELL YOUR PRIMARY RESIDENCE:
- And retire at age 62, you'll have $3494/mo to live on
- And retire at 65, you'll have $4,655 to live on
-And retire at 67, you'll have $5852 to live on

IF YOU DON'T SELLL YOUR PRIMARY RESIDENCE:
- And retire at age 62, you'll have $2352/month to live on
- And retire at age 65, you'll have $3109/month to live on
- And retire at age 67, you'll have $3,946/month to live on

Not draconion, particularly in some areas of the country, but definitely eye-opening!!!

What do Baby Boomers think government's role should be?

2009-09-30T13:40:00.000-07:00

We asked our online panel of 150 boomers their thoughts on the role of govt. vis a vis the economy and social issues. Here's what they told us (they were allowed to chose more than one response):

• 46% - “I’ve seen the flaws of unregulated capitalism and I’m for more government intervention.”

• 20% - “I am dedicated to the principles of capitalism now more than ever.”

• 32% - “I think it’s the government’s role to make sure that all people have equal access to housing, healthcare, education and a dignified retirement.”

• 9% - “People should fend for themselves. The smaller the government, the better.”

• 45% - “I’m disgusted with government’s role because it’s rewarding failure and bailing out people who made mistakes.”

• 6% - “I think Socialism is a good idea and it will help us solve some of today’s problems.”

Is Social Security the largest Ponzi scheme going?

2009-07-30T09:05:00.000-07:00

That's exactly how a prettty knowledgeable friend of mine described it.

Actually, I thought it was a compelling question, so I did a little research. Here are the facts:

* Right now, the total amount of money taken in through payroll taxes EXCEEDS the benefits paid out to retirees. The excess is put in a trust fund invested in US bonds

* In 2017, the amount taken in will not cover benefits paid. It will have to be supplemented by interest from the trust fund.

* By 2027, the amount paid in plus the interest will not be sufficient to cover benefits. Hence, the government will have to dig into the principal to fund the benefits (a mortal sin according to rich WASPs)

* By 2040, the entire trust fund will be depleted.

The Good News?Social Security will be around for most of our lives. Well, on second thought, maybe not good news, but at least it doesn't suck!!!

Jewelry or Gall Bladders?

2009-07-21T11:31:00.000-07:00

I remember when I took Econ 101, in one of the early chapters there was this tradeoff chart that depicted macroeconomic decisions that government had to make during WWII: guns or butter? In other words, in a finite world you could only produce so much guns or butter -- the more guns, the less butter and vice versa.

This sort of reminds me of the dilemma we're facing now and makes me wonder why there's so much resistance to this "millionaires" tax to fund universal health care.

It seems to me if someone is making in the range of a million dollars a year, that 5.4% tax (or whatever it is) on marginal income will definitely not be used for life's necessities. So for lack of a better term, let's say it would be used on a luxury item, like jewelry.

So, put in more basic terms, some of the politicians who are oppossed to the tax on the wealthy are saying they'd rather have their rich constituents buy jewelry than one of their poorer constituents have his or her gall bladder surgery.

What's wrong with this picture?

On Bonuses....

2009-03-17T10:43:00.000-07:00

Who deserves bonuses?
Any teacher who inspires a student to love learning, any hardworking volunteer at homeless shelters, soup kitchens, EMT crews -- not to mention police officers and fire fighters -- the little league coach who plays the fat, uncoordinated kid even if it means blowing a game, Sully and his entire flight crew, single moms who work two jobs to raise their kids and send them to college, and a bevy of others...

Who doesn't deserve bonuses?
Any of the already overpaid geniuses at AIG who got us into this mess and their other Wall St. bretheren, Alex Rodriguez and Roger Clemens (not for lying or giving themselves an unfair advantage, but for what it says to the kids of the world), and, last but not least, any member of the 2008 Detroit Lions.

The only good thing that come out of this Wall St. crisis is that it is underscoring the unfair disequibilbrium of income and wealth in this society, exposing a skewed system of wealth "entitlement," and is driving a new wave of populist revolt that might just change things for the better long term.

The Best and the Brightest.

2009-03-05T12:47:00.001-08:00

It seems to me that one of the causes of our current economic malaise lies in how we've deployed our very best talent.

Instead of getting into industries that innovate, create, or manufacture real stuff, they went to Wall St.

And what did they do there?

At first, M&A was the hot thing. They'd stick two companies together -- in many cases two companies that had no business being stuck together -- they'd fire middle and upper level managers (in many cases the very heart and soul of the companies) to bring expenses down and profits up so that they could become very wealthy.

The expense? Failed companies, a compromised middle class, and lots of money for the very few.

Lately, they've been into hedge funds and these mortgage backed security "things." To read about some of these deals is mind boggling. They'd take a mortgage backed security, pick off its most risky pieces, put them and others like them into a mutual fund, then another mutual fund would buy the riskier pieces of those funds. All mired in a foggy soup of derivatives, credit swaps and a bevy of indicipherable instruments.

Well, the best and the brightest finally outsmarted themselves.

In their quest to impress themselves with the brilliance of all their financial slight-of-hand, they've created nothing, absolutely nothing -- other than a financial crisis of epic proportion.

Back to my original point: when our country succeeded we were driven by real innovation -- not the contrived innovation of CMOs, derivatives, and credit swaps -- innovation, that created value, jobs, and productivity gains.

The industrial revolution was fueled by steel mills, automobile factories, and electric generating stations. The sixties were driven by housing starts, the NASA program, shopping malls and supermarkets. The nineties by Microsoft, Intel, Cisco, the dot.commers. Real products. Real value.

And, yes, for all those expansions, Wall St. was there -- serving its proper function: providing captial for the mills, factories, shopping malls, microchips factories and software companies. Whenever Wall St has tried to get fancy, it's failed miserably.

Perhaps the best and the brightest of the next generation should concentrate on creating real value rather than the illusory value of Wall St.

The Exploitation of the Many by the Few

2009-02-23T12:27:00.000-08:00

I noticed an article the other day.

Apparently, Goldman Sachs owns a major piece of Burger King.

The article basically made the point that if you took the total bonus pool of Goldman Sachs and extended it to all the Burger King employees, they each would have received an $18,000 bonus, which is in excess of the average BK salary of $14,000.

Significantly, Goldman Sachs took billions in federal bailout money and still gave out bonuses. Several years ago I remember reading that the average total compensation at Goldman Sachs -- including secretaries, administration, clerical -- was $600K. We can only imagine what people at the most senior levels got.

So here's my point: are we better off with the few making so, so much and the many struggling just to survive. Yes, of course, there are different levels of talent and it takes a lot more education and smarts to put together an M&A deal than flip burgers, but I have to question the over-exaggerated skew towards the very wealthy.

The Goldman Sachs bonuses, I'm sure, bought a lot of expensive Coops in Manhattan, McMansions in Fairfield County, Summer Homes in the Hamptons and Nantucket, yachts, exotic luxury cars and many things I can't even imagine.

Wouldn't the money have been put to better use by bringing those BK employees up from poverty levels to income levels which begin to border on adequate?

What if they gave a depression and no one came?

2009-02-21T13:15:00.000-08:00

I took a lot of economics courses in my time (not that I remember much!)

But, despite the few things I can remember about Keynesian economics and Milton Freidman's monetary theories, I'm more confused than ever now.

What happens when almost everyone has NOTHING?

What if we just kept on doing what we're doing now -- going to work, the grocery store, the movies, everything -- but we just didn't use money.

It's a beautiful idealistic thought (I've never been accused of being a pragmatist).

The one problem, though, is some people would try to take advantage of it and the whole thing would become unglued before it got started.

Oh, well......

Is it just me or....

2009-02-20T11:58:00.001-08:00

are advertising people the most abused class of people in the world?

It's a tough business, you put all your energy and passion into what you do, and then you get fired for trivial reasons without any regard to the quality of work you do.

I think we're all masochists!

I Don't Understand the Republicans.

2009-02-18T18:24:00.001-08:00

They voted against the stimulus bill, calling it unnecssary spending.

In California, they won't help balance the budget.

Don't they get it?

Spending creates jobs!!!!!

If you spend $10 million to build (or repair) a bridge, that could potenially hire 100 people at 50K a year who will spend most of that at WalMart, Target, StopNShop, A&P, Ralphs, Home Depot, etc which will cause all of those stores to hire more people and their vendors to hire more people to manufacture their goods. Their's a multiplier effect of about 1.7 times the actual investment.

What do the Republicans think we should do?

Sink into a morrass of poverty?

Will Our Generation Ever Be Able to Retire?

2009-02-18T12:46:00.001-08:00

I was thinking the other day (always dangerous!).

Our parents generation had for the most part pensions and social security.

Our generation -- unless you're a public employee or one of the dwindling number of unionized workers -- for all intents and purposes, has no pension.

If you were to look at everyone over 50 years old and cut out the top 5% in terms of net worth, I bet you (and this is strictly a guess) that the average liquid savings is less than $100K.

Social Security, as we all learned in Econ 101, is not in actuality a trust, but a transfer payment. Our generation funded the social security payments of our parent's generation. But the problem is, there were more of us than them. The situation reverses itself with the next generation.

So....

No pensions. Not a lot of savings. Dubious prospects for Social Security.

Yikes!!!!

Socialism here we come.