As the years become faded memories, there are some dates that never leave your brain's electronic data storage. Take 1967 for instance. That was the year I first heard the Beatles song, "When I'm Sixty-Four." I was reminded of it this week when my days on planet Earth reached that magic number. Wasn't it only yesterday that 64 seemed really, really old?
The birthday milestone prompted an examination of what has happened in my brief lifespan. No question that change has been a constant theme, both globally and personally. Nothing has been certain but uncertainty. And that's not just hyperbole.
If you will indulge my fit of nostalgia, here is my list of moments and events that changed history and influenced the lives of most of us Boomers:
1. Neil Armstrong's stroll on the moon deserves top billing. Americans sat mesmerized in front of their televisions as what seemed like science fiction played out on our screens. The technological achievement has no equal in my lifetime.
2. The attacks of September 11th are forever etched in our memories. Most Americans can describe with amazing clarity where they were and what they were doing when the two airplanes smashed into the Twin Towers. In the days and years that followed, Americans no longer felt safe from attack on our own soil.
3. The assassination of President Kennedy gripped the country like no event before or since. As Americans watched on television, the country buried a youthful hero too young to die. It made all of us feel a little more vulnerable.
4. The Cuban missile crisis threatened to plunge the country into a war with Russia. The world shuddered as the brinkmanship between the two countries appeared headed for a nuclear showdown. We all breathed easier when Russia stood down, but we never forgot the feeling of uneasiness about our future.
5. The collapse of the Berlin Wall shook the foundations of democracy. The Russian empire was thought to be invincible. When the wall came down, Russia disintegrated at a breathtaking pace. The world order changed overnight.
6. The Vietnam War was the first conflict that aired on the evening news. The television pictures shocked a nation that was used to seeing old photos and reading print stories about the violence of war. The coverage awakened a peace movement and changed the way people viewed war, the military and the sacrifices required for victory.
7. Watergate sunk the presidency of Richard Nixon and shamed a nation. It may have ended one man's political career, but its lasting impact was the role the media played in driving an elected official from office. That gave rise to a virulent strain of investigative journalism that has become more of a tool for the activist media to drive out of power those opponents of its views and agenda.
8. The shooting of Martin Luther King snuffed out the life of a change agent. The terrible tragedy focused attention on the black-white strife boiling beneath the surface. Many Americans were forced to confront their own feelings about race.
9. The Roe vs. Wade decision by the Supreme Court remains one of the most controversial judicial rulings in history. The verdict has sparked decades of jostling on both sides of the issue. It also has focused the spotlight on the power of the court to impact everyday lives.
10. No list would be complete without paying tribute to the Internet. It has facilitated the lightning spread of information, ideas and human communication beyond what was once imaginable. People around the globe are now connected in a way that could never have been possible without the Internet.
That's my top ten. You probably have others that belong on the list. But there is one moment that only I can claim. And it is the reason that Sixty-Four doesn't seem so alien, even if Paul McCartney must have worried about the uncertainties of growing old when he wrote, "Will you still need me? Will you still feed me? When I'm Sixty-Four."
In 1967, something else happened that changed me forever. That was the year I proposed to a gorgeous coed named Dianna. When she accepted my offer of marriage, it gave new meaning to my life. Now 42 married years later, my days are filled with unbridled joy, unconditional love and mutual faith.
Sharing my life with Dianna also produced two incredible sons who make me proud every day. They in turn have introduced two wonderful daughters-in-law into my life and one extraordinary grandson. Add to that many good friends and family it is easy to understand why I am such a blessed man.
As a result, Sixty-Four now sounds like a much kinder number than it once did.
Wednesday, June 30, 2010
Sunday, June 27, 2010
Mexican Drug Violence: Illegal Immigation Nightmare
As drug violence escalates along our southern border, it is beginning to appear that the Mexican government is losing its four-year war with the powerful cartels. Heavily armed drug death squads continue to murder with impunity, wiping out government soldiers, police, rival gang members, politicians and news reporters. Innocent bystanders are often part of the collateral damage. In one attack, six children, including a two-year old, were slaughtered. No one is spared in this grisly violent spasm that has gripped the country.
Earlier this month the killings reached a nadir when the country recorded its bloodiest weekend. In a string of attacks, 14 were killed in an assault on a drug house, 12 federal officers died in an ambush and 19 drug addicts in a rehabilitation clinic were executed in gangland fashion. In a single 24-hour period, the death toll reached 85, surpassing the previous record of 58 killings in 2008. That same week more than 160 people were murdered. Even for Mexico, these are mind-numbing statistics.
Since December 2006, more than 23,000 people have been killed in drug-related violence. In just one year period, murders jumped 300 percent. As the killings have mounted, the incidents have turned more grotesque with each passing day. Decapitations, mutilations, sexual abuse, torture and sadistic ritual violence have been used by the drug gangs to intimidate and silence those who would oppose them. The message is clear to Mexico's frightened population.
For the government's part, the response has been lacking in resolve. Instead of an all out offensive, the government of Felipe Calderon has treated the conflict as more of a war of containment. In a sprawling country of 111 million people, the government has dispatched 50,000 troops, hardly a show of massive force. Often the troops are out gunned by heavily armed drug cartel forces that are better trained in tactical warfare. In addition, the level of corruption in the local police and the military remains high. That helps explain how the cartels have gained the upper hand.
As one example of the government's failure, the city of Cuidad Juarez on the Texas border with El Paso has been a hotbed of violence. Nearly ten people are murdered every day. Almost 1,200 have been killed this year. The city is emptying at an alarming rate as citizens flee the violence and businesses shutter their shops. By some estimates, 30,000 people have abandoned the city of 1.3 million. Instead of establishing a massive, heavily-armed military presence and declaring martial law in Juarez, the government has been content to send a few thousand troops in hopes of quelling the violence. This approach has been an utter disaster.
President Calderon, taking a page from President Obama's playbook, continues to blame the U.S. for all Mexico's problems. The U.S. appetite for drugs and the flow of weapons across the border to Mexico are to blame, Calderon complains. Granted he does have a point, but Mexico's own failures to cope with the issues speak louder of the government's performance. Instead of finger-pointing, Calderon needs to quit pussyfooting around with the cartels and wage war on the drug lords.
It's hard to imagine that ordinary Americans would stand idly by if the U.S. military and police could not stamp out rampant violence in our cities. However, Mexico's citizenry has a long history of passivity, ignoring corruption and drugs. Looking the other way is ingrained in the Mexican culture. That has allowed the cartels to operate brazenly without fear of a revolt by the populace.
For that reason, one must question the long term stamina of the Mexican government's anti-drug battle. People and businesses are growing tired of the violence. They view the government as ineffective in protecting them. No section of the country remains untouched by the violence. Once tourist towns were considered safe havens, but all that is changing, too, as murders rack every corner of the country, sparing no city. Even in President Calderon's home state, drug lords recently gunned down 12 federal officers. They were beheaded and their bodies dumped along side a busy highway.
In a sign of the cartel's growing influence, one of the Mexican President's top anti-drug prosecutors was recently arrested and charged with accepting more than $500,000 in bribes from the powerful Sinaloa cartel, headed by Joaquin "El Chapo" Guzman, a billionaire and one of Mexico's richest men. Incredibly, Guzman and other drug kingpins are not arrested; their assets are not confiscated; and, they travel freely about the country. Meanwhile, the cartels are raking in an estimated $10 to $25 billion annually in profits from illegal drugs.
There appear to be two possible outcomes to the violent upheaval gripping the country. The most likely may be that Calderon abandons his campaign, leaving the cartels to fight it out among themselves for the most lucrative drug routes. This would not stop the bloodshed, of course. Perhaps fewer police and military would die. However, if Calderon gives in, it would embolden the drug cartels to spread their tentacles even deeper into society and business. The country would slowly collapse, causing hundreds of thousands of citizens to flee over a period of time.
The second scenario is more ominous. Under that outcome, Mexico dissolves into complete turmoil as drug cartels literally take over the country. The government is under siege. Civil war breaks out in the streets. People flee in the millions for their very lives.
Whichever outcome unfolds, the U.S. would be the most likely escape route for Mexicans. That means thousands of illegal immigrants would be streaming into the U.S. If U.S. policy-makers today are hard-pressed to close the borders, it will be all but impossible if chaos erupts. People willing to risk everything for a job is one thing, but the desperation of people fleeing from a bullet is something altogether more difficult to contain.
Already, there are troubling signs that should make the Washington crowd sit up and take notice. Asylum requests from Mexican nationals are increasing at an alarming rate. There are 12,100 such requests pending, according to the Justice Department's Executive Office for Immigration Review. There would be thousands more, but Mexicans are discouraged by the few requests that have been granted: only 232 to date. No one knows how many Mexicans today are surreptitiously leaving the country for the U.S. to escape the violence. However, it is clear that many fleeing Mexico are increasingly criminals, who are eluding rival gangs or seeking shelter while they regroup.
Some Americans may see the increasing drug violence as solely Mexico's problem. But the increase in kidnappings of Americans should be a wake up call. Nearly 70 U.S. citizens have been kidnapped by cartels on both American and Mexican soil. Phoenix now holds the distinction as the city with the second highest reported kidnappings in the world. In just the last year, kidnappings in that city have risen 40 percent. (Is it any wonder Arizona was the first state to pass tough illegal immigration legislation?) Mexico City ranks number one with 30-50 kidnappings every day.
Up to now, the U.S. government has limited its assistance to technical and financial aid. The Obama administration is spending $1.3 billion to train police, reform the courts and supply military equipment to the Mexican government. But our government has been poring millions of dollars to fund Mexico's effort for nearly a decade without any impact on reducing the violence and restoring a measure of peace.
The Obama Administration would be well advised to take heed. There is a brewing storm in Mexico that threatens to unleash a mass migration unlike any the U.S. has ever witnessed. That is why border security should be a top priority for the administration. A year from now may be too late.
Sadly, up to this point, the government has seemed more willing to criticize Arizona's attempt to stem the tide of illegals, rather than offer concrete solutions. Every day that the administration delays addressing this issue, it imperils the future safety of all Americans.
Earlier this month the killings reached a nadir when the country recorded its bloodiest weekend. In a string of attacks, 14 were killed in an assault on a drug house, 12 federal officers died in an ambush and 19 drug addicts in a rehabilitation clinic were executed in gangland fashion. In a single 24-hour period, the death toll reached 85, surpassing the previous record of 58 killings in 2008. That same week more than 160 people were murdered. Even for Mexico, these are mind-numbing statistics.
Since December 2006, more than 23,000 people have been killed in drug-related violence. In just one year period, murders jumped 300 percent. As the killings have mounted, the incidents have turned more grotesque with each passing day. Decapitations, mutilations, sexual abuse, torture and sadistic ritual violence have been used by the drug gangs to intimidate and silence those who would oppose them. The message is clear to Mexico's frightened population.
For the government's part, the response has been lacking in resolve. Instead of an all out offensive, the government of Felipe Calderon has treated the conflict as more of a war of containment. In a sprawling country of 111 million people, the government has dispatched 50,000 troops, hardly a show of massive force. Often the troops are out gunned by heavily armed drug cartel forces that are better trained in tactical warfare. In addition, the level of corruption in the local police and the military remains high. That helps explain how the cartels have gained the upper hand.
As one example of the government's failure, the city of Cuidad Juarez on the Texas border with El Paso has been a hotbed of violence. Nearly ten people are murdered every day. Almost 1,200 have been killed this year. The city is emptying at an alarming rate as citizens flee the violence and businesses shutter their shops. By some estimates, 30,000 people have abandoned the city of 1.3 million. Instead of establishing a massive, heavily-armed military presence and declaring martial law in Juarez, the government has been content to send a few thousand troops in hopes of quelling the violence. This approach has been an utter disaster.
President Calderon, taking a page from President Obama's playbook, continues to blame the U.S. for all Mexico's problems. The U.S. appetite for drugs and the flow of weapons across the border to Mexico are to blame, Calderon complains. Granted he does have a point, but Mexico's own failures to cope with the issues speak louder of the government's performance. Instead of finger-pointing, Calderon needs to quit pussyfooting around with the cartels and wage war on the drug lords.
It's hard to imagine that ordinary Americans would stand idly by if the U.S. military and police could not stamp out rampant violence in our cities. However, Mexico's citizenry has a long history of passivity, ignoring corruption and drugs. Looking the other way is ingrained in the Mexican culture. That has allowed the cartels to operate brazenly without fear of a revolt by the populace.
For that reason, one must question the long term stamina of the Mexican government's anti-drug battle. People and businesses are growing tired of the violence. They view the government as ineffective in protecting them. No section of the country remains untouched by the violence. Once tourist towns were considered safe havens, but all that is changing, too, as murders rack every corner of the country, sparing no city. Even in President Calderon's home state, drug lords recently gunned down 12 federal officers. They were beheaded and their bodies dumped along side a busy highway.
In a sign of the cartel's growing influence, one of the Mexican President's top anti-drug prosecutors was recently arrested and charged with accepting more than $500,000 in bribes from the powerful Sinaloa cartel, headed by Joaquin "El Chapo" Guzman, a billionaire and one of Mexico's richest men. Incredibly, Guzman and other drug kingpins are not arrested; their assets are not confiscated; and, they travel freely about the country. Meanwhile, the cartels are raking in an estimated $10 to $25 billion annually in profits from illegal drugs.
There appear to be two possible outcomes to the violent upheaval gripping the country. The most likely may be that Calderon abandons his campaign, leaving the cartels to fight it out among themselves for the most lucrative drug routes. This would not stop the bloodshed, of course. Perhaps fewer police and military would die. However, if Calderon gives in, it would embolden the drug cartels to spread their tentacles even deeper into society and business. The country would slowly collapse, causing hundreds of thousands of citizens to flee over a period of time.
The second scenario is more ominous. Under that outcome, Mexico dissolves into complete turmoil as drug cartels literally take over the country. The government is under siege. Civil war breaks out in the streets. People flee in the millions for their very lives.
Whichever outcome unfolds, the U.S. would be the most likely escape route for Mexicans. That means thousands of illegal immigrants would be streaming into the U.S. If U.S. policy-makers today are hard-pressed to close the borders, it will be all but impossible if chaos erupts. People willing to risk everything for a job is one thing, but the desperation of people fleeing from a bullet is something altogether more difficult to contain.
Already, there are troubling signs that should make the Washington crowd sit up and take notice. Asylum requests from Mexican nationals are increasing at an alarming rate. There are 12,100 such requests pending, according to the Justice Department's Executive Office for Immigration Review. There would be thousands more, but Mexicans are discouraged by the few requests that have been granted: only 232 to date. No one knows how many Mexicans today are surreptitiously leaving the country for the U.S. to escape the violence. However, it is clear that many fleeing Mexico are increasingly criminals, who are eluding rival gangs or seeking shelter while they regroup.
Some Americans may see the increasing drug violence as solely Mexico's problem. But the increase in kidnappings of Americans should be a wake up call. Nearly 70 U.S. citizens have been kidnapped by cartels on both American and Mexican soil. Phoenix now holds the distinction as the city with the second highest reported kidnappings in the world. In just the last year, kidnappings in that city have risen 40 percent. (Is it any wonder Arizona was the first state to pass tough illegal immigration legislation?) Mexico City ranks number one with 30-50 kidnappings every day.
Up to now, the U.S. government has limited its assistance to technical and financial aid. The Obama administration is spending $1.3 billion to train police, reform the courts and supply military equipment to the Mexican government. But our government has been poring millions of dollars to fund Mexico's effort for nearly a decade without any impact on reducing the violence and restoring a measure of peace.
The Obama Administration would be well advised to take heed. There is a brewing storm in Mexico that threatens to unleash a mass migration unlike any the U.S. has ever witnessed. That is why border security should be a top priority for the administration. A year from now may be too late.
Sadly, up to this point, the government has seemed more willing to criticize Arizona's attempt to stem the tide of illegals, rather than offer concrete solutions. Every day that the administration delays addressing this issue, it imperils the future safety of all Americans.
Thursday, June 24, 2010
Letters From O.H. Bama
Dear General Petraeus:
As your lovable commander-in-chief, I feel it is my obligation to lay down a few ground rules to help you avoid some of the mistakes of your predecessor, General Stanley McChrystal.
But before I do, perhaps what we have here is a teachable moment. Generals are to be seen and not heard. I think McChrystal gets that now. Unfortunately, he was a little slow on the uptake so now he's just another Big Mac whose buns got toasted.
Let me also clear the air about my previous comments and those of other Democrats when you appeared on the Hill during the last failed presidency. Yes, back then we called you, "General Betray-us." And, that was one of the kinder names. But as you know general, sometimes war makes for strange bedfellows, especially under those silly "don't ask, don't tell" rules.
I hope that puts your mind at ease. You have my undying, intractable, 110 percent support. You can count on that just as surely as you can count on balanced budgets and no cuts in defense spending.
Now, here are those ground rules I promised:
1. Avoid drunken interviews with Rolling Stone magazine. If you feel you must speak to one of their reporters, stick to these talking points: "Barack, good. Taliban, bad."
2. Never call the vice president Joe Bite Me. You my refer to him as Plugs, Halfwit, Numbskull or Clueless. Out of respect for the handicapped, we should never call brain dead people a disparaging name.
3. Never say that I (your commander-in-chief) looks "uncomfortable" and "intimidated" in a room full of military people. Sometimes my Presidential underwear bunches up and I get a pained expression on my face. But I am never ill at ease in any roomful of puffed up generals who wouldn't know the first thing about community organizing.
4. Meetings with me are never referred to as "photo ops." However, get used to getting your picture taken by the press every time you show up at the White House. After the photo session, we should have a minute or two to discuss the Afghan conflict before my afternoon basketball game or a round of golf.
Now, I know what you must be thinking. "Oh great, I'm going to have to kiss the President's rear end to keep my job." Not true. A peck on the back, neck or Presidential ring is all that is required.
I realize that it probably wasn't this way when you worked for that dolt, George Bush. He expected you to tell the truth and run the war effort as if the U.S. wanted to win. Forget that stuff. My larger-than-life image matters more than a bunch of poppy-growing, women-hating, beard-wearing, rag heads in Afghanistan.
Besides, if things go terribly wrong in Afghanistan, I can always blame Bush. After all, he is the one who appointed you in the first place. I'm just a victim of his past misjudgements.
But don't worry, general. I got your back.
Your Commander-in-Chief (and don't ever forget it),
O.H. Bama
As your lovable commander-in-chief, I feel it is my obligation to lay down a few ground rules to help you avoid some of the mistakes of your predecessor, General Stanley McChrystal.
But before I do, perhaps what we have here is a teachable moment. Generals are to be seen and not heard. I think McChrystal gets that now. Unfortunately, he was a little slow on the uptake so now he's just another Big Mac whose buns got toasted.
Let me also clear the air about my previous comments and those of other Democrats when you appeared on the Hill during the last failed presidency. Yes, back then we called you, "General Betray-us." And, that was one of the kinder names. But as you know general, sometimes war makes for strange bedfellows, especially under those silly "don't ask, don't tell" rules.
I hope that puts your mind at ease. You have my undying, intractable, 110 percent support. You can count on that just as surely as you can count on balanced budgets and no cuts in defense spending.
Now, here are those ground rules I promised:
1. Avoid drunken interviews with Rolling Stone magazine. If you feel you must speak to one of their reporters, stick to these talking points: "Barack, good. Taliban, bad."
2. Never call the vice president Joe Bite Me. You my refer to him as Plugs, Halfwit, Numbskull or Clueless. Out of respect for the handicapped, we should never call brain dead people a disparaging name.
3. Never say that I (your commander-in-chief) looks "uncomfortable" and "intimidated" in a room full of military people. Sometimes my Presidential underwear bunches up and I get a pained expression on my face. But I am never ill at ease in any roomful of puffed up generals who wouldn't know the first thing about community organizing.
4. Meetings with me are never referred to as "photo ops." However, get used to getting your picture taken by the press every time you show up at the White House. After the photo session, we should have a minute or two to discuss the Afghan conflict before my afternoon basketball game or a round of golf.
Now, I know what you must be thinking. "Oh great, I'm going to have to kiss the President's rear end to keep my job." Not true. A peck on the back, neck or Presidential ring is all that is required.
I realize that it probably wasn't this way when you worked for that dolt, George Bush. He expected you to tell the truth and run the war effort as if the U.S. wanted to win. Forget that stuff. My larger-than-life image matters more than a bunch of poppy-growing, women-hating, beard-wearing, rag heads in Afghanistan.
Besides, if things go terribly wrong in Afghanistan, I can always blame Bush. After all, he is the one who appointed you in the first place. I'm just a victim of his past misjudgements.
But don't worry, general. I got your back.
Your Commander-in-Chief (and don't ever forget it),
O.H. Bama
Thursday, June 17, 2010
Factoids That You Can Use
Food stamps are a shining example of the government's ineptness at administrating a federal program. Begun in 1964, the Food Stamp program has gobbled up billions of dollars in taxpayers dollars and done nothing to stamp out hunger. The program has been fraught with fraud, theft and bloated administrative costs. In fact in 2008, the program's bad public image prompted Congress to change its name to the Supplemental Nutrition Assistance Program (SNAP). It may be a catchy acronym, but nothing much has changed. Last fiscal year, taxpayers shelled out a record $56 billion to serve 28 million recipients, according to the Cato Institute. That works out to $2,000 per recipient. However because of an inefficient government bureaucracy, administration costs ate up a whopping $5.5 billion that never made it to the recipients. Fraud chomped off another $1 billion. Theft and over payments cleaned out another $1 billion. Yet the federal government keeps going back to the public trough for more money. As part of the stimulus package, Congress engorged SNAP with a fresh $20 billion. Despite inserting the word "nutrition" in the program's name, it has failed miserably in that regard, too. According to federal data, obesity rates are higher for adults and children receiving SNAP assistance. This should give pause to anyone who believes the government would do a better job than the private sector of administering the nation's health care.
Monday, June 14, 2010
Oily Residue Covers President and Hayward
The two principal players in the Gulf of Mexico oil spill saga are vying for the title of "Most Incompetent." President Obama and British Petroleum CEO Tony Hayward have dithered, dallied and danced their way around one of the worst environmental disasters in modern times. As the drama drags on and on, the two leaders have done everything but lead. Their collective ineptitude is staggering.
Let's start with Hayward, BP's beleaguered chief executive officer. His performance has gone from bad to worse since the oil rig explosion on April 20 that killed 11 workers. He was practically invisible in the early days of the crisis. When the heat was turned up on BP, the jaunty Hayward told reporters all the criticism of his company's handling of the spill hadn't fazed him because he maintained a "stiff upper lip." Not exactly comforting words to a world waiting for answers.
Then Hayward proceeded to put both feet in his mouth. Asked by reporters about his schedule, he half-hearted complained the crisis had intruded on his life. That incensed the relatives of the workers killed in the explosion. Hayward may be burning the midnight oil, but their husbands and fathers were gone forever. It didn't play very well on the evening news.
That's when Hayward turned to a "crisis management" firm for help in buffing his image. Their recommendations were standard public relations fare: run a bunch of self-congratulatory ads on the clean-up efforts and use social media to tell the world about BP's laudable record for environmental protection. As the advertising broke, it was greeted with an unanimous chorus of boos from everyone, including the President. Hayward had blown another opportunity for leadership.
By comparison, Hayward actually comes off better than President Obama. Fearing a Katrina-like backlash, the President has made numerous appearances in the affected states and flown over the disabled oil rig in the Gulf of Mexico. The news footage has shown a deeply troubled president, his shirtsleeves rolled up as he examines the damage. He has looked the part of a leader. But that's where any similarities with leadership have ended.
Instead of putting the entire resources of the federal government and military at BP's disposal, Obama laid sole responsibility for stopping the leaking oil on BP's doorstep. He adopted a hands-off attitude. Then he named a retired Coast Guard admiral as the official government point man instead of a cabinet-level person with more clout.
As the crisis dragged on, Obama quickly resorted to name calling like a school yard bully. He said he was "angry and frustrated". A lynch mob mentality gripped the administration. Attorney General Holder skipped the formalities of due process and announced his office was preparing to file criminal charges against BP. Forget quaint ideas like innocent until proven guilty.
That started a feeding frenzy in Congress where committees began competing to see which one could launch hearings the fastest. Television coverage in an election year was just the tonic that senators and representatives needed to boost their flagging popularity with voters. The President called for BP to set up an escrow account to pay for damages. A figure of $20 billion was bandied about. Congress drafted a letter to Hayward essentially repeating the President's demands. Then the President upped the ante, saying he wasn't worried about BP's profitability.
That ticked off our friends in Britain. The Mayor of London called the "anti-British" rhetoric unseemly and urged cooler heads rather than name-calling. He complained that this "great British company is being continually beaten up on the airwaves." Meanwhile, there is a growing backlash against Prime Minister David Cameron's failure to intervene with Obama on behalf of the petroleum giant. That led to a hastily arranged telephone conversation between the leaders.
Despite all the words, the posturing and finger-pointing, oil continues to flow into the Gulf of Mexico. Every day brings a new promise of a fix. That is followed by another disappointment. The rhetoric ratchets up another notch, but solutions are as hard to find as effective leadership.
Instead of school yard bantering, Hayward and Obama should have met face-to-face on Day 2 of the spill, pledging all their collective resources to stop the well from spewing oil. They needed to present a united front to the public. A high-ranking government official, reporting to the President and Hayward, should have been tapped to lead the cleanup effort. Then the government and the oil industry should have mobilized all their resources and mapped a plan for best case and worst case scenarios.
Hayward should have left the cushy comfort of his offices in the United Kingdom and set up a BP crisis center in the gulf region. His on site directing of BP's efforts would have at least given the appearance that he was engaged and in charge. Instead he sought shelter in his offices across the pond. That didn't exactly inspire confidence.
For his part, the President spent all his energy haranguing BP, its CEO and the oil business in general. Apparently, his advisers think the public would rather hear him beat up on Big Business rather than actually solve the catastrophe. His sporadic flyovers along the Gulf Coast have been nothing more than PR stunts. Where are the town meetings with affected businesses that he has become so famous for? Perhaps, the President doesn't want to face the music.
Even worse, the President has turned a deaf ear to offers from other nations and oil industry businesses that have offered ships, oil dredging equipment, well-capping services and similar resources to help stem the leak. It is almost as if he would rather watch BP fail at any cost than lend a hand.
The two bumbling leaders have covered themselves in words while the crisis remains unchecked. According to the latest government estimates, 40 to 100 million gallons of oil have already gushed into the Gulf of Mexico. As the crisis has worsened, BP has lost $140 billion in stock market value as investors try to assess the forthcoming damage to the company's earnings. The President's approval ratings are sinking too as voters become more frustrated with the lack of progress.
Looks like it is a tie between Obama and Hayward for the "Most Incompetent" title. However, American voters and the board of British Petroleum will have the last word on their leadership performance. That can't be a comforting thought for either man.
Let's start with Hayward, BP's beleaguered chief executive officer. His performance has gone from bad to worse since the oil rig explosion on April 20 that killed 11 workers. He was practically invisible in the early days of the crisis. When the heat was turned up on BP, the jaunty Hayward told reporters all the criticism of his company's handling of the spill hadn't fazed him because he maintained a "stiff upper lip." Not exactly comforting words to a world waiting for answers.
Then Hayward proceeded to put both feet in his mouth. Asked by reporters about his schedule, he half-hearted complained the crisis had intruded on his life. That incensed the relatives of the workers killed in the explosion. Hayward may be burning the midnight oil, but their husbands and fathers were gone forever. It didn't play very well on the evening news.
That's when Hayward turned to a "crisis management" firm for help in buffing his image. Their recommendations were standard public relations fare: run a bunch of self-congratulatory ads on the clean-up efforts and use social media to tell the world about BP's laudable record for environmental protection. As the advertising broke, it was greeted with an unanimous chorus of boos from everyone, including the President. Hayward had blown another opportunity for leadership.
By comparison, Hayward actually comes off better than President Obama. Fearing a Katrina-like backlash, the President has made numerous appearances in the affected states and flown over the disabled oil rig in the Gulf of Mexico. The news footage has shown a deeply troubled president, his shirtsleeves rolled up as he examines the damage. He has looked the part of a leader. But that's where any similarities with leadership have ended.
Instead of putting the entire resources of the federal government and military at BP's disposal, Obama laid sole responsibility for stopping the leaking oil on BP's doorstep. He adopted a hands-off attitude. Then he named a retired Coast Guard admiral as the official government point man instead of a cabinet-level person with more clout.
As the crisis dragged on, Obama quickly resorted to name calling like a school yard bully. He said he was "angry and frustrated". A lynch mob mentality gripped the administration. Attorney General Holder skipped the formalities of due process and announced his office was preparing to file criminal charges against BP. Forget quaint ideas like innocent until proven guilty.
That started a feeding frenzy in Congress where committees began competing to see which one could launch hearings the fastest. Television coverage in an election year was just the tonic that senators and representatives needed to boost their flagging popularity with voters. The President called for BP to set up an escrow account to pay for damages. A figure of $20 billion was bandied about. Congress drafted a letter to Hayward essentially repeating the President's demands. Then the President upped the ante, saying he wasn't worried about BP's profitability.
That ticked off our friends in Britain. The Mayor of London called the "anti-British" rhetoric unseemly and urged cooler heads rather than name-calling. He complained that this "great British company is being continually beaten up on the airwaves." Meanwhile, there is a growing backlash against Prime Minister David Cameron's failure to intervene with Obama on behalf of the petroleum giant. That led to a hastily arranged telephone conversation between the leaders.
Despite all the words, the posturing and finger-pointing, oil continues to flow into the Gulf of Mexico. Every day brings a new promise of a fix. That is followed by another disappointment. The rhetoric ratchets up another notch, but solutions are as hard to find as effective leadership.
Instead of school yard bantering, Hayward and Obama should have met face-to-face on Day 2 of the spill, pledging all their collective resources to stop the well from spewing oil. They needed to present a united front to the public. A high-ranking government official, reporting to the President and Hayward, should have been tapped to lead the cleanup effort. Then the government and the oil industry should have mobilized all their resources and mapped a plan for best case and worst case scenarios.
Hayward should have left the cushy comfort of his offices in the United Kingdom and set up a BP crisis center in the gulf region. His on site directing of BP's efforts would have at least given the appearance that he was engaged and in charge. Instead he sought shelter in his offices across the pond. That didn't exactly inspire confidence.
For his part, the President spent all his energy haranguing BP, its CEO and the oil business in general. Apparently, his advisers think the public would rather hear him beat up on Big Business rather than actually solve the catastrophe. His sporadic flyovers along the Gulf Coast have been nothing more than PR stunts. Where are the town meetings with affected businesses that he has become so famous for? Perhaps, the President doesn't want to face the music.
Even worse, the President has turned a deaf ear to offers from other nations and oil industry businesses that have offered ships, oil dredging equipment, well-capping services and similar resources to help stem the leak. It is almost as if he would rather watch BP fail at any cost than lend a hand.
The two bumbling leaders have covered themselves in words while the crisis remains unchecked. According to the latest government estimates, 40 to 100 million gallons of oil have already gushed into the Gulf of Mexico. As the crisis has worsened, BP has lost $140 billion in stock market value as investors try to assess the forthcoming damage to the company's earnings. The President's approval ratings are sinking too as voters become more frustrated with the lack of progress.
Looks like it is a tie between Obama and Hayward for the "Most Incompetent" title. However, American voters and the board of British Petroleum will have the last word on their leadership performance. That can't be a comforting thought for either man.
Sunday, June 13, 2010
GPS: Locating an uncertain future
Global Positioning System (GPS) data is seeping into practically every segment of business and society. Trucking companies use it to manage their fleets. Surveyors use it to map streets. Businesses use it to control remote machines. Drivers use it to find their way on highways and streets. Sailors use it to navigate the seas. Golfers use it to measure distances on the course. Police use it to track stolen vehicles and monitor sex offenders. And that's just a partial list of uses.
In particular, the growth in automotive and consumer applications has contributed to a worldwide GPS boom, including in untapped markets outside the U.S. For that reason, the global market for mobile location technologies is expected to rise at a compounded annual growth rate of 20 percent. That means the worldwide GPS industry will top $70 billion by 2013, according to a new research study published on ReportLinker.
At first glance, that forecast appears to be great news for shareholders of TomTom and Garmin, the world's largest retailers of portable GPS-based navigation devices. However, the two heavyweights should be concerned about another trend that looms as a threat to their market dominance.
Cell phone handsets equipped with navigation applications are eating into the big two's market share for portable devices. By 2013, GPS-enabled handsets will account for 66 percent of the market share for portable devices, research suggests. Not good news for TomTom, Garmin and other device makers.
Consumer demand for cheaper navigation solutions is driving this trend. Voice-guided navigation systems with turn-by-turn directions are available today on the IPhone. For example, AT&T offers its Navigator app free, but the company charges $69.99 annually for the service. Magellan RoadMate and TomTom offer slightly lower priced applications. However, unlike the AT&T solution, the apps must be paired with expensive ($120-$130) car kits. Even that is cheaper than Garmin's new portable GPS unit, the NUVI 379OT, which retails for $449.99. TomTom's XXL 550 goes for $249. Application developers for IPhone will be able to exploit the price differential between the software solution and a dedicated navigation handset.
Consumer demand for navigation applications is robust. According to market research by J. Shapiro and Associates, 24 percent of today's cell phone users want navigation services on their next handset. Just six percent of cell phone users currently have the application. This underscores the pent-up demand for GPS technology on a single device that can not only function as a navigation tool, but perform other tasks as well.
The big portable navigation device makers recognize their products risk becoming the next CB radio. In fact, Garmin is hedging its bets with a smart phone of its own that uses Google's Andriod operating system. However, Garmin's track record in the cellular handset arena is lousy. Its earlier Nuvifone marketed in 2009 had many critics. Garmin claims it has fixed the problems and the sequel, called Garmin Fone, will be able to hold its own against other smart phones, especially at a retail price of $199. That sounds like wishful thinking. The folks at Apple probably aren't losing sleep over Garmin's latest entry into the smart phone market.
That isn't to gloss over the problems with current GPS applications on the IPhone and other smart devices. The sound quality for directions tends to be poor. Incoming phone calls disrupt the navigation guidance. Then there is the drain on battery life. All these issues contribute to some bad experiences with GPS on smart phones. But the issues are being addressed by handset makers. Given the growing importance of navigation applications, there is plenty of incentive for the handset manufacturers to solve these problems.
In the end, consumers will vote with their wallets. The bet here is that consumers will prefer a single device to meet the needs of voice, Internet and navigation. That means Garmin and TomTom's days are numbered. They won't disappear overnight. But remember you can still buy a CB radio, too.
In particular, the growth in automotive and consumer applications has contributed to a worldwide GPS boom, including in untapped markets outside the U.S. For that reason, the global market for mobile location technologies is expected to rise at a compounded annual growth rate of 20 percent. That means the worldwide GPS industry will top $70 billion by 2013, according to a new research study published on ReportLinker.
At first glance, that forecast appears to be great news for shareholders of TomTom and Garmin, the world's largest retailers of portable GPS-based navigation devices. However, the two heavyweights should be concerned about another trend that looms as a threat to their market dominance.
Cell phone handsets equipped with navigation applications are eating into the big two's market share for portable devices. By 2013, GPS-enabled handsets will account for 66 percent of the market share for portable devices, research suggests. Not good news for TomTom, Garmin and other device makers.
Consumer demand for cheaper navigation solutions is driving this trend. Voice-guided navigation systems with turn-by-turn directions are available today on the IPhone. For example, AT&T offers its Navigator app free, but the company charges $69.99 annually for the service. Magellan RoadMate and TomTom offer slightly lower priced applications. However, unlike the AT&T solution, the apps must be paired with expensive ($120-$130) car kits. Even that is cheaper than Garmin's new portable GPS unit, the NUVI 379OT, which retails for $449.99. TomTom's XXL 550 goes for $249. Application developers for IPhone will be able to exploit the price differential between the software solution and a dedicated navigation handset.
Consumer demand for navigation applications is robust. According to market research by J. Shapiro and Associates, 24 percent of today's cell phone users want navigation services on their next handset. Just six percent of cell phone users currently have the application. This underscores the pent-up demand for GPS technology on a single device that can not only function as a navigation tool, but perform other tasks as well.
The big portable navigation device makers recognize their products risk becoming the next CB radio. In fact, Garmin is hedging its bets with a smart phone of its own that uses Google's Andriod operating system. However, Garmin's track record in the cellular handset arena is lousy. Its earlier Nuvifone marketed in 2009 had many critics. Garmin claims it has fixed the problems and the sequel, called Garmin Fone, will be able to hold its own against other smart phones, especially at a retail price of $199. That sounds like wishful thinking. The folks at Apple probably aren't losing sleep over Garmin's latest entry into the smart phone market.
That isn't to gloss over the problems with current GPS applications on the IPhone and other smart devices. The sound quality for directions tends to be poor. Incoming phone calls disrupt the navigation guidance. Then there is the drain on battery life. All these issues contribute to some bad experiences with GPS on smart phones. But the issues are being addressed by handset makers. Given the growing importance of navigation applications, there is plenty of incentive for the handset manufacturers to solve these problems.
In the end, consumers will vote with their wallets. The bet here is that consumers will prefer a single device to meet the needs of voice, Internet and navigation. That means Garmin and TomTom's days are numbered. They won't disappear overnight. But remember you can still buy a CB radio, too.
Wednesday, June 9, 2010
Factoids That You Can Use
The news surrounding the much ballyhooed Health Care Reform Act keeps getting worse. In the latest development, primary care physicians are opting out of Medicare at an alarming pace. In Texas, new data shows that more than 300 doctors in the state have stop taking seniors with Medicare coverage. In just the first three months of this year, 50 doctors have announced they will no longer accept new Medicare patients. The Texas Medical Association states the opt-outs follow years of declining Medicare reimbursements that culminated in a "looming 21 percent cut" this year. The trend is not confined to Texas. According to the American College of Physicians, an organization of internal medicine doctors, things will be decidedly painful in the future. The organization predicts a rising number of internists will be unwilling to accept new Medicare patients. This will create a shortfall of between 35,000 and 45,000 internal medicine physicians needed to treat seniors. Also, the independent Medicare Payment Advisory Commission has revealed that 29 percent of Medicare beneficiaries it surveyed are having a problem finding a primary care doctor to treat them. With more Medicare cuts on the horizon as a result of Health Care Reform, there is no light at the end of the tunnel. This is awful news for the 40 million Americans with Medicare insurance, many of whom were bamboozled by the AARP into supporting the Obama health care plan.
Tuesday, June 8, 2010
Last Best Hope For Electric Cars
You are excused if you did not see the recent announcement about Tesla Motors, the one shining example of the future of electric cars. The news was buried in the small print in business sections of most newspapers, if it was covered at all. However, the news deserved more attention because Tesla Motors has the distinction of being the first U.S. company to produce and sell an all-electric car. That's no small feat when you consider the world's largest multi-billion auto manufacturers' plans for producing and retailing electric cars are still years away.
In its announcement, Tesla Motors and Toyota unveiled plans to work jointly on electric vehicle development and production. As part of the agreement, Toyota signaled that it will purchase $50 million of Tesla's common stock. Currently, Tesla is privately held, but it filed papers early this year with regulators, revealing its plan for an initial public offering. No date has been set for the IPO.
Perhaps, the lack of excitement about the investment can be traced to Tesla's checkered past. Its founder, entrepreneur Elon Musk, has been a mercurial leader for the motor company. Musk, who co-founded PayPal, has flitted between the car company and SpaceX, a private space exploration company he started. There also have been questions about the firm's financial viability. Since its founding, the company has lost about $290.2 million. Add on top of that, Musk's brushes with messy lawsuits and legal settlements during his tenure at the company, and it's little wonder skepticism runs deep. In addition, Tesla's public relations machine has often ginned up expectations that went unfulfilled. That has created a credibility gap that makes the media wary of any Tesla announcement.
Yet the Toyota investment could be the spark that jump starts mass production of electric cars. This is more than Toyota just throwing chump change at a potential competitor. Money aside, the real news is that Tesla has purchased a part of the former NUMMI manufacturing factory in Fremont, California. General Motors and Toyota had been sharing the facility until GM pulled out in June, 2009. Toyota produced its last car there in the plant a month ago.
What has always hamstrung any start-up car company has been mass production. Modern automobile plants require nearly a billion or so dollars to build, making mass production out of the reach for small firms. Producing a few hundred cars is all Tesla could manage on its own. Even with limited facilities, the Palo Alto-headquartered Tesla has manufactured 1,000 of its Roadsters, attracting a loyal if small following of car enthusiasts. The Roadster, equipped with a 375-volt AC induction air-cooled electric motor, looks like an European expensive sports car. The price tag is around $100,000, putting it out of the reach of ordinary Americans. Without mass production, the Roadster will remain a novelty.
However, Tesla has developed a sleek sedan, dubbed Model S, with a base price of $49,900 and a range of 300 miles on one electric charge. The car zooms from zero to sixty in a breathtaking 5.6 seconds. According to Tesla officials, the new model can be quick charged in a mere 45 minutes and is twice as efficient to operate as today's hybrids. If indeed the car can deliver on those numbers, then highway-capable electric cars could go mainstream faster than anyone imagined.
Another thing Tesla has going for it is the design. Its electric vehicles do not look anything like the prototypes the big auto companies have unwrapped in recent years. They share design traits with European sports cars, not the boxy hybrids being pumped out today. Why anyone would buy one is beyond me, unless it is a person wants to thump his chest and proclaim, "I am an environmentalist!"
The key to Tesla's success is producing enough cars to seriously contend with the big automakers. Mass production not only amps up the inventory, but it will bring down the per unit price of each electric vehicle sold, driving up profitability. That means it will be affordable to more Americans, a key to breaking through in the cluttered market place. If you heart rate isn't elevated over that prospect, then you are seriously in need of a pacemaker.
Of course, production doesn't guarantee sales. Big automakers have huge dealer distribution networks that seriously handicap small firms' ability to compete. This may remind you of the ill-fated DeLoren, which has disappeared from the automobile landscape, although it still has its share of devoted fans who cling to their cars.
To survive, Tesla needs to break the distribution mold. More cars are being sold over the Internet than ever before. Even brick-and-mortar dealers use the net to lure customers to their lots. One avenue for Tesla would be to strike an agreement with a firm such as Costco, a discount wholesaler with locations throughout the country. Tesla's cars could be showcased at the wholesaler's stores. Costco is already in the car business today, offering its customers discounts on automobiles. This would be a lot less expensive way to enter the market than building an extensive dealer network. Of course, Toyota already has its own huge worldwide distribution network that it could make available to Tesla.
Servicing is another huge stumbling block to new entrants. Dealer networks provide the maintenance, repair and service every car requires. Today, Tesla has so-called "service rangers" who make house calls to work on its Roadsters. Quaint, but it won't work for Tesla if it begins selling 20,000 cars a year. Again, the partnership with Toyota could be the answer.
However, Toyota also has announced its own plans to market an electric vehicle in 2012. No one knows how this will impact its allegiance with Tesla or even if Toyota will be able to get its electric vehicle production ramped up by that date. There has been lots of talk from the big auto manufacturers about electric cars, but not much to show for all the hype. That's why its best to wait and see what happens. This could turn out to be another false start for the electric vehicle as a mainstream replacement for gasoline powered cars.
All that said, there is cause for hope. Tesla has actually produced and sold a world class, highway drivable electric car, something no big automaker can claim. Tesla Roadster owners seem to love the vehicle. It has the looks and performance to turn any potential buyer's head. Now if Tesla will not muck up this opportunity with Toyota, there just might be an electric car in every one's future.
In its announcement, Tesla Motors and Toyota unveiled plans to work jointly on electric vehicle development and production. As part of the agreement, Toyota signaled that it will purchase $50 million of Tesla's common stock. Currently, Tesla is privately held, but it filed papers early this year with regulators, revealing its plan for an initial public offering. No date has been set for the IPO.
Perhaps, the lack of excitement about the investment can be traced to Tesla's checkered past. Its founder, entrepreneur Elon Musk, has been a mercurial leader for the motor company. Musk, who co-founded PayPal, has flitted between the car company and SpaceX, a private space exploration company he started. There also have been questions about the firm's financial viability. Since its founding, the company has lost about $290.2 million. Add on top of that, Musk's brushes with messy lawsuits and legal settlements during his tenure at the company, and it's little wonder skepticism runs deep. In addition, Tesla's public relations machine has often ginned up expectations that went unfulfilled. That has created a credibility gap that makes the media wary of any Tesla announcement.
Yet the Toyota investment could be the spark that jump starts mass production of electric cars. This is more than Toyota just throwing chump change at a potential competitor. Money aside, the real news is that Tesla has purchased a part of the former NUMMI manufacturing factory in Fremont, California. General Motors and Toyota had been sharing the facility until GM pulled out in June, 2009. Toyota produced its last car there in the plant a month ago.
What has always hamstrung any start-up car company has been mass production. Modern automobile plants require nearly a billion or so dollars to build, making mass production out of the reach for small firms. Producing a few hundred cars is all Tesla could manage on its own. Even with limited facilities, the Palo Alto-headquartered Tesla has manufactured 1,000 of its Roadsters, attracting a loyal if small following of car enthusiasts. The Roadster, equipped with a 375-volt AC induction air-cooled electric motor, looks like an European expensive sports car. The price tag is around $100,000, putting it out of the reach of ordinary Americans. Without mass production, the Roadster will remain a novelty.
However, Tesla has developed a sleek sedan, dubbed Model S, with a base price of $49,900 and a range of 300 miles on one electric charge. The car zooms from zero to sixty in a breathtaking 5.6 seconds. According to Tesla officials, the new model can be quick charged in a mere 45 minutes and is twice as efficient to operate as today's hybrids. If indeed the car can deliver on those numbers, then highway-capable electric cars could go mainstream faster than anyone imagined.
Another thing Tesla has going for it is the design. Its electric vehicles do not look anything like the prototypes the big auto companies have unwrapped in recent years. They share design traits with European sports cars, not the boxy hybrids being pumped out today. Why anyone would buy one is beyond me, unless it is a person wants to thump his chest and proclaim, "I am an environmentalist!"
The key to Tesla's success is producing enough cars to seriously contend with the big automakers. Mass production not only amps up the inventory, but it will bring down the per unit price of each electric vehicle sold, driving up profitability. That means it will be affordable to more Americans, a key to breaking through in the cluttered market place. If you heart rate isn't elevated over that prospect, then you are seriously in need of a pacemaker.
Of course, production doesn't guarantee sales. Big automakers have huge dealer distribution networks that seriously handicap small firms' ability to compete. This may remind you of the ill-fated DeLoren, which has disappeared from the automobile landscape, although it still has its share of devoted fans who cling to their cars.
To survive, Tesla needs to break the distribution mold. More cars are being sold over the Internet than ever before. Even brick-and-mortar dealers use the net to lure customers to their lots. One avenue for Tesla would be to strike an agreement with a firm such as Costco, a discount wholesaler with locations throughout the country. Tesla's cars could be showcased at the wholesaler's stores. Costco is already in the car business today, offering its customers discounts on automobiles. This would be a lot less expensive way to enter the market than building an extensive dealer network. Of course, Toyota already has its own huge worldwide distribution network that it could make available to Tesla.
Servicing is another huge stumbling block to new entrants. Dealer networks provide the maintenance, repair and service every car requires. Today, Tesla has so-called "service rangers" who make house calls to work on its Roadsters. Quaint, but it won't work for Tesla if it begins selling 20,000 cars a year. Again, the partnership with Toyota could be the answer.
However, Toyota also has announced its own plans to market an electric vehicle in 2012. No one knows how this will impact its allegiance with Tesla or even if Toyota will be able to get its electric vehicle production ramped up by that date. There has been lots of talk from the big auto manufacturers about electric cars, but not much to show for all the hype. That's why its best to wait and see what happens. This could turn out to be another false start for the electric vehicle as a mainstream replacement for gasoline powered cars.
All that said, there is cause for hope. Tesla has actually produced and sold a world class, highway drivable electric car, something no big automaker can claim. Tesla Roadster owners seem to love the vehicle. It has the looks and performance to turn any potential buyer's head. Now if Tesla will not muck up this opportunity with Toyota, there just might be an electric car in every one's future.
Sunday, June 6, 2010
Presidential Hijinks Stink
Last week President Obama donned his cheer leading outfit, fetched his pom-poms and began turning somersaults over the latest jobs data. The fawning media applauded the stunt and duly reported that the economy is recovering. Apparently, the President and his lapdogs believe you really can fool all the people all the time.
In his role as Cheerleader in Chief, the President used the media megaphone to shill the Labor Department report that showed employment rose by 431,000. The number is about as real as a $3 bill with Elton John's picture plastered on the front. The stock market reacted by falling more than 200 points. So much for good economic news.
To understand the market's decline, all you need to know are two facts. First, all but 41,000 of those 431,000 jobs were created by the federal government. Most were temporary census workers. Secondly, the unemployed are facing the longest wait on record to find work. There just aren't enough available jobs because the private sector isn't hiring. In fact, last week brought fresh news of more corporate layoffs.
That means things are unlikely to get better anytime soon. The economy will have to grow at an annual rate of 3.5 percent for three years to recoup the 8 million jobs that have been lost since the recession began. No self-respecting economist has predicted growth anywhere near that level. Even the optimists in the Federal Reserve are now saying that employment will remain at nine percent or higher until perhaps the end of 2011.
It is time for the media to pronounce the administration's economic stimulus and job plans a total and utter failure. The billions spent to reinvigorate the economy have been wasted on pork projects with no economic benefit. To make matters worse, passage of the Health Care Reform Bill further stalled plans for hiring and business investment because of the uncertainty over future costs.
Meanwhile, consumer spending has sputtered along. It once was the country's economic engine, accounting for 70 percent of spending. However, nothing makes consumers feel "poor" like layoff worries, sinking home prices and a falling stock market. Americans won't be opening their wallets until there are improvements in all three areas, which are critical to consumer confidence. When home prices were skyrocketing, the stock market was soaring and jobs were plentiful, consumers felt "rich," even if their bank accounts remained the same.
As bad as things are on the job front, the home market looks even worse. With the home buyer federal tax credit expired, sales will likely tank. Already, there are signs of a major pull back in sales contracts, according to experts. And more than one-third of this year's sales have been so-called distressed homes selling at deep discounts. Typically, these homes have been taken over by banks or the owners have sold because they are unable to make payments. That has impacted prices for sellers who want to move up, causing them to rethink their decisions. One real estate analyst firm, Core-Logic, predicts the market will continue to fall with next February's prices lower by 4.2 percent.
Meanwhile, the number of bank failures in the country keeps rising. To date, regulators have seized the assets of 78 banks. Bank closures are expected to peak this year, but you have to wonder. The feds closed 140 banks last year. At the current pace, bank failures could eclipse last year's number, considered the worst since the Great Depression.
Instead of trying to whip up enthusiasm for the tepid economy, the President needs to do something more than symbolism. He could start by rescinding the onerous Health Care Reform Bill. Then he should announce tax incentives for hiring and research, followed by a reduction in the federal red tape that adds to the cost of doing business.
Of course, none of this will happen. The President refuses to come to grips with the reality of the economic slide. The country is more likely to see Elton John's picture on a greenback than real economic reform.
In his role as Cheerleader in Chief, the President used the media megaphone to shill the Labor Department report that showed employment rose by 431,000. The number is about as real as a $3 bill with Elton John's picture plastered on the front. The stock market reacted by falling more than 200 points. So much for good economic news.
To understand the market's decline, all you need to know are two facts. First, all but 41,000 of those 431,000 jobs were created by the federal government. Most were temporary census workers. Secondly, the unemployed are facing the longest wait on record to find work. There just aren't enough available jobs because the private sector isn't hiring. In fact, last week brought fresh news of more corporate layoffs.
That means things are unlikely to get better anytime soon. The economy will have to grow at an annual rate of 3.5 percent for three years to recoup the 8 million jobs that have been lost since the recession began. No self-respecting economist has predicted growth anywhere near that level. Even the optimists in the Federal Reserve are now saying that employment will remain at nine percent or higher until perhaps the end of 2011.
It is time for the media to pronounce the administration's economic stimulus and job plans a total and utter failure. The billions spent to reinvigorate the economy have been wasted on pork projects with no economic benefit. To make matters worse, passage of the Health Care Reform Bill further stalled plans for hiring and business investment because of the uncertainty over future costs.
Meanwhile, consumer spending has sputtered along. It once was the country's economic engine, accounting for 70 percent of spending. However, nothing makes consumers feel "poor" like layoff worries, sinking home prices and a falling stock market. Americans won't be opening their wallets until there are improvements in all three areas, which are critical to consumer confidence. When home prices were skyrocketing, the stock market was soaring and jobs were plentiful, consumers felt "rich," even if their bank accounts remained the same.
As bad as things are on the job front, the home market looks even worse. With the home buyer federal tax credit expired, sales will likely tank. Already, there are signs of a major pull back in sales contracts, according to experts. And more than one-third of this year's sales have been so-called distressed homes selling at deep discounts. Typically, these homes have been taken over by banks or the owners have sold because they are unable to make payments. That has impacted prices for sellers who want to move up, causing them to rethink their decisions. One real estate analyst firm, Core-Logic, predicts the market will continue to fall with next February's prices lower by 4.2 percent.
Meanwhile, the number of bank failures in the country keeps rising. To date, regulators have seized the assets of 78 banks. Bank closures are expected to peak this year, but you have to wonder. The feds closed 140 banks last year. At the current pace, bank failures could eclipse last year's number, considered the worst since the Great Depression.
Instead of trying to whip up enthusiasm for the tepid economy, the President needs to do something more than symbolism. He could start by rescinding the onerous Health Care Reform Bill. Then he should announce tax incentives for hiring and research, followed by a reduction in the federal red tape that adds to the cost of doing business.
Of course, none of this will happen. The President refuses to come to grips with the reality of the economic slide. The country is more likely to see Elton John's picture on a greenback than real economic reform.
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