Slowly but surely the American people are being strangled to death. Is it because there is no money out there? Not really but it's all being squirreled away by greedy companies who just want to keep making a high profit. The real reason why so many people are being let go is not that keeping them would drive the company under, but that they want to keep profits high in down times. The stupidity is that by letting people go they are only exacerbating the situation more and may be sealing their doom in the future.
On monday a record a record 75,000 job cuts were announced. How many of them were needed because there was no work for those people and how many were because those companies wanted to maximize profits in bad times.
Caterpillar who makes farm and construction equipment announced that 20,000 people would be laid off. If nobody is buying tractors then there is no sense in building them, but is 20,000 realistic or is that number unreasonably high in order to make a bigger profit in bad times?
Clear Channel an outfit that owns the most broadcast stations in America totaling over 1200 and a nationwide billboard business, let go 1,850 people. It is interesting that last year their revenues fell 9%, but they made a profit and that current number laid off is 9% of the company's total staffing. The question is are they afraid of going into the red or just wanting to keep profits the same as in better years?
We are living in times when people are expendable. In fact most companies look at the employee as a a liability where in the past they were an asset. Company loyalty to their staff is almost negligible and yet the company demands loyalty from them. It's a bad deal all around.
So what can the government do. First of all quit bailing out companies who will take the money and let people go. Earmark that money for job security and nothing else. But if its a chance to help a corporation or help the people, guess who's taking a walk? The only reason the government wants to get money in the hands of the people is so they will turn around and spend it on the corporation, not to put food in their mouth but when they do, they dole out the food in a manner that makes people grovel at the cost of their self esteem.
I wish I could come up with a rosy end to this blog, but there isn't one. Maybe it's just that capitalism is a miserable failure and nobody is ready to admit it.
3 comments:
What you say is very true, except we're now in the proverbial Catch-22 situation. If the companies don't watch the bottom line and keep the profits up (or in the sad situation of today - try to limit massive losses by cutting jobs), then the stock prices take precipitous dips.
The mutual fund managers and the individual investors will lose faith in the companies and sell massive amounts of stock.
The result will be a further fall in the Dow and Nasdaq, resulting in
worthless stock options for employees who count on them in their pensions plans. Further exacerbating the situation is that
because of the 401k pensions, more
people than ever before are dependent on the stock market.
As you can see, if the greedy companies didn't try to limit those losses or keep profits up (assuming these aren't really paper profits due to reduced depreciation, sudden
recognition of deferred income, unrealistic accounts receivable, etc.), the unemployed could actually suffer even more when their deferred pension plans lose more value.
The real question is not so much how to prevent the layoffs, but how to get ourselves out of this mess.
Can the economy turn around when we don't produce anything other than grain and produce? All our manufacturing is almost gone.
Rather than issue economic stimulus checks which will either just be banked or used to purchase goods made in China, how about if a portion of this bailout money is saved for future rebates for the purchase of goods made in the USA?
There's got to be a way to get some industry back. Will the greening of America stretch to the manner in which electronic components are manufactured?
I think a further question should be asked:
When and if these jobs come back, at what price? After the last recession, most jobs were lower paying. What can we expect now?
Will anyone include health care,
let alone dental and vision plans?
Shouldn't Tom Daschle and President Obama already be preparing the country for a single payer health care system as that will be the only way to force future employers to offer health care?
One word: Tarriffs
We need to bring back the tarriff on all manufactured goods imported. To jump start the economy a tarriff of at least 100%. The price of goods would rise but companies would start to form to produce here protected from low wage competetin by the tarriff.
People fall into a few specific categories of employment, IMO
They are;
Over-employed: These are the folks that make too much money based on the work they do. And, FYI...it's not always CEO's & Bankers....there are plenty of "middle class" jobs that fall into this category. Some people get lucky and some people don't.....hell of a way to plan for life, ain't it?
Under-employed: These are people who have a lot of skills but can't find work for a variety of reasons. A typical example would be the guy working at Home Depot who could probably build your entire house but he can't find a job because there is no work. More and more people that do have jobs are falling into this category and that's a scary thing.
Unemployed: These people can't find a job. The scary thing is that a lot of the companies mentioned above are looking at 3, 5, and 10-year projections for their products and if they can justify laying off 20,000 people then the future doesn't look very bright.
What the govn't needs to do is make sure that we have a healthy and prosperous middle class (which we don't)....we are moving to a situation where there are two kinds of people in the country....rich and poor.
That's a scary thought.
Stay tuned.
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