Matt at Weapons of Mass Discussion has a great post on how New York’s highest-level politicians have been all too willing to jeopardize a community’s safety to please a wealthy developer and contributor.

This is not hyperbole. Go there and see.

I’ve certainly been critical of Wal-Mart for losing its way by trying to appease its critics in the US (here and here) and allowing the Chinese Communist Party to set up a recruiting center in one of its Mainland stores, but this TCS Daily piece by Michael Strong makes some awfully important points about what the company has accomplished while pursuing global growth.

Strong certainly comes on strong:

Between 1990 and 2002 more than 174 million people escaped poverty in China, about 1.2 million per month. With an estimated $23 billion in Chinese exports in 2005 (out of a total of $713 billion in manufacturing exports), Wal-Mart might well be single-handedly responsible for bringing about 38,000 people out of poverty in China each month, about 460,000 per year.

There are estimates that 70 percent of Wal-Mart’s products are made in China. One writer vividly suggests that “One way to think of Wal-Mart is as a vast pipeline that gives non-U.S. companies direct access to the American market.” Even without considering the $263 billion in consumer savings that Wal-Mart provides for low-income Americans, or the millions lifted out of poverty by Wal-Mart in other developing nations, it is unlikely that there is any single organization on the planet that alleviates poverty so effectively for so many people. Moreover, insofar as China’s rapid manufacturing growth has been associated with a decline in its status as a global arms dealer, Wal-Mart has also done more than its share in contributing to global peace.

….. rural Chinese peasants surviving on less than a dollar per day do not regard economic growth, or Wal-Mart factory jobs, as a cancer. When a Mongolian student at a U.S. workshop on globalization heard U.S. college students denounce sweatshops, he shouted: “Please give us your sweatshops!”

An unreflective passion for social justice may be one of the biggest obstacles to creating peace and prosperity in the 21st century. While there are most certainly factory owners in China whom we would rightly regard as criminal in their treatment of their workers, it is very important not to confuse these incidents with the phenomenon of globalization. It is a good thing that Wal-Mart is encouraging more humane standards in its supplier’s factories. And yet it is also important to remember that Wal-Mart’s “vast pipeline that gives non-U.S. companies direct access to the American market” is a vast pipeline of prosperity for the hundreds of millions of rural Chinese whose lives are more difficult than we can imagine.

Act locally, think globally: Shop Wal-Mart.

If the choice is merely preventing starvation with private charity and foreign aid vs. economically uplifting commerce, I know which side I’m on. I wish the folks in Bentonville understood that their doomed-to-failure appeasement efforts and the implied recognition of the Chinese Communist Party could get in the way of the company’s powerful global poverty-fighting formula.

The New York Times has received quite a bit of criticism here and elsewhere, almost all deserved.

To be fair, the paper has excelled in calling attention to the state and municipal pension crisis most parts of the country face. After doing a story on Duluth, MN some months ago and San Diego, CA more recently, its latest exploration of the problem last Sunday was in its own back yard (link does not require registration at the moment), and yet another small tip of a very large iceberg:

August 20, 2006
New York Gets Sobering Look at Its Pensions
By MARY WILLIAMS WALSH and MICHAEL COOPER

Every year since 1999, New York City has reported that it has all the money it needs to pay for the pensions that have been promised to city workers.

With the retirement plans said to be financially sound, state politicians have happily showered city employees with generous pension enhancements — annual cost-of-living increases, holiday bonus payments, early retirement with full benefits — that are the envy of private-sector workers, whose pension benefits have eroded.

But a close inspection of city pension records shows that the funds committed to the plans may fall well short of the city’s promises to hundreds of thousands of current and retired workers. They look fully funded chiefly because the city has been using an unusual pension calculation that does not comply with accepted government accounting rules. Even the city’s chief actuary, who helps produce the annual reports, says the official numbers are “meaningless” when it comes to showing the plans’ financial health.

The chief actuary, Robert C. North, has prepared a little-noticed set of alternative calculations showing that the gap in the pension funds could be as wide as $49 billion. That is nearly the size of the city’s entire annual budget and the equivalent of the city’s publicly disclosed outstanding debt.

The existence of a big gap between the city’s future obligations and the resources committed to meet them does not mean the pension funds are about to run out of money. But it does mean that New York City is promising its current employees future benefits it might not be able to provide without big tax increases or major budget cuts. When such a reckoning might occur, if at all, is hard to predict.

Pensions are now one of the city’s fastest-growing expenses. In recent years the city’s required contributions to its pension funds have more than quadrupled, to $4.7 billion this year from $1.1 billion in 2001.

Two years from now, the city expects to spend one out of ten dollars in its budget on pension contributions.

Here’s the real kicker in New York (paragraphs presented out of order from original article):

The new benefits New York City has added since 1999 have been politically popular. But they have also been very expensive. Even though they look modest on an individual basis, their cost adds up quickly because they have to be paid to many people who will be retired for many years.

In New York, public workers’ pensions are guaranteed by the State Constitution, so once they are granted, they cannot be reduced, even if they cost more than expected.

That guarantee means that short of the state declaring bankruptcy, the taxpayers are on the hook.

The article doesn’t deal with the gold-plated retiree health care benefits city workers receive; those may actually turn out to be a bigger problem, because unlike pensions, there is usually very little effort to set aside money now to fund those future healthcare costs (NY City may be an exception, but I tend to doubt it).

It could be that disputes that will make last year’s subway workers’ strike look like a picnic may be coming.

____________________________

UPDATE: More on the long-term dire situation in public pensions is here.

On the heels of last week’s Dell battery recall (link is to a PC Magazine article if you need to see the details), Apple is recalling 1.8 million Sony-produced batteries found in iBook G4 and PowerBook G4 laptops. The company’s web page for the battery-exchange program is here.

Apple’s recall involves a much bigger percentage of its customer base than Dell’s did of theirs. It would not surprise me if the recall strains the business relationship that had shown signs of building in other areas.

From Bloomberg, in an article that requires some wading through some anti-administration bias:

Bush has triumphed by gaining without a fight permanent status for more than 50 tax cuts, said Clinton Stretch, director of tax policy at the accounting firm Deloitte & Touche LLP in Washington. He has yet to win that status for lower rates on marginal income, dividends and capital gains.

The most significant of the breaks include higher annual caps on retirement-account contributions; a guarantee that gains in so-called “529″ state-sponsored college tuition accounts will be exempt from federal taxes; a tax credit matching deposits by low-income Americans in retirement accounts; and the Roth 401(k), which provides tax-free income in retirement.

Though nothing in the law is truly “permanent,” it will literally take an act of Congress to change any of the above, which is a nice change from the scheduled-expiration situation these items were previously in.

The takeaways from this are:

• You don’t need to worry that the tax breaks for college 529 plans will disappear without a serious fight that I doubt the tax-increasers could win.
• The Roth 401(k)’s “permanence” should encourage many employers who were holding back to include that feature in their existing 401(k) plans. In “traditional” 401(k) situations, contributions are made pre-tax (effectively meaning that you get a deduction for your contributions), and distributions from the plan during retirement are taxed. In a Roth situation, there is no tax break at the time contributions are made, but distributions during retirement aren’t taxed at all. The math can be complex, but in general, the younger you are, and the more aggressive investor you are as an investor, the more likely it is that making Roth instead of “traditional” 401(k) contributions will leave you better off in retirement.

A San Francisco’s business weekly reports that private equity firms are “Awash in oceans of capital,” but at the same time, the Raleigh-Durham weekly reports that “Congress may reopen funding spigot for VC-backed concerns.”

I realize that they are different lines of investment, but why not let the markets allocate the capital more efficiently and appropriately? The last time the Small Business Administration got into the venture-capital business, it was an unmitigated failure.

An Ohio Society of CPAs newsletter tells me that according to The Wall Street Journal, the number of defined benefit plans offered by employers has decreased to 30,000 from 112,000 in 1985. Combined, the remaining pension plans are estimated to be in the hole by $450 billion.

If the pension reform recently signed into law closes this gap, and prevents employer mismanagement from creating new gaps, it will be a significant accomplishment.

Asymmetrical Information (HT Instapundit) busts a persistent myth:

Contrary to conventional ignorance, at large Japanese and German companies, “workers ….. get their health insurance via joint contributions from employeer and employee, just as they do in the United States. Big corporations in both countries also have pension schemes, just as in the United States, and higher social security contributions.”

I knew about the true social security and pension situations, but conventional ignorance had me on the healthcare part.

Ben Cort of Westminster, CO is beyond lucky (HT Drudge; video is at link):

Man survives 800 foot fall
Updated: 8/22/2006 10:24 PM MST

WESTMINSTER - When Ben Cort went to Longs Peak Saturday to climb with his friends, he never imagined what would happen once he reached the top.

Cort, from Westminster, was climbing an area called Lamb’s Slide, which is known for its icy and rocky terrain.

When Cort was at the top, he lost his footing and fell some 800 feet.

“The next thing you know I was just flying down the mountain without my ice axe,” he said. “That’s when it gets bad.”

Traveling at speeds witnesses estimate were near 40 mph, Cort stayed conscious for the entire fall.

“Total pandemonium,” he said. “I was head over heels and I was smacking my face on rocks. Rocks were coming down with me and then this boulder rolled over me a couple times.”

When Cort reached the bottom, he initially thought he was dead.

….. Remarkably, Cort not only survived, but was left with only a broken leg and shoulder, and some scrapes and cuts.

“I hit the ground and I felt my feet, I felt my fingers and was just so overcome with gratitude because I knew that God had just decided to save me,” he said.

His climbing group, which included a man with Rocky Mountain Search and Rescue, immediately came to his aid.

Cort says complete strangers also stopped to help him.

“It was hailing. It was raining. It was nasty,” he said. “And they didn’t even think twice.”

Cort also says the Flight for Life pilot took a risk by flying in the bad weather to land in a tricky spot to rescue him.

Cort was flown out of the area that night. He’s been recovering at St. Anthony Hospital since then.

It’s likely he’ll be released from the hospital this week, but it will be several months before he’s able to climb again.

“I’ll probably be out of climbing for about a year,” he said. “But I’m talking to you.”