January 12, 2007

Treasure This: The Deficit is Down by Almost 1/3 from Last Year

Filed under: Economy,Taxes & Government — Tom @ 3:37 pm

The Treasury just released its monthly receipts and outlays report, which is coherently and comparatively presented below:

USTreasRecsOutlays1206

The deficit through the first three months of the current fiscal year is almost $39 billion, or 32.7%, lower than last year’s comparable figure. Receipts are up a bit over 8%, as the supply-side tax cuts continue their “magic.” The real surprise is that outlays have barely budged, actually going up at a rate that is substantially lower than inflation (Psst — Don’t tell Congress that).

Cross-posted at NewsBusters.org.

Catch of the Day: The Pelosi-Samoa Connections May Be Even Deeper

Filed under: Business Moves,Taxes & Government — Tom @ 2:17 pm

Note: One of the items here is based on a Wikipedia entry that has not otherwise been verified. See the Editor’s Note below.

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Fishing around in the now widely-known Samoan exception to the recently passed Minimum Wage bill (where tuna industry workers there are apparently being paid $3.26 an hour), Andy’s Angle cast a wide net and hauled in the following:

The interesting thing, however, is that the largest employer in American Samoa is Del Monte Foods’ StarKist Tuna, home to over 75% of the island’s workforce. Del Monte Foods, as it turns out, is headquartered in the District of the new Speaker of the House Nancy Pelosi. Smelling a whiff of impropriety, House Republicans have thrown up some serious questions about the exemption and who inserted it into the bill.

NewsBusters points out that few in the Mainstream Media will cover this story given their breathless love for the new Speaker. FoxNews has picked up the story, questioning the potential influence Del Monte may have as a major player in the Speaker’s District. Doing my own research, however, I’ve discovered that the impropriety is much deeper. Speaker Pelosi’s husband Paul, it turns out, owns something to the order of $17 million in Del Monte stock! (see what immediately follows–Ed.)

(Editor’s Note — The previous sentence is noted in Wikipedia and has not otherwise been verified. Commenter #3 below, claiming to be Tom Elliott of FunkyPundit, says he was told that no one holds more than $14 mil worth of DLM stock [except Heinz]. Commenter #4 Kevin says that this item was entered into Wiki at 3:04 PM Jan. 12 [GMT, it is believed]; that link is here. The link claiming $17 mil in Del Monte ownership by Paul Pelosi goes to Nancy Pelosi’s Wiki page. The Del Monte ownership interest is not claimed at that page. Thus, there is reason to believe that the claim of such ownership interest on the part of Paul Pelosi is suspect. UPDATE, Jan. 16 — the latest available info (an item inexplicably deleted from the Heinz Wiki entry on Jan. 13 indicates that Mr. Pelosi’s $17 million interest [link is to item deleted] is in Heinz, and that he was involved in some way in that company’s recent proxy battles.)

I wonder if he stands to benefit should StarKist avoid an additional $2 hike in hourly wages… (actually, for the Samoans, it would be a $3.99 hike from $3.26 to $7.25 — Ed.)

Follow the money trail a little further and Speaker Pelosi may have a sympathetic accomplice in the US Senate. It turns out that the H.J. Heinz Company owns nearly 75% of Del Monte’s stock. Heinz, of course, is the company owned in large part by the H.J. Heinz family of whom Teresa Heinz is a major heir as the widow of H.J. Heinz the III, the late Senator from Pennsylvania. And who did Mrs. Heinz marry shortly after her late husband’s passing? Senator John Forbes Kerry of Massachussetts!

If the Del Monte (or Heinz — Ed.) holdings of Mr. Pelosi are supposed to appear on her Congressional Disclosure Form, I don’t see them. The Del Monte stock could be owned by a separate holding company that is listed, or it could be that such holdings don’t have to be disclosed. Hopefully, readers here will know more.

Cross-posted at NewsBusters.org.

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UPDATE: Be sure to read my Comment 10 below.

BP: Browne Stepping Down Early

Filed under: Business Moves — Tom @ 2:13 pm

Good news for BP shareholders; bad news for the so-called Corporate Social Responsibility movement.

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Previous related posts:

  • Nov. 25 — Friedman and ‘Corporate Social Responsibility’ — It’s Not the Line That’s Blurred, It’s Peoples’ Thinking That Has Moved the Line
  • Sept. 14 — BP CEO Lord John Browne Should Resign, Says Group
  • Sept. 9 — The Corporate Social Responsibility Appeasers Are Probably Long-Term Market Underperformers
  • Aug. 22 — Column of the Day, Plus Timeless Essay of the Day, on “Corporate Social Responsibility”

Go Ahead, Tony; Make My Day

From Hugh Hewitt’s interview yesterday with Tony Snow (HT Hot Air; duly noted by Eason “Mr. Lessons to Be Learned” Jordan):

HH: As we saw during the summer war between Hezbollah and Israel, Tony Snow, Hezbollah went to such lengths as to stage atrocities, buildings blown up, and victims left in there.

TS: Yeah.

HH: Are you, as the head of the White House communications operation, prepared to immediately get out there and quarrel with that and stop those sorts of stories from metastasizing?

TS: Yeah, I am looking forward to meeting Captain Jumil Hussein, but other than that, yes. You’ve seen the latest on that, right?

HH: No, I haven’t. I haven’t read today. Is he back and not existing again?

TS: He’s back to non-existence.

HH: (laughing) But that’s the new media war…

TS: Yeah.

Cool. However, tempting as it is, and unlike certain others, BizzyBlog will not engage in premature e-celebration. :–>

The Post-Kelo World: Too Many Cases, and Too Little Attention to Each, Require a National Solution

Filed under: Business Moves,Economy,Taxes & Government — Tom @ 12:33 pm

It gives me no pleasure to report the accuracy of this prediction in August of 2005, a few months after the Supreme Court’s infamous Kelo decision:

That’s nice, but human nature being what it is, the citizen involvement and oversight, while it has shown good staying power, won’t last, and the definition of “reasonable and necessary” will eventually start pushing the limits now allowed by the Supremes.

Legislative solutions are needed, and state governments need to be pressured to pass something …..

I later came to believe about a year ago that only definitive national legislation or a Kelo reversal by the Supremes will restore the Founders’ clearly intended primacy of property rights:

The simple fact is this: Mayors, commissioners, and governors all compete with each other economically. They have long had various weapons at their disposal, some reasonable and some, though legal and frequently used, that are not reasonable (and in my opinion should not be legal).

….. The Kelo ruling is another unreasonable, but now legal, weapon in the economic development arsenal. States and cities that choose to use it will over time, and all other things being equal, probably be better off than those who stay away from it on principle. Politicians who want to be re-elected, even those who don’t like Kelo-type takings, will be forced to gravitate towards them in the interest of political survival.

That’s why the Kelo weapon should not be available anywhere, as our Constitution intended.

At OpinionJournal.com on Thursday, William Maurer of the Institute for Justice recited a litany of breathtaking eminent domain abuses taking place throughout the land, and said:

Regardless of strong constitutional protections for private property, governments and courts now view eminent domain as an area where few if any restrictions exist.

….. Meanwhile, state and federal courts are turning redevelopment areas into Constitution-free zones, where the government can do what it wants with few or no restrictions. It doesn’t have to be this way. Courts could force the government to comply with the state and federal constitutions. Local governments could limit their takings only to legitimate public uses. But until all three branches of government begin taking their constitutional obligations seriously, property owners across the country face the continued threat of eminent-domain abuse, regardless of what the state or federal constitution says.

It’s dreadfully obvious that nothing short of definitive national legislation or a Kelo reversal will force “all three branches of government begin taking their constitutional obligations seriously.” The current Congress has too many Kelo cheerleaders to expect any action there, so that leaves the Supremes, who, with Roberts and Alito, might actually do the right thing. They have to persuade one of the five in original majority, all of whom are still there, to change his or her mind; one would think that at least one will find the carnage taking place persuasive enough for a rethink. Here’s hoping that the case mentioned here Monday get a shot.

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Note: I originally thought that Rehnquist supported Kelo, and was incorrect. I corrected this post and deleted the previous related text.

Retail Sales: AP Reporter Describes A Probable Real Improvement as ‘Slowdown’

Filed under: Economy,MSM Biz/Other Bias,MSM Biz/Other Ignorance — Tom @ 10:15 am

Associated Press reporter Martin Crutsinger reported this morning that retail sales in December came in better than expected:

Retail sales rose in December at the strongest pace in five months, indicating that the all-important holiday shopping season turned out better than original reports indicated.

The Commerce Department said Friday that retail sales increased 0.9 percent last month, the strongest showing since a 1.4 percent increase in July.

The increase was better than the 0.7 percent advance that economists had forecast and provided evidence that consumer spending was ending the year on a firmer footing than initially thought.

The government report presented a firmer tone to spending than initial reports from the nation’s big chain retail stores. They complained that holiday sales had fallen below expectations as mild winter weather depressed sales of winter clothing.

Crutsinger then downplayed the year’s strong retail results, and used it as an opportunity to get in a few licks about how supposedly tough the economy of 2006 was:

For all of 2006, retail sales rose by 6 percent, a solid showing but down from a 6.9 percent increase in 2005.

That slowdown reflected the fact that consumer spending, after a sizzling start to the year, slowed in the spring and remained at lower levels for the rest of the year as Americans were battered by soaring gasoline prices, rising interest rates and a cooling housing market.

Mr. Crutsinger portrayal of the full-year result as a “slowdown,” which formed the linchpin of the rest of that sentence’s negativity, overlooked one “minor” detail: Reported retail sales figures include inflation.

Final Consumer Price Index (CPI) figures for December aren’t available, but that’s really no excuse, as you will see from this chart (to replicate, go to this link and select the very first report for display):

CPIU1106

2005′s CPI-U inflation was 3.5% (196.8 divided by 190.3). The real (after inflation) increase in retail sales was 3.4% (6.9% less 3.5%).

Through 11 months of 2006, inflation was 2.4% (201.5 divided by 196.8). Unless December’s reported inflation is greater than 0.2%, which would cause full-year inflation to be greater than 2.6%, 2006′s real increase in retail sales will be 3.4% or greater (6.0% less 2.6%) — i.e., equal to or better than 2005′s. Even if CPI comes in slightly higher, the difference will be very small, and nowhere near the 0.9% decline Crutsinger reported to his readers (6.0% in 2005 less 6.9% in 2006) by ignoring inflation.

“Slowing,” schmowing. “Battered,” schmattered.

Cross-posted at NewsBusters.org.

Minimum Wage Bill in House: Local Reps Mostly Disappoint

Filed under: Economy,Taxes & Government — Tom @ 8:23 am

Here’s the House roll call.

Quickly cruising through the 82 Republicans who supported this job-killing, unemployment-producing, underground economy-supporting bill (no Democrats opposed it), I found these obvious local and certain other disappointments:

- Geoff Davis (KY)
- Gillmor (OH)
- Jindal (LA)
- LaTourette (OH)
- Pryce (OH)
- Schmidt (OH)
- Shays (CT)
- Turner (OH)
- Wilson (NM)

Non-agenda-driven academic economists across the board agree that minimum wage legislation doesn’t pass the stench test, let alone the smell test. It’s a big letdown that the majority of GOP reps in the supposedly conservative Greater Cincinnati area (Davis, Schmidt, and Turner) either just don’t get it; know it’s a bad idea, but voted out of fear of negative repercussions from others who don’t get it; or voted for it because it appears that President Bush will sign it into law. It is very little consolation that “at least” Boehner and Chabot got it right.

Couldn’t Help But Notice (011207)

Filed under: Business Moves,General,Taxes & Government — Tom @ 6:20 am

iOops, indeed — Apple announced the iPhone without having definitive control of the name. Cisco is suing. Eric Schonfeld identifies other less-legalistic unknowns about the iPhone, which is supposed to start shipping in June.
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In a new extension of vaporware, Apple inked a deal with Cingular to be the wireless carrier for the iPhone, even though at the time the device didn’t even exist (link may require registration).
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Tony Gwynn and Cal Ripken were elected to baseball’s Hall of Fame. Mark McGwire wasn’t. Too bad, as I said a few weeks ago, Big Mac’s rejection was for the wrong reason.

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As I’ve said before, something is intensely wrong when states can give tax breaks to corporations for building new plants or facilities. It’s even more bizarre when state coffers are opened up just to keep businesses in place. Probably the most extreme example of that ever has just taken place in Michigan, where the state is giving Ford $300 million to keep six plants open — a subsidy of $23,000 per employee involved. Of course, Ford had threatened to take the work to other states.

It happens time and time again (another example: the “big box” retail giveaway objected to here and here sailed through Ohio’s legislature last year). Yet so far, this effective fleecing of all other taxpayers has inexplicably withstood legal challenge (third item at link). It’s such an obvious violation of equal protection (of all other taxpayers), I don’t even understand how any of these deals passes legal muster.

Who Owns the National Debt?

Filed under: Taxes & Government — Tom @ 6:15 am

The conventional wisdom (CW) is that about half of it is held by foreigners, dominated by the Chinese and Japanese.

The CW was wrong as of May of last year, and it certainly hasn’t changed that much since. Go to the indispensable Skeptical Optimist for a knock-your-socks-off chart.

Ho Hum Hiring Headline (011207)

Filed under: Business Moves — Tom @ 6:10 am

From Philadelphia:

Comcast to add 900 here
It said most of the new employees would be filling roles expected to improve customer service.

Buoyed by demand for its cable, Internet and phone-service package, Comcast Corp. said yesterday that its Eastern Division would add 900 jobs in the Philadelphia area, mostly in roles expected to improve customer service.

In all, Comcast will add 2,800 jobs in the Eastern Division, which stretches from Northern Virginia through northern New Jersey.

The additions will come four months after the company said it would hire 650 employees in the area. The positions announced yesterday will increase the number of Comcast employees in the Philadelphia and South Jersey area to 6,350, excluding employees at the corporate headquarters, the company said.

Biz Weak’s Latest Issue: Odds & Ends

Filed under: Biz Weak,Business Moves,Privacy/ID Theft — Tom @ 6:05 am

The Jan. 15, 2006 issue wasn’t too bad, once you get past the weak and way too sympathetic piece about Bob Nardelli I covered on Monday.

Here are a few worthy tidbits I picked up (all links probably require subscription):

  • - Stephen Wilstrom says you shouldn’t buy Vista when it debuts on January 30 — “Probably not, given the odds against a satisfactory upgrade experience. But I’d certainly consider speeding up the purchase of a new computer when pcs loaded with Vista become available in a few more weeks.”

Shoppers, on average, return about 6% of everything they buy. That proportion spikes in January to nearly 10%. This used to be a sore point for retailers. Rather than try to make sense of a hodgepodge of generally used, sometimes broken goods with packaging shredded or instructions missing, stores tended just to write the lot off as a loss. But over the past decade, an opportunistic industry has sprung up to give the reject pile a new lease on life.

Most big-box retailers–Sears, Target, Best Buy, Kohl’s, and many others–now outsource the handling of returns to companies that specialize in so-called reverse logistics. These third parties’ job, basically, is to pick up a store’s returns and figure out what to do with them–restock an item, sell it somewhere else, like in Peru or at a flea market, or throw it in the trash.

Schemes generally fall into three basic types: stealing data such as bar codes and magnetic strip information, planting data, and indulging in checkout scams (generally the work of employees with access to both the cards and the systems that activate or redeem them). Companies polled in the 2005 National Retail Security Survey, conducted by the University of Florida’s Center for Studies in Criminology & Law, estimate that employees are responsible for 62% of gift-card fraud, while stolen and counterfeit cards account for 13% each.

One way to steal money from gift cards is to copy data off unsold cards, then use the store’s Web site or 800 number to check their status. Once the cards are bought and loaded with dollars, crooks use the data to buy goods online or to create bogus cards. Other fraudsters clone cards they own and plant the copies in stores to be sold. When the cards are activated, the money goes onto the thieves’ cards.

The easiest scams take insider knowledge or access and little else. Employees may pretend a card is empty or deactivated and persuade the customer to hand over the “worthless” card, hoping to use it later. They may just swap them, pocketing activated cards at the register while slipping customers look-alikes. Or they may clone cards using information off discarded receipts.

Positivity: Driver’s survival a ‘miracle’

Filed under: Positivity — Tom @ 6:00 am

When you read about the details of the accident you have to wonder how the unnamed driver made it — and, for that matter, how others involved did too. But they did:

TAUNTON, MA – As curious neighbors and accident reconstructionists walked last night between shards of glass and the mangled pieces of what was once a silver Nissan Altima, many muttered the same phrase: “It must h miracle.”

Witnesses said the back tires of the Altima slid out as the driver sped around a Somerset Avenue turn at about 6 p.m., causing the car to slam into a box truck and then a Mitsubishi Galant before breaking into two large pieces, throwing the driver into a nearby yard.

Although the driver was MedFlighted to Beth Israel Deaconess Medical Center in Boston to be treated, he was conscious after the accident – a surprise to those who saw the ravaged car. The drivers of the other two vehicles suffered only minor injuries.

The driver’s name was not released. The fire department said he was taken to the Boston hospital, but a spokesman for Beth Israel said he had no record of him.

Police said the car is registered to Tom Davidson, 36, of Eighth Street, although police and hospital officials could not confirm that Davidson was the driver because he did not have identification on him at the time of the accident.

Witnesses said the man was conscious after he was thrown, although he was in considerable pain from a back injury.

Andy Pacheco, a 24-year-old who lives off Somerset Avenue near Silverwood Drive, said he was walking into his home when he heard the Altima coming around the corner.

“I could hear how fast he was going,” Pacheco said.

When he turned to watch, he saw the Altima’s back end slide out and the box truck, which was traveling in the opposite lane, almost come to a stop before the two collided.

“The car started spinning and it split in two,” he said.

After the Altima hit the Galant and came to a stop in two pieces, Pacheco saw the driver of the Altima lying in the back yard of a Highland Avenue home.

“He was lying there and he was screaming about his back,” Pacheco said.

He and another neighbor talked to the man and asked if there was anyone else in his car, but the man couldn’t respond.

“We looked in the car and didn’t see anything,” he said.

Suzie Ryder came to the scene of the accident with her sister, whose husband, Martin C. Harris, was driving the box truck.

Harris and the driver of the Galant, Renae Gearhart, of Dighton, were not seriously injured in the crash.

Ryder said Harris was wearing his seatbelt during the accident and was able to get out of his truck by climbing through the window.

Harris, who runs a vending machine supply company in Taunton, was about a mile from his home when he was hit.

Looking at the crumpled front and driver’s side of the truck, Ryder could not believe her brother-in-law was OK.