First there was the fear spread by our President advising that there is a CRISIS, in just about every aspect of our economy.
(Photo of government mandated future transportation.)
In fact there was a speech I no longer remember in which I believe that he used that word more than 20 times. Everything was a CRISIS, and he had the answer to that CRISIS, to every matter defined as a CRISIS.
Now keep in mind that everything in our economy was defined as a CRISIS, no matter what it was; bank capital shortages, bad loans, predatory lenders, high oil prices, low oil prices, no inflation, high inflation, high government deficit spending, the falling dollar, growing unemployment, GM rescue, insurance companies writing new policies or paying old ones, new organizing rules for unions, executive pay, Mexico free 
trade…on and on and on.
Everything was a CRISIS; nice scary talk by our fearless leader.
But, have no fear fellow Americans, there was a one size fit all solution to every conceivable CRISIS. That solution was to spend, spend and spend your children s and grandchildren’s future income.
The solution was needed and immediately necessary, it had to be voted on right away, without reading, without further comment-TRUST ME, was the mantra of our fearless leader.
And so, as we all remember, the CONGRESS voted on a massive bill which nobody read.
It is expected that its present total impact will be a minimum of $12. 5 TRILLION over its life. That by the way is the value of the entire output of all the goods and serviced of the USA, in a year.
That is approximately equal to almost the output of all the G20, members ( for instance Russia’s total output is $1.5 Trillion).
However, there was catch, a catch that nobody knew about because nobody read the bill. In fact I tried to see it in final form and as much as I tried all I got was certain versions on the Internet, making it difficult to decide which was the final bill.
The final bill, the one that Congress voted for, contained a few surprises that in effect were that the government would now run the businesses that took any money from the government.
Now keep in mind, that our new President, (as described by Joe Scarborough on his morning TV show today) has never had a job at a business, has never had to run a business and deal with the myriad of government meddlers ranging from local zoning to licensing, to all the other matters of daily managing of a business. he never had a paycheck from a real business, never.
Now he was going to tell the most sophisticated financial institution in the world how to run their business. He was going to tell them how to wind down their derivatives, and he fired the CEO of GM on the air, by saying so. The board of directors did not fire him, our President did!
Then, the government advised that GM would be building cars for which technology was not yet invented for, while stopping the realistic expansion of the availability of electricity, and outright stating that electric rates would rise dramatically for all users due to their mandates and initiatives.
The government (make that Barney Frank and Chris Dodd) also proposed what salaries, what bonuses would be paid to recipients of government money, and special taxes of 90% were proposed on bonuses.
Now something is starting to happen. The recipients of the government money, now read the bill-they read the conditions of doing business with the devil , sorry I meant the government.
The recipients want to give back the loans, or pay back the loans early and are being arm twisted to not pay the loans back!
In a free market, business attracts key employees by offering attractive pay, or bonuses or other perks to get the best people. In a new government run business model, such incentives do not exist.
For instance under the government model, a successful business that offers a $1 salary to an employee and unlimited bonus tied to financial performance, is penalized as he will be taxed at crazy confiscatory rates on his bonus.
For instance, the new employee making $1 billion in profits for the employer, and being rewarded with a bonus of 5% of the profit or $50 million, would have to pay 90% in taxes, under the government program of being employed by a recipient of government largess.
On the other hand, the government does not impose such a tax if the employee was paid $50 million in a guaranteed salary, and $1 in bonus!
So working for a government, at a company which has received government funds can be a better deal for a slacker, since his salary is guaranteed. But all the highly motivated employees will work elsewhere.
The government is using a Socialist type of compensation-equal pay for all slackers, as usual, and that is starting to become clear to businesses who want to be free of the government restrictions on how to run a business.
The banks, the companies taking government money are learning the hard way to Not do business with the government as they will be burdened by the usual slow moving and non-motivational policies of a bureaucracy, and will make that business not competitive with others.
As in the case of GM, we saw a failure of the company to exist on its own and causing an even greater and more expense bailout than a pure bankruptcy reorganization would have provided, not to mention that it is now a government run zombie company.
Socialism and free enterprise just do not mix, and the sooner our government gets it, the sooner will we see an economic recovery in the USA.
We all know someone who is or was a union member.
My dad was one when he worked as a machinist in a machine shop in Chicago. He did not choose to be one though; he HAD to become one since the business he worked in was a “union shop.”
Since that time in the early 1960’s, union membership as a percentage of employed people had dwindled due to expansion of the number businesses in the country, and the decline of the forced “union shop”.
Being a “UNION SHOP” has come to mean high labor costs, or lack of a profitable enterprise due to the excessive costs of labor in that enterprise.
Unions were needed, when workers had 7 day work weeks and no overtime pay and no benefits.
However, today, their hard fought labor benefits, are for the most part responsible for the decline of every industry in which they are pervasive.
Take for example the auto manufacturing industry in America.
The fully loaded labor cost per employee is realistically over $75 an hour; and that’s regular time pay. That calculates to $3,000 per week; and $156,000 per year.
In order to not hire new employees, and thus add to a long term financial burden to the company, in times of added business, the auto companies would have the present employees work overtime at 1.5 times that wage, thus a cost of $234,000 a year, per employee!
To put this simply, think about this example:
You go to the Starbuck’s store, and the barrista working mixing your exotic coffee, is getting paid $234,000 a year. What price would be the price for your cup of coffee?
Oh, and there can not be just one person, there would be 2 or 3 or four people needed to staff that store, plus a manager, at presumably an even higher price-assume $275,000.. That would mean a staff cost of $743,000 to $1,211,000 for that little store.
Rest assured that there would be NO such store in existence, nor would they ever be started.
Well this phantom business, this coffee store will never be seen again if the government and union backed EMPLOYEE FREE CHOICE ACT, a top legislative priority for the new administration is approved into law.
The ACT, in short would allow employees at a business, simply to sign cards requesting that the employees who are in the majority signings such cards, now be represented by a Union.
There is no more need for a secret ballot, nor employer lobbying.
Now, that is not bad compared to a planned provision in the bill that would have a government arbitrator set the contract terms for a business if the parties could not agree after 120 days!
So now the government and the Unions would be running every business in America deciding what wages and benefits would be paid in every company.
Do you believe that this ACT as proposed would be a stimulus to the economy, by mandating work terms?
Some of the best and brightest people, those in technology companies, those in manufacturing would be jobless. Every entrepreneur who wants to start a business would think twice about doing it. Every existing business would question its ability to continue to effectively compete with others.
THE EMPLOYEE FREE CHOICE ACT would be the employee FREE TO BE UNEMPLOYED ACT.
If history considers the Great Depression to be a bad time for America, it will look like a vacation compered to this great country being brought down to its knees with this great new goverment idea.
There is no country in the world stupid enough to have such a regulation to stifle free enterprise and the formation of new businesses, as well stifling every existing business.
New multi-billion dollar investments have been made by foreign companies such as Toyota, Nissan and Mercedes Benz in building auto manufacturing plants with NON-union labor.
Those companies have not asked for loans from taxpayers, those companie have put up their own non taxpayer capital to exist. If they did not have the opportunity to attract labor at a rate attractive to starting their business in America, they would not have built their plants here.
The woder about a free eneterprise system is that nobody is FORCED to work anyplace, at a salary or wages that they do not find appopriate or attractive. They are fre to change jobs for another job that they like better, or offers better pay.
Is it the desire of the government to now madate that employees get a certain pay scale and benefits…?
What about equality in pay? Do all the coffee shops pay the same?
That happened in the old Soviet Union and its eastern Block countries. I know how that worked first hand having visited there during the late 1970’s.
Everyone was equally “employed”.
If you worked at a candy store (candy store #2073) for instance, your pay was the same if you worked in another retail shop. All emplyees were equally bored. The service was non existant and the products as well.
Nobody cared about their job, and they and no way to make more money except by cheating the employer—they would keep their job no matter what.
Everyone wanted to make more money. The government finally allowed free enterprise to start by allowing private businesses to compete with the state controlled ones.
The private ones offered lower wages with the hope of better ones when business improved. Guess what happened?
Today there ane no government owned candy shops, and everyone makes the wages that are market based. The countries have all prospered.
Now in America, we are about to make all pay equally dismal. Slackers or performers will be paid the same “union mandated” wage. Just like the educational system, as a perfect example.
Is this going to be good for America?
Think about it…as an employee you will not be able to be paid more…the contract will forbid that. as an employer, you will be forced to pay slackers the same as motivated employees.
Worst of all, kiss that $1 value meal goodbuy.
Sterling Cooper Inc 