Unemployment

Death from overwork on the Tokyo Olympic Stadium

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After the first stadium was rejected for its exorbitant cost, the ‘budget’ conscious stadium started 14 months later than anticipated. Due to the delay, work on the new stadium has caused another scandal – excessive overtime. One worker has taken his life after logs showing he had worked over 211hrs of overtime in a month. One shift saw the worker start at 6:30am and finish up 26 hours later. One wonders what will turn it? If Tokyo Governor Yuriko Koike offers a glib apology what hope is there of reform? The punishment for Dentsu (who saw a worker commit suicide) was it wasn’t allowed to apply for any Tokyo government ad contracts for one month.

While the advent of Premium Friday (workers can knock off at 3pm on the last Friday of each month) is a positive step forward and having employees clock on & off makes sense, there is a deep seated cultural problem of not wanting to become an outcast within a company. Although the The Japan Institute of Labour Policy & Training reports that since 2002 bullying and harassment claims to the Labor Tribunal have soared from under 6% to over 20% at the same time total disputes have trebled to over 300,000 annually. One worker from Olympus complained his bosses were being unethical by poaching many of a contractors staff. His punishment was demotion among other humiliation. In order to avoid being unfairly treated, people are using the ‘-hara’ (pawa-hara = power harassment, seku-hara = sexual harassment, mata-hara = maternity harassment) route to their advantage as the following charts show.

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For corporates in Japan, the government is the leader. It took PM Koizumi some 15 years ago to introduce the ‘Cool Biz’ concept (removal of neckties in the middle of sweltering summer during a period of power conservation) because corporations didn’t want to risk being the odd one out.

However there are exceptions. One company in Japan has a very open approach to hiring and paying its staff top rates that are based on performance. Staff are willing to work long hours because inputs have transparent outputs. Instead of getting one or two months pay twice a year like many Japanese corporates offer no matter how ordinary the real performance is this company has employees who think, according to one, “like working in heaven.” Simple – they are paid for their abilities and the trappings of that success are indeed visible.

3 maps which explain a lot

IMG_0743The chart above shows the average % change in housing prices in the US by county today vs that in 2000 according to a Harvard study. The following maps show the results of the 2008 and 2016 election by county. Could this be yet another basic concept showing why the US voted the way they did last election?

2008 – a hope for change

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2016 – the last 8 years didn’t help – time to vote for wholesale change

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Feel free to draw your own conclusions. These three maps to me voice the disgruntled who remain destitute after all this time.

Do you ever wonder why…

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…the majority would believe words like “demolished” from the press when the subject in question is a video driven by The Guardian pushing the even more Trump-hating journalism of Australia’s taxpayer funded ABC? Despite the ABC being controlled by a charter that says it mustn’t show political bias, it knows only one drum beat – join every Trump derangement cause without exception. It isn’t just this but whenever you see the words “demolished, destroyed, smashed” in a headline, discount its value by half then deduct another 75%. That will be about the extent of how “powerful” the report is. Viral? More like a bad bout of gastroenteritis. The walls of Washington were most likely reverberating with uncontrolled laughter.

Uhlmann can argue that Trump is the biggest threat to the West and he’s accelerating the decline of the US but it was 8 years under the Obama administration where Russia and China could run amuck with little fear of anything more than a hashtag in retaliation. It is more obvious that on foreign policy, the US is in a revival phase and her foes are sitting up and taking notice. Surely that hasn’t come about by chance.

Who cares if Merkel, Trudeau or Macron voice disapproval of the current US president? It isn’t new. Australian PM Turnbull is utterly mesmerized by Trump. While the mutual affection society of the ABC and its former minister Turnbull continue to mock POTUS he was the first to jump at the chance catch a ride in the Beast . That when he alighted spoke of how much he respects Trump and how much in common the two have (ppffft). The Aussie PM is petrified of DT in person. Turnbull loved Obama but never feared him.

The job of POTUS is not to join a chorus. True leadership is often doing things that aren’t popular. Dumping the Paris Climate Accord isn’t popular but it’s the right thing to do according to Americans and surveys in the US say as much. When one objectively studies the realities of the non-binding document it is clear the agreement is an empty one when countries like France & Germany step up to make up for the 75% of emitters that refuse to get on board.

Trump’s actions surrounding North Korea have the Chinese scurrying around looking for a solution that keeps the US from potentially influencing “the” border to its north. Isn’t that ‘leading the world’ by trying to get those that have the most to lose by suggesting the US will take control of the Korean Peninsula if they dither anymore? Notice B1-B Lancer bombers have been strafing the border on the 38th parallel with precision dummy bomb drills?  They aren’t for North Korea’s delectation but a message to China – stop messing about! Obama would have been dropping leaflets of peace, harmony and Hershey bars.

Under Obama’s watch China willfully built man made military bases in the South China Sea in contested waters taking advantage of his weakness. Xi knows there is a new sheriff in town and realizes he has to resort to another chapter in Sun Tzu.

The BBC – of all news channels – had a body language expert revealing that the alpha male show off in Hamburg between POTUS and Putin, had the former dominant over the latter. Putin is a master of bullying. Remember he had his intelligence arm find out Merkel was petrified of big dogs and made sure he had a monster canine wander around during their chat when she visited Russia? Doesn’t strike me that Trump is weak, unfit and out of his depth if Putin was nervous.

As more media coverage shows Trump as isolated and going it alone it isn’t the 1/20 being left out in the cold but the 19/20 who can’t get any edge on him.

As Uhlmann makes clear, he is just as clueless as so many other journalists because he makes no attempt to give context and perspective on the starting point. To think Obama led a period of American exceptionalism in foreign policy is preposterous. If Trump actually gets a positive outcome on North Korea or ISIS will Uhlmann issue an apology for his oversight? Let me give you a hint – not on your life.

I’ll happily admit when Trump does questionable things but I’ll make no apologies trying to address the ridiculous bias in the media against him. That bias remains so prevalent that it drowns out any noise that may actually be relevant to the Trump lovers who see no wrong.

Try being an agent of change not a victim of it

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It is hard to feel sympathy for these news organizations that forget the golden rules of commerce – if you stop adding value your audience will consume elsewhere, Someone told me the other week that NYT subscriptions had soared. If indeed that was the case then why is the paper looking to junk half its editorial staff? Running the idea that free media is hurting advertising revenues and that shame on the paper for having to make rational business decisions. Free media might be part of the equation but had the NY Times stopped congratulating its self appraised excellence in bus shelters and billboards  realized that its journalism was the problem perhaps they might be expanding the kind of readership its advertisers would pay up for. Has the NYT not realized that the exposure of media outlets like CNN droning endlessly on about Russia-gate being a total fabrication for ratings is why trust in mainstream media is lower that the President?

The actions of the NY Times staff smacks of the same stupidity of the Sydney Morning Herald which has had to take two massive rounds of lay-offs inside a year because the product isn’t reaching. The SMH staff took a vote to strike at their evil overlords who put profit ahead of people. Welcome to the free market. When one journalist at the SMH became a scab (because he admitted the problem) he was vilified by his fellow workers. Biased in and biased out. Think of Channel 10 in Australia which is now under administration. Could it be the product that is not reaching? Could it be a lack of creativity or diversity in content (as opposed to diversity of background).

The NY Times does deserve credit though for trying to introduce balance to its columns with the introduction of a ‘climate sceptic’ (Bret Stevens) whose first article created such ructions that social media lit up like a Christmas tree – calling for his sacking and how the NY Times betrayed its loyal readers. Instead of praising the NY Times for trying to bring balance and diversity of thought into the mix, the group thinkers could only try to shut him down. It is exactly that type of reaction that will precipitate the demise of the paper. To be honest, when you read articles, journals, books or watch TV don’t you wish to learn other perspectives. Or do you want to listen to the same noise reverberating inside your own echo chamber?

It is natural to feel fear in the face of difficult times but staging protests only has the reverse effect. It is doubtful that management relishes having to retrench so many. However these people should live in the knowledge that management’s failure to turn around this wayward ship will result in their bosses’ necks. Instead of solutions, proposals and most importantly recognition of a failing product, they’ve chosen to be victims not agents.  Ironically at the moment NYT’s shareholders are behind management with the stock price up 50% YTD.

Illinois Police Pension can’t protect or serve – it is going bust

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Sadly the Illinois Police Pension is rapidly approaching the point of being unable to service its pension members and a taxpayer bailout looks unlikely given the State of Illinois’ mulling bankruptcy. Local Government Information Services (LGIS) writes, “At the end of 2020, LGIS estimates that the Policemen’s Annuity and Benefit Fund of Chicago will have less than $150 million in assets to pay $928 million promised to 14,133 retirees the following year…Fund assets will fall from $3.2 billion at the end of 2015 to $1.4 billion at the end of 2018, $751 million at the end of 2019, and $143 million at the end of 2020, according to LGIS…LGIS analyzed 12 years of the fund’s mandated financial filings with the Illinois Department of Insurance (DOI), which regulates public pension funds. It found that– without taxpayer subsidies and the ability to use active employee contributions to pay current retirees, a practice that is illegal in the private sector– the fund would have already run completely dry, in 2015…The Chicago police pension fund held $3.2 billion in assets in 2003. It shelled out $3.8 billion more in benefits to retired police officers than it generated in investment returns between 2003 and 2015…Over that span, the fund paid out $6.9 billion and earned $3.0 billion, paying an additional $134 million in fees to investment managers.”

The public pension black hole in America is an alarming issue.  In the piece, “The Public Pension Black Hole” it was plain to see the problems of unfunded state pensions is rife across America. Take California- “The US Federal Reserve (Fed) reported in 2013 that the State of California had an official unfunded pension liability status equivalent to 43% of state revenue. However, if marked-to- market with realistic discount rates we estimate that it is equivalent to 300% of state revenue or 7x greater. Going back to 2000, California had an unfunded liability less than 11% of tax collections. As a percent of GDP it has grown from 2% to 9.7% based on official figures. If our estimate is correct, the mark-to market reality is that California’s unfunded state pension (i.e. for public servants only) is around 18% of state GDP!”

The problem for Illinois is that a taxpayer funded bailout is all but impossible. The State of Illinois ranked worst in the Fed study on unfunded liabilities.  The unfunded pension liability is around 24% of state GDP. In 2000 the unfunded gap to state revenue was 30% and in 2013 was 124% in 2013. Chicago City Wire adds that the police fund isn’t the only one in trouble.

“Chicago’s Teachers Union Pension Fund is $10.1 billion in debt. Its two municipal worker funds owe $11.2 billion and its fire department fund owes $3.5 billion…All will require taxpayer bailouts if they are going to pay retirees going into the next decade…Put in perspective, the City of Chicago’s property tax levy was $1.36 billion in 2017…Paying for retirees “as we go,” which will prove the only option once funds run dry, will require almost quadrupling city property tax bills…Last year, it would have required more than $4 billion in revenue– including $1 billion for City of Chicago workers, $1.5 billion for teachers, and $1.5 billion for retired police officers and fire fighters.”

This problem is going to get catastrophically worse with the state of bloated asset markets with puny returns. Looking at how it has been handled in the past Detroit, Michigan gives some flavor. It declared bankruptcy around this time three years ago. Its pension and healthcare obligations total north of US$10bn or 4x its annual budget. Accumulated deficits are 7x larger than collections. Dr. Wayne Winegarden of George Mason University wrote that in 2011 half of those occupying the city’s 305,000 properties didn’t pay tax. Almost 80,000 were unoccupied meaning no revenue in the door. Over the three years post the GFC Detroit’s population plunged from 1.8mn to 700,000 putting even more pressure on the shrinking tax base.

In order for states and local municipalities to overcome such gaps, they must reorganise the terms. It could be a simple task of telling retiree John Smith that his $75,000 annuity promised decades ago is now $25,000 as the alternative could be even worse if the terms are not accepted. Think of all the consumption knock on effects of this. I doubt many Americans will accept that hands down, leading to class actions and even more turmoil.

 

WaPo writer channels Kathy Griffin

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What on earth inspires people to write such things after the shooting at a Congressional baseball practice in Virginia? How does someone who tweets such vile and thoughtless texts ever pass the editorial sniff test of a newspaper like WaPo where Malcolm Harris is an occasional writer? Will we see an apology via a televised press conference where Harris will claim it was comedy and that now his life is ruined?

I note that WaPo is using “Democracy dies in darkness” on its banner – perhaps it should be “journalistic integrity dies in daylight”.

What is this obsession with crowd funding?

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I get where crowd funding the plight of some poor starving tribe in Africa hit by a devastating famine, or a Bangladeshi child who needs emergency surgery to save her might have merit but to dig deep for Katie Hopkins takes some convincing. Her ‘final solution’ comments in the wake of the Manchester bombing got her fired from LBC. I’m not here to debate the radio station’s internal staff policies or how they execute them. Katie’s views are always strong, especially with regards to radical Islamic terrorism. I actually thought Janet Albrechtson’s article in the Weekend Australian was a far more eloquent summation of how to put a case forward to fix the problem.

Katie chose her words poorly (even if deliberately) and even if she expresses her views under the banner of ‘free speech’ she has to accept the consequences of those actions of the sponsor that pays her wages. In a sense LBC has the right (mostly for concerns to its advertisers) to make a call on that. Just like those US government agencies who were told to cease criticizing their President-elect on taxpayer funded websites. It was not a ban on free speech but a question of insubordination. To those that couldn’t see that view I suggested they send a message to their boss with the rest of the company CC’d about how stupid you thought he was. The LBC decision stands.

Still one has to wonder why there is a need to crowd fund Katie? Surely she will resurface again. I am surprised Breitbart hasn’t posted an applicaton form to join. Her darkest hour? Are they serious? I am sure she has had many darker. Though who is it for me to determine who wishes to give her money? After all it is charitable. I wonder though whether the tax authorities must have a good, hard look at such crowdfunding and deem whether there is a legitimate tax deductibility case to be had…

Having said that, what a sign of the times that crowd funding tells us about how deeply certain issues affect others. The flip side is they only think she is worth 100,000 pounds. If I ever get crowdfunded I can only hope the figure is far higher.