Mark's Rant Blog

I started formulating this rant a couple of days ago when I learned that Polaris is closing their plant in  Osceola, Wisconsin.  This will end 515 jobs in this town of 2,700.  Quite a blow for a small population like this.  The reason for the closing: they are moving production to Mexico to cut costs.  Polaris' stock price has more than doubled in the past 52 weeks.  Do they really need to put more Americans out of work?

Sooner or later, these companies had better realize that if they keep putting Americans out of the job by moving their higher paying jobs overseas or to Mexico, there will come a point when no one in our country will have the money to buy their goods!  Duh!  That shouldn't be a difficult concept.

I got really ticked this morning by an incident with Amazon and that caused me to actually sit down and write this.  I am a huge fan of Amazon.  I am an Amazon Prime member, so for $75 a year (approx) I get free two-day shipping on all my orders.  On two occasions I have had to contact them by phone and each time I understand why they do almost everything on the web!  Like most companies, they outsource their call center activities to somewhere overseas.  But whereas some companies set high standards to prevent language problems, Amazon doesn't appear to.  I called today because I placed an order late last night and the credit card failed to authorize.  Turned out I forgot to activate the card - still not sure how I did that.  Anyway, I use Amazon's site which has a feature where they will call you when an operator is able to talk to you.  The guy calls and there was an immediate language barrier.  I just needed them to reprocess the transaction.  I explained that and he asked if I wanted to cancel my order.  I told him I didn't want anything cancelled, but I need it reprocessed.  He comes back and asks if I want to change cards.  I told him no, same card, run it again.  Finally, he comes back and tells me he has taken care of everything for me.  A few minutes later, I get an email telling me that he had processed the card for some of the items in my order, cancelled an item, and left several other items with the payment pending.  Talk about frustrating!  I didn't want to call back again, so I cancelled the remaining items and bought them all again.  Very poor service on the phone from a company that otherwise provides stellar service.

Here's the thing.  Those call center jobs don't necessarily pay that much. TeleTech is a local call center company and they start people out in the $8-$9 range.  I understand that is triple what they would pay in India, but if none of these companies want to hire Americans, how they continue to expect Americans to buy from them?

Executives needs to start looking at this very real and growing issue when they make these decisions.  I know that they have a responsibility to their stockholders to maximize profits.  But they also have a responsibility to ensure long-term profitability, which is being endangered by some of these actions.  And even more to blame are the shareholders who demand profits RIGHT NOW so that they can just sell and walk away leaving thousands of American jobs - really, American LIVES - shattered just so that they can make a fast buck.  Where does this end?  Shareholders need to be in it for the long haul.  Otherwise, this downward spiral will continue and the end will not be pretty.

Link: http://www.washingtonpost.com/wp-dyn/content/article/2009/12/27/AR2009122701714.html

According to a recent article in the Washington Post, the 40% tax on Cadillac health insurance plans (those over $8500 for individuals or $23000 for families) is not really a new tax, but a partial elimination of a current tax break.  Maybe so, not sure about that part.  But this author truly shows his colors later in the article.  I know he is a professor of economics at MIT, but that doesn't mean he knows everything.  I certainly don't know everything either, but my money would not be on what this guy is saying.  For instance:

Moreover, most experts and Congress's Joint Committee on Taxation assume that most companies would not end up paying this tax but would instead reduce their insurance spending to below the threshold for the tax. And when firms reduce their insurance generosity, they make it up in higher pay for their workers.
Ceterus paribus.  The author fails to take into account the various other taxes on business that may either be added or left to die.  The truth is that there is so much uncertainty over what this government will do that I don't foresee any savings on health insurance being passed along to employees.  Perhaps the biggest threat is not even a direct tax on most businesses, but could be a massive increase in energy costs to pay for "green energy" systems. 

By my calculations the excise tax in the Senate legislation will raise U.S. worker wages by a total of $223 billion over the next decade, which would mean about $660 in extra annual earnings per employer-insured household by 2019. Moreover, the vast majority of those wage increases accrue to middle- and lower-income households; 90 percent would go to families with incomes below $200,000.
See above.  And if anyone does see any of this savings in premiums passed along in the form of higher salary, it will NOT be the middle class.  I just don't see this happening.

So in the end, we have a policy that ... induces employers to buy more cost-effective health insurance...
I would agree.  I would expect most employers to "cheapen" their plans.  But is that really fair?  Do we really want that?  Isn't that like saying "your health care is too good, we're going to take some for the less fortunate."

So in the end, we have a policy that... lowering U.S. health-care spending...
How?  My company recently changed insurance plans.  Our current coverage is much, much better than our previous coverage.  But that doesn't mean that my health care spending is more - it just means that less is coming from my pocket!  Likewise, forcing companies to reduce their health coverage won't reduce health care spending, it will just shift the cost from the insurance company to the individual.  So now, I've not just taken a benefit cut without an increase in pay, and my costs have gone up... I'm triple screwed and didn't enjoy any of it!

So in the end, we have a policy that...offsets a bias in our tax system that favors more expensive insurance...
Only a Communist world excludes bias.  And Communism has never worked and never will because it fails to take into account human wants, needs, and desires.  Do I need to bring up the story of the little girl who is going to give money to the homeless - and a family friend offers to pay her $20 to rake his leaves and then drive her downtown to give the money to a homeless person?  The little girl's reply to the offer is "why doesn't he just go rake your leaves and you pay him?"  If you keep taking money from other people to give to the less fortunate, you WILL eventually run out of other people's money.  Is there a bias there?  Yes.  Is that wrong?  In my opinion, no.  The simple fact of the matter is that I can't have everything I want and will never be the richest man in the world.  My neighbor may drive a BMW, but I'm perfectly happy with my VW.  Life isn't fair.  And the quicker some people get that through their heads the better. 

This health care plan is a mistake.  It verges on socialized medicine, which has not worked well in any country that has tried it.  It will result in many employers dropping health insurance completely.  It may cost jobs.  It will certainly not solve the real issue, which is the overall cost of the health care itself.  Until you get the cost of a basic blood test down from $800 to a reasonable level, you're just putting a Band-Aid on the problem.  Typical politics...

Link: http://bit.ly/3z1g97

A quick search here on my blog will show that I have been extremely critical of Ken Lewis and his company, Bank of America, which I often call Devil Bank. I despise the way BofA has treated their customers and even their employees (my wife worked for them for a short time). I feel that over the past year they have added to the financial mess many of us are in by raising credit card fees and interest rates to the point where good people who never had a problem paying their bills are suddenly barely able to keep up. However, I still believe fair is fair and right is right. And what our government is doing to Ken Lewis is neither fair nor right. I never thought I'd feel sorry for this man, but I do.

Let's go back in time a bit, to October 2008. At that time, the financial sector was being hit hard with losses. Some of these losses were created by their own actions, some losses happened for reasons outside the companies' control. The government wanted to shore up the situation by giving the banks money to loan out to businesses and individuals. As with most government money, there were strings attached and the bankers were hesitant to accept. It was Mr. Lewis that finally stood up and pushed the others into accepting the money.

In December 2008, the government forced Bank of America to take over Merrill Lynch (which was just hours from bankruptcy), even after Mr. Lewis raised many concerns as to the feasibility of the deal. Yes, they did force this on BofA, telling Mr. Lewis that he would be fired if he did not agree (and since they had taken the money in October, the government could fire him). Shortly after the takeover, BofA realized how bad the situation was at Merrill and returned to the government for more money.

Then, in January 2009, Congress dragged Ken Lewis to Capitol Hill to rake him over the coals over the Merrill Lynch deal that THE GOVERNMENT forced him into. One of their biggest complaints was Merrill paying out millions in bonuses that were awarded and paid before Bank of America officially took over the operation. So, they were grilling Mr. Lewis over things that were totally out of his control. Whether he knew about the bonuses ahead of time or not does not matter - it wasn't yet his company, so how could he stop it from happening?

All of that resulted in a shareholder revolt that ended with Ken Lewis being stripped of his Chairman of the Board title, leaving him just the CEO.

On September 30, Mr. Lewis informed his board that he would be retiring in December, a year earlier than planned.

Now, this week, President Obama's "Pay Czar" (a possibly illegal position), ordered Ken Lewis to pay back the $1 million he has been paid so far this year. He also ordered Mr. Lewis not to accept any of the remaining $1.5 million that he is due for his services and forbid him from accepting any bonuses. We can debate some other time about whether a $2.5 million salary is fair or acceptable. It wouldn't matter if we were talking about $1,000 here - the fact is, he had a contract with Bank of America to work for a certain amount of money. He has worked nearly ten months this year expecting that salary. Now our GOVERNMENT tells him he's been working for free all this time and he actually has to pay back what he's gotten!?! I don't care if we are talking about $100 or $5 million - that just is NOT right! I wouldn't blame Mr. Lewis if he never went back to work - he got hosed here. This wasn't about "doing what is right for our country or the company" this decision was personal and punitive against Mr. Lewis.

With crap like this going on, what incentive does any executive have to work their butt off if their salary can just be revoked at any time? I'm certainly no fan of Bank of America or Mr. Lewis, but this is not right. I only know of one word to describe a situation where the government can claim you've made too much money and order you to return it: Socialism.

Link: http://www.cbsnews.com/stories/2009/10/12/national/main5378839.shtml?tag=contentMain;contentBody

In another testament to how far overboard our society has gone, a six year old boy in Delaware faces a 45-day suspension because he brought a spork (spoon/fork/knife) to school to eat his lunch. The boy had recently joined the Cub Scouts and had gotten this utensil as a camping tool.

The kid was excited about joining Cub Scouts - a wonderful organization that teaches young boys so many valuable skills - and these administrators crush him because of the school's "zero tolerance" policy. These policies are a joke. Anyone who really believes that a single, set punishment can apply in any possible situation needs to seek help. Punishments should fit the crime. Some may call me naive, but I fail to see a crime here. The school board president is quoted in the article as saying, "There is no parent who wants to get a phone call where they hear that their child no longer has two good seeing eyes because there was a scuffle and someone pulled out a knife." That is very true. But I see three things wrong here. First, the boy brought it to use for his lunch, not to seek violence. Second, unless the school only serves finger foods, they have to provide these utensils anyway. Third, I bet any of the kids in that school would be smart enough to know that if they wanted to poke an eye out they could do so with any pen or pencil - if not a finger!

I'm no expert and I'm not sure where you draw the line. But I do know that punishing a young boy for bringing a nifty camping-style eating utensil to school for his lunch is just asinine. The only ones who should be suspended are the board members, administrators, and teachers who find this punishment acceptable.

In an AP News article, former President Carter has made some incredible statements regarding Representative Wilson's comments during President Obama's speech last week.

I will start first with Wilson's comments. What he said was out of order. There is no place for comments like that during a Presidential address. To be said later is another story entirely. I truly believe that Mr. Wilson understands this and regrets what he probably didn't even intend to say aloud. For the House Democrats to formally scold him for these comments is just dumb. He already apologized (publicly) and the President accepted his apology (publicly).

Now, on to the comments of former President Carter. He claims that Mr. Wilson's comments were racist in nature. WHAT? How do the words "You lie" even remotely insinuate race? He then goes on to say that this is another part of the trend of conservatives equating President Obama to Nazis. With all due respect Mr. Carter, have you inhaled too much peanut dust? The comparison to Hitler or the Nazis has nothing to do with the racial aspects of Nazi Germany. It has everything to do with President Obama's socialist policies. If you look at history, what the President wants is strikingly similar to many political (read non-racial) ideas that Hitler had.

As a conservative white guy, I am offended by former President Carter's statements. I have no problem with a black President. I do not mind President Obama's race at all. It's his politics that I dislike! And that has nothing to do with the color of his skin.