Retraining

We are starting the selection. Being a practical child, she feels that teaching music/theater is a better employment bet than performing. That means we have to find an education/dance/music/theater college. That is way outside my area of expertise.

But- she really liked the casting demos at Cabin Fever. And there's probably a quota for female foundry workers.

Kevin Gallimore

========== At least he is *ADDING* value [until he burns one...]. Per other posts, this is more than can be said for ever increasing numbers of economic sectors/occupations in the US.

=================== The statutory tax rate means nothing if no one pays it.

There are now so many deductions, exceptions, exemptions, etc. that on the average, a US corporation pays income and total taxes at a *LOWER* rate than a single working mother, and this is only on their known/reported income.

Where a corporation such as Ford, General Motors, or Chrysler reports a continuing operating loss they pay *NO* income taxes because they had no income, although they are generally consuming enormous amounts of tax payer funds. These losses will be subsidized by the tax payers for many years *IF* the corporations return to profitability, through the magic of "carry-forward" tax losses. Corporations operating under Chapter

11 (reorganization) are similarly favored.

Lets get rid of these "tin cup" corporations.

I suggest that "tax loss hobby operation" type regulations be applied to all corporations. For example, automatic chapter 11 reorganization if a corporation fails to pay federal and state income taxes in at least 7 years of a rolling 10 year period for which the national unemployment rate is below 6.5%, and automatic chapter 7 liquidation for second bankruptcy in a 3 year period, or for chapter 11 operation for more than 2 years.

How about no tax, no bail-out?

Good luck to her in any case. Teaching sounds good. Foundry work will probably be so automated in a few years that they'll run with the lights out.

-- Ed Huntress

I'm just ranting...actually, over 80% of what I make today are new products exploiting a niche that I hope is too small to attract competition and the technology is proprietary. I just anticipate the other shoe dropping and I get screwed somehow. I've abandoned those products that are made in Spain and China but I still can produce if the demand swings and they become profitable. Ohio increased the minimum wage by more than 25% last year and bumped it again this year. I had to separate some low end employees that their skill level couldn't justify the bump. (porters and cleaners) I have hired more people at a much higher skill and wage level but I feel terrible that the jobless rate in Cleveland skyrocketed due to the State's wage bump. Crime rates paralleled it too with the added thousands to the street. I used to be able to afford a few "charity" jobs for the neighborhood riff-raff.

You're right, the Dollar is over valued but until the Chinese cut the Yuan loose from the Dollar completely, they have a competitive advantage so I will stay out of those product lines or buy the products from them.

Getting back to the original post, I see less and less people being involved in manufacturing in the US and those people will have higher and higher skill levels. The days of good factory jobs for the masses are gone for a while. I don't understand how the economy works with less and less actual wealth creation...it can't be a good thing.

From the statistics, it doesn't look like the increased minimum wage had a measurable effect on unemployment in Ohio -- it was already running a few tenths of a percent above the national average and it still is -- although sorting out the details for Cleveland and isolating the causes would be tough. You're a small business in a rust-belt, monopsonistic state (one that traditionally has a high percentage of large employers who dominate the labor market). As a small business you're always going to take the hit from higher wages, regardless of the cause. And Ohio's fortunes are still heavily influenced by the fortunes of the automobile industry, which, as Michigan knows, is not exactly booming.

On the average, boosting a minimum wage results in a small increase in unemployment (partly because more people enter the labor market when wages go up, while hiring remains static due to the higher rates), accompanied by a small increase in average worker incomes. Where you have monopsony the increase in unemployment often is close to zero. Where a regional economy has a high percentage of low-wage service jobs the increase in unemployment can be significant. *Your* employment, as a small business, is going to drop but the statistical effect of small changes in employment in small manufacturing-related businesses is hardly measurable in most regional economies.

But I won't quibble over that. You're feeling it, and you're obviously frustrated by it. If your "charity" jobs actually helped people get started working and encouraged them to do better, it's unfortunate that the increase in the minimum wage took that option away from you. I'm doubtful about how much effect that has when you start looking at entire communities and states, but I can't judge it because I don't know how common the practice is. The whole dynamic of employer size and dominance, union effects, and legislated minimum wages is a complicated thing to measure and judge. It tends to spring a few surprises, too.

"Actual wealth creation" is the key to that question, and it requires some study. The wealth tends to accumulate to the people or the societies that control the aggregation, lending, and supply of money, like Luxembourg, New York, or London. Where it actually comes from is an interesting question. Manufacturing is just one of several components.

No doubt the numbers of people involved in manufacturing will continue to drop, although the big drops may already have happened. Productivity growth is likely to slow down and take a breather for a while. Now we're starting to see what manufacturing will look like in the US as globalization and development of large chunks of the world's economy and population advance. I've thought for a long while that the US will have a smaller but healthier base of manufacturing, and that, as you say, the people involved will be highly skilled. If nothing else, global competition will force it.

-- Ed Huntress

But what about the foundry that she could have choreographed?

Br>> But- she really liked the casting demos at Cabin Fever. And there's

If she can choreograph foundries, and if she can attract an audience, there's a unique place for her in the global economy. d8-)

Foundrywork is much more fun as a hobby or a one-person specialty operation. I've been in enough foundries to know that I wouldn't want to work there. The local cupola iron foundry, which went out of business over 30 years ago, would remind you of those stories about hell we were told as kids. And old diecasting shops, when I started reported on manufacturing (mid-'70s) could have come straight out of Dante's Inferno. Everything was there but the wails, screams, and the sound of flailing chains. They probably muted them for my visit.

-- Ed Huntress

===================== No, but in the larger sense it is not the "fault," of the people in trouble either.

Take a good look at the US TV ads and shows. The people in trouble are simply doing what the ads want them to do and are mirroring the behaviors they see on the TV shows, not realizing this is a highly toxic and counter-productive life-style. Think Paris Hilton (and she or her family has unlimited money).

Indeed, the establishment "cure" for the current economic "hiccup" [by comparison to what is likely to occur] is to promote, extend and amplify the behavior patterns that caused the problem in the first place, i.e. conspicuous over-consumption. The traditional "hair of the dog that bit you" cure for a "hangover," appears to be alive and well.

As far as bailouts go, if a bailout was for good for Chrysler, good for Lockheed, good for the S&Ls, good for LTCM [Long Term Capital Management], and good enough for the banks and brokerage houses [e.g. FRB prime interest rate cut to below the rate of inflation], then why aren't bailouts good for the people?

?mod=wsjcrmain A major contributing factor to what you [and I] consider to be a glairing and increasingly serious omission in high school education, i.e. financial sanity and lifestyle review (which is at least as important as sex education, HIV information, and driver training) is that the "establishment," which relies on consumer debt, recreational shopping and conspicuous consumption for its existence, doesn't want it.

==> In this context, what you don't know will not only hurt you, it may well kill you, and in doing so, it may kill the country, as we know it.

========== It all depends who you are and how you make your living.

Salvage/wreaking/demolition firms make huge profits from fires, floods and earthquakes. The difference is that [in most cases] these firms do not set fires, etc.

For the chosen few, the bankruptcy/liquidation of a large corporation are *VERY* profitable in the short term, and there is always another corporation to render, much like there was always another buffalo to shoot...

What? Oh... you mean dancing around the truth? Well, right about now, and for the next 10 months, that is a major growth industry, allright!

Jon

========= While this has some "sound bite" appeal, like the chant, "corporations don't pay taxes, they just collect taxes for the government," it glosses over the fact that a corporation is a synthetic creation like a golem or Frankenstein's monster, and just like "Tinker Bell" they fade away when people don't/won't believe.

BEcause of a lack of alternatives, many non-profit organizations are organized as corporations. As the name suggests, for-profit corporations were organized "for profit," and it seems reasonable that these should do what they were created to do, or their assets, under the rubric "creative destruction," should be reallocated to other existing or new entities which can and will generate "net added value."

If an organization is so vital to the American society/economy that it must continue to exist, even though it does not generate any "net value added," then it should be reorganized as a non-profit/third-sector organization, subject to non-proft rules of governance, such as full public disclosure of its assets/operations, limitations on executive/director compensation, etc. just like the Red Cross or Boy Scouts.

In short, I am proposing that you can't have it both ways. As a for-profit corporation, you either step up and make a profit, or you get out of the way for a corporation or company that will, with reasonable wages, working conditions, and benefits for their employees and contract workers, and yes, taxes paid for the services they consume.

A really important thing that corporations provide is a long term legal being necessary for significant capital investment.

If all assets were to be "creatively destroyed" upon the partner's or proprietor's demise, how could places that are capital intensive (oh, like a large oil company with hundreds of billions in infrastructure) continue to exist? What of all the employees? Toss them out with the bathwater as well?

Rockefeller is l> While this has some "sound bite" appeal, like the chant,

Ed Huntress wrote: old

Hmmm. As a costumer intern, my daughter spent the weekend cleaning the blood that gets on the Macbeth cast. Sounds like a foundry might be a good fit.

Metalworking Content: She tells me she knows how one of the illusions is done, and will tell me after I see the show.

Kevin Gallimore

============= Whick proves that hard work is indeed worth a lot, but just not for the worker, but rather for their employer. The motto is "the harder you work, the richer I get."

======== Who said anything about partner or proprietor? I said corporations.

Just because a corporation goes out of existance, the physical (and other assets) and employees do not disappear. These are acquired by the successor corporation(s) and/or redeployed for other activities. What happened to the employees/infrastructure of ARCo Standard Oil Esso Mobil Phillips Texaco UnoCal etc.

If you are for-profit corporation, them make a profit, pay dividends and pay taxes.

The

And what would you propose to replace letting the market set pay? Letting the market determine the pay may not be perfect, but it seems to beat all the alternatives.

However the rich tend to make sure that their offspring get educated and understand how to invest so they retain money rather than squander it.