Inadvertent Economic Advice

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I love it when columnists try to make one point and unwittingly make another.  Case in point, this columnist for the Chicago Sun-Times in her column titled There is no 'free' lemonade argues that these kids, who are giving away lemonade that their parents paid for, are doomed because we can't even teach them the basics of running a lemonade stand.  From her column:

"No!" I exclaimed from the back seat. "That's not the spirit of giving. You can only really give when you give something you own. They're giving away their parents' things — the lemonade, cups, candy. It's not theirs to give."

I pushed the button to roll down the window and stuck my head out to set them straight.

"You must charge something for the lemonade," I explained. "That's the whole point of a lemonade stand. You figure out your costs — how much the lemonade costs, and the cups — and then you charge a little more than what it costs you, so you can make money. Then you can buy more stuff, and make more lemonade, and sell it and make more money."

The folks at BoingBoing point out why the columnist is inadvertently making out a point other than what she intended:

Get that, kids? The correct thing to do with the stuff you appropriate from others is sell it, not give it away! Sounds about right — companies take over our public aquifers and sell us the water they pump out of them; telcos get our rights of way for their infrastructure, then insist that they be able to tier their pricing without regard to the public interest. Corporatism in a nutshell, really.

Armed

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Guns make me nervous, always have and always will.  In particular I'm not a big fan of handguns because it just seems like it would be too easy to make a catastrophic error with one.  That's why seeing people walking around with handguns makes me jumpier than a mouse in a room full of cats.  It's not that I think they'll gun me down for looking at them cross-eyed, rather it's that I can think of 100 ways that someone could inadvertently pop off a round and I can just as easily imagine myself catching that round somewhere on my body.  That explains why you won't catch me within ten miles of the Guilford Courthouse National Military Park on August 14 when some pro-gun people hold their Restore the Constitution Rally.

Obviously I'm not a gun guy, but I'm also not someone who gets real worked up about gun control.  I am a guy that's been known to sit in rush hour traffic and marvel that so few accidents occur on a daily basis rather than how many.  Seriously, given what we know about the human condition how is it possible that thousands of cars driven by people who watch American Idol on a regular basis can weave from lane to lane at 75 mph and only a tiny minority actually wreck?  Take that thought process and apply it to guns and you'll know where I'm coming from.

So Kid, You Don’t Think Education Is Important?

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An interesting article in the New York Times about the lack of skilled workers available for manufacturing jobs in the U.S.:

Here in this suburb of Cleveland, supervisors at Ben Venue Laboratories, a contract drug maker for pharmaceutical companies, have reviewed 3,600 job applications this year and found only 47 people to hire at $13 to $15 an hour, or about $31,000 a year.

The going rate for entry-level manufacturing workers in the area, according to Cleveland State University, is $10 to $12 an hour, but more skilled workers earn $15 to $20 an hour.

All candidates at Ben Venue must pass a basic skills test showing they can read and understand math at a ninth-grade level. A significant portion of recent applicants failed, and the company has been disappointed by the quality of graduates from local training programs. It is now struggling to fill 100 positions.

I’m, Like, Gonna Be Famous

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Esbee asked me to write about my experience test driving the Cheerwine Kreme filled Krispy Kreme so that she could post it on Life in Forsyth.  For my friends from out of town that's about as big-time as it gets around here.  

My thanks to Esbee for treating my treatise with a gentle editing pen.  

Redefining Standing Room Only

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European discount airline RyanAir is proposing a special kind of budget "seating" for some of their planes:  

Instead of being allocated a seat, Ryanair travellers would perch on a narrow shelf and lean against a flat padded backboard.


They would be restrained with a strap stretching over their shoulder, the budget airline said.

Click through to the story to see an artist's rendering of the proposed seats.  Basically it looks like the seating on modern roller coasters.  To be honest I wouldn't have a problem with this for short flights.

About Those Overpaid Bureaucrats? They Aren’t in Cali These Days

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California hasn't passed it's 2010-11 budget and as a result Gov. Schwarzenegger has reduced state employees' pay to the federal minimum wage: $7.25 an hour.  And if you're a state employed lawyer or doctor you're really SOL:

Some employees, such as doctors and lawyers, would get no pay because federal exempts them from any minimum wage requirement. Managers, supervisors and others who don't get paid for working more than 40 hours per week would receive $455 per week until a budget deal got done.

Schwarzenegger has invoked a 2003 state Supreme Court decision as grounds for the move. That ruling, White v. Davis, held that without a budget that appropriates money for state payroll, employee wages can be withheld to the federal minimum. That condition exists today, which is the start of the 2010-11 fiscal year and the state is without a budget. The back pay would be paid once a budget is enacted.

Full article: http://www.sacbee.com/2010/07/01/2864148/schwarzenegger-orders-minimum.html#ixzz0sWVNpsyi

The good news for the 'crats is that they'll get their money eventually, but I'm thinking next month's mortgage and car payments are gonna be painful for them.

Is BP Burying Oil?

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According to this post at FastCompany.com BP is being accused of dumping sand on top of oil from the Gulf Spill at a beach in Louisiana.  Below is the video they posted showing oil sandwiched between different layers of sand.  The oil was exposed by erosion caused by the hurricane/tropical storm that blew through the gulf earlier this week. Obviously there needs to be confirmation by an independent scientific expert, but if the story is proved true it will be next to impossible to believe anything that BP says about the spill.

Captain Obvious Announcement: The Rich Get Richer

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Updated numbers show that in America the very wealthy got very wealthier during the last decade:

The Center on Budget and Policy Priorities released a report over the weekend showing that the gaps in after-tax income between the richest 1 percent of Americans and the middle and poorest fifths of the country more than tripled between 1979 and 2007. The CBPP concluded that the data suggests greater income concentration at the top of the income scale than at any time since 1928.

Check out the chart here for a little visual of what they're talking about.

Later on they point out that the numbers only cover up to 2007 so the Great Recession probably knocked the super wealthy down a peg, but I seriously doubt it put much more than a dent in the disparity.

One of the common arguments I hear about taxes, especially when the topic is progressive tax structures (i.e. higher tax rates on the wealthy) is that the wealthy pay more in tax dollars than the rest of us.  I find that argument pretty lame because in my mind the most important number is the net, not the gross, and as you can see from the numbers above the net income of the super wealthy, that is their income after taxes, has grown at a much higher rate than everyone else.  That means that even if they are paying a higher tax rate, and that's a big if (see this for a look at how the effective tax rate on the super wealthy is less than you'd think), their real net income gains have still far outpaced those of us who live here below the income stratosphere.  As your average middle classer I find that troubling.

Countdown to someone calling me a socialist: 10, 9, 8, 7…