Article 43
General Reading
Sunday, September 05, 2010
Article 43 Turns Six
I wrote my FIRST ARTICLE on September 4, 2004.
Like this time LAST YEAR - there’s NOT MUCH GOOD TO WRITE ABOUT.
The middle-class is still dying, jobs are still going overseas, while mergers and aquisitions make the big guys bigger, and controllers of our destinies.
The mysterious author over at George Washington’s Blog WRITES ABOUT the eroding middle class and ills that plague this country with clarity…
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The Government Has Encouraged the Offshoring of American Jobs for More Than 50 Years
President EISENHOWER re-wrote the tax laws so that they would favor investment abroad. President Kennedy RALLIED AGAINST tax provisions that “consistently favor United States private investment abroad compared with investment in our own economy”, but nothing has changed under either Democratic or Republican administrations.
For the last 50-plus years, the TAX BENEFITS to American companies making things abroad has encouraged jobs to move out of the U.S.
The Government Has Encouraged Mergers
The government has actively ENCOURAGED mergers, which destroy jobs.
For example, the Treasury Department encouraged banks to use the bailout money to buy their competitors, and PUSHED THROUGH AN AMENDMENT TO THE TAX LAWS which rewards mergers in the banking industry.
This is nothing new.
Citigroup’s former chief executive says that when Citigroup was formed in 1998 out of the merger of banking and insurance giants, Alan Greenspan TOLD him, I have nothing against size. It doesn’t bother me at all.
And the government has ACTIVELY ENCOURAGED the big banks to grow into mega-banks.
The Government Has Let Unemployment Rise in an Attempt to Fight Inflation
As I NOTEDlast year:
The Federal Reserve is mandated by law to maximize employment. The relevant statute states:
The Board of Governors of the Federal Reserve System and the Federal Open Market Committee shall maintain long run growth of the monetary and credit aggregates commensurate with the economy’s long run potential to increase production, so as to promote effectively the goals of maximum employment, stable prices, and moderate long-term interest rates.
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The Fed could have stemmed the unemployment crisis by demanding that banks lend more as a condition to the various government assistance programs, but Mr. Bernanke FAILED TO DO SO.
Ryan Grim ARGUES that the Fed might have broken the law by letting unemployment rise in order to keep inflation low:
The Fed is mandated by law to maximize employment, but focuses on inflation—and “expected inflation”—at the expense of job creation. At its most recent meeting, board members bluntly stated that they feared banks might increase lending, which they worried could lead to inflation.
Board members expressed concern “that banks might seek to reduce appreciably their excess reserves as the economy improves by purchasing securities or by easing credit standards and expanding their lending substantially. Such a development, if not offset by Federal Reserve actions, could give additional impetus to spending and, potentially, to actual and expected inflation.” That summary was spotted by Naked Capitalism and is included in a summary of the minutes of the most recent meeting…
Suffering high unemployment in order to keep inflation low cuts against the Fed’s legal mandate. Or, to put it more bluntly, it may be illegal.
In fact, the unemployment situation is GETTING WORSE, and many leading economists say that - under Mr. Bernanke’s leadership - America is suffering a permanent destruction of jobs.
For example, JPMorgan Chase’s Chief Economist Bruce Kasman TOLD Bloomberg:
[We’ve had a] permanent destruction of hundreds of thousands of jobs in industries from housing to finance.
The chief economists for Wells Fargo Securities, John Silvia, SAYS:
Companies really have diminished their willingness to hire labor for any production level,Ӕ Silvia said. ItӒs really a strategic change, where companies will be keeping fewer employees for any particular level of sales, in good times and bad, he said.
And former Merrill Lynch chief economist David Rosenberg WRITES:
The number of people not on temporary layoff surged 220,000 in August and the level continues to reach new highs, now at 8.1 million. This accounts for 53.9% of the unemployed - again a record high and this is a proxy for permanent job loss, in other words, these jobs are not coming back. Against that backdrop, the number of people who have been looking for a job for at least six months with no success rose a further half-percent in August, to stand at 5 million - the long-term unemployed now represent a record 33% of the total pool of joblessness.
And see THIS.
In fact, the Fed INTENTIONALLY curbed lending by banks in an attempt to stem inflation, without addressing whether PUBLIC BANKS could provide credit.
The Government Has Allowed Wealth to be Concentrated in Fewer and Fewer Hands
As I POINTED OUT a year ago:
A new report by University of California, Berkeley economics professor Emmanuel Saez concludes that income inequality in the United States is at an all-time high, surpassing even levels seen during the Great Depression.
The report shows that:
* Income inequality is worse than it has been since at least 1917
* “The top 1 percent incomes captured half of the overall economic growth over the period 1993-2007”
* “In the economic expansion of 2002-2007, the top 1 percent captured two thirds of income growth.”
As others have pointed out, the average wage of Americans, adjusting for inflation, is lower than it was in the 1970s. The minimum wage, adjusting for inflation, is lower than it was in the 1950s. See this. On the other hand, billionaires have never had it better.
As I wrote in September:
The economy is like a poker game . . . it is human nature to want to get all of the chips, but - if one person does get all of the chips - the game ends.
In other words, the game of capitalism only continues as long as everyone has some money to play with. If the government and corporations take everyone’s money, the game ends.
The fed and Treasury are not giving more chips to those who need them: the American consumer. Instead, they are giving chips to the 800-pound gorillas at the poker table, such as Wall Street investment banks. Indeed, a good chunk of the money used by surviving mammoth players to buy the failing behemoths actually comes from the Fed…
This is not a question of big government versus small government, or republican versus democrat. It is not even a question of Keynes versus Friedman (two influential, competing economic thinkers).
It is a question of focusing any government funding which is made to the majority of poker players - instead of the titans of finance - so that the game can continue. If the hundreds of billions or trillions spent on bailouts had instead been given to ease the burden of consumers, we would have already recovered from the financial crisis.
I noted in April:
FDRs Fed chairman Marriner S. Eccles explained:
As in a poker game where the chips were concentrated in fewer and fewer hands, the other fellows could stay in the game only by borrowing. When their credit ran out, the game stopped.
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When most people lose their poker chips - and the game is set up so that only those with the most chips get more - free market capitalism is destroyed, as the “too big to fails” crowd out everyone else.
And the economy as a whole is destroyed. Remember, consumer spending accounts for the lion’s share of economic activity. If most consumers are out of chips, the economy slumps.
And unemployment soars.
As former Secretary of Labor Robert Reich wrote yesterday:
Where have all the economic gains gone? Mostly to the top.
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ItҒs no coincidence that the last time income was this concentrated was in 1928. I do not mean to suggest that such astonishing consolidations of income at the top directly cause sharp economic declines. The connection is more subtle.
The rich spend a much smaller proportion of their incomes than the rest of us. So when they get a disproportionate share of total income, the economy is robbed of the demand it needs to keep growing and creating jobs.
Whats more, the rich donҒt necessarily invest their earnings and savings in the American economy; they send them anywhere around the globe where theyll summon the highest returns җ sometimes thats here, but often itҒs the Cayman Islands, China or elsewhere. The rich also put their money into assets most likely to attract other big investors (commodities, stocks, dot-coms or real estate), which can become wildly inflated as a result.
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THE Great Depression and its aftermath demonstrate that there is only one way back to full recovery: through more widely shared prosperity.
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And as Americas middle class shared more of the economyҒs gains, it was able to buy more of the goods and services the economy could provide. The result: rapid growth and more jobs. By contrast, little has been done since 2008 to widen the circle of prosperity.
So through it’s policies encouraging the offshoring of jobs, mergers, decreasing of economic activity to fight inflation, allowing wealth to be concentrated in fewer and fewer hands, and other policy mistakes (like pretending that there is a “jobless recovery"), the government has channeled water away from U.S. jobs, creating a worsening unemployment drought.
Note for Keynesians: As I have repeatedly explained, the government hasn’t spent money on the right kind of things to stimulate employment. See this and this.
Note for followers of Austrian economic theory: I have repeatedly railed against the government artificially propping up asset prices and leverage, so that malinvestments can’t be cleared, and we have a stagnant, zombie economy which prevents job creation.
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Big Men, Little Shoes
“In this article Vivek Wadhwa laments that short shrift is paid to management training these days at many high-tech firms. You can’t be born with the skills needed to plan projects, adhere to EEOC guidelines, prepare budgets and manage finances, or to know the intricacies of business and IP law, says Wadhwa. All this has to be learned. Stepping up to address the problems of ‘engineering without leadership,’ which may include morale problems, missed deadlines, customer-support disasters, and high turnover, are programs like UC Berkeley’s ENGINEERING LEADERSHIP PROGRAM and Duke’s MASTERS OF ENGINEERING MANAGEMENT PROGRAM, which aim to teach product management, entrepreneurial thinking, leadership, finance, team building, business management, and motivation to techies.”
- SoukSkill at ShashDot
Tech Industry Managers: Little Men in Big Shoes?
By Vivek Wadhwa
Tech Crunch
September 4, 2010
When I was ready to transition from computer programmer to project manager, my employer, Xerox Corporation, sent me to its huge training center in Leesburg, Virginia. Over two weeks, the people there taught me some of the skills I needed in order to succeed in my new role: managing projects, motivating people, complying with employment regulations, and preparing status reports and presentations. The company also encouraged me to complete an MBA, on a part-time basis, at New York University. It gave me lots of time off and paid for the tuition.
Tech companies in the internet era offer their employees some great perks. But do you think that Facebook, Groupon, or Zynga provide budding professionals with any serious management training? Not at all. Given the way tech companies grow and the HR challenges they face, management training and career development are more important than ever. But few have the timethey are too busy surviving.
Professors Robert Fulmer and Byron Hanson of Duke University’s Corporate Education group researched the management practices of 23 leading high-tech firms. Corporate executives in an overwhelming majority, 89 percent, believed that leadership development was becoming increasingly important for their companies; 58 percent ranked this as a high corporate priority. Yet less than one-fourth of the managers interviewed had a clear roadmap for how they could develop themselves, and more than half didnt even know who in their organization was responsible for the development of leaders. The conclusion of the researchers wasn’t surprising: many high-tech companies are young, so their systems and procedures for grooming leaders arent well developed or firmly established.
Maybe this is why so many tech companies suffer from morale problems, missed deadlines, customer-support disasters, and high turnover. And this may be one of the reasons why so many tech startups who succeed in selling their vision and raising millions in financing are just a flash in the pan.
One of the interesting findings in the Fulmer and Hanson research was that more than 70 percent of the tech executives interviewed said that leadership development in technology-driven firms is different than in other industries. The researchers believed, just as I do, that these tech executives were dead wrong. The lessons that leading companies like Proctor and Gamble and General Electric have learned about management development and training apply as much, if not more, to tech companies.
This means that if you’re a fresh grad joining a hot new tech startup, you shouldn’t expect your managers to train and groom you, or the company to provide you with time off to complete an MBA. You’re on your own. If you are working at some of the more established companies, such as IBM and H Pwhich do have excellent management-development practices - take full advantage of them. You need to learn all you can.
Many people are born with an innate sense of vision; they readily learn new technologies and master them. Some are very good at communicating and inspiring others. But you cant be born with the skills needed to plan projects, adhere to EEOC guidelines, and prepare budgets and manage finances, or to know the intricacies of business and intellectual property law. All this has to be learned. Some skills can be developed on the job, but this is usually through trial and error.
I usually recommend that engineering students who want to become managers and CEOs complete a fifth year of education. There are one-year long engineering management programs which cover such subjects as marketing, finance, intellectual property, business law, and management - similar to the key courses in an MBA program; plus tech-oriented subjects like innovation management, operations management, and entrepreneurship. One such program (and there are many) is the Duke Masters of Engineering Management program, at which I teach.
For experienced tech workers in Silicon Valley, Berkeley and Stanford both have excellent executive MBA programs. Berkeley Haas School dean, Rich Lyons told me over dinner, last month, of his plans to make his school the premier training ground for Silicon Valley executives. Bostons Babson College is also launching a program in San Francisco.
But not everyone needs to spend two years doing an MBA. Berkele’s college of engineering is creating a much shorter program targeted at Silicon Valley techies with leadership potential. Under the aegis of Fung Institute Chief Scientist and Director of UC Berkeleys Center for Entrepreneurship & Technology, Ikhlaq Sidhu, the school is developing a professional program in Engineering Leadership. This will meet one evening a week for six months and teach subjects like product management, entrepreneurial thinking, leadership and finance. It will also teach team building, business management, and motivation.
The new Berkeley program is highly selective however. It will only accept 25 candidates in 2011, based on recommendations from senior executives in the valley. Sidhu says that he hopes to address the symptoms of engineering without leadership - which include organizational indecision about new products and services; unresolved conflict between product management and engineering; and superficial technology strategies. Berkeley will likely expand this program significantly over time and add many others. After all there is a great need.
Editors note: Guest writer Vivek Wadhwa is an entrepreneur turned academic. He is a Visiting Scholar at the School of Information at UC-Berkeley, Senior Research Associate at Harvard Law School and Director of Research at the Center for Entrepreneurship and Research Commercialization at Duke University. You can follow him on Twitter at @vwadhwaand find his research at http://www.wadhwa.com.
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Thursday, September 02, 2010
Work Threats
Have You Even Been Threatened at Work?
It seems as though our society becomes less courteous and polite with each passing year. Rebecca Donatelle, an associate professor of public health at OSU, was quoted as saying,
“Violence is woven into the very fabric of our society and there seems to be an increasing disrespect for life and property.”
When people returned from service in World War II and entered the workforce, there were some things you simply did not do. It was acceptable, to a point, to complain about some things such as working conditions, long hours, and other stressors. One thing that was not tolerated then, and was very rare, was threatening co-workers or supervisors. It was disrespectful in the extreme (respect and courtesy being the norm, and not the exception, back then). And it was a quick way to lose your job.
Today, threats in the workplace are alarmingly common. According to a study by Northwestern National Life Insurance Company, six million workers in the United States were threatened with violence in the year 1992. We’ve gotten accustomed to them. In some companies, it’s actually considered “cool” to threaten co-workers or supervisors. Instead of earning respect through hard work and dedication, people try to get “instant respect” by intimidating others. In the opening scene of the movie “Grand Canyon” Danny Glover is negotiating with a young gun-toting gang member. Danny Glover’s character asks the hoodlum to let him go on his way. The youth replies, “I’m gonna grant you that request, but first I want you to answer a question. If I didn’t have this gun, would you be asking my permission?” Danny Glover answers, “If you didn’t have that gun, we wouldn’t be having this conversation.” As he turns to go, the young man says, “That’s what I thought - no gun, no respect. That’s why I always got the gun.” Instead of earning respect, this young man mistakenly thought his only way to get it was through intimidation.
Threats can come in two forms - verbal and non-verbal. Both can range from extremely subtle to highly overt. Non-verbal threats may come in the form of gestures, notes (including emails), or damage to personal property. Verbal threats can come in the form of innuendo ("if Fred doesn’t knock it off, he might not be coming in tomorrow"), general threats ("I’m gonna make sure Fred regrets he said that"), or specific threats ("tonight after work, I’m gonna go to Fred’s house and set it on fire.").
While few threats are as clear as this last example, ALL threats should be taken seriously - verbal or non-verbal.
It’s illegal to make a joke about a bomb at an airport. For the safety of air travelers, every single comment about bombs or explosives - even those seemingly made in jest - are investigated. Would you rather have all comments investigated or lose a loved one because a security guard was pretty sure someone’s comment was a joke, and turned out to be wrong. The point is it’s never worth the risk to ignore a potential threat.
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Saturday, August 28, 2010
Work Like A Survivor
With a seemingly endless supply of bad bosses, bad workers, and bad jobs plus an absence of loyalty or commitment from employers and employees and a continual off-shore migration of Americas jobs, today’s supervisors and workers need more than ever to develop survival skills to enhance their job security and mental well-being.
- Workplace Survival
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Its a jungle out there. Reality-show tips are essential.
By Nathaniel Reade
Spirit Magazine
August 2010
Several years ago, I toiled in the most DYSFUNCTIONAL office on Earth. The boss berated and criticized virtually every member of her staff to the point of tears. When we were two days past our deadline, she would throw away work shed approved six times before, saying, “I never liked that.” And No. 2 was even worse: A master of smiley charm and managing up, she undermined anyone who threatened her, which meant most of the best people there.
As a result, Crazy World Inc. was an unhappy, whispering place. Co-workers said to me things like, ”I LIVE IN FEAR” and “I feel like I’m WORKING FOR my alcoholic parent.” Most of us were sick, stressed, and getting through our days and nights on a diet of Ibuprofen, Prilosec, and Ambien. When I took a quiz in the back of a book about office psychology, I learned that our organization suffered from manic-depression, neurotic behavior, paranoia, and post-traumatic stress. If our office were a person, in other words, it would be getting some serious drugs and a whole lot of therapy. But an office, like a person, has to want to change.
This one didnt.
Sadly, MY OFFICE was NOT THE EXCEPTION. Job satisfaction, according to a recent survey from the Conference Board, just hit the 20-year low of 45 percent. That’s because while our culture has come a long way in understanding individual dysfunction, were still pretty much Neanderthals when it comes to the psychology of groups. As the German philosopher Friedrich Nietzsche put it, in individuals insanity is rare, but in groups “it is the rule.”
What to do? I couldn’t quit; Id moved for this job into a very expensive housing market, and I needed the salary to pay my mortgage. Plus, I LIKED the work and discovered that I was good at it. So I found mentors who were good at office politics. I read. I talked to experts. Every time I stepped on another Crazy World Inc. landmine, I learned a little bit more. Who, for example, would have ever guessed that my BOSSES WOULD GROW ANGRY WHEN I WON A MAJOR AWARD? But what really taught me the secret to survival in office politics was Survivor.
In case you’ve never had the pleasure of hearing Jeff Probst snuff a tiki torch with the words, “The tribe has spoken,” Survivor is a televised game played by real people in some secluded tropical locale. Contestants win immunity and rewards during competitions, and in just about every episode, the group of players votes to send somebody home. The winner gets a million dollars and the title Sole Survivor. As I watched Survivor, I began to realize that I was witnessing an ongoing experiment in group psychology and compiled these Survivor Rules for Office Success.
1. Align yourself with the power person - Survivor, like most offices, isnt fair. Some of the nicest people go home first, and some of the SLEAZIEST survive. It’s not about truth and justice, its about power, and in most offices the boss has all the votes. This isn’t true in every workplacesome companies have employees anonymously rate their managers and oust low scorers, and a teacher friend of mine can tell off his boss because heגs protected by a union. The rest of us need to identify who has the powereven if it’s someone as rotten as sock-burning, water-draining Russell, a finalist in season 19and appear to be on his or her side.
2. Don’t fight the power - work it Most Survivor winners have been champions at charm and guile. I started at Crazy World Inc. horribly naive; I thought that honesty was the best policy, which just lead me to trouble in the conference room. Instead, I had to learn how to manipulate the unhinged bosses for my own needs. This made me feel like a sham until one of my mentors said to me, Pretend you’re playing a part. OK. I tried not to let the people who annoyed me know it. I tried to smile to their faces and make them think IԒd never vote them out. I tried to keep my big mouth shut. When I did something well, I told them it was all thanks to them.
3. Blend in with the crowd - Anyone whos watched more than two seasons of Survivor comes to realize that, as they like to say in Japan, the nail that sticks its head out gets hit with a hammer. On Survivor, the first person voted off is almost always someone who is unusual in some way: older, more religious, more eccentric. People like people who are the most like them. If you stick out from the group - if you like to go sit by yourself on the beach, if you have strong opinions about how to build the shelter, if youve got a weird haircut (season 19s mulleted Shambo) or tell long, strange stories (vainglorious, tattooed orchestra conductor Coach)you could be exposing yourself to the group’s wrath and allowing yourself to be seen as a threat. Much better to be useless than different. The person fired fastest at Crazy World Inc. was bubbly and smart, but she talked too much about her love of roller derby for the bosss comfort. Many a million-dollar winner of Survivor was the best at lurking in the background and making minimal waves.
4. Charm but don’t intimidate your bosses - My father taught me that if you work hard and do a job well, youll get ahead. Not always. Charm can be more important, and ability can actually hurt you if you don’t manage it right. In my office, two highly skillful employees were either fired or pushed out, while a third who did almost nothing right got coddled and treated to a high-paying lateral move. My manager proved to be incompetent at both the work we were doing and at managing, yet she had a long, impressive resume. How could this be? Because as on Survivor, people who are good at challenges are seen as threats and get voted off. The only person to win Survivor twice, a mother of two named Sandra, never once won a challenge. Thats why, when I received a coveted prize, the bosses were cranky. In their eyes, it made me a threat.
5. Make it look like you’re working hard - Maybe in a perfect workplace people judge you by what you do and not how many hours you put in every day. The rest of us, however, do have to create the impression that we love our job so much we would happily die in harness. On Survivor, when its time to vote somebody off, a marginally annoying person who’s busily catching fish or hauling wood can survive a little longer, because their work is useful and it makes them seem loyal. My managers lack of skill and efficiency meant that the simplest memo sat on her desk for two months. But she regularly stayed until 7 p.m. She might have actually been using that time to calculate her weight on Mars, but she created the impression with the boss that she was slaving away for the good of the tribe, and that impression overpowered her actual performance.
6. Gripe to your dog - Once I went to a co-worker and kvetched. A recent assignment list showed that she and I were each doing the work of three adults, whereas someone else making a lot more money than either of us was producing less than a small child. She reported this conversation to my manager, who then turned around and chastised me for my bad attitude. I was shocked: Why would she rat me out? I went to her in confidence. One of my mentors warned me to get used to it. Nothing is private in the workplace any more than it is for Survivor contestants, who are followed everywhere by camera crews. If you’ve got something private to say, my mentor told me, say it to your best friend, your spouse, or your dog.
7. Trust no one - In an unhappy office (or on Survivor), everyone is fighting for survival, and SOME PEOPLE will deceive others to save themselves. Some will even lie. At Crazy World Inc., I discovered that the SWEETEST, MOST HARMLESS PERSON in the office, someone I liked so much I brought her flowers from my garden, had been telling the boss all kinds of fibs about me, including that I had threatened her. What? Why would she do that? Because figuratively speaking - she thought itd help her win a million dollars.
8. Choose good over evil - Some Survivor contestants, Rupert, for instancetry to play the game WITHOUT DECEIT, and they don’t win. Ah, but then the higher power of TV viewers loves them for that. After a while I got tired of the office craziness and decided that a good life was more important than a fat paycheck. I quit. A day later I slept well again, a month later I had a better job, and a year later Crazy World Inc. went out of business. Now I have less money, but I have more happiness. This, I like to think, makes me a soul survivor.
Nathaniel Reade survives as a freelance writer in Massachusetts.
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Tuesday, August 24, 2010
Suicide At AT&T
Bridgewater man jumps to death from AT&T complex building
NJ DOT COM
August 16, 2010
A Bridgewater man jumped to his death Friday at AT&T, where he worked, authorities said today.
Ralph Merritt, 46, was pronounced dead at the scene, said acting Somerset County Prosecutor A. Peter DeMarco Jr.
At 11:34 a.m. Friday, Bedminster police responded to “Building B” at the AT&T complex, located at One AT&T Way, after being notified that a male employee had jumped from the fifth floor to the atrium below, DeMarco said.
Detectives from Bedminster, the prosecutors Major Crimes Squad and members of the New Jersey Northern Regional Medical Examiners Office responded to the scene, along with medics and emergency medical technicians from Somerset Medical Center. The preliminary investigation has determined Merritt’s death was a SUICIDE, the prosecutor said. The medical examiners office will conduct a post mortem examination. DeMarco would not comment on WHAT PROMPTED Merritt to KILL HIMSELF.
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