Wal-Mart is good for the Black Community

Everyone likes to pick on a winner, but when you add it up, Wal-Mart is good for the Black Community. Not great, but pretty good. Wal-Mart is a plus for the economic health of the Black Community because of it's low prices and job creation.

Disclaimer: I do shop at Wal-Mart for commodities like detergent, meat, and basic clothing.

1) The lower prices on basic goods really do help consumers. Wal-Mart prices really are about 20-33% cheap on the same item at a local suburban supermarket and up to 50%-75% cheaper than supermarkets in low-income areas.

2) The quality is also better. Wal-Mart requires maximum dating, rotates stock and does not sell expired product. Products are delivered frequently since they do not want to keep inventory.

3) The selection is better. Wal-Mart typically offers two brand names and one store brand for all major product categories. Many competitor carry one national brand and one store brand.

4) Wal-Mart employs large numbers of low-income people and minorities who could not find employment elsewhere. Wal-Mart gives jobs to many people that could not work else where due to geography, discrimination and skill issues. Wal-Mart offers a chance to get on the first rung of the employment ladder. Many Mom-and-Pop business in poor neighborhoods would never hire the people that work in Wal-Mart. Now they can work where they shop.

5) Destination Economics. A Wal-Mart has a significant leakage effect. Wal-Mart always brings in a string of related businesses that capitalize on the traffic. Fast-food places, banks, cleaners, and gas-stations. Usually other big box retailers like Lowes, Home Depot, Staples, 99 cents store and Pet store join the neighborhood.

6) Finally, there are also subtle ways in which Wal Mart is good. As a large public, corporation Wal-Mart worries about it's public image. Wal-Mart can be pressured. When the news media has found Wal-Mart misdeeds, Wal-Mart has corrected them.

Wal-Mart also has some negative attributes / strikes against it.

1) Low wages. Walmart typically pays the minimum legally required where it operates. It gives employees few or minimum holidays. It also forces employees to work maximum part-time hours to keep benefits down. Wal-Mart also offers low-quality benefit plans.

2) Hard work. Wal-Mart has many incentives (both postive and negative) to keep employees working hard. Cashiers are measured on scans per hour, stock clerks on stock levels, receiving clearks on accuracy and put-aways. All the store data are instantly available to the store manager and their management team as well as regional and division managers.

3) Leading the outsourcing of manufacturing from the US. Wal-Mart is a leader in non-US manufacturing of clothes, toys, sports equipment, jewelry and fashions. Just about anything with a significant amount of labor has been "sourced" by Wal-Mart from China.

4) Drive local businesses out of business. Yes, Wal-Mart does drive local shopkeepers out of business. Retailers who are in the same business and cannot offer anything better (faster service, unique items, cheaper products) usually are put our of business by Wal-Mart. However some businesses survive.

5) Wal-Mart contributes to a unhealthy life style of shopping as an activity, over spending and over consumption. Wal-Mart encourages over consummerism and impluse buying. Wal-Mart stores are destinations for a "full-day" of activity: Shopping. Cheaper items lead to buying more products that contribute to poor health and an sedentary lifestyle. Do we really need a five pound bag of chips ?? or two pounds of cookies ??

When you weigh up the pluses and minusus of Wal-Mart, the low-prices and jobs tip the balance in favor of Wal-Mart being a postive economic influence on the Black Community.

Let the bush tax cuts expire. Extend unemployment benefits

It is time to let the Bush era tax cuts expire. Simple as that. No middle class tax cut, no tax cut for anyone. Going in, it would have been nice to see a middle class tax cut for those families making $100,000 or less. But the "starve-the-government" republicans are against any revenue raising possibility. The existing tax cuts are so skewed to the rich that they are not good for anyone but the rich. They also increase income inequality in the US.

Continuing the cuts would waste money on people who do not need the money. The rich would invest the money further lower interest rates and not spend it. More investment is not need in a 0% interest rate climate. Or worse, if they do spend it, it would be on imported, luxury goods. What is currently needed: investment opportunities from increased consumption and demand in the short run.

Meanwhile, the same money could be used to support additional unemployment benefits. Or educational grants. Job training.

The best position is to veto any extension of the tax cut bill. A good compromise is to offset the tax cuts by closing some tax loopholes on corporate off shore revenues, farm subsidies and the military.

Hanging out with the about to be unemployed

Hey, I am on the floor of a building where everyone is losing their jobs next Tuesday. Well, almost everyone. It is pretty sad state. People are close to tears. One lady was telling the woman who is replacing her that she did not know how to do her job and to "stop calling IM" all the time. Another came in, read some e-mail and left with a box. Everyone else comes in around 10am and leaves around noon. The last day is next Tuesday, November 15th, 2010. A lot of people are already gone, having exchanged phone numbers, e-mails, gifts and recipes last week.

"Leadership - Until you spreads you wings, you have no idea how far you will fly" (with a picture of an Eagle with wings spread). The department had those corny "Motivators" posters by Successories all over the walls. In the good times, they were ignored as another harmless idea from the boss. Now the posters mock the losers as they head out the door.

The company had a medium sized manufacturing plant in New Jersey but things haven't been good for years. Then they got bought by another company. The plant was running about 20% capacity. People would leave and not be replaced or replaced by temps. The last few days are a lot of heartache for the people working here. Almost everyone has more than 10 years experience. It is, sorry WAS, a big corporation accounting and finance operation, so you know the staff was 80% female. Only the bosses and the IT staff are men.
"Belief - The future belongs to those who believe in the beauty of their dreams" Lighthouse with a light in the dark on a hill. Say what, Can't figure this one out.

I stumbled across a cube, while looking for the printer. The cube has all the name plates that have been taken down as people left. Lisa, Pilar, Rose Marie, Ken, Patricia and Deborah. A pretty mixed group judging from the last names: some Spanish, Indian, Italian, Black and Polish. They were lucky to work here.

It is a little creepy to see order breakdown. I can almost hear the conversations: ”I never liked you. I saw you and Mike at the Christmas party. You can’t dress worth a damn. You need help and soap. I’ll miss you.”

Now it is Friday afternoon and the place is deserted; close to spooky. The cubes are stacked with boxes and junk. The filing boxes are in the hall way waiting for the mover to come get them. Some are going to storage because they cannot be legally destroyed. Others are going to the recycle bin. Just massive amounts of waste paper.

Excel - "All glory comes from daring to begin". (Waterfall). Who writes this stuff? It is just bad sloganeering that won't help anyone get a job.

I am sure they all got good severance packages. Company's usually give 1-2 weeks of pay per year of service as long as the employee's agree not to sue. But a lot of them were making good money for a pretty easy job. They worked 8 hours days, 1 hour for lunch, flexible hours, worked from home, vacation days and unlimited sick days. On the other hand almost none of them will find the same type of job and pay. Most were around 50, which is too early to retire but at least they got the kids out of the house (knock wood). Now what?

The security guard walks by, once in the morning, once at noon and one in the evenings. Looks in the conference room, decides I am safe. Some young kid. I guess they are looking for obvious trouble. Like some one going postal. I have never seen security in an office building unless there is trouble.

"Attitude - "Blah, Blah, Blah, it is all in your attitude, blah, blah, blah" (Ski-jumper going off a cliff)

Well almost time to go. I guess the posters didn't help much. But they had a nice little run so things can't be too bad. Some of the people had 25 years of experience and made it to retirement. It just looks bad right now.

Writing from the front lines of the recession...

October jobs report is slightly positive

The Bureau of Labor Statistics released the October unemployment report on November 5th, 2010. The report said the United States unemployment rate stayed at 9.6%. Non farm payroll increase by a total of 151,000 jobs.

The unemployment rate for all groups stood at 9.6%. For Blacks it was 15.7%, Hispanics had a rate of 12.6% and the White rate was 8.8%. The average unemployment duration increased from 33.3 weeks to 33.9 weeks. The number of people who were jobless for 27 weeks or more was 6.2 million. The number people working part time involuntarily was 9.2 million. This group would work full time if they could.

The October jobs report shows almost no change in all major categories. The small positive note was the increase in non farm payrolls of 151,000 jobs. Private service jobs increased by 154,000. Retail was up by 28K, Business Services increase 46K, 35,000 of which were temp help. Health was up 34K and education was up 19K. Government drop 8K (local government -7,000).

In other notable categories construction added on 5,000 jobs, Manufacturing dropped 7K jobs, and computer systems design added 7,500.

$80 Billion on Intelligence and $43 on homeland security

The Washington post reported that the government spent $80 billion on intelligence activities in fiscal 2010 which ended in September 2010. The amount consisted of $53 billion for the CIA and other intelligences agencies that report to the director of national intelligence and $27 Billion for military intelligence. An additional $43 billion was spent on Homeland security and $49 million was spent on state department operations.

Last years budget was $75 Billion and national intelligence was $49.5 million. The amount was double what was spent in 2001. In 2001 the amount was approximately $40 billion.

In the important Washington Post series, "Top Secret America", Robert M. Gates, Secretary of defense, said that a review of intelligence spending is necessary.


The Evil Black Economist want to make several points.

1) First, I am glad, under the leadership of President Obama, the military and CIA are releasing their spending figures. Now we can have an honest discussion of what we are spending the money on and what is the right level of spending for whatever we are buying.

2) The amount of spending is way out of proportion to the amount of safety and counter terrorism we are buying. And some of the counter terrorism money is mis-directed. Terrorism is a long term human development problem best countered with jobs and education not necessarily with counter terrorism spending.

3) The Intelligence - Security complex is one of the few area's were very little is actually produced. The program is a huge middle and upper middle class jobs program. It is time to monitor, measure and streamline the intelligence community.

4) It is also sad how small the minority participation in the intelligence spending establishment. Blacks and Hispanics are few and far between at major firms or as contractors. The IS community is a "good-old boys" network loaded with republican donors and hand shakers.

It is time to open up intelligence spending for the larger benefit of all.

PS. One department doing quite well in minority hiring is the TSA, which employs large numbers of minorities and women. It is also the lowest paying branch of Home land security.

Industry Salaries

I am not sure what is going on but industry salaries are still way to high. I work in computers and I am listening to a cubicle conversation. There is one lady here who has no secrets. She blabs everything. I am bad but this lady has diareaha of the mouth. Anyway, I am not sure of her positon, but she has not reports and appears to be a team member of an IT team. Yet, she has stock options, owns horses, a $600K house and drink fine wine. Wine that is way north of $50 dollars a bottle. What the heck ??

Dangerous times in the United Kingdom

I think the NY Times spurs one to write. Today's editorial on the insane government fiscal policy in the UK requires discussion. Britain is playing with one of the economic stabilizers that automatically bring countries out of recessions. England is planning to cut up to 20% from certain departments over a 5 years. They will lay off close to 400,000 government workers.

The plan is close to reckless in a recession. Any reduction in spending during a recession is dangerous enough, but a 20% decrease is insane. The government also believes the private sector will pick up the differences in job losses from government cuts. This radical switch in policy counts on consumer demand and increased private investment. However, job and unemployment insurance cuts scare consumers. And corporations have shown a reluctance to invest. Big companies pay can borrow at a near zero interest rate. They also are sitting on record profits, yet they do not invest in creating jobs.

What should Britain do ? Apply a little of the usual common sense. (0) Flatten government growth. (1) Gradually cut spend and the deficit at a rate that roughly matches the countries growth rate. A cut little above the rate for the conservatives. (2) Increase the efficiency of government. (3) Better match long term job openings with worker skills.

Unemployment Rate Stays High and Static

October 8th, 2010. The Bureau of Labor Statistics reported the unemployment stayed the same: 9.6% of the civilian labor force is unemployed. The unemployment rage for all major sub-groups was also static: adult men (9.8), adult women (8.0), teenagers (26.0), whites (8.7), Blacks (16.1)and Hispanics showed little or no change.

The report was completely flat in almost every category for both household and establishment data. Absolutely no short-term news here.

The long term unemployed stood at 6.1 million (those who are looking more than 26 weeks). Forty-two percent of all unemployed were part of the long term unemployed.

The civilian labor participation rate was 64.7% and the employment to population ratio remained at 58.5

In more troubling news, people working part-time for involuntary reasons jump 600K to 9.5 million. These are people who want to work full time but cannot find a full-time gig.

Marginally attached workers climbed to 2.5 million from 2.2 million a year earlier. And discouraged workers jump to 1.2 MM from 0.5 mm a year ago.

Non-farm payroll moved up 64,000 positions but was erased by a 76,000 decrease in local government jobs. Employment in manufacturing was flat and construction dropped 21K.

The average work week stayed at 34.2 hours and wages increased 1 cent to $22.67.

Both July and August Non-farm payroll number were revised downward.

Soft hards and Easy jobs

Someone told me I have "soft hands" and that I have not done a hard days worth of work in my life. Well I do work hard, just not with my hands. Everyone wants a nice, cushy job sitting in a cool/warn office and typing on a computer. It looks like an easy job. And it is an easy job compared to how jobs used to be.

We cannot imaging what is was like to pick cotton or oranges by the pound, work on an assembly or in mine digging coal or on the railroad tracks as a "gandy dancer" (maintenance worker). Old jobs were hard, dirty, sweaty and paid crap.

It turns out that almost all jobs are easy now. Government regualtions, power equipment, and cheap motive power have turned may hard jobs into easy ones. Tell me how skinny people you see at a construction site these days. Even day laborers have add some pounds from when the arrived in the US.

Today, every job is an easy job compared to how things used to be. Every job has safety regulations, breaks, decent pay and very little heavy lifting. Jobs where you directly handle the product are rare. Jobs where you really work hard are even rarer.

Look at the size and shape of the avverage construction work, wherehouse employee or maintenance work. Not to many skinny people are there ?? If fact I think the best all around job from a fitness point of view is postal worker or UPS delivery truck drive, but that is for another post.

Yet, we as Black people, have been condition to look down on contstruction, building trades, engineering, maintenance work and delivery person. There are all good paying jobs which are now "easy" jobs. It is all in how define what an easy job is. There are lot's of other easy jobs as well where you still work with your hands and make good money.

Number of people obese or overweight could reach 75% by 2020

Draft v2

What seems like a ordinary but scary headline, "Overweight and obese could be 70% of population by 2020," actually contains a lot of interesting economic issues.

Do markets always yield the best results ?? Will people make good, long-term choices ?? How far should regulations go (the government) in mandating behaviors ??

Few people dispute how efficiently Markets allocate resources. Nor how well they reward marketplace winners and losers. But what happens when produce undesirable results like pollution, toxic chemicals, or overweight/obese people. All of which contribute to economic activity and GDP. And then the cleanup also contributes to GDP.

It is interesting to note that two countries who have the highest rates of obesity and overweightness also have no national healthcare system.