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What’s Good for General Motors …

Being the hard-nosed and hard-hearted sorts of old-fashioned conservatives who embrace Adam Smith and Milton Friedman and their red-in-tooth-and-claw school of laissez faire capitalism, we’ve always voted against those damned Democrats for fear they’d arrogantly think they could run our incomprehensibly multi-trillion dollar economy better than the free markets comprised of the free men and women  who actually make it happen. Now we’ve got a Republican president who arrogantly thinks he better knows how to run both big and small corporations better than the executives who have made them successful, however, and at the risk of being called Republicans in Name Only we can’t say we like that any better.
The constantly feuding President Donald Trump’s latest feud is with the iconic and still-formidable General Motors Company, where the brains behind the operation have decided that their long-term fortunes require them to shut down five plants and lay off 14,000 workers in the United States, which Trump would prefer they not do, and he’s threatening whatever punishments he has at hand if they go ahead and do it. Most of those plants and workers are in some of the industrial midwest states that provided Trump his improbable electoral victory based on his promises he would protect manufacturing jobs, so we can well understand his political calculations, but Trump’s underlying economic theory is not so obvious.
General Motors’ explanation is that by shutting down those five plants and laying off those 14,000 workers they can reinvest the money they’re currently losing in more efficient plants with workers building more profitable products in the scarily looming days of self-driving cars and other high-tech automotive gizmos, and that if they don’t the whole company and all of its workers might eventually be out of business. We don’t know any more about the automotive industry than Trump seems to, but given General Motors’ long tradition of existence to its workers and customers we’re inclined to believe its executives have a better grasp of the company’s situation than we or Trump have. We’ve long observed that success of capitalism involves some creative destruction, and this looks like one of those situations.
We have sincere sympathy for those 14,000 thousand workers and everyone in those five communities that will see a major segment of their economy shut down, even if they don’t affect our non-existent political careers, but we’d hate even more to see the rest of General Motors’ hard-working employees eventually be put out of work in a futile effort to sustain an unsustainable status quo. We’ll always remember how our beloved Boeing executive Dad used to agonize over the layoffs he was sometimes forced to make to keep that company the world-beating entity it is today, Life is undeniably tough in the red-in-tooth-and-claw free market world, yet it does seem to get better over the long run, and so far we haven’t found any damned Democrats or damned Republicans who can credibly claim to make it better yet.
So far this Trump fellow’s meddling in the economy strike us as arrogantly intrusive as anything that even a self-proclaimed socialist such as Sen. Bernie Sanders or any damn Democrat might have done if they’d had the chance. Republicans used to complain that Democrats wanted to choose the winners and losers, but Trump’s trade wars have provoked retaliatory tariffs and thus chosen the steel-making sector of the economy over the steel-using sector that includes General Motors, the coal-mining industry over the many industries that would prefer to use less expensive and more environmentally-friendly sources of energy, and he also prefers the mom and pop Main Street retailers over an e-commerce giant offering better prices whose owner also happens to own that troublesome Washington Post. So far it’s worked out well enough, but recent trends and ancient history suggest it won’t last forever.
Trump is still feuding with the iconic and steel-buying Harley-Davidson motorcycle company, which shifted some work to Europe to get around Trump’s trade war with that entire continent, and now he’s threatening tariffs that would raise the cost of the Apple Computer Company’s hugely popular designed-in-America but made-in-China I-Phones by a hundred bucks or so, which probably won’t play well with young voters.  Apple dominates the huge high-tech sector of the American economy that has lately been taking a beating on the stock markets, which was helped wipe out all of the last year’s overall stock market gains, so the threat strikes us as both economics and bad politics.
Trump is currently blaming the stock market’s recent swoon on the guy he appointed to be Chairman of the Federal Reserve Board, which has recently nudged interest rates up slightly to a point that’s still far lower than historic norms in response to what Trump boasts is the great American economy ever, but we trust that the Fed knows more about monetary than Trump or we do. The inflation rate is a full 11 points or so lower than the worst we’ve seen since way back in the ’70s, but it is outpacing the modest gains in wages that Trump likes to brag about, and the Fed seems to be acting according to the time-honored economic principles that the free market has mostly thrived on. Lower or at least steady interest rates would be a short-term gain for the president, especially after two trillion dollars of debt that’s been racked up by his administration despite the best American economy ever, but in the long run we’ll better trust better than Trump the time-honored economic principles and the creative destruction of the free markets.
Nowadays that makes us Republicans in Name Only, and we have no faith any damned Democrat would do any better than Trump has, so for now we don’t have much say in the matter. Those immutable laws of economics and their awesome market enforcements are more powerful than  anything n the universe anything but God, however, and General Motors and Harley-Davidson and the Federal Reserve Board still hold some significant sway, and we expect they will eventually prevail over such puny forces as Trump or those damned Democrats.

— Bud Norman

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Another Annus Horribilis

Years always seem to end in the dead of winter, when the trees are bare and the skies are gray and the prairie winds blow bitterly cold, and thus far 2015 is proving no exception to that desultory rule. In this case it seems altogether apt, as 2015 has been a desultory year. Even the most determined optimist would find it hard to identify much good news from the past six months of headlines, in any section of the paper.
The economy sputtered along steadily enough that the Federal Reserve has hiked interest rates a teensy-weensy bit, and the unemployment rate didn’t seem so bad if you just excluded all the underemployed and the huge number of people who’d given up on finding any sort of work, but the working stiff’s wages were still stagnant and even the investor class was having the hardest time making a profit since the legendarily hard times of the Great Depression. The global state of affairs further deteriorated, with the Middle East exploding in an even greater than usual hatred and the deadly repercussions being felt as far away as Paris and San Bernardino, refugees from that troubled region and Central America and elsewhere in the Third World pouring into the west in such numbers that they overwhelmed the resources and generosity of the First World, and elite western opinion blaming it all on capitalism. Academia went utterly mad in 2015, government regulations proliferated at an unprecedented rate, the popular culture offered no compensatory movies or songs or novels or dance crazes that we noticed, and our favorite sports teams suffered frustrating seasons.
The new year that starts tomorrow promises an extra Leap Year day, an inevitable spring, and a long and leafy summer that will lead to an autumnal Election Day that could possibly put some of this right, but the past year doesn’t make us hopeful. So far the Democrats seem more riled up about impoverishing the rich than enriching the poor, and the polls predicts that they’ll nominate a woman who has parlayed political influence into extraordinary wealth to make the point, so there’s little chance for progress there. Meanwhile the Republicans, until recently infuriated by crony capitalism and Russian arrogance and a shallow popular culture, are threatening to nominate a man who brags about buying off politicians and revels in the praise of Vladimir Putin and was the star of a long-running reality television show to make their point. The infuriation of 2015 will make level-headed decision-making difficult in 2016, although we can hope the warmer weather will help.

— Bud Norman

On Labor Day

Today is Labor Day, when America celebrates its workers by giving them a day off from labor, but we thought we’d sit down and write something about it anyway.
Some say Labor Day is intended to celebrate the labor union movement, but they’ve always struck us as a bunch of pinkos, and here in the proudly right-to-work state of Kansas we’ve never seen it that way. Some of the workers at the local aircraft factories gather down at the Machinists’ Hall on the south side to make a big deal about it, and we hope they enjoy their hot dogs and beer and end-of-the-summer picnic as much as the rest of us, as they’re a good bunch of guys and gals by and large, and they’re even inclined to vote Republican when their gun rights or some other irksome sort of government busybody-ness is seen to be at stake, but we are nonetheless are inclined to justify our day of idleness by thus honoring all those who labor and are heavy-burdened, regardless of whether their employment is bargained collectively or by the choice of a free-born individual. These days only 6.6 percent of the private sector workforce is unionized, far down from from a mid-’50s peak of 35 percent, and gradually moving further downward with each passing Labor Day, and the dwindling crowds down at the Machinists’ Hall reflect that objective fact, and only those hidebound types who still swell up with tears every time they hear Joan Baez singing “I Dreamed I Saw Joe Hill Last Night,” and of course the people that Obama administration appointed by hook and crook to the National Labor Relations Board and the rest of the federal bureaucracy, seem to care.
The latest jobs report suggests that this overwhelmingly non-unionized sector of the country isn’t faring very well, with the official unemployment rate dropping to an almost respectable 5.1 percent but the real rate that includes those who aren’t even bothering to fill out applications anymore at more alarming 10 or more percents, as even the self-described socialist and sudden Democratic Party presidential front-runner Sen. Bernie Sanders admits, and the growth in wages has barely kept apace a similarly suspiciously low inflation rate, but few think that a lack of union meddling is the culprit. Wichita isn’t so bad off as Detroit, which had a lot more hot dog-eaters and beer-drinkers at the United Auto Workers’ Labor Day picnics than the Machinists’ could ever draw around here, and most of us around here will assume that it not entirely coincidental. Whatever problems the American economy confronts, and there seems to be an endless supply of them at the moment, union goons and work stoppages and regulatory schemes that don’t take into account that increased employment compensation must follow increased productivity are not likely to prove satisfactory solutions.
Meanwhile, over in the more rapidly expanding public sector, union membership is still stuck in that Eisenhower-era Golden Age achievement of 35 percent. They’re plenty powerful enough to warm the soul of the late Joe Hill, too, and their members enjoy more compensation and job security and perquisites than their more largely non-unionized compatriots in the private sector. This does provide an argument for private-sector unionism, we suppose, but we can hope that people committed to careers with companies that do enjoy such protections from ruthless competition would be susceptible to the counter-argument that the public sector unions have grown too powerful and become a drag on the overall economy. We’re still hoping that Wisconsin Gov. Scott Walker will get his due credit for taking on the public sector unions in his state, and surviving their brutal reprisals, but for now the latest Donald Trump reality show is getting higher ratings.
Better, then, to hoist a Labor Day beer to the average workingman and the average working woman. We mean that “working woman” in the most respectful way, of course, and to those who are offended we offer our most sincere apologies and our most heartfelt assurances that we only meant to be inclusive. It is altogether fitting and proper, as Abraham Lincoln might have said, that as a nation we take a day off to honor the labor that would otherwise be done. In the third chapter of Genesis we learn that work is a curse that God placed on Adam and his descendants, “By the sweat of your face you shall eat bread until you return to the ground,” in the third chapter of Colossians it is described as a blessing, “Whatever you do, work at it with all your heart, as working for the Lord, not human masters,” and our long experience of work suggests that both of these seemingly contradictory notions are true. Those who endure work’s burdens and exhilarate in its joys therefore deserve that moment of reflection and swig of beer.

We’ve got some seafood and steak that we’ll put on a tiny little charcoal grill in the backyard, and we’ll do our annual playing of Merle Haggard and the Strangers wailing those “Workin’ Man Blues.” It’s a big job just gettin’ by with nine kids and a wife, as the song explains, “but I’ve been a workin’ man dang near all my life, and I’ll keep on workin’, as long as my two hands are fit to use. I’ll drink a little beer in a tavern, and cry a little bit of these workin’ man blues.” There’s a heroic guitar solo by James Burton that seems to celebrate the satisfactions of a workin’ man’s life, and Merle’s whisky-smooth vocals sum up its miseries, and there’s some politically incorrect posturing about welfare, and no mention of unions. That song and Labor Day always make us happy to be Americans, so today we can only say, “Hey, hey, the workin’ man, a workin’ man like me.”

— Bud Norman

Minimum Logic

Raising the minimum wage is not a good idea, but that is of no importance. All that matters is that it sounds like a good idea.
The proposal sounds very compassionate, at least, and for some strange reason many people think compassion is always a good thing. Anyone wishing to give someone else’s an employee a raise will therefore be given credit for the best of intentions, while anyone who would deny the presumably hard-working and underpaid fellow an extra pittance or two will be assumed a heartless cad, and it is not difficult to predict which side will reap the political benefit.
One could argue that raising the minimum wage isn’t compassionate at all because it results in higher unemployment among the very unskilled workers that it is intended to benefit, and hurts them over the long run by denying them the entry-level jobs that could lead to better-paying work, but it would be of no use. Such arguments take more time than most people will devote to political questions, and require a level of abstract thought that the typical minimum wage-earner won’t bother to muster. There’s no way of pointing to the jobs that were never created as a result of increasing wages beyond what an employer can pay what an employee can contribute to a business, after all, while those favoring an increase can readily demonstrate the benefits to those workers lucky enough to get a job at the higher wage.
The better-read liberals will cite studies, and of course there will always be studies purporting to show that raising the cost of something somehow doesn’t decrease the demand for it. Other studies suggest otherwise, of course, and they conform to economic logic that has held true for centuries, but such appeals to common sense and the practical experiences of employers no longer seem to carry much weight with the better-read liberals. Compassion is what counts with these people, along with the political advantages that come with it, and the cruel results are just a cost of doing business.

— Bud Norman