According to Moneynews.com on April 15:
"Inflation at the wholesale level soared in March at nearly triple the rate that had been expected as the costs of energy and food both climbed rapidly.
"The Labor Department reported Tuesday that wholesale prices rose by 1.1 percent last month, the second largest increase in the past 33 years, exceeded only by a 2.6 percent rise last November. Analysts had been expecting a much more moderate 0.4 percent rise in wholesale prices for the month."
At the same time, Money News reports that there are fewer new millionaires because of the "economic slump". The classic tactic (that goes back to the late nineteenth century) of arguing for inflation, which increases profits and stock market values but hurts people on fixed incomes and the productive poor (i.e., inflation redistributes money from the working poor and pensioners to the wealthy) is to argue that inflation will reduce unemployment. Of course, pro-inflation progressives never mention that besides reducing unemployment inflation gets elderly people to eat cat food and the working poor to give up necessities.
Increasingly, the news media don't bother to lie or color the story as they have in the past. In the 1970s, if you can recall, the media and academia argued that oil prices caused inflation and in the 1960s they argued that unions caused inflation. Today, MoneyNews.com more or less says that millionaires are hurt because there's not enough inflation:
"The continuing global economic turmoil is taking its toll on the wealthy — as fewer new millionaires are being minted....
Is this the end of the American dream? Or just a bit of a nightmare? Probably the latter, economists are telling MoneyNews, as the problems in the stock market are limiting the growth of the portfolios of professionals and executives and entrepreneurs for now. "
Where is Jim Cramer now that we really need him? I want to break into the seven figures myself. We need more old people on cat food and evicted from their homes because they can't afford the property taxes; and we need more families depriving their children of milk so people like me can become millionaires. Absolutely.
Saturday, April 19, 2008
Thursday, April 17, 2008
Chronicle of Higher Ed on Seidemann Case
I sent out a small press release concerning David Seidemann's victory in district court against the leadership of the Professional Staff Congress (PSC). Reporter David Glenn of the Chronicle of Higher Education called to thank me for the information and the story ran today (paid access). The article is accurate and even handed. David Glenn's reporting is excellent.
In addition to sending out the press release I had invited Barbara Bowen, Nancy Romer, Steve London, Stanley Aronowitz and several other members of PSC's administration office to comment on my last blog on the recent ruling, but none has responded.
The article points out that Dorothee Benz, a union employee, claims that
"the 'vast majority' of the disputed spending has been allocated to lobbying campaigns to encourage state and local governments to provide financial support to the university, not on political causes that have nothing to do with professors' wages or benefits."
However, this is misleading for two reasons. First, there have been considerable "soft money" activities by the union leadership involving Iraqi War protests, demonstrations and conferences. The leadership is paid salaries to participate in these activities. To be fair, agency dues payments should be reduced by the proportion that salaries for the union leadership's time spent on such political activites bears to the union's total budget. Second, lobbying typically involves political as well as wage and benefit concerns, as Professor Seidemann points out in the article.
An additional concern is that the union has used CUNY facilities to send e-mails and used CUNY facilities to conduct meetings of a political nature. Since CUNY is a section 501(c)(3) organization, the repeated use of CUNY facilities to further the Professional Staff Congress's political goals is inappropriate and likely a breach of the tax code's requirements for charitable and educational institutions (that is, that they not be used for political purposes).
The article quotes Christopher M. Callagy, a union attorney, as saying that the union's chief political efforts are in Albany. This is a lie. The union leadership has repeatedly notified faculty of Iraqi War protests, and used their time and union resources for such protests.
Moreover, the article points out that even Albany lobbying is not considered a collective bargaining expense:
"Mr. Seidemann pointed out in an interview on Wednesday. 'Lobbying for an increased budget for education—that is a political act,' Mr. Seidemann said. ['']There may be people who think education should be supported by property taxes or should be supported totally by tuition.' Mr. Seidemann said that...he distrusts the union's management and wants to give it as little financial support as possible. "
The article adds that Professor Seidemann is continuing with a further complaint. He is asking the judge to require that the union file its financial data online on a specific date. No more Enron-style financials for the Professional Staff Congress.
Professor Seidemann has performed an important social service, and he deserves an award. However, I would argue that his case does not go far enough. The case of Lehnert v. Ferris Faculty Association on which Judge Lois Bloom relies in the Seidemann case assumes that agency payers may be free riders because they receive union benefits but do not contribute to the costs of negotiation. But the PSC has won no benefits for its membership. Rather, because of the PSC's incompetent negotiation stance, silly demonstrations, and adverserial approach, the union has managed to diminish faculty wages and benefits. An equitable rendering of the Lehnert decision ought to be that where unions reduce wages, agency payers should be reimbursed for their losses because of the union's incompetence. Perhaps the next step ought to be to try this case under equity principles.
In addition to sending out the press release I had invited Barbara Bowen, Nancy Romer, Steve London, Stanley Aronowitz and several other members of PSC's administration office to comment on my last blog on the recent ruling, but none has responded.
The article points out that Dorothee Benz, a union employee, claims that
"the 'vast majority' of the disputed spending has been allocated to lobbying campaigns to encourage state and local governments to provide financial support to the university, not on political causes that have nothing to do with professors' wages or benefits."
However, this is misleading for two reasons. First, there have been considerable "soft money" activities by the union leadership involving Iraqi War protests, demonstrations and conferences. The leadership is paid salaries to participate in these activities. To be fair, agency dues payments should be reduced by the proportion that salaries for the union leadership's time spent on such political activites bears to the union's total budget. Second, lobbying typically involves political as well as wage and benefit concerns, as Professor Seidemann points out in the article.
An additional concern is that the union has used CUNY facilities to send e-mails and used CUNY facilities to conduct meetings of a political nature. Since CUNY is a section 501(c)(3) organization, the repeated use of CUNY facilities to further the Professional Staff Congress's political goals is inappropriate and likely a breach of the tax code's requirements for charitable and educational institutions (that is, that they not be used for political purposes).
The article quotes Christopher M. Callagy, a union attorney, as saying that the union's chief political efforts are in Albany. This is a lie. The union leadership has repeatedly notified faculty of Iraqi War protests, and used their time and union resources for such protests.
Moreover, the article points out that even Albany lobbying is not considered a collective bargaining expense:
"Mr. Seidemann pointed out in an interview on Wednesday. 'Lobbying for an increased budget for education—that is a political act,' Mr. Seidemann said. ['']There may be people who think education should be supported by property taxes or should be supported totally by tuition.' Mr. Seidemann said that...he distrusts the union's management and wants to give it as little financial support as possible. "
The article adds that Professor Seidemann is continuing with a further complaint. He is asking the judge to require that the union file its financial data online on a specific date. No more Enron-style financials for the Professional Staff Congress.
Professor Seidemann has performed an important social service, and he deserves an award. However, I would argue that his case does not go far enough. The case of Lehnert v. Ferris Faculty Association on which Judge Lois Bloom relies in the Seidemann case assumes that agency payers may be free riders because they receive union benefits but do not contribute to the costs of negotiation. But the PSC has won no benefits for its membership. Rather, because of the PSC's incompetent negotiation stance, silly demonstrations, and adverserial approach, the union has managed to diminish faculty wages and benefits. An equitable rendering of the Lehnert decision ought to be that where unions reduce wages, agency payers should be reimbursed for their losses because of the union's incompetence. Perhaps the next step ought to be to try this case under equity principles.
John W. Dean's Warren G. Harding
John W. Dean. Warren G. Harding. New York: Henry Holt and Co., 2004. 202 pages.
"In late 1911 and early 1912 Harding and the Star* had railed at the progressive movement within the Republican Party, which Harding believed was based on personalities, not principles. Harding was not opposed to progressive ideas, such as voter initiatives, recall of elected officials, referendums on ballot issues, corporate trust busting and resource conservation. But he found the progressives' 'unreasonable antipathy to Taft' baseless, and TR's talk about fighting against special interests for the common man 'claptrap'...To Harding Roosevelt was a traitor..."
When Harding ran for Senator from Ohio in 1914 Taft endorsed him, but he was not ideologically committed to either the conservative or progressive ideology. Dean writes (p. 36) "the audience could hear what they wanted". As a junior US Senator Harding was asked to be keynote speaker at the 1916 Republican Presidential convention because "Republicans wanted to heal the division between the progressive and conservative factions of the party, and Harding held the respect of both elements, in spite of his earlier disapproval and chastisement of the progressives who had bolted to the Bull Moose Party in 1912."
The one area where Harding significantly differed from the Democrats was that he favored protectionism while the Democrats opposed it. Harding (p. 32) opposed free trade and believed that Woodrow Wilson's low tariff policy would result in a depression. The two chief differences between Harding and Wilson were that Harding was more statist in that he favored protectionism and that he was less supportive of the League of Nations than was Wilson. In a speech before the Senate (p. 49) which Dean argues was preliminary to his presidential campaign, Harding argued that he could not sign the League of Nations treaty unless an article were added relieving the US from defending other countries without the approval of Congress as required by the Constitution. Harding said to the Senate (p. 49):
"A Senator may be as jealous of his constitutional duty as the President is jealous of an international concoction, especially if we cling to the substance as wll as the form of representative democracy."
*Harding's business was that he was owner and editor of the Marion Star.
The reason that John W. Dean was interested enough in Warren G. Harding to write a biography becomes obvious at the end of the book. Just as Dean was involved in the Watergate scandal, Harding is (Dean argues unfairly) remembered for the "teapot dome scandal" that reached the public eye immediately following his death 2 1/2 years into his administration. Harding's death led to the appointment of Vice President Calvin Coolidge to the presidency in August 1923.
Warren G. Harding was certainly a supporter of progressivism. However, he split with Theodore Roosevelt because Roosevelt was disloyal to the Republican Party by running against Taft on the Progressive Party or Bull Moose Party (so-called because Roosevelt had said that he was "fit as a bull moose"). The conservatives and progressives within the Republican Party were at odds, but Harding was hardly a conservative. According to Dean:
"In late 1911 and early 1912 Harding and the Star* had railed at the progressive movement within the Republican Party, which Harding believed was based on personalities, not principles. Harding was not opposed to progressive ideas, such as voter initiatives, recall of elected officials, referendums on ballot issues, corporate trust busting and resource conservation. But he found the progressives' 'unreasonable antipathy to Taft' baseless, and TR's talk about fighting against special interests for the common man 'claptrap'...To Harding Roosevelt was a traitor..."
When Harding ran for Senator from Ohio in 1914 Taft endorsed him, but he was not ideologically committed to either the conservative or progressive ideology. Dean writes (p. 36) "the audience could hear what they wanted". As a junior US Senator Harding was asked to be keynote speaker at the 1916 Republican Presidential convention because "Republicans wanted to heal the division between the progressive and conservative factions of the party, and Harding held the respect of both elements, in spite of his earlier disapproval and chastisement of the progressives who had bolted to the Bull Moose Party in 1912."
The one area where Harding significantly differed from the Democrats was that he favored protectionism while the Democrats opposed it. Harding (p. 32) opposed free trade and believed that Woodrow Wilson's low tariff policy would result in a depression. The two chief differences between Harding and Wilson were that Harding was more statist in that he favored protectionism and that he was less supportive of the League of Nations than was Wilson. In a speech before the Senate (p. 49) which Dean argues was preliminary to his presidential campaign, Harding argued that he could not sign the League of Nations treaty unless an article were added relieving the US from defending other countries without the approval of Congress as required by the Constitution. Harding said to the Senate (p. 49):
"A Senator may be as jealous of his constitutional duty as the President is jealous of an international concoction, especially if we cling to the substance as wll as the form of representative democracy."
The New York media (p. 67) opposed Harding's candidacy because the Times, the Post, the World, the New Republic and the Nation perceived him as a second rate conservative. But Harding was not a Mugwump (he was too young) and was not at all influenced by the laissez faire ideas of the late 19th century, to include Sumner's and Godkin's. Nevertheless, the Nation wrote that Harding was an (quoted on p. 67):
"amiable, faithful, obedient errand boy for the Old Guard politicians and the business interests they serve...In truth he is a dummy, an animated automaton, a marionette that moves when the strings are pulled."
Thus, the pattern of the left wing progressives calling the right wing progressives "old guard" is established by the Harding candidacy (it was more likely a product of the Taft-Roosevelt fight). But Harding did NOT reflect the laissez faire views of Sumner and was less linked to east coast business interests than was Roosevelt. Thus, by 1920 the left had established a pattern of slandering right-wing progressives. But true advocates of small government were already virtually non-existent except as a fringe of the Republican Party.
Harding's campaign hired Albert D. Lasker of the Lord and Thomas advertising and public relations firm in Chicago. It may have been the first to introduce advertising and PR techniques that are commonly used today.
Harding was not a particularly ideological candidate. William McAdoo described a typical Harding campaign speech as (quoted on p. 73):
"an army of pompous phrases moving over the landscape in search of an idea. Sometimes these meandering words actually capture a straggling thought and bear it, triumphantly, a prisoner in their midst, until it died of servitude and over work."
Dean observes (p. 77) that Harding's victory over Democratic candidate Jim Cox in 1920 may have been as much a rejection of Wilson as a vote for Harding. As well (p. 77):
"Harding biographer Andrew Sinclair attributes the victory to Harding's ability to give voice to the dream of the rural past by the promise of returning to normal times..."
There was no ideology or rejection of Progressivism. Just a mood change.
After election, Harding appointed Henry C. Wallace secretary of agriculture (p.85):
"Harding knew he would have to take political flack for selecting Wallace, because his liberal leanings were offensive to the right wing of the party, but the president-elect understood that the party's progessives would support Wallace."
Dean adds (p. 86):
"Harding was impressed with young Hoover and wanted him in his cabinet, but Republican elders and conservatives objected...Harding experienced more internal party squabbling and opposition to Hoover than any of his choices. Notwithstanding old guard opposition that he was too liberal, too ambitious, too international in his views, not to mention too publicly popular, Harding offered Hoover the Deoartment of Commerce or the Department of the Interior."
Wilson did not leave the country in good shape (p. 94). In his inaugural address (p. 96) he stated that the U.S. would not join the League of Nations but would have an activist and interventionist foreign policy. He criticized businesses that profited from the war. He said (p. 96):
"Our most dangerous tendency is to expect too much of government and at the same time do for it too little."
That is hardly the view of an advocate of small government or laissez faire.
On April 12, 1921 Harding (p. 100):
"addressed a joint session of Congress concerning the policies, plans and matters he believed the Congress should undertake...Harding's normalcy was not a call to turn back the clock but rather...he was calling for onward, normal way...He called on Congress to cut government expenditures by creating a Bureau of teh Budget, he urged revising the federal tax laws including the abolition of the excess profits tax, and he requested that Congress enact emergency tariffs followed in six months with more comprehensive revisions...he called for a new immigration law; he raised the need to deal with emerging transportation problems (railroads, highways as well as the new civil and military aviation); he asked Congress to regulate the new technology of radio and transcontinental cable communications; and he called for establishing a merchant marine. No request surprised and confounded his conservative colleagues more than his recommendation that they create a department of public welfare that would be responsible for 'education, public health, sanitation, conditions of workers in industry, child welfare, proper amusement and recreation, the elimination of social vices.'"
On May 27, 1921 Harding signed an emergency tariff measure and in July 1921 the House passed a bill that increased tariffs across the board. In September 1922 Harding signed the Fordney McComber Act which reflected a hodgepodge of special interests. The result, though, was that other countries responded with high tariffs, hurting American agriculture (p. 105).
In 1921 Harding's Budget Accounting Act created the Bureau of the Budget and the General Accounting Office. Harding did favor tax cuts (P. 106). However, he also supported (p. 112) a host of government interventions concerning agriculture such as the Grain Futures Act which regulated speculation on commodities and the Packers and Stockyard Act insuring fair practices on the part of the meat packing industry.
Dean quotes Schapsmeier's and Schapsmeier's "Disharmony in the Harding Cabinet" on p. 113:
"[t]he amount of progressive-type legislation during [Harding's brief presidency] was not duplicated until the New Deal."
Harding also advocated an activist fiscal policy more than a decade before the election of Franklin D. Roosevelt. Dean writes (p. 115):
"[he prodded] state and local governments to commence public works projects that would provide employment. The president took similar action at the federal level, ordering all his cabinet secretaries to look for federal projects that could be started sooner rather than later...Harding's pump priming was contrary to hi philosophy of using federal funds to solve the unemployment problem..."
Harding also tried to unravel the racism that was prevalent during and characteristic of Woodrow Wilson's administration (p. 124). "Wilson had removed Republicans and blacks from appointed positions, replaced them with white Democrats and then locked them into the system by extending civil service protections.
In 1922 (p. 137) Harding:
"called for the end of child labor, by consitutional amendment if necessary. His message...pleaed Congress, the New York Times and even such progressive journals as the Literary Digest."
It is evident that Harding was hardly a conservative. Following on the heels of William H. Taft, he was probably slightly to Taft's left and to Theodore Roosevelt's right. He was a blend of conservatism and progressivism, hardly to the right of Woodrow Wilson. Following the left wing presidency of Roosevelt and the mildly conservative but progressive presidency of Taft, Harding was very much in the tradition of Republican progressivism and was certainly no advocate of laissez faire or free market ideas. He was a low-tax progressive.
*Harding's business was that he was owner and editor of the Marion Star.
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