E
ebe
Hi,
This is a posting of a newsletter a friend of mine sent me:
Emergency Management and Planning Newsletter
© 2008 by David Kanecki, All Rights Reserved
Vol. 16, No. 2, Copy 206
May 21st, 2008
By David Kanecki, Bio. Sci., A.C.S.
(e-mail address removed)
P.O. Box 866 * Kenosha, WI 53141 * UNITED STATES
(Former Chairman of Emergency Management and Planning for SCS,
1992-1999)
The Effect of the World Price, Not the US Price, of a Product/Service
on Jobs and Income
Speculative Analysis of Live in the US with Auto Gas at $5 or More
The Effect of Paying the Lowest Cost Without Considerations of Work
Conditions, Needed Standard of Living, and Human Rights
1. The Effect of the World Price, Not the US Price, of a Product/
Service on Jobs and Income
As the US diminishes its dominant position as the world’s top
consumer, and other countries develop consumer markets, the price of
goods and services will move to the world price, not the US price.
One effect of this can be observed in the UAW contracts with Chrysler,
GM, and Ford. In the past, the UAW could bargain with authority
because most cars were bought in the US. But, with US car sales flat
and the companies needing to rely on non US sales, the salaries for
the workers was cut to the world level paid by Toyota and other non US
car makers. Secondly, Chrysler reorganized as a LLC. To most workers,
they do not understand the difference between a sole proprietorship,
LLC, S-Corp, or C-Corp. Chrysler went from a C-Corp to a LLC. The
implication is that other US automakers may do the same to improve
their operations and to undo past hindrances. The result may mean the
GM and Ford will have to follow the same course that Chrysler did if
current conditions hold to stay in business.
What does this mean to people in the US? In the US, it will mean that
salaries for certain jobs will be readjusted to the world salary. If
the salary cannot be readjusted, then as with the IT industry certain
positions will be shifted to lower salary areas like India, Vietnam,
or the Philippines. The result of this will cause anger, as was
demonstrated in the www.cnbc.com video “Balmer Egging 1.0” in which an
IT student in Hungary threw an egg at Steve Balmer of Microsoft
complaining of the effects of lost jobs and lost wages.
The reason why this incident in Hungary is important, because Hungary
at one was a former Soviet Satellite and IT and other professionals
were paid low wages under the communist system, and when the communist
system was replaced by a capitalist system promises were made for a
better life, better work, and income. However, the globalization of
the 1990’s and the income down sourcing of 2001 onward, after the dot-
com crash, by moving jobs to lower priced areas. So, how does someone
who lives in a first world or second world area try to live with a
salary expectation of a third world area? The thing they can’t. This
is because each area of the world has certain expectations on housing,
food, social standards, and quality of life. We should not have a race
to the bottom because of economics only. The goal should be to improve
housing, food, social standard, and quality of life to first world
levels, worldwide. If we continue the race to the bottom of social and
income standards, more protest like Hungary against CEO’s like Balmer
will continue.
The world price is a proper standard if the certain quality of
standards is maintained on a first world level. The reason for the
world price is that certain salaries became inflated in the US due to
politics and power. In addition, a income redistribution is needed to
avoid another world recession followed by a world war.
2. Speculative Analysis of Live in the US with Auto Gas at $5 or More
To many people of my generation, born 1962, or later, they have never
had to live with gas prices high or had to make wise decisions on auto
gas use. The reason is that my generation and later lived in the
affluent economy as described by John Kenneth Galbraith. What this
means, is the generation is used to a cheap gas economy. This is
contrary to other parts of the world, name the EU and other areas.
What does this mean to us in the US? First, it will mean that we need
to make wiser choices as to what we spend our money on. For example,
auto gas is taking away from disposable income, as this increases, we
will need to find other ways to use our remaining disposable income to
make us happy. Secondly, public transportation in the US is joke. In
cities outside of New York or Chicago, it will take you forever to get
there, and you will not be able to complete the entire tasks you need
to do in a day unless you plan for a 20 hour day compared to a 12 hour
day.
As gasoline prices climb, and speculation about gas rationing as I
first found on cnbc.com, it will mean that the car culture in the US
will change. The effect of this change will impact the lowest 50% of
the income earners first. For example, more people will have to reduce
buying food to pay for gas to go to work. Also, public transportation
will not be able to meet the demand and time schedule for work, so
many people will receive disciplinary notices for being chronically
late. The result is a lost job and lost income, more hard choices to
make.
My father told me about what gas rationing was like during WWII and up
to 1948. The main point is that people had special stamps on their
cars and a gas stamp book. Also, there were problems with gas
rationing due to black market activities it produced. So, it seems
that is solved one problem and created others.
In practical reasoning, what increased gas prices will mean is that a
single person or couple will have to learn how to live on 30% less
than what they do now. For men, this will mean that they will have to
learn how to budget as well as woman do now. The process of budget
will be hard for some people to do because they are supplementing the
income by credit, home equity, and other debt sources. As energy
prices increase, the short term effect will be a recession until it
real solutions are practiced.
The most important point is that Americans will not give up their car
or cars. The reason is that travel is an important freedom that public
transportation does not provide in the American perception.
What can be done? First, we can start to explore oil resources on the
shores of the US as the coast line areas. Second, we need to develop a
transportation policy for travel and for people to get to work
economically. Third, we need to reconsider our view on ethanol because
it is causing various, valid objections. For example, at the post
office in Kenosha, Lyndon LaRouche’s group was out protesting about
foreclosures and the Gore taking our food by proposing ethanol. The
two people there had many people look, and get literature. Therefore,
ethanol needs to be reconsidered when it means taking away from food.
Finally, as energy prices increase, food prices increase and this
causes a spiral that will affect all levels of the economic strata.
How well can someone work if they are undernourished? How long can
someone work if they cannot recreate? How will someone view work if
they don’t quality of life improvement? Based on the principle of
maximum economic advantage, what will the economic diversity look
like?
Part of this problem is caused by Saudia Arabia playing politics on
this. The best way to stop the politics on this is to use own
resources, oil reserves that exist on the coastline, and a progressive
plan to transition from a cheap gas economy to an energy utilization
economy that benefits everyone. The problem is that the oil reserves
are declining and we need to make a transition plan and not a shock
therapy plan.
3. The Effect of Paying the Lowest Cost without Considerations of Work
Conditions, Needed Standard of Living, and Human Rights
The morning on cnbc.com there was news clip about Steve Balmer of
Microsoft Corp. being egged: http://www.cnbc.com/id/15840232?video=749024097&play=1
The student who threw the egg was an IT student. Also, it is
interesting that the other students did not stop him. It shows the
other student shared the same sentiments. The sentiment shared is that
the computer industry’s following of maximum economic value for
salaries is actually a quality of life rush to the bottom.
The reason this is true is that it is common wisdom if that a first
world or second programmer asks for an acceptable salary, the option
is to go to India, Pakistan, Vietnam, or some other low quality of
life place where they pay the people $1/day to work as a programmer.
The result of this is people in first and second world countries
cannot live as IT professionals because they are being asked to live
on a third world income which is not possible to maintain quality of
life needed for first and second world countries.
Therefore, the economic dictum used by the computer industry and
others is:
1) the maximum economic value needs to be replaced by maximum economic
value for the company and it’s personnel along with the increase in
the quality of life and maintaining a first world standard for the
quality of life.
The problem is that if this is not done, eventually the IT industry
and other professionals in first and second world nation will get a
survivor mentality of the old west gunfight. Currently, this is one
problem of the IT industry that is appearing, the rush to the bottom
in quality of life due to an impartial economic and social standard.
The second problem is that augsberg syndrome as mentioned in some IT
journals. Augsberg syndrome is a form of autism. The problem is that
according to studies, the IT environment increases this syndrome, and
its’ effect hurts the person and those he interacts with and loves.
This is why some, including myself, advocate an approach whereby one
needs to make time to get away from computers completely, go to the
park, walk, listen to music and most importantly being with someone,
don’t make the computer your girlfriend.
However, as race to the bottom of quality of life pressures increase
on professionals, particularly in the IT field, the two problems I
mentioned will increase. This is the reason why colleges are others
are noticing declines in the IT and computer field. Whether it is
rush to the bottom quality of life offshoring or H1-B’s, it is the
same probem.
The solution is that as the US adopted a minimum wage in the last
depression, the US and other leading countries of the G8 need to adopt
a minimum quality of life standard, and that work may not be exported
unless the country signs a treaty to this standard and follows it from
the day it is signed.
This is a posting of a newsletter a friend of mine sent me:
Emergency Management and Planning Newsletter
© 2008 by David Kanecki, All Rights Reserved
Vol. 16, No. 2, Copy 206
May 21st, 2008
By David Kanecki, Bio. Sci., A.C.S.
(e-mail address removed)
P.O. Box 866 * Kenosha, WI 53141 * UNITED STATES
(Former Chairman of Emergency Management and Planning for SCS,
1992-1999)
The Effect of the World Price, Not the US Price, of a Product/Service
on Jobs and Income
Speculative Analysis of Live in the US with Auto Gas at $5 or More
The Effect of Paying the Lowest Cost Without Considerations of Work
Conditions, Needed Standard of Living, and Human Rights
1. The Effect of the World Price, Not the US Price, of a Product/
Service on Jobs and Income
As the US diminishes its dominant position as the world’s top
consumer, and other countries develop consumer markets, the price of
goods and services will move to the world price, not the US price.
One effect of this can be observed in the UAW contracts with Chrysler,
GM, and Ford. In the past, the UAW could bargain with authority
because most cars were bought in the US. But, with US car sales flat
and the companies needing to rely on non US sales, the salaries for
the workers was cut to the world level paid by Toyota and other non US
car makers. Secondly, Chrysler reorganized as a LLC. To most workers,
they do not understand the difference between a sole proprietorship,
LLC, S-Corp, or C-Corp. Chrysler went from a C-Corp to a LLC. The
implication is that other US automakers may do the same to improve
their operations and to undo past hindrances. The result may mean the
GM and Ford will have to follow the same course that Chrysler did if
current conditions hold to stay in business.
What does this mean to people in the US? In the US, it will mean that
salaries for certain jobs will be readjusted to the world salary. If
the salary cannot be readjusted, then as with the IT industry certain
positions will be shifted to lower salary areas like India, Vietnam,
or the Philippines. The result of this will cause anger, as was
demonstrated in the www.cnbc.com video “Balmer Egging 1.0” in which an
IT student in Hungary threw an egg at Steve Balmer of Microsoft
complaining of the effects of lost jobs and lost wages.
The reason why this incident in Hungary is important, because Hungary
at one was a former Soviet Satellite and IT and other professionals
were paid low wages under the communist system, and when the communist
system was replaced by a capitalist system promises were made for a
better life, better work, and income. However, the globalization of
the 1990’s and the income down sourcing of 2001 onward, after the dot-
com crash, by moving jobs to lower priced areas. So, how does someone
who lives in a first world or second world area try to live with a
salary expectation of a third world area? The thing they can’t. This
is because each area of the world has certain expectations on housing,
food, social standards, and quality of life. We should not have a race
to the bottom because of economics only. The goal should be to improve
housing, food, social standard, and quality of life to first world
levels, worldwide. If we continue the race to the bottom of social and
income standards, more protest like Hungary against CEO’s like Balmer
will continue.
The world price is a proper standard if the certain quality of
standards is maintained on a first world level. The reason for the
world price is that certain salaries became inflated in the US due to
politics and power. In addition, a income redistribution is needed to
avoid another world recession followed by a world war.
2. Speculative Analysis of Live in the US with Auto Gas at $5 or More
To many people of my generation, born 1962, or later, they have never
had to live with gas prices high or had to make wise decisions on auto
gas use. The reason is that my generation and later lived in the
affluent economy as described by John Kenneth Galbraith. What this
means, is the generation is used to a cheap gas economy. This is
contrary to other parts of the world, name the EU and other areas.
What does this mean to us in the US? First, it will mean that we need
to make wiser choices as to what we spend our money on. For example,
auto gas is taking away from disposable income, as this increases, we
will need to find other ways to use our remaining disposable income to
make us happy. Secondly, public transportation in the US is joke. In
cities outside of New York or Chicago, it will take you forever to get
there, and you will not be able to complete the entire tasks you need
to do in a day unless you plan for a 20 hour day compared to a 12 hour
day.
As gasoline prices climb, and speculation about gas rationing as I
first found on cnbc.com, it will mean that the car culture in the US
will change. The effect of this change will impact the lowest 50% of
the income earners first. For example, more people will have to reduce
buying food to pay for gas to go to work. Also, public transportation
will not be able to meet the demand and time schedule for work, so
many people will receive disciplinary notices for being chronically
late. The result is a lost job and lost income, more hard choices to
make.
My father told me about what gas rationing was like during WWII and up
to 1948. The main point is that people had special stamps on their
cars and a gas stamp book. Also, there were problems with gas
rationing due to black market activities it produced. So, it seems
that is solved one problem and created others.
In practical reasoning, what increased gas prices will mean is that a
single person or couple will have to learn how to live on 30% less
than what they do now. For men, this will mean that they will have to
learn how to budget as well as woman do now. The process of budget
will be hard for some people to do because they are supplementing the
income by credit, home equity, and other debt sources. As energy
prices increase, the short term effect will be a recession until it
real solutions are practiced.
The most important point is that Americans will not give up their car
or cars. The reason is that travel is an important freedom that public
transportation does not provide in the American perception.
What can be done? First, we can start to explore oil resources on the
shores of the US as the coast line areas. Second, we need to develop a
transportation policy for travel and for people to get to work
economically. Third, we need to reconsider our view on ethanol because
it is causing various, valid objections. For example, at the post
office in Kenosha, Lyndon LaRouche’s group was out protesting about
foreclosures and the Gore taking our food by proposing ethanol. The
two people there had many people look, and get literature. Therefore,
ethanol needs to be reconsidered when it means taking away from food.
Finally, as energy prices increase, food prices increase and this
causes a spiral that will affect all levels of the economic strata.
How well can someone work if they are undernourished? How long can
someone work if they cannot recreate? How will someone view work if
they don’t quality of life improvement? Based on the principle of
maximum economic advantage, what will the economic diversity look
like?
Part of this problem is caused by Saudia Arabia playing politics on
this. The best way to stop the politics on this is to use own
resources, oil reserves that exist on the coastline, and a progressive
plan to transition from a cheap gas economy to an energy utilization
economy that benefits everyone. The problem is that the oil reserves
are declining and we need to make a transition plan and not a shock
therapy plan.
3. The Effect of Paying the Lowest Cost without Considerations of Work
Conditions, Needed Standard of Living, and Human Rights
The morning on cnbc.com there was news clip about Steve Balmer of
Microsoft Corp. being egged: http://www.cnbc.com/id/15840232?video=749024097&play=1
The student who threw the egg was an IT student. Also, it is
interesting that the other students did not stop him. It shows the
other student shared the same sentiments. The sentiment shared is that
the computer industry’s following of maximum economic value for
salaries is actually a quality of life rush to the bottom.
The reason this is true is that it is common wisdom if that a first
world or second programmer asks for an acceptable salary, the option
is to go to India, Pakistan, Vietnam, or some other low quality of
life place where they pay the people $1/day to work as a programmer.
The result of this is people in first and second world countries
cannot live as IT professionals because they are being asked to live
on a third world income which is not possible to maintain quality of
life needed for first and second world countries.
Therefore, the economic dictum used by the computer industry and
others is:
1) the maximum economic value needs to be replaced by maximum economic
value for the company and it’s personnel along with the increase in
the quality of life and maintaining a first world standard for the
quality of life.
The problem is that if this is not done, eventually the IT industry
and other professionals in first and second world nation will get a
survivor mentality of the old west gunfight. Currently, this is one
problem of the IT industry that is appearing, the rush to the bottom
in quality of life due to an impartial economic and social standard.
The second problem is that augsberg syndrome as mentioned in some IT
journals. Augsberg syndrome is a form of autism. The problem is that
according to studies, the IT environment increases this syndrome, and
its’ effect hurts the person and those he interacts with and loves.
This is why some, including myself, advocate an approach whereby one
needs to make time to get away from computers completely, go to the
park, walk, listen to music and most importantly being with someone,
don’t make the computer your girlfriend.
However, as race to the bottom of quality of life pressures increase
on professionals, particularly in the IT field, the two problems I
mentioned will increase. This is the reason why colleges are others
are noticing declines in the IT and computer field. Whether it is
rush to the bottom quality of life offshoring or H1-B’s, it is the
same probem.
The solution is that as the US adopted a minimum wage in the last
depression, the US and other leading countries of the G8 need to adopt
a minimum quality of life standard, and that work may not be exported
unless the country signs a treaty to this standard and follows it from
the day it is signed.