Mish's Global Economic Trend Analysis

Transit Union Plays Nuclear Terrorist Card

Posted: 17 Jul 2010 09:57 PM PDT

In response to Union Hires Non-Union Workers at Minimum Wage to Protest a Company Hiring Non-Union Workers "Harm" commented ...

Now that Mish has brought to light every conceivable form of labor union hypocrisy and corruption (and I must admit, he really hit the mark on this one), can we move on the *other* evil "unions" that are robbing us all blind?

Hold your horses.

Please consider the following image snips from the New York Metro "News" Report Attack on Iran will start war, won't stop nukes.

"Harm" I believe you stand corrected, in less than a day I might add. With that out of the way, let's take a look at other transportation news.

Pittsburgh Port Authority: $7 suburban fares possible

The Pittsburgh Post-Gazette reports Port Authority: $7 suburban fares possible

Fares on suburban commuter routes could rise to $7 or more and service could be slashed 25 percent or more as the Port Authority tries to dig out of its latest financial hole.

The authority faces a $50.6 million deficit for the fiscal year that begins July 1 despite three years of financial reforms that have produced $52 million in annual savings, CEO Steve Bland said.

State aid, which makes up about half of the authority's income, has not increased in four years and is scheduled to decrease by $25 million, to about $159 million, in the coming year because of the failure of the Legislature's Act 44 transportation funding law.

Enacted in 2007, it relied heavily on generating new toll revenue from Interstate 80. That plan was nixed by the Federal Highway Administration this spring, leaving the state with a giant deficit in its highway, bridge and transit budgets.

With no growth in revenue, Port Authority faces rising salary, health care, pension and fuel expenses, all of which are largely beyond its short-term control.

Its drivers are among the nation's highest-paid at $24.74 an hour and are under contract through June 2012. The contract, hammered out in December 2008 after acrimonious negotiations, provided 11 percent in raises over four years. The authority's salary expenditures are expected to increase by $5 million in the coming year.

Oakland California: Judge Orders Arbitratrion

KTVU reports Judge Orders AC Transit To Enter Arbitration With Union

A judge Friday ordered AC Transit to enter into binding arbitration with the bus agency's 1,600 employees to try to reach an agreement on a new contract.

The ruling by Alameda County Superior Court Judge Frank Roesch was a blow to the financially-troubled bus agency, whose outside spokesman, Sam Singer, predicted two weeks ago that a lawsuit by the employees' union would be dismissed.

Singer said the bus agency, which serves parts of Alameda and Contra Costa counties, is seeking $15.7 million in labor cost savings to help close a projected $56 million funding gap for the two-year period ending June 30, 2011.

ATU Local 192 lead negotiator Claudia Hudson said the union has offered $9 million in savings for the first year of a new contract with "substantial savings" in the second and third years.

This is absolutely idiotic. Management should outsource the entire outfit to the lowest bidder. No other response makes any sense.

Christie looks to privatize motor vehicle inspections, other services

Thankfully someone knows what to do. Please consider Christie looks to privatize motor vehicle inspections, other services.

New Jersey would close its centralized car inspection lanes and motorists would pay for their own emissions tests under a sweeping set of recommendations set to be released by the Christie administration today.

State parks, psychiatric hospitals and even turnpike toll booths could also be run by private operators, according to the 57-page report on privatization obtained by The Star-Ledger. Preschool classrooms would no longer be built at public expense, state employees would pay for parking and private vendors would dish out food, deliver health care and run education programs behind prison walls.

All told, the report says, New Jersey could save at least $210 million a year by delivering an array of services through private hands.

"The question has to be, 'Why do you continue to operate in a manner that's more costly and less effective?' rather than, 'Why change?' " said Richard Zimmer, the former Republican congressman who chaired the task force.

Once again, three cheers to Christie who not only wants to privatize vehicle inspections, but everything else too.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List

Ron Paul Silver Ounces Accepted at Michigan Gas Station; Chiropractor Accepts Gold, Silver, Apple Pie; Back to the Stone Age; Chickens Invade Lansing

Posted: 17 Jul 2010 11:16 AM PDT

Here's four interesting ways businesses, private citizens, and counties are coping with the economic depression. The first is the most important one. Let's hope it catches on.

Gold, Silver, Copper, Freely Accepted as Money

Connect Mid-Michigan reports Competing currency being accepted across Mid-Michigan.

New types of money are popping up across Mid-Michigan and supporters say, it's not counterfeit, but rather a competing currency. Right now, you can buy a meal or visit a chiropractor without using actual U.S. legal tender.

They sound like real money and look like real money. But you can't take them to the bank because they're not made at a government mint. They're made at private mints.

"I sell three or four every single day and then I get one or two back a week," said Dave Gillie, owner of Gillies Coney Island Restaurant in Genesee Township.

Gillie also accepts silver, gold, copper and other precious metals to pay for food. He says, if he wanted to, he could accept marbles. He's absolutely right.

The U.S. Treasury Department says the Coinage Act of 1965 says "private businesses are free to develop their own policies on whether or not to accept cash, unless there is a state law which says otherwise."

That allows gas stations to say they don't accept 50- or $100 bills after a certain time of day in hopes of not getting robbed.

A chiropractic office in Lapeer County's Deerfield Township allows creativity when it comes to payment. "This establishment accepts any form of silver, gold, chicken, apple pie, if someone works it out with me," said Jeff Kotchounian of Deerfield Chiropractic. "I've taken many things."

Ron Paul Silver Ounces Accepted at Local Gas Station

I want to highlight one important sentence from the article.

Jeff Kotchounian says he's used this Ron Paul half troy ounce of silver to get $25 worth of gas from a local station.

New Types of Money?

The article calls this "new types of money". The phrase is incorrect. Historically, gold, silver, copper (but primarily gold) have always been money. Indeed, money is nothing more than a commodity used as a medium of exchange.

For a detailed discussion of money as a commodity as well as a discussion as to the proper amount of money, please see What is Money and How Does One Measure It?.

Furthermore, I would like to point out that money is what a free market would accept as money. In this regard, if a free market accepts gold as money (and the article shows that is happening), then gold is money, and no government decree can change that fact.

For further discussion of that point, please see Misconceptions about Gold

If the trend in Mid-Michigan escalates, expect government to step in and outlaw gold and silver transactions. However, that will not stop gold from being money. The key point being: money is what a free market decides it to be.

Those vendors in Michigan are operating (for now) as a free market. Government decree is decidedly not a free market.

Back to the Stone Age

In order to cope with rising costs of repaving roads, counties are tearing them up, converting them back to chip-and-seal sometimes known as "poor man's pavement", or even letting them deteriorate to gravel.

Please consider Roads to Ruin: Towns Rip Up the Pavement

A hulking yellow machine inched along Old Highway 10 here recently in a summer scene that seemed as normal as the nearby corn swaying in the breeze. But instead of laying a blanket of steaming blacktop, the machine was grinding the asphalt road into bits.

"When [counties] had lots of money, they paved a lot of the roads and tried to make life easier for the people who lived out here," said Stutsman County Highway Superintendant Mike Zimmerman, sifting the dusty black rubble through his fingers. "Now, it's catching up to them."

Outside this speck of a town, pop. 78, a 10-mile stretch of road had deteriorated to the point that residents reported seeing ducks floating in potholes, Mr. Zimmerman said. As the road wore out, the cost of repaving became too great. Last year, the county spent $400,000 on an RM300 Caterpillar rotary mixer to grind the road up, making it look more like the old homesteader trail it once was.

The moves have angered some residents because of the choking dust and windshield-cracking stones that gravel roads can kick up, not to mention the jarring "washboard" effect of driving on rutted gravel.

But higher taxes for road maintenance are equally unpopular. In June, Stutsman County residents rejected a measure that would have generated more money for roads by increasing property and sales taxes.

"I'd rather my kids drive on a gravel road than stick them with a big tax bill," said Bob Baumann, as he sipped a bottle of Coors Light at the Sportsman's Bar Café and Gas in Spiritwood.

Rebuilding an asphalt road today is particularly expensive because the price of asphalt cement, a petroleum-based material mixed with rocks to make asphalt, has more than doubled over the past 10 years. Gravel becomes a cheaper option once an asphalt road has been neglected for so long that major rehabilitation is necessary.

"A lot of these roads have just deteriorated to the point that they have no other choice than to turn them back to gravel," says Larry Galehouse, director of the National Center for Pavement Preservation at Michigan State University. Still, "we're leaving an awful legacy for future generations."

Unpaved Road List

Old Highway 10 in North Dakota.
In Michigan, at least 38 of the 83 counties have converted some asphalt roads to gravel in recent years.
Last year, South Dakota turned at least 100 miles of asphalt road surfaces to gravel.
Counties in Alabama and Pennsylvania have begun downgrading asphalt roads to cheaper chip-and-seal road, also known as "poor man's pavement."
Some counties in Ohio are simply letting roads erode to gravel.

"City-Fresh" Eggs and a Chicken in Every Pot

Tired of rising prices of eggs, or simply want "city-fresh" eggs that are organic and taste better?
Numerous cities across the country are letting residents raise chickens. Most of the ordinances outlaw slaughtering chickens, but will any cities enforce that? I doubt it.

Please consider Chickens set to invade Lansing

I remember distinctly one Easter season a dozen or so chickens made their way into my grandparents' house. The chickens arrived by U.S Mail in a small box with little holes cut into it. My cousin Jackie and I played incessantly with the little yellow fuzz balls, and amazingly none of them died from over handling. Since it was still too cold for the chicks to be outside, they were diverted to a temporary home on a stair landing which led to the basement. My pinkeye, which kept me from kindergarten the day we did finger painting, was blamed on the critters. My art career never took off, but I still love fresh eggs and chicken legs.

That's why I am looking forward to the chicken invasion in Lansing. Many cities across Michigan have changed city ordinances to allow the raising of hens in backyards. ...

There you have it, four distinctly different ways to cope with the depression: barter, unpaving roads, raising your own chickens, and most importantly - a return to real money at a number of Mid-Michigan businesses.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List

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Saturday, July 17, 2010

Mish's Global Economic Trend Analysis

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