Weird...Ann Arbor Overtakes Flint in Manufacturing

Ten years ago, 30.5% of Flint's non farm employment was in manufacturing. Today 5.3% of Flint's non farm employment is in manufacturing. That's now lower than Ann Arbor at 6.5%.

As much as everybody thinks of Flint as a blue-collar, manufacturing town, it's gradually become a service-based economy (see a related discussion here on the Flint Expatriates blog).

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Heh..."gradually"

100,000 Michigan Citizens to Lose Unemployment Benefits

Something ain't right.

Ya gotta admit, things seem to be in pretty good shape considering the state's unemployment levels in many cities are reaching Depression Era levels, approaching 20% in some areas.

That is partially because of the massive unemployment benefit extensions to the state of Michigan and around the country. As posted in my blog at the DailyKos the state of Michigan is likely to be in for a severe jolt in the next 6 months as all the Federal unemployment benefit extensions come to an end almost all at once.

http://michiganmessenger.com/25218/michigan-house-democrats-push-for-unemployment-extension

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The math is this:

100,000 citizens losing their unemployment benefits x $1200 month per citizen

$120,000,000 sucked from the Michigan economy each month, removed very suddenly as the Federal unemployment extensions end.

WUMP.


And the economy is in no place to absorb these individuals who have lost, entirely, all income.

The Michigan economic situations has been buffered tremendously by the Federal unemployment extensions.

Now the Michigan legislature is calling for another extension to unemployment benefits. And that sounds to me like a fine idea...

But...unemployment benefits are an excellent tool to hold people over for a short term until they can find a job. Or in more robust economies, they're great tools for holding over a region until the economy rebounds and can absorb those losses. And let's face it, Michigan isn't in that position. When we extend unemployment benefits now, they will need to be renewed again in a few more months. And again. Something else needs to be done.

Michigan's economic climate and the ongoing needs of its citizens are far beyond what can be helped by mere unemployment extensions.

In addition to giving people the money they need to survive, the State or Fed needs to give those who are willing and able the means to create self-sustaining businesses to employ themselves and others. The banks we've bailed out to the tune of trillions have not been forthcoming with small loans or lines of credit to start up businesses, at a time when investment in small business would make the greatest difference.

The State or Fed needs to directly offer very small business loans to start up entrerpeneurs who have no other financing options. We're already giving money to the unemployed with no hope of return...we do it to help the unemployed keep their homes, maintain some dignity, and offer them a modest standard of living. Why not also lend to individuals who have a business plan some Federal or State money that COULD potentially provide a return on invesmtent?

I Know! Let's Let GM Stiff Their Contractors! That's a Good Solution!

What people don't seem to realize is, GM doesn't build cars. They ASSEMBLE cars. Tons of their parts and electronics and computers are made by thousands of third party contractors around the country. My uncle, for instance, lives in St. Petersberg Florida and makes motherboards for Cisco in California who then makes car components and software for car computers which are sent off to a GM plant.

When GM files for Bankruptcy, suddenly they are protected from debt.

Let's say you're a small business owner in, say, Texas, who makes widgets for GM who currently has an outstanding bill with your company for half a million bux. Suddenly people around the country start chanting that GM should have debt protection. Suddenly people are actually begging GM to stiff you. They all think it's the right thing to do because those darn union guys get too much money for pushing a button and besides GM made crappy, fuel sucking cars.

Lucky GM, they get to file for bankruptcy and restructure. You? You're not getting that half mil for a loooooong time even though you've got a quarter mil of expenses into the production. So you file for bankruptcy and close your doors and start dusting off your resume along with your fifty or so employees.

Uh oh! So now Honda wants to buy parts from you like they usually do because you sub-contract to all the auto companies. But you're not in business anymore. Oh no! Where is Honda going to get its widgets? They go from small manufacturer to small manufacturer and find that an alarming number of them have gone under and the rest are either on the ropes or are over extended.

But that's only the beginning of the problem. The price of steel has collapsed from a dramatic drop in demand, which is initially pretty sweet, but suddenly the steel companies can't make ends meet, so refineries close up and then the price of steel skyrockets from a combination of lack of production and the economies of scale for shipping steel aren't there anymore.

Not that it matters anyway. From all the mom and pop manufacturing companies around the country shutting down, there's a rash of unemployment, so nobody can buy Hondas anyway

In summary, we shouldn't loan money to GM and should let them file for bankruptcy. That'll show 'em and the greedy Unions what for.

I Dominate Energy Efficiency

Check my stats. When the gas company comes a'sellin' I say "Good DAY, Sir. I said Good Day!"

I'm 25% below the average home use for a similar sized home in the area, and I shaved 3 CCFs of gas from our usage compared to last year despite a bit of a cooler November. I'd also like to add we keep our house at about 70 degrees. We could try to insulate our house more, but so far most of our gas usage comes from the hot water heater. We should insulate that better, as well as the pipes to carve our use even more.

And so far this year I have over 5 cords of wood for under $200. Sha-frickin'-zam.

Layin' Down My Mad Iron Age Skills

Yesterday I was splitting some wood I had cut from the fallen beech tree when I got a glimpse of human history.  The grain of the beechwood is twisty and irregular so even landing a solid whack with a steel maul usually only results in a shallow dent. It's some tough wood.

So what I have to do is sink a steel wedge into  the large stump with a sledge hammer. Then with the hammer side of the maul I pound and pound and pound between 5 to 20 times before the chunk of beech splits open.

Even cutting and splitting easier wood in any reasonable timeframe requires an iron axe at the very least. Copper would be way too soft. Bronze, maybe, but still pretty soft.

Without iron, we would stare helplessly at trees. They would be solid, enduring objects we had little influence over. Sure we could take down a tree with stone or copper, but it would take so long as to be nearly impractical.  And once down, then would come the daunting task of hewing it into timber or sectioning it into firewood. And forget about working with wood with any precision to make wheels or furniture or wooden machinery...as for clearing the land for cultivation, forget about it.

Without that one material, Iron, all the heating, industiral, and constructive benefit of wood would be locked up into solid, seemingly impregnable objects. We'd be pretty helpless to do anything to or about the trees in the world.

Liberal Bias in the Everything

So I've been reading redstate.com lately. It's a mega-conservative blog. And the most common thread there is about Liberal bias...

...and there's liberal bias everywhere. Just prior to the election the big uproar is with the liberal bias in the Polling. Apparently every active pollster in the world including the "conservative" Fox, Rasmussen, and the Mason-Dixon pollsters are in on some nefarious scheme to make Obama APPEAR AS THOUGH he's distantly ahead in national and some battleground state polls.

Why? Just to be assholes, apparently.

So we have liberal bias in the media, in polling, in primary education, in college education, in science, in Hollywood, in most of the world, in video games (video games!?!), in the Internet, in the United Nations, and my personal favorite...a liberal bias in Economists and Fed chairmen Ben Bernanke. Yes, as more economists point to Obama's plan as preferred over McCain's, RedState.com folks are now screaming liberal bias in the field of economics.

Why, everywhere you turn, the institutions of our civilization seem to ooze with liberal bias. Everybody just wants to keep the poor conservatives down. It's not like lthey've dominated congress for 6 of the past seven congressional electoral cycles, or the presidency for 5 of the past 7 presidential electoral cycles or anything. Poor poor conservatives, so out in the cold, struggling just to have their voices heard amidst a world that seems to tell them that they're constantly and hopelessly wrong about so many things. Reality itself seems to have taken on a liberal bias, trying to make Republicans look bad on the economy and stupid on national policy.

But it's not real. It's only liberal bias.

Finance Darwinism

I have invented a term. Finance Darwinism.

Basically, organizations adapt to take as much of your available money as they can at every stage of your life.

In the natural world, food doesn't go uneaten for very long. Cellulose is hard to digest and for a very long time, nothing ate it. Plants just died and sank into the earth and became coal. Over time, critters adapeted to eat cellulose.  Why? Because food doesn't go uneaten.

Now consider that money is food. Given a median household income there will be no point in your life where one expense ends without another beginning. Do I have proof of this yet? No...it's just a hypothesis...

...of course some of this comes from us personally, where we have excess money all of a sudden and we think of ways to spend it. But Some degree of that has to be external too...an insurance company knows when a demographic is suddenly free from other expenses and they increase premiums at that age, for example.