Another One Bites the Dust

Today is a sad day in Denver, Colorado. The Rocky Mountain News printed its last paper and closed its doors. The paper had survived since before the Civil War but could not survive the current state of our economy and the current business mindset. It follows to the grave many other losers in many towns and many industries who have been wiped out by the wide tornadic path left by consumerism that doesn't really care where something came from as long as it is cheaper so more can be acquired and a business philosophy that focuses on quantity over quality and that is solely dictated by the bottom line and what will put the most money in the pockets of those at the top.

Obituaries are scattered across the entire country for small town hardware stores and supply houses who have been blown away by the likes of Lowests and Home Import. Casualty counts are high for small grocers, meat markets, and produce marts that have been sucked out of existence by WoeMart and it's counterparts.

When will we wake up to realize that the strength of this country's economy was built as much on an employer's loyalty to their employee and that employee's loyalty to their company as it was on any free market economic theory. Free market and trickle down only work in a society that prizes fairness, integrity, and the whole (business, local area, country) over wealth, greed, and self. Over the last several decades the gap between the average salary of a company's CEO and his workers has widened ridiculously. As indicated by the recent insurance and bank bailouts, this doesn't even require that the CEO is doing a decent(let alone good)job.

Forgetting for a moment the trillion dollars of debt in Washington and the bantering about who should or shouldn't be bailed out and what should or shouldn't be legislated, what hails down across the country are job losses and home losses in our own towns and neighborhoods.

That the storm is now causing the closing of communications industry jobs(You remember, communications and service jobs were what they told us would take the place of all our manufacturing jobs)is frightening. It is frightening in the sense that newspapers are following in the wake of radio stations where local stations were engulfed by larger affiliates and where so much of it is technologically driven that when a local crisis occurs it could take hours to reach an actual person to interrupt a broadcast that is being sent from hundreds of miles away. Without local newspapers, whether their editorial bias is liberal or conservative, we remove one of the checks and balances on local government and local business.

I agree wholeheartedly with journalist Bill Johnson who said in his final article for The Rocky, "When a newspaper dies, there are no victors."

You can read his article here.

You can read about the closing and The Rocky's history here.

Thursday Thirteen - Wake Up Call

Below are 13 facts about the 1920s leading into The Great Depression from an extensive list you can find here. (bold emphasis and comments in italics are mine.)

1. During World War I, federal spending grows three times larger than tax collections. When the government cuts back spending to balance the budget in 1920, a severe recession results. However, the war economy invested heavily in the manufacturing sector, and the next decade will see an explosion of productivity... although only for certain sectors of the economy. (Think construction/housing industry)

2. An average of 600 banks fail each year.

3. Agricultural, energy and coal mining sectors are continually depressed. Textiles, shoes, shipbuilding and railroads continually decline.

4. The value of farmland falls 30 to 40 percent between 1920 and 1929.

5.Organized labor declines throughout the decade. The United Mine Workers Union will see its membership fall from 500,000 in 1920 to 75,000 in 1928. The American Federation of Labor would fall from 5.1 million in 1920 to 3.4 million in 1929.

6. "Technological unemployment" enters the nation's vocabulary; as many as 200,000 workers a year are replaced by automatic or semi-automatic machinery. (Think information age-we don't need to produce anything but information/services)

7. Over the decade, about 1,200 mergers will swallow up more than 6,000 previously independent companies; by 1929, only 200 corporations will control over half of all American industry.

8. By the end of the decade, the bottom 80 percent of all income-earners will be removed from the tax rolls completely. Taxes on the rich will fall throughout the decade.

9. By 1929, the richest 1 percent will own 40 percent of the nation's wealth. The bottom 93 percent will have experienced a 4 percent drop in real disposable per-capita income between 1923 and 1929.

10. The middle class comprises only 15 to 20 percent of all Americans.

11. Between May 1928 and September 1929, the average prices of stocks will rise 40 percent. Trading will mushroom from 2-3 million shares per day to over 5 million. The boom is largely artificial.

12. Backlog of business inventories grows three times larger than the year before. Public consumption markedly down. Automobile sales decline by a third in the nine months before the crash.

13. Individual worker productivity rises an astonishing 43 percent from 1919 to 1929. But the rewards are being funneled to the top: the number of people reporting half-million dollar incomes grows from 156 to 1,489 between 1920 and 1929, a phenomenal rise compared to other decades. But that is still less than 1 percent of all income-earners.

SOUND FAMILIAR?

Two for Tuesday-yadseuT rof owT

Driving to work this morning I saw this bumper sticker:

"Legalize the Constitution"

Huh?

My mind goes so many different directions...

Is this guy a firearms enthusiast? Is he against judges making laws instead of enforcing them? Or is he just all about the "pursuit of happiness"?



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Black Friday

What are you doing on Black Friday? It is usually a day of crazy early morning shopping for me - not because I'm so drawn by the deals, but because I love the crowds and the craziness of it all. I know, I'm weird! I'll be working this year but may try to sneak in a few stores before I have to be at work at 8:00 a.m.

Wikipedia says, " Although Black Friday, as the first shopping day after Thanksgiving, has served as the unofficial beginning of the Christmas season at least since the start of the modern Macy's Thanksgiving Day Parade in 1924, the term "Black Friday" has been traced back only to the 1960s. The term "Black Friday" originated in Philadelphia in reference to the heavy traffic on that day. More recently, merchants and the media have used it instead to refer to the beginning of the period in which retailers are in the black (i.e., turning a profit)."

So, what do you think the economy will do to the shopping? Are you changing your spending habits for Christmas this year? We certainly are.

Do you think the stores will reach that "in the black" zone? Even if they do, if this definition is accurate, what type of business principle has you operating in the red for 332 days out of the year and then trying to make up for it in the last 33 days? I've read that several retail companies have filed with the government of their intent to close, either a number of their stores or entirely, after the first of the year. Do you think they should be required to tell consumers ahead of time so they don't purchase gift cards that may be difficult or impossible to spend?