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2003-04-30 21:03PDT (2003-05-01 00:03EDT) (04:03GMT)
George Muzea _CBS.MarketWatch.com_
A new bull market or a fake out?: Follow the really big money
"Most stocks have ugly chart patterns and poor relative strength at bottoms and very good-looking patterns and strong relative strength at tops. Fundamental analysis of individual company charts is also very useful when trends are underway, however, at the bottom of every major decline, the new-low list will be littered with companies with strong fundamentals. Psychology makes market bottoms and tops... Anyone who has been trading this market for the last year is well aware that we have had 3 market bottoms -- July and October 2002, and most recently March 2003. The rallies off the July and October lows both failed after gains of approximately 1,500 Dow points... Vilfred Pareto... was a 19th century economist who described the 80:20 principal after discovering that 80% of the wealth in Rome was owned by only 20% of the people."
2003-05-01 01:03PDT (04:03EDT) (08:03GMT)
Once-Mighty Bethlehem Steel Fades Away
"But on Wednesday, an American industrial icon that employed 300K people during its World War II heyday faded into history... The bankrupt steel-maker's executives and lawyers began signing paper-work Wednesday transferring ownership of the company's mills to International Steel Group, a new company based in Cleveland... Its 11K steel-workers kept their jobs as ISG took control at Bethlehem's plants, but about 450 managers and executives were laid off, said Bethlehem's chief executive, Robert Miller... Industry consolidation, over-seas competition, and Bethlehem Steel's own legacy led to the company's demise, he said. Until the $1.5G sale, the company provided pensions for more than 100K retirees and their dependents, far more than it could support [so a major purpose of the scam was to abandon those legitimate pension obligations]."
2003-05-01 10:26PDT (13:26EDT) (17:26GMT)
Mark Gongloff _CNN_/_Money_
From bad to worse?: Economists expect April's jobs report to be weak. They may be too optimistic.
"Analysts have been forecasting that unemployment rose to 5.9% last month from 5.8% in March, according to the latest Reuters poll, and that employers cut 53K jobs in April. But recent reports indicate things could be worse than that... Gerald Cohen, senior economist at Merrill Lynch, which expects 125K job losses to be reported Friday... But 30K new jobs, while fantastic for the people who get them, don't come close to the 125K-to-150K new jobs needed each month to keep up with population growth, according to most economists... A Congressional Budget Office study, headed by Douglas Holtz-Eakin, formerly chief economist of Bush's Council of Economic Advisors, said even the president's original $726G plan would provide 'a relatively small impetus' to the economy. A PricewaterhouseCoopers study commissioned by the Business Roundtable said the full plan might have added 800K jobs in 2003."
2003-05-01 11:47PDT (14:47EDT) (18:47GMT)
Mark Gongloff _CNN_/_Money_
US jobs jumping ship: Cheap off-shore labor is not just for manufacturing any more -- is your job heading over-seas, too? (with graphs)
"'By 2004, more than 80% of U.S. executive board-rooms will have discussed off-shore sourcing, and more than 40% of U.S. enterprises will have completed some type of pilot or will be sourcing IT (information technology) services.', Gartner Inc., a technology consulting firm, said in a study late last year... developing a taste for super-cheap over-seas labor in developing countries, where workers are increasingly better-trained, especially if they've spent significant time working in the United States on temporary visas... While tech spending by U.S. businesses has been underwater since the tech bubble of the late 1990s popped in 2000, countries such as India, [Red China], Ireland, Israel and the Philippines all are experiencing a boom in exporting IT services... NASSCOM predicts that the Indian 'business process out-sourcing' industry -- a narrow category that includes customer-support call centers -- will export $21G to $24G worth of services by 2008 and employ more than 1.1M Indian workers. Those workers -- in one narrow segment of the out-sourcing industry in just one country -- would replace about 1M U.S. workers, according to consulting firm Gartner."
2003-05-01 13:33PDT (16:33EDT) (20:33GMT)
Bambi Francisco _CBS.MarketWatch.com_
Bush to visit Silicon Valley
"When President Bush arrives in the San Francisco Bay Area on Friday to talk job growth and government spending on technology, he may find himself in front of a tough audience. Bush is due in Santa Clara on Friday morning, after visiting the USS Abraham Lincoln in San Diego on Thursday, where he addressed sailors with an inspiring speech on the Iraq war... The unemployment rate in Santa Clara County averaged 8.4% in 2002, and has remained around 8.5% in the first quarter of this year. This is up from 1.3% in 2000 December, and compares to the nationwide rate of 5.8% in March. San Francisco also remains in a recession, according to economist Steve Cochrane of Economy.com. Employment has fallen by 12% from its late 2000 peak, or a loss so far of nearly 130K jobs, and the trend continues downward, Cochrane wrote in an April report... To be sure, the tech-employment landscape is improving. In the first quarter, technology job cuts represented 17% of the 355,795 cuts announced by all industries, according to Challenger... Many of the jobs lost in these tech industries may not come back as more tasks are shipped to over-seas suppliers and service providers, where tech labor is cheap, noted Challenger. And, the indirect effect of those job losses touches a number of other industries... In fact, Cochrane says that personal bankruptcy filings are rising in San Francisco, following a prolonged period of stability. 'This economy has not seen a bottom yet, and won't likely until the end of this year.'... The government is spending $59G in IT this fiscal year, making it the [single] largest spender on technology... exports account for more than 50% of some companies' sales."
Lisa Guernsey _NY Times_
Making Intelligence a Bit Less Artificial
"recommender systems - software that analyzes patterns in a customer's choices to predict what else that person might want or need. In addition to Amazon's system, the better-known examples include TiVo, the digital television recorder, and NetFlix, the online DVD rental service... Only 7.4% of online consumers who noticed these systems said they often purchased recommended products, according to a report issued in February by Forrester Research. About 22% said they found the recommendations valuable, and about 42% said the products listed were not of interest... People are becoming a critical component: analysts who understand why a particular type of music appeals to some people, categorization experts who know how to cross-reference material, retail executives who tweak the system to improve the bottom line and reviewers who check for non-sensical or offensive results... 'The holy grail is to be able to capture all the customer's interactions in detail and get smarter about what not to recommend.', said Usama Fayyad, chief executive and president of digiMine, the software company behind the online recommendations of J. Crew and Barnes & Noble. 'We can recommend very well. Knowing when not to bother someone is much harder.'... Matt Turck, president of TripleHop Technologies, a company that has built recommendation engines for USA Today's online travel section and SkiMatcher, which advises travelers on ski resorts... Rashmi Sinha, the founder of Uzanto Consulting, a company that focuses on end-user experiences with technology. She is also a cognitive psychologist who has conducted studies of how people respond to recommender systems... collaborative filtering, a technique that matches a user to a group of others who have purchased or praised similar products, then analyzes the group's data to predict what else the user might like... Firefly... the software that kept track of user profiles, which Firefly had called 'passport', for what became M$'s own Passport software for the quick transfer of personal data."
Refinancing Helps Bolster Spending
"In the first 3 months of the year, 43% of refinanced loans were for amounts 105% or higher than the original mortgage, compared with 60% a year earlier, said Freddie Mac."
Wayne Lutton _Middle American News_
States, Federal Government Hire Foreign Guest-Workers
"Despite the availability of tens of thousands of highly-trained recent college graduates and high national unemployment rate pegged by the Labor Department at 8.9% for white-collar workers, American governments are using the federal H-1B foreigner-employment program to import foreign workers, shutting out unemployed Americans... Federal agencies that have hired H-1B non-citizen workers include the Argonne National Laboratory, U.S. Department of Defense, Department of the Air Force, Department of the Navy, Department of Veterans Affairs, U.S. Department of Agriculture, U.S. Naval Academy, Lawrence Livermore National Laboratory and the Los Alamos National Laboratories. State governments using public money to retain foreign nationals at a time when large numbers of qualified Americans are seeking employment include the Arizona Department of Transportation, Arizona Department of Environmental Quality, California Department of Transportation, Illinois Department of Nuclear Safety, Indiana Department of Transportation, Louisiana Department of Public Safety, Massachusetts Department of Public Health, Massachusetts Department of Revenue, Minnesota Department of Transportation, New Jersey Department of Transportation, New York Public Library, Tennessee Department of Transportation, and the Virginia Department of Corrections. The state of Florida under Republican Gov. Jeb Bush has been an especially prominent employer of H-1B visa holders. The Florida Department of Corrections, Florida Department of Environmental Protection, Florida Department of Health, and Florida Department of Transportation are among the state agencies that have hired foreign professionals. The state of Ohio, led by Republican Governor Bob Taft, presents a case study of the types of good jobs going to foreigners instead of Americans. At least eight Ohio state agencies have hired H-1B workers, most of them citizens of India and the Pacific Rim countries of [Red China], Korea, and Taiwan. The Ohio Department of Job & Family Services has hired a number of foreign computer programmers and analysts at starting salaries ranging from $50,336 to over $64K."
Kurt Eichenwald _NY Times_
US Indicts 11 Former Enron Executives
"Federal prosecutors unsealed indictments today against 11 former Enron executives, including charges that the once-vaunted success of the company's high-speed Internet business was largely an illusion. In addition, the government charged 3 new defendants with participating in illegal deals with Enron's former chief financial officer, Andrew S. Fastow, using those deals both to enrich themselves and improperly manipulate the company's financial performance [reports]."
Paul Craig Roberts _Washington Times_
Dark employment clouds
"During the first 27 months of the Bush administration, the U.S. economy has lost 2.6M private sector jobs. Much of this loss is from the fall in profits and subsequent downsizing after the high-tech bust. Some lost jobs, however, are from a new development: America's export of high-wage jobs to low-wage countries."
David Tzeng & Wen-Yu Lang _DigiTimes_
HP, Dell expanding R&D in Taiwan
"While HP expects to increase its Product Development Center (PDC) staff from 80-90 currently to around 200 by late 2004, Dell is gearing up to expand its Taiwan Design Center (TDC), with a target of reaching 60-70 staff this year. The TDC currently has about 50 employees, but the number could grow to several hundred in 2004, sources said."
Michael Kinsman _San Diego Union-Tribune_
Local indicators fall, may indicate "bottoming out"
"An index of leading economic indicators released yesterday by the University of San Diego showed that the local outlook continued to weaken during the first quarter of this year. But the decline appears to be leveling off, which could signal an end to the region's slump... 'I think the San Diego economy is still going to have some rough spots.', Gin said. 'The big question is, what does a rough spot in San Diego mean? It doesn't mean a down-turn. A slump in San Diego means a slow-down. It is not a true slump.' The index, which looks at building permits, unemployment insurance claims, local stock prices, consumer confidence, help wanted advertising and national leading indicators, has dropped precipitously since mid-2000. It declined 0.2% in January, 0.3% in February and 0.2% in March."
2003-05-02 06:29PDT (09:29EDT) (13:29GMT)
Rex Nutting _CBS.MarketWatch.com_
Job losses continue for 3rd month: April's losses total 48K; seasonally adjusted jobless rate jumps to 6%
"Non-farm pay-rolls fell by 48K in April, on the heels of losses totaling 124K in March and 353K in February. Along with downward revisions to March totaling 16K, the April decline more or less matched economists' expectations. Total hours worked in the economy fell by 0.7% in April as the average workweek plunged by 18 minutes to 34 hours, matching the lowest level since the [depression] began. The loss in hours worked is equivalent to losing more than 800K jobs in terms of output. Average hourly earnings rose by 0.1%, or 2 cents, to $15.11. Average hourly earnings are up 3.1% in the past 12 months. But with the decline in hours worked, the average weekly pay-check fell by 0.7% -- nearly $4 -- to $513.74... The private sector shed 80K jobs in April, including 95K in manufacturing -- the worst job loss in the factory sector in 15 months. The factory workweek sank by 18 minutes to 40.5 hours. Retail trade lost 10K jobs, while transportation and utilities lost 19K jobs, with 18K of those in the airline industry. Temporary help services lost 14K jobs. Job gains of 32K were recorded in state and local government, mostly in education. Health-care services added 13K, while construction added 18K... survey of households from which the unemployment rate is derived showed job gains of 339K... The household survey also showed unemployment rose by 341K to 8.79M people in April, as 680K more Americans joined the labor force. About 1.9M people have been jobless for at least six months, and 4.8M were working in part-time jobs although they wanted full-time positions."
2003-05-02 07:34PDT (10:34EDT) (14:34GMT)
Dot-com survivors come roaring back
"After years of ridicule and ruin, Internet stocks are seducing investors again... Online auctioneer eBay, for instance, began this year with first-quarter revenue of $476.5M -- a 94% increase from last year. Excluding gains from acquisitions made during the last year, eBay's revenue still rose by 56%. At the end of April, eBay's shares stood at $92.91 -- a 37% gain since the end of 2002."
2003-05-02 07:40PDT (10:40EDT) (14:40GMT)
Seasonally adjusted unemployment jumps to 6%: Jobless rate surges to cyclical high as employers shed another 48K jobs from non-farm pay-rolls.
"Unemployed workers now total 8.8M, up from 8.4M in March."
2003-05-02 13:07PDT (16:07EDT) (20:07GMT)
Leigh Strope _AP_/_San Diego Union-Tribune_
Unemployment swells to 6% as pink slips out-number job offers
"The nation's [seasonally adjusted] unemployment rate swelled to 6% in April, returning to an eight-year high as employers slashed pay-rolls even deeper. The ailing economy has lost a half million jobs in the past 3 months... In April, the number of unemployed workers surged to 8.8M, with almost 2M without jobs for 27 weeks or more. The average duration of unemployment shot up to 19.6 weeks -- a 20-year high... April's jobless rate increase was caused in part by 680K people returning to the labor force... A healthy economy typically adds 200K to 250K new jobs each month, [Ken] Mayland [of ClearView Economics of Cleveland] said. It could be a long time before those days return. The costs associated with hiring new employees have sky-rocketed, particularly for health care and pensions. Companies will make do with their existing force for as long as possible, working employees longer hours and paying more over-time."
2003-05-02 11:53PDT (14:53EDT) (18:53GMT)
Jeanne Sahadi _CNN_/_Money_ Job-search hell: Employers are in the driver's seat and the competition for the passenger side is stiff.
"'Companies are cherry-picking. They can be very selective.', said Charley Donohoe, a North Carolina-based managing consultant for human resources consulting firm DBM... The median search time has been on the rise for 7 consecutive quarters. In the first quarter, it surged to 4.2 months, a 17-year record high, according to out-placement firm Challenger, Gray & Christmas... Indeed, experts said, employers are very aware the job market is tough and don't consider a layoff a mark against candidates... Lastly, Donohoe tells clients to think about what their minimum pay requirements are both in terms of their budget and their psyche. The budget number is your 'absolute must have', he said. Your psyche's number is the amount you need to feel you're valued for your skills and experience."
2003-05-02 11:53PDT (14:53EDT) (18:53GMT)
Leslie Haggin Geary _CNN_/_Money_
Who's firing? Who's hiring?: Lay-offs aren't completely a thing of the past, but hiring is taking place within some industries.
"Private-sector employers have shed 2.6M jobs since 2001 March, when the recession officially began, and the national unemployment rate in April just climbed to 6% [seasonally adjusted] with 8.8M individuals counted as 'officially' unemployed. In fact, there are 1.4M unemployed individuals [counted as 'discouraged']... Though one in five employers -- 22% -- hope to add to their pay-rolls, 9% plan to trim jobs in the second quarter of the year, according to the latest survey by Manpower International... Meanwhile, battered industries like telecom and technology may have seen the worst of the cuts, said Tim Bajarin, president of Campbell-based Creative Strategies Inc., a Silicon Valley market researcher..."
2003-05-02 13:24PDT (16:24EDT) (20:24GMT)
William L. Watts _CBS.MarketWatch.com_
Bush cites job data, touts tax cut; Democrats say figures show president's plan flowed
"'The unemployment number is now at 6%, which should serve as a clear signal to the United States Congress we need a bold economic recovery package so people can find work.', Bush told a cheering audience at a United Defense Industries factory in Santa Clara, CA... Democrats have called for as much as $160G in short-term tax cuts and spending aimed toward lower income Americans, which they say would be more likely to spur economic growth in the short term while adding only minimally to public debt."
2003-05-02 13:33PDT (16:33EDT) (20:33GMT)
Jobless in America
2003-05-02 13:38PDT (16:38EDT) (20:38GMT)
Julie Rannazzisi _CBS.MarketWatch.com_
Nasdaq breaks above 1500: Dow sees triple-digit gain
"The Dow shot up 128, or 1.5%, to 8,582, as it headed into territory not seen since January. All but one of the blue chip's 30 components headed into the green with Boeing, SBC Communications, DuPont, Intel, Honeywell and J.P. Morgan Chase leading the way. The Nasdaq Composite galloped up 30 points, or 2.1%, to close at 1,502, a level not seen since June of last year. The Standard & Poor's 500 Index climbed 1.5% while the Russell 2000 Index of small-capitalization stocks swelled 2.2%... Volume came in at a healthy 1.53G, above the average of 1.4G, on the New York Stock Exchange. Nasdaq volume totaled a hefty 1.8G. Market breadth was decidedly positive, with advancers outnumbering decliners by 25 to 7 on the NYSE and by 23 to 9 on the Nasdaq. On the fund flow front, Trim Tabs reported that all equity funds had inflows of $1.2G in the week ended April 30 compared with outflows of $400M in the prior week. Equity funds that invest primarily in U.S. stocks got a $1.6G infusion vs. out-flows of $700M during the prior week."
2003-05-02 16:25PDT (19:25EDT) (23:25GMT)
Rex Nutting _CBS.MarketWatch.com_
Fed's patience is wearing thin
"For those who were distracted by the 'better-than-expected' spin from the folks on Wall Street, let's review the 'highlights' of the jobs report:
GM Chief Says Sales Need Help
"The chief executive of General Motors, Rick Wagoner, in his first speech since adding the title of chairman, said today that the price war his company was leading was losing effectiveness and the industry would need a strong economic stimulus package from Washington... 'Deficits do matter.', he added. 'As much as I don't like deficits, I believe an economic slow-down is not the time to try [to] curb them... Sooner is better than later and relatively bigger is better than relatively smaller.'"
Danny Hakim _NY Times_
Fuel Economy Hit 22-Year Low
"The average fuel economy of the nation's cars and trucks fell to its lowest level in 22 years in the 2002 model year, the Environmental Protection Agency reported today... Since 1981, the average vehicle has 93% more horsepower and is 29% faster in going from 0 to 60 miles an hour. It is also 24% heavier, reflecting surging sales of sport utility vehicles... We have 30 models that get over 30 miles per gallon, but the top 10 most fuel-efficient vehicles are less than 2% of sales.', she said... In the 2002 model year, fuel economy averaged 20.4 miles a gallon, the lowest since the fleet averaged 19.2 miles a gallon in 1980. Fuel economy peaked at 22.1 miles a gallon in 1988 but has mostly fallen since. The agency predicts fuel economy will rise to 20.8 miles a gallon in the 2003 model year, with a 0.5 mile a gallon margin for error. Cars are expected to average 24.8 miles a gallon, compared with 19.6 for minivans, 17.8 for S.U.V.'s and 16.8 for pickups."
Catherine Valenti _abc News_
Hiring Slump on Campus: College and MBA Graduates Get Ready to face Dismal Job Market
"Around 42% of employers surveyed by the National Association of Colleges and Employers, a Bethlehem, PA-based group that provides information for career services professionals on college campuses, say they expect to cut college hiring this year, while 36% said they plan to hire new college graduates. Overall, employers expect to keep their levels of hiring new college graduates steady this year compared to last year. But considering that hiring of new graduates dropped 36.4% last year from the previous year, that still implies a continued hiring slump for graduates, says NACE employment information manager Camille Luckenbaugh... Even the companies that are coming to campus aren't hiring, but going to colleges to maintain their visibility with students once the hiring market does turn around, says Luckenbaugh... 75% of respondents to the Graduate Management Admission Council's survey reported making job offers to their companies' own interns before even interviewing other candidates, and 50% of new hires in 2002 ultimately came from recruiters' own intern pools."
Alexander Stille _NY Times_
Did Knives and Forks Cut Murders?: Counting backward, historians have resurrected crime statistics and found that the Middle Ages were more violent than now.
"Although there were no national statistics centuries ago, some historians discovered that the archives of some English counties were intact back to the 13th century. So in the 1970's they began diligently counting indictments and comparing them with estimated population levels to get a rough idea of medieval and early modern crime rates. Historians in Continental Europe followed suit and came up with findings that yielded the same surprising result: that murder was much more common in the Middle Ages than it is now and that it dropped precipitately in the 17th, 18th and 19th centuries... But James A. Sharpe, an historian at the University of York in England, said the big statistical dip in violence preceded industrialization and urbanization by more than a century."
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2003-05-31 2003-05-31 2003 May 2003 May 2003 May
Nina Pineda _WABC_
"When word went out that a local union would be taking applications for apprenticeships, no one expected the response would be so overwhelming. The hundreds of prospective workers who are lining up days before the scheduled interviews may be symptomatic of the ailing economy. When the 200 positions were offered, some people showed up within an hour of hearing about it."
A little bird reported, today, that 2 laid-off Bank of America employees in Concord, CA, committed suicide. Meanwhile, the company continues to abuse guest-workers and move people's personal private financial information off-shore to India. Thus the popularly mandated name change to "Bank of India".
Douglas Jehl, Danny Hakim & Michael Moss _NY Times_
US-Backed Iraqi Exiles Return to Re-Invent Nation
"Munther al-Fadhal believes that there is no place for religion in a new constitution for Iraq. He favors the establishment of relations between Iraq and Israel. He even thinks Iraq should outlaw the death penalty. As the designated senior adviser to the Iraqi Justice Ministry, he will be one of the leaders of a 150-strong team of exiles plucked by the Pentagon from posts in America and Europe to help shape the new Iraq. A look at the team, assembled in a mere 2 months by Deputy Defense Secretary Paul D. Wolfowitz, shows how boldly the United States is trying to import secular, democratic notions to an Iraq whose political future remains the subject of profound division and flux... Iraqi Reconstruction and Redevelopment Council [members are] primarily administrators whose job will be to smooth a transition to an Iraqi-led authority by resuscitating moribund ministries and restarting basic services... the Iraqi advisers would not play political roles... The roots of the exiles' team led back to the Iraqi Forum for Democracy, which Mr. Dhia co-founded in 1998. Composed mostly of secular professionals from across the spectrum of Iraq's Shiite, Sunni, Kurdish and Christian populations, the group's declared mission has been 'to promote democracy and democratic values for Iraq by peaceful means'... But technically, they are working for SAIC, a defense contractor... Most members of the team have post-graduate degrees... A substantial number are naturalized citizens of the United States or European countries... 'I have a dream,', he said, 'to build in Iraq a civil society, a democracy, like Switzerland or Sweden.'"
David Leonhardt _NY Times_
A Noted Few Make a Case for Optimism (Again)
"Starting in early 2001, Federal Reserve officials and most Wall Street economists began predicting a quick return to healthy growth, only to repeat the forecast a few months later after they were proved wrong... So anybody with a good memory deserved sympathy last week when trying to understand Alan Greenspan's hopeful testimony to Congress... The government's effort to revive the economy began in early 2001, when the Fed began cutting its benchmark short-term interest rate. President Bush signed a tax cut that spring. But only in the last year has the stimulus from these policies fully kicked in... The federal government did not begin running an annual deficit -- putting more money into the economy than it was taking out -- until 2002 April, Mr. Paulsen said. Today, tax cuts and benefits like unemployment insurance are giving money to households, while military and security spending is helping some businesses. Long-term interest rates, which are influenced by the Fed's actions but set by investors, are near a 40-year low, making both mortgages and business loans less expensive. From late 2001 to 2002 March, when a rapid economic recovery seemed possible, these rates rose more than 15%. The value of the dollar also did not begin its main descent until the spring of 2002. Only since then has the effective price of American goods become more competitive with those of their rivals. And oil prices have tumbled since the eve of the Iraq war... companies are also showing signs of health, if not yet vigor. Profits in the first quarter continued a climb that began more than a year ago. So far, the improvement has largely come from layoffs and other cost cutting. But eventually, the optimists say, better profits will cause companies to invest in new equipment, technology and workers. Orders for new equipment by technology companies are exceeding shipments for the first time since 2000..."
Steve Lohr _NY Times_
Technology Hits a Mid-Life Bump
"a prosperous niche as an expert in shutting down failed technology start-ups on behalf of venture capital firms and other disenchanted investors... Sherwood Partners has shut down 150 once-aspiring start-ups in the last 2 years, and Mr. Pichinson figures that thousands more are destined to fold... But what's painful for Silicon Valley is beneficial for those who use the stuff it produces... These trends, they say, point to increased pressure on prices and profits for most technology companies, a good deal for corporate customers and a very tricky time for investors... The technology itself will still deliver waves of innovation in the future. Yet an industry that has risen to account for 10% of the economy and nearly 60% of business capital spending can no longer play by its own rules... Yet an article published last week in The Harvard Business Review does question corporate America's faith in the value of technology. Titled 'IT Doesn't Matter', the article argues that information technology is inevitably headed in the same direction as the railroads, the telegraph, electricity and the internal combustion engine. All of these industrial technologies aged from their boom-time youth to become, in economic terms, ordinary factors of production, or 'commodity inputs', the article noted. 'From a strategic stand-point, they became invisible; they no longer mattered.', wrote Nicholas G. Carr, editor at large of The Harvard Business Review. 'That is exactly what is happening to information technology today.'... Unlike so many industrial technologies -- railroads, say, or the telegraph -- the stored-program computer is a general-purpose tool, animated by software, a medium without material constraints. The unrelenting pace of improvement in processing speeds, data storage and miniaturization means the tools are more powerful and smaller; people then figure out things to do with them. Indeed, innovation continues apace, despite the downturn. Advances are evident in a range of technologies ó wireless, data center automation, speech recognition, intelligent software, telephone service over the Internet, sensors, natural language processing, and on and on."
Laura M. Holson _NY Times_
The Affable Ax Wielder at Sony
"No one believes that Howard Stringer likes laying people off. But he certainly gets a lot of practice. And he does it so gracefully... At CBS in the late 1980s, [he] presided over a drastic down-sizing of the broadcast industry's proudest news division, one that he had grown up in as a clerk, documentary maker and news producer. Many of the more than 200 people who lost their jobs were his friends... Sony Music... has announced plans to eliminate 1K jobs..."
Daniel Duane _NY Times_
Egg-Heads Unite: Is a teaching assistant an apprentice scholar or an exploited worker?
"Motivating them is their perception that the corporate university exploits teaching assistants as cheap labor in a way that -- most galling of all -- eliminates the professorships those T.A.'s are ostensibly training to get. University fund-raising depends primarily on high-profile faculty publishing, so the smart money cuts the total number of professors in order to spend big on a few stars and give them enough free time to stay famous. Graduate students, serving as T.A.'s and even as lecturers, pick up the teaching slack. This makes for a great fiscal model -- tenure produces high fixed costs, while disposable T.A.'s work for peanuts. But it also creates an ever-greater over-supply of Ph.D.'s competing for ever-fewer tenured jobs. Back when graduate students could reasonably see themselves as apprentices bound for glorious lecture halls, the low pay was tolerable, but when T.A.-ships look like the university's way of balancing the budget at the expense of their graduate students' futures, it feels like an outrage. Administrators have made the mood only worse by sending their own salaries through the roof... Despite the heavy fire-power, the National Labor Relations Board agreed with the contention that T.A.'s are employees, doing real work for real pay."
Edmund L. Andrews _NY Times_
Top Employer Gone, Iraqis Scuffle for Jobs
"Today, 3 weeks after Saddam Hussein's government crumbled, Mr. M is among the thousands of Iraqis here begging for work from the newly arrived American administrators. But like most of other applicants, Mr. M has awakened to the bitter realization that the Americans are hiring very few of those now unemployed... By some estimates, as much as 75% of the Iraqi work force made a living from either the government or the military -- both of which have now collapsed. Largely because of the trade sanctions imposed by the United Nations after the Persian Gulf war in 1991, manufacturing had all but halted by the time the United States and Britain attacked in March. Many urban Iraqis moved to the country and turned to subsistence farming for survival. Meanwhile, prices for many basic staples are rising rapidly as shortages and growing demand collide with the incoming flood of dollars from big-spending foreign government officials, international organizations and journalists from around the world. For the lucky few -- those who find work with foreigners as translators or drivers or technical specialists -- income has soared from about $40 a month to as much as $100 a day."
Scott Leith _Atlanta Journal-Constitution_
Jobs take trip abroad: Growing trend toward IT off-shore out-sourcing is a boon for India
"Bangalore, a city of 5.5M, has become one of the world's hot spots for the kind of white-collar jobs that were long a strength of the U.S. economy. Now, many are moving over-seas... Tech jobs have been moving over-seas for some time, but a confluence of factors has accelerated the shift. They include corporate cost-cutting, a stale US economy and the rising sophistication of many over-seas tech communities... Countries on the receiving end of the shift have been busy building and promoting their tech sectors [unlike the USA]. India is the most aggressive, dating to the 1980s. The work has continued, such as with the 1998 May formation of a task force on information technology and software development to 'help India emerge as an IT software super-power', according to NASSCOM, India's main vehicle for promoting itself as a tech destination... US techies who can find jobs now often accept lower pay."
Diane E. Lewis _Boston Globe_
Firms take harder look at temp hires
"In the late 1990s, just about anyone who wanted a long-term temporary or contract job could find one fast. Not anymore. With recent college graduates and laid off professionals competing for short- and long-term assignments, staffing firms are searching for the best and brightest these days. The reason: US employers are tightening spending, shedding workers, and paying closer attention to budgets for temporary and contract work... Fran Goldstein [said] 'The termination of a temp has budgetary consequences that were not looked at as closely before.' In a push to promote their best temps and boost business, some staffing firms are offering perks such as specialized training, guaranteed job placements, and other benefits, as well as enhanced services to employers... Last year, annual sales for temporary staffing services [bodyshops] were $55.2G, down from 1.8% in 2001 [sic], according to the association. Additionally, 2.1M temporary or contract employees worked for US staffing firms in 2002, down from 5.7% in 2001 [sic]... Data from the US Bureau of Labor Statistics show that close to 2M workers have been unemployed for more than 26 weeks, nearly triple the number recorded 3 years ago. Meanwhile, a fall 2002 survey of 347 employers by the National Association of Colleges and Employers in Pennsylvania found that, on average, employers planned to hire 3.6% fewer graduating college seniors this year than last year, when campus hiring dropped 36%."
Any Lindgren _Boston Globe_
Playing the job market smarter
Marshall Loeb _CBS.MarketWatch.com_
Coeds and credit cards: Financial pressures lure college students to credit cards
"Credit card companies aggressively target college students in marketing campaigns, so it's no surprise that the college students carry an average balance of $2,327, according to Nellie Mae. Some college students use credit cards to pay for living expenses not covered by school loans. One in 5 college students has a balance between $3K and $7K... In 4-year colleges and universities, about three-fourths of under-graduates work part-time, according to the American Council on Education. Rising tuition costs put more even more pressure on students to get part-time jobs, but their grades tend to suffer substantially when they work more than 15 hours a week."
Rex Nutting _CBS.MarketWatch.com_
Challenger: April lay-offs up 71% to 146K
"total announced lay-offs to their highest level in 5 months... Challenger Gray & Christmas. Announced job cuts jumped 71% in April to 146,399 from 85,399 in March, Challenger said Monday. The budget crunch at state and local governments was finally felt in April as 57,927 workers were told to clean out their desks..."
Jon Groat _CBS.MarketWatch.com_
Demand for IT workers still weak: Tech job market stagnant in 2003, work moves ahead
"Demand for information technology professionals has stabilized but is not growing, according to a telephone poll of 400 hiring managers by the Information Technology Association of America. While technology companies have cut more jobs in the last year, even moving positions over-seas... About 493K information technology positions -- software developers, engineers, networkers and technical support personnel -- will open up in 2003, the survey said. That's down from a high of 1.6M positions in 2000. Almost 67% of those surveyed said they expected demand would stay the same or decline during the next year... About 12% of technology companies have relocated work outside the United States -- in India , [Red China] and Russia -- in the past year and almost 15% plan to do so in the next year."
Rachel Konrad _AP_/_Yahoo!_
Tech Job Markets to Stay Bleak
"ITAA President Harris N. Miller [alleged] there are about 493K unfilled technology jobs in the United States, down from 1.6M open positions at the start of 2000. The United States has about 10.3M technology jobs. The tight market for technology jobs comes as hundreds of American companies out-source positions to smaller engineering and programming firms in India, [Red China], Russia and other countries with inexpensive labor forces."
Firms irked over Red Chinese copies: 65% of companies falling prey to intellectual property theft
"About 30% of the pirating and technology thefts occurred in [Red China]... Of the 314 cases, 114 occurred in [Red China], with infringements centering on products such as motorcycles, watches and toys."
Planned lay-offs increase 71%
"Lay-offs at US firms surged 71% to 146,399 in April from 85,396 job cuts planned in March, job placement firm Challenger, Gray & Christmas said. That brought the year's total job cut announcements to a hefty 502,194 even as U.S. troops made rapid progress in the battle for Baghdad..."
Dexter Filkins _NY Times_
Saddam Hussein's Son Took $1G Just Before War, Bank Aide Says: The removal of money from Iraq's Central Bank is raising fears that it is being used to finance remnants of the former government.
Patrick E. Tyler _NY Times_
Opposition Groups to Help to Create Assembly in Iraq
"The main Iraqi opposition groups have agreed to help put together a national assembly of more than 350 deputies that would meet this month to name an interim executive council or prime minister to run the country. Representatives of the opposition groups, which worked with the Bush administration for Saddam Hussein's down-fall, have been meeting behind closed doors at the Republican Palace, the American headquarters for the enormous task of rebuilding Iraq."
Dan Verton _Computer World_
Off-shore coding work raises security concerns
"At last week's Techno-Security Conference here, users peppered a panel of corporate security officers with questions about the wisdom of out-sourcing software development to cheap labor over-seas, where there is little or no way to ascertain the security risk that workers may pose. Of particular concern to some attendees is the work that is being sent to [Red China]. While not yet a major provider of out-sourcing services, [Red China] has a significant economic espionage program that targets U.S. technology, the users noted. Also of concern are countries in Southeast Asia, particularly Malaysia and Indonesia, where terrorist networks are known to exist... A show of hands during the closing session of the conference indicated that the majority of attendees doubted the ability or willingness of software companies to conduct proper background investigations of foreign software coders working over-seas. That's not surprising, given that few companies in the U.S. conduct background investigations on IT personnel, said Joyce Brocaglia, CEO of Alta Associates Inc., a Flemington, NJ-based executive search firm."
Vince Golle _Bloomberg_
US Economy: Services Industry Expands in April
"The Institute for Supply Management's index for retail, financial services, construction, and other non-manufacturing businesses rose to 50.7 last month from 47.9 in March. The median forecast of 46 economists polled by Bloomberg News was 49. Readings above 50 indicate expansion. Services account for 85% of the economy and a sustained increase may reinforce some economists' expectations for an acceleration of growth later this year."
Is software dead as a growth industry?
"JMP Securities analyst Pat Walravens, another proponent of the 'software has a future' camp, sees the long-term trend for software to be one in which it gobbles up an ever bigger share of total technology spending. Walravens, who like Di Bona is an independent analyst, said he expects the industry to grab an even larger percentage as it packs more intellectual property into software, and hardware becomes more of a commodity. Software represents $46 per every $100 spent on technology, up from $2 per $100 in the 1960s when most went toward hardware. There is room to pick up still more, he argues... software makers haven't come up with innovative new products to spur buying..."
Rachel Koning _CBS.MarketWatch.com_
Fed holds as expected, but sees weakness as a risk
"As expected, the Federal Open Market Committee held its target federal funds rate steady at a 41-year low of 1.25% following Tuesday's meeting... At the same time, the committee said it sees the risks to the economy tilted toward weaker growth, meaning the committee could be ready to cut rates if business confidence doesn't recover quickly."
Mike Tarsala _CBS.MarketWatch.com_
Electronic Arts stock jumps on strong report
"The Redwood City, CA-based video-game producer reported net income in its March quarter of $9.24M, or 6 cents a share, down from $47.3M, or 33 cents a share, a year earlier. Excluding asset impairment and restructuring charges related to its online division, the company said it earned $59M, or 40 cents a share. By that measure, analysts had been expecting earnings of 34 cents a share, on average. The company said it took $72M in charges -- $65M of it stemming from EA.com. The rest was related to employee severance, lease terminations and the retirement of Class B stock options."
Mary Williams Walsh _NY Times_
House Considers Measure to Cut Billions in Pension Obligations
"A bill pending in the House of Representatives would allow businesses with union workers to reduce their company pension obligations by billions of dollars, because statistics show that most blue-collar workers do not live as long as other Americans. The provision, which has gone largely unnoticed in a broad pension bill, is being supported by the United Auto Workers and manufacturing companies whose pension funds now have assets far short of what they are projected to need under previous assumptions about worker longevity... Edwin C. Hustead, chairman of the actuarial panel, said in an interview he was concerned that the data were being used in an improper way. White-collar workers are shown by statistics to live longer, he said, but the bill would not require companies to factor that into their pension calculations. If it were included, unionized companies with largely white-collar workers would have to set aside more to fulfill their promises to retirees in the future. In addition, Mr. Hustead said workers' pay had been shown to be a more powerful predictor of life expectancy than whether a worker was blue collar or white collar, but the bill did not recognize that higher-paid workers live longer and therefore require longer pension pay-outs... With most pension plans now underfunded, Mr. Hustead and some other actuaries fear that a reduction in contributions could increase the risk of defaults, at a time when companies are already defaulting on their pension plans at a greatly accelerated rate."
David Stout _NY Times_
Bush Says Tax Cuts as Important as Strong Defense
"On Capitol Hill, heated debates were getting under way in both houses on how big any cuts should be, and whose taxes should be cut. And while a lot of arguments lie ahead, Mr. Bush got a piece of good news when the chairman of the Senate Finance Committee, senator Charles E. Grassley, Republican of Iowa, indicated partial agreement with Mr. Bush's plan to eliminate taxes on stock dividends. Mr. Grassley inserted a provision in the first draft of the legislation to eliminate dividend taxes in 2005 and reduce them for 2003 and 2004."
Judith Miller _NY Times_
Iraqi Documents on Israel Surface on a Cultural Hunt: While searching for a 7th-century Talmud, U.S. troops unearthed maps featuring terror strikes against Israel dating back to 1991.
"found maps featuring terrorist strikes against Israel dating to 1991. Another map of Israel highlighted what the Iraqis thought were the locations at which their Scud missiles had struck in the Persian Gulf war of 1991... Written in Arabic and dated May 20, 2001, the memo from the Iraqi intelligence station chief in an African country described an offer by a 'holy warrior' to sell uranium and other nuclear material. The bid was rejected, the memo states, because of the United Nations 'sanctions situation'... Slogging down the dank hallway, the soldiers reached a room where they found hundreds of books floating in the foul water. There they rescued 3 bundles of older Jewish books, including a Babylonian Talmud from Vilna, accounting books of the Jewish community of Baghdad between 1949 and 1953 and dozens of more modern scholarly books mostly in Arabic and Hebrew..."
Steven Greenhouse _NY Times_
Bill Offers Employees Option of Compensatory Time
"Congressional Republicans and corporate America thought they had a family-friendly idea that workers would love -- give them the choice of taking compensatory time or time-and-a-half overtime pay when they work more than 40 hours a week. Under current law, employers are generally required to give overtime pay to hourly workers in the private sector and are barred from giving comp time... But when a House committee passed a comp time bill last month in what would be the first significant change in the nation's overtime law in 65 years, organized labor declared war against the idea... Under the bill, a wage earner who works a 50-hour week, meaning 10 hours of overtime, would be able to choose, computing at time and a half, between taking 15 hours of comp time or 15 hours' pay. Emphasizing that the choice is voluntary, the bill sets strict penalties for companies that coerce workers into taking comp time instead of cash. The bill would allow workers to bank up to 160 hours of comp time a year, and whatever banked time is not used by December 31 would have to be cashed out."
Phyllis Schlafly _Washington Times_/_TownHall_/_Eagle Forum_
H-1B visas cost American jobs
alternate link at Eagle Forum
"Corporations are lobbying to extend a Clinton Administration law that raised the number of workers entering the United States with H-1B visas to 195K a year. The law is scheduled to expire on September 30 and revert to the 1999 level of 65K H-1B workers per year. H-1B visas allow corporations to displace U.S. citizens with skilled labor imported from foreign countries... It is a fiction that the United States suffers a shortage of skilled labor, and most H-1B aliens fill entry-level jobs. By far, the most H-1B visas are issued to people from India. The second largest number of H-1B visas go to workers from [Red China]. According to the U.S. Bureau of Labor Statistics, unemployment among electronic engineers who are U.S. citizens has soared to 7% and among computer hardware engineers to 6.5%. Both numbers surpass the national jobless rate of 5.8%. According to the Institute of Electrical and Electronics Engineers, electrical and electronic engineers lost 241K jobs in the past two years. Computer scientists and systems analysts lost 175K jobs, the IEEE said. IEEE president John Steadman said he has 'never heard' of such high unemployment, and that the wide-open importation of H-1B aliens has substantially contributed to the hardship of U.S. engineers and computer scientists. The result, he said, is 'a very substantial and negative effect on the economic conditions of the United States'. Corporations continue importing H-1B aliens at the same time they lay off U.S. citizens. With hundreds of thousands of unemployed U.S. engineers, why should corporations receive special privileges to import even more foreign workers?... Another device used by employers to bring in alien workers is the L-1 visa. L-1 visas are intended to enable multi-national corporations to transfer executives, managers and employees with specialized skills from a foreign office to a U.S. location or affiliate. But L-1 visas have fewer stipulations and are easy to abuse. Mike Emmons told how his former employer, Siemens ICN, used L-1 visas to replace 20 U.S. computer workers with aliens from India."
Jeffrey Yamaguchi _Bank Rate_
What to do once you've been handed a pink slip
"This isn't a unique story. Workers in the dot-com industry are being laid off in droves -- a recent study put the number at over 21K during the past year. These days, conversations around a dot-com office's water cooler, or perhaps the oft-photographed foosball table, are less about stock options and more about how unemployment insurance works."
Carol Kleiman _Chicago Tribune_
Care, coaching, questioning and fighting
_The San Diego Channel 10 abc News_/_AP_
Economy, Job Market Worry Executives
"Even some of the country's most highly paid executives are stressing out over the economy and the dreary job market. According to a recently released Netshare Executive Confidence Index, only 3% of respondents said they were confident about the economy and just 12% were confident about prospects in their particular industry or field. In addition, fewer than 30% said they were confident about the future of their own company. Despite all these worries, these $100K-a-year-plus execs don't seem to be sacrificing much in the way of creature comforts..."
Most lucrative college degrees
"OT1H, employers are generally going to maintain the number of college grads they recruit to their pay-rolls from last year. On the other, companies slashed the number of college hires by 36% last year, according to Luckenbaugh. Grads who are fortunate enough to be hired this year will find that roughly four out of 10 employers -- 44% -- will keep salary levels unchanged. For example, electrical engineering grads will typically be paid a starting salary of $50,566, up just 0.5% from last spring, NACE found. Nearly as many employers, 42%, are cutting salaries for new hires."
Amanda Gardner _abc News_/_Health Scout News_
Do Violent Lyrics Beget Violent Thoughts?
"a new study in the May issue of the Journal of Personality and Social Psychology that contends songs with violent lyrics increase aggressive thoughts and feelings. A slew of research has shown that aggressive content in television, movies and, to a lesser extent, video games, increases aggressive thinking and behavior... Those who had listened to the violent song expressed higher levels of hostility than those who had listened to the non-violent song. Females also reported higher levels of hostility. Participants in the second experiment listened to the same 2 songs by Tool. Those who heard the violent song tended to assign more aggressive meanings to ambiguous words such as 'rock' and 'stick'. In the third experiment, male and female college students who listened to four violent songs -- 'Shoot 'Em Up' by Cypress Hill, 'I Wouldn't Mind' by Suicidal Tendencies, 'Hit 'Em Hard' by Run DMC, and 'Jerk-Off' by Tool -- tended to read aggressive words more quickly than non-aggressive words. The fourth experiment showed that humorous violent songs seemed to have the same effect on aggressive thoughts and feelings as non-humorous violent songs. The fifth experiment put humorous and non-humorous songs side by side, and then asked participants to answer questions about how they felt. Again, students who listened to non-violent songs expressed less hostility."
Sales Increase at Faster Rate than Inventory
"Wholesale sales rose 1% [in March], compared with the 0.5% increase in February, the Commerce Department said. Stocks of goods at distributors increased 0.5% [in March] after a 0.3% rise [in February]. Wholesalers have a record-low supply of goods in stock of 1.21 months at the current sales pace... A separate report from the Federal Reserve showed that consumer borrowing slowed in March to $931M from $1.3G in February... The economy has lost 525K jobs in the last 3 months and the unemployment rate, at 6%, matches an 8-year high. Analysts had expected that Americans took out $3.3G more in loans during March, after an originally reported increase of $1.5G during February."
Diane Levick _Hartford Courant_
Congresswoman Trains Sights on Insurers' Hiring Practices
"Johnson, R-5th District, wants to know how many Indians the companies employ on H-1B visas now, whether that number has grown during the past 2 years and how many American IT workers the companies have laid off. She sent letters requesting information from Aetna Inc., CIGNA Corp., The Hartford Financial Services Group Inc., The Phoenix Cos. Inc., and Travelers Property Casualty Corp. Many employers have hired Indian firms that handle IT work from offices over-seas, but also bring Indians to clients' U.S. offices on H-1B visas... The Indian firm InfoSys had 165 IT employees in Aetna's U.S. offices as of last June, and 400 more people serving Aetna from India."
Ned Potter _abc News_
Why We Fear What We Fear
"War and terrorism, anthrax and SARS, the stock market and the job market -- if any of those things have really shaken you up, that's your amygdala talking to you. The amygdala (pronounced ah-MIG-da-la) is a region of the brain that, as one researcher put it, tells you if new sights and sounds are 'relevant' to you -- whether you need to respond quickly to them. The amygdala can generate powerful emotions -- the so-called fight-or-flight response... The problem is that when one needs to react quickly to something traumatic, the amygdala wins out. And that means, sometimes, that people worry about the wrong things... Behavioral scientists say because of the brain's structure, perfectly healthy people may over-react to upsetting circumstances... At the Massachusetts Institute of Technology, economist Andrew Lo sees the same dynamic at work in financial markets... the decisions we all have to make on impulse are often the wrong ones. Doctors say that after a traumatic experience, the best response is often to do nothing -- to wait, calm down, and learn more. 'Less knowledge, more anxiety.', says Grafman. 'More knowledge, less anxiety.'"
Norm Matloff _UC Davis_
Needed Reform fo the H-1B Work Visa: Major Points
"The employers claimed to need these workers to remedy a software labor shorage, citing industry-sponsored studies. However, none of the numerous independent studies ever confirmed a shortage. Prominent members of Congress publicly admitted that they were forced to approve the H-1B expansions because of industry campaign contributions. By official data, currently more than 100K U.S. programmers are un-employed. Many more are under-employed, working in non-professional jobs such as bus driver, real estate appraiser, and so on. The un- and under-employed easily total 500K workers. Meanwhile 463K H-1Bs are employed in the field..."
Larry Barker _KOAT Target 7_
Foreign Nationals from India Must Now Leave US
"A KOAT Target 7 investigation has uncovered a deal that had the state of New Mexico illegally paying for foreign nationals to get green cards. And now, 15 skilled computer programmers will lose their jobs and likely be deported... it started a couple of years ago -- the Taxation and Revenue Department needed computer programmers. So, they hired more than a dozen highly qualified foreign nationals from India, promising to pay their immigration fees. The problem? It's against the law... Goodwin first discovered the practice in February -- the department, sponsoring computer programmers from India to work for the state. Taxation and Revenue paid $1,100 each to the Immigration and Naturalization Service for at least 15 state employees, the last check written earlier this year."
Greg Morcroft _CBS.MarketWatch.com_
US Financial sector seen exporting 500K jobs by 2008
"U.S. financial services firms are likely to export up to 500K jobs over-seas during the next five years -- including high-paying research positions, according to a study by consulting firm A.T. Kearney. The figure represents about 8% of combined banking, brokerage and insurance jobs, and is part of an industry-wide move to cut billions in operating costs... India is the No. 1 off-shore destination for job exports. Brazil, Hungary and the Czech Republic also are among top recipients."
30 Investigates: IT Companies Send Jobs Over-Seas
"The NBC 30 Investigative Team uncovered a confidential memo that shows why unemployed white-collar computer consultants are losing out to cheaper foreign competition. 30 Investigates found that many of those workers are angry because Connecticut companies are out-sourcing much of their technology and customer service work to foreign companies with the goal of reducing costs and increasing profits. Numbers from the Connecticut Department of Labor show that there are more than 70K non-immigrant workers in Connecticut. NBC 30 found that the giant Connecticut-based insurance company, Cigna, is turning many of its technology jobs over to the Indian firm, Satyam, and firing local workers."
_Monster_ forum message 2884500 Unemployment office laying off
Rex Nutting _CBS.MarketWatch.com_
Accountant in the lion's den: Big tech tries to muscle FASB
"Accountants threaten American technological and military superiority, senators and tech industry [executives] said Thursday. A proposal by the accounting standards board could smother the American dream of starting a business, or owning a home or going to school, they said. It could mean 'nuclear winter' for the tech industry, one congresswoman said... Robert H. Herz, chairman of the Financial Accounting Standards Board. Herz was supposed to meekly listen to their complaints that his board could threaten the vitality of the economy with its 'reckless' quest to force the tech industry to put billions of dollars of employee compensation on its books... Every other form of compensation, including stock grants, are now expensed, Herz said. The inequality of accounting treatment created an unlevel playing field that encouraged companies to grant stock options instead of compensating employees in more straight-forward ways. If employees and their abilities are major assets of tech companies, the books ought to reflect the costs of acquiring that capital, Herz said."
Katie Hafner _NY Times_
Internet Access for the Cost of a Cup of Coffee
"Ms. G's initial capital outlay for her wireless setup was $700, counting a refund of $425 from the Internet service provider she used. She pays another $120 a month for the Wi-Fi access. She pointed out that she would be paying $80 a month anyway for her own access; adding the capacity for more computers was not much more expensive."
Jobless claims fell slightly last week: But high level of new claims shows job market still weak
"new applications for jobless benefits dropped by a seasonally adjusted 28K to 425K for the work week ending May 3. Even with that decline, claims have been running above the 400K mark -- a level associated with a stagnant job market -- for 12 straight weeks. The more stable, four-week moving average of new claims, which smooths out week to week fluctuations, rose by 3,250 last week to 446K. That represented the highest level in more than a year... The number of workers continuing to draw unemployment benefits rose by 6K to 3.67M for the work week ending April 26, the most recent period for which this information is available."
Allen Wan _CBS.MarketWatch.com_
Tokyo stocks fall on yen strength
"Tokyo's key stock index snapped a 5-session winning streak Thursday as the strengthening yen hurt exporters here and losses for tech stocks in the U.S. set a negative tone for their counterparts in Japan... The yen, which was trading in the 120 range against the dollar earlier this month, has climbed in recent days, reaching a 10-month high of 116.38 in late afternoon Asia from the late Wednesday New York level of 117.65."
Carl Hulse _NY Times_
With Tussles, House Renews a Job Program
"Voting largely along party lines, the House agreed today to renew a $6.6G employment training program, rejecting Democratic criticism that the measure would sanction discrimination by religious groups that provide job services."
Jobless Claims Exceed 400K for a 12th Week
"Jobless claims dropped to 425K last week from 453K in the prior week, the Labor Department said... Claims reached a 13-month high of 459K in the week that ended April 19... The less-volatile 4-week moving average of claims rose 3,250, to 446K, the highest since mid-April last year."
Ludwig Siegele _The Economist_
Paradise Lost: Modifying Moore's Law
"So far, information technology has thrived on exponentials. Now it has to get back to earth... 'The industry has entered its post-technological period, in which it is no longer technology itself that is central, but the value it provides to business and consumers.', says Irving Wladawsky-Berger... There are still plenty of opportunities, but if the example of the railways is anything to go by, most IT firms will have to make do with a smaller piece of the pie."
_NBC 30 Connecticut_
30 Investigates: IT Companies Send Jobs Over-Seas
"The NBC 30 Investigative Team uncovered a confidential memo that shows why unemployed white-collar computer consultants are losing out to cheaper foreign competition... Connecticut companies are out-sourcing much of their technology & customer service work to foreign companies with the goal of reducing costs & increasing profits. Numbers from the Connecticut Department of Labor show that there are more than 70K non-immigrant workers in Connecticut..."
_China Labour Bulletin_
Act Now to Release Yao Fuxin and Xiao Yunliang
"Wife of Xiao Yunliang beaten unconscious after sentence announced... China Labour Bulletin today strongly condemned the harsh prison sentences handed down by a Liaoyang court this morning on two detained Liaoyang worker activists, Yao Fuxin and Xiao Yunliang. Yao Fuxin has been sentenced to 7 years imprisonment and Xiao Yunliang to 4 years imprisonment on charges of ìsubverting state powerî for their part in the peaceful demonstrations by workers from the Liaoyang Ferro-Alloy Factory in 2002 March. The 2 men have been in detention since then and were tried on 2003 January 15..."
Leslie Haggin Geary _CNN_/_Money_
Starting Salaries for New Grads
Chemical Engineering $52,169 EE Engineering $50,566 Computer Science $46,536 Civil Engineering $41,067 MIS $41,543 IS $39,800 Math/Statistics $41,543 Accounting $41,360 Economics & Finance $40,764 Nursing $37,803 Business $36,515 Government $28,546 English $28,438 History $30,395 Liberal Arts $29,543 Biology $29,554 Psychology $26,738
Julie Rannazzisi _CBS.MarketWatch.com_
Dow ends near 4-month highs: Chip rally gives Nasdaq 4th week of gains
"On the week, the Dow rose 0.3%, the Nasdaq 1.2% and the S&P 0.3%. The Dow Jones Industrial Average put on 113.38 points, or 1.3%, to 8,604.60, underpinned by Intel, American Express, Boeing and SBC Communications. Only 4 of the Dow's 30 components -- Eastman Kodak, Citigroup, 3M and Johnson & Johnson -- dripped in red ink. On Friday, the House passed a $550G tax cut bill that scaled back on the White House's call to eliminate the double taxation of dividends. The Senate is slated to vote next week on a package of $350G in tax cuts. The Nasdaq Composite sprinted 30.46 points, or 2%, to 1,520.15 and the Nasdaq 100 Index ascended 24.79 points, or 2.2%, to 1,143.55. The Standard & Poor's 500 Index put on 1.4% while the Russell 2000 Index of small-capitalization stocks added 1.4%."
Susan Lerner _CBS.MarketWatch.com_
Toronto posts modest gains: Up-side limited as Canada sheds 19K jobs in April
"Statistics Canada reported that employment fell by 19K in April, pushing the country's unemployment rate up 0.2 percentage points to 7.5%. The government agency indicated that the largest losses were in Ontario, where employment fell by 27K in April, pushing the provincial unemployment rate up 0.3 points to 6.8%. The national decline was below the 10K additions expected by economists, and was the worst monthly showing since 2001 June."
Faith Bremner & Jane Larson _Arizona Republic_
US lagging in chips race
"Because of a worldwide computer chip glut and depressed prices, U.S. companies are hard pressed to continue pumping 14% of their revenues back into research and development and to make enough money to buy equipment and build factories, the report said. It costs $2G to build a state-of-the-art computer chip plant... While U.S. computer companies claim to produce 51% of the world's computer chips, only 20% to 25% of those chips are made in the United States. U.S. companies manufacture the rest abroad... The professors agreed with the national research that the dwindling pool of American talent is another big worry. Too few American students go into engineering because they perceive it as hard, they said, and top students from other countries face restrictions on entering or staying in the United States."
Jeff D. Opdyke & Michelle Higgins _Wall Street Journal_/_Orange County Register_
"While the costs of computer gear, clothing and air-fares have generally dropped, many everyday expenses, particularly services and insurance, have jumped over past 3 years."
_Oregon Employment Department_
Oregon's economy grim in April
"Oregon's seasonally adjusted unemployment rate rose to 8.0% in April, from 7.6% in March. This was Oregon's highest unemployment rate since 2002 February, when the rate was 8.1%. In comparison, the state's highest rate since the economic down-turn that started 2 years ago was reached in 2002 January when the rate was 8.4%. One of the reasons that Oregon's unemployment rate has risen over the past few years is that the labor force is growing while the number of jobs has not kept pace."
Alex Veiga _AP_/_San Diego Daily Transcript_
California unemployment rate unchanged in April
"California's unemployment rate held steady in April at 6.7%, unchanged from a revised 6.7% in March, the California Economic Development Department reported Friday."
Tim Coffey _San Diego Daily Transcript_
Local unemployment drops but job growth remains sluggish
John Brandt _Search 400_
US workers going the way of the buggy whip?
"If you fast-forward to today (and reality), you will find that these corporate raiders still exist. The problem is, they're no longer a single player, nor are they obvious. They're using the H1-B visa program, a program created to help U.S. companies fill high-skilled technical position during a skills shortage, to exploit you and the H1-B worker. They're not just putting a bunch of outmoded buggy whip makers out of business. They're putting you out of business. The way the H1-B program is supposed to work is a company applies to the government to allow them to use workers from over-seas for a 'highly technical' job that can't be fulfilled by the current U.S. work-force in that area [sic Strictly speaking, it was 'can't be fullfilled by anyone anywhere in the US work-force']. After approval, workers can apply for the visa and come to the U.S. to work in that job, in that area. The rules are fairly straightforward and simple. But there are a lot of loopholes in the system that allow businesses to exploit the system. I heard about a company in Miami who hired no one but H1-B workers to perform IT services in Miami for $20 an hour -- the going rate. Sounds fine, so far, doesn't it? Here's where it gets dicey. In Dallas, the going rate is $75 an hour. So the hiring company put the workers on planes, trains and automobiles and off they went to Texas. The workers still made $20 an hour, but the company billed them out at the going rate of $75."
_AP_/_San Francisco Chronicle_
Unemployed professionals finding little hope in tight job market
"Despite having 30 years of computer and management experience, Kelly lost his job as a systems network administrator last year to downsizing. He's gone from making $66,500 a year to living off a $37 annual Air Force pension. So far, [in its 8 months,] his job search has reeled in only 3 interviews... Professionals like Kelly are competing against a glut of highly qualified candidates for fewer jobs, and often less pay since the technology bubble burst 2 years ago... While the California Economic Development Department reported Friday that the state's unemployment rate held steady again last month at 6.7%, unchanged from the previous month, it's not necessarily getting any better for many professionals, particularly in the technology sector... Michael Bernick, director of EDD in Sacramento, said that the unemployment rate in Santa Clara County, the heart of Silicon Valley, was 8.3% in April, up from 8% a year ago. 'It would be higher, except its labor force continues to decline [as some give up and others move out].', he said... Eric Archer, president of professional recruiting at Fort Lauderdale, FL-based Spherion Corp... In 1999, companies took about 2 to 3 months to hire a new professional or management executive. Now, it's not uncommon for it to take between 6 and 9 months, or a year for senior executive positions, he said."
Steve Gelsi _CBS.MarketWatch.com_
Market momentum points upward: Stratetists see pull-back coming, but not sure when
"Momentum appears to be on the upside after the NASDAQ posted its fourth straight week of gains and the Dow its second upside week. The Dow Jones Industrial Average heads into the second week of May at 8,604, up 0.3% from its week-ago close of 8,582. The Nasdaq finished at 1,520, up 1.2% from its starting point of 1,502 last week. The S&P 500 ended Friday at 933, up 0.3% from its close of 930 last week. 'This is a market that really wants to go up.', said John Forelli, senior vice president and portfolio manager at Independence Investments."
Amy Waldman _Charleston Post and Courier_/_NY Times_
MIgration of jobs to India raises cry from NJ welfare officials
Glenn Somerville _Reuters_/_Yahoo!_
Job Out-Look Clouds Political Horizon
"Since President Bush took office in 2001 January, some 2.7M jobs have been lost from private-sector pay-rolls, including more than half a million in February through April alone, according to government statistics. There is little in recent economic data to suggest a sharp resurgence in growth. The most optimistic projections see a recovery of only 1.5M jobs by the end of 2004, leaving hundreds of thousands unemployed as they go to the polls."
Lisa W. Foderaro _NY Times_
Harder Times Mean Trading the Hotel Suite for a Tent
"With the economy still flat on its back and everything from taxes to rent to subway and bus fares climbing, this is shaping up as a year when even summer is being handed a pink slip. No, children in Scarsdale won't spend the summer playing stick-ball, and don't expect to see fire hydrants gushing on the Upper East Side... They are planning shorter sojourns or scrapping them altogether. They are opting for car trips over air travel. And they are dropping hints with far-flung friends in the hope of avoiding the expense of hotels. Many are rediscovering the romance (and bargain) of camping; New York State reports that campsite reservations are way up for the summer."
Amy Waldman _NY Times_
More "Can I Help You?" Jobs Migrate from US to India
"Some New Jersey officials say they just about did that when they learned that a contractor had arranged for Bombay operators to handle calls from the state's welfare recipients. County welfare directors complained. A state legislator, Shirley Turner, proposed a bill requiring that workers hired under state contracts be American citizens or legal aliens, or fill a specialty niche Americans could not, prompting at least four other states to consider similar bills. Much as the exodus of manufacturing jobs abroad did in decades past, sending service or knowledge-intensive jobs to countries like India is causing fears of displacement in the United States and elsewhere. A study by Forrester Research of Cambridge, Mass., estimated that this type of labor migration, generally referred to as out-sourcing if contracted to another company, or off-shoring if run by a company itself, could send 3.3M American jobs overseas by 2015. India, with its large pool of English-speakers and more than 2M college graduates every year, is expected to get 70% of them. American companies say a weak economy is pushing them to find new ways to cut costs. American workers say the same economy is the reason they need the jobs to stay home... Kiran Karnik, the president of India's National Association of Software and Service Companies [NASSCOM]... Pradeep Saxena, the president of eFunds International... But American unions, particularly the Communications Workers of America, have begun a campaign against the practice. When high-tech off-shoring began, said Marcus Courtney, the president of the Washington Alliance of Technology Workers, he and others thought it would be confined to technical support... Similar protests have come from the Communication Workers Union in Britain against the British Telecom Group's deal with an Indian software technology company. At the same time, in the face of rising unemployment in the West, resistance has also grown to importing high-tech professionals from India... Vivek Paul, the chief executive of the software company Wipro Technologies... Kishore H. Mirchandani, president of Out-source Partners International..."
Catherine Valenti _abc News_
Lay-Offs, Cost Cuts Lead to Over-Worked, Dissatisfied Workers
"The wave of down-sizing that has gripped corporate America in recent years is being felt acutely by workers. Longer hours, non-existent or small pay increases and the constant fear of losing their jobs has led to a nation of stressed-out and dissatisfied workers, say many career counselors and economists."
Peter Nicks _abc News_
For Long-Term UnEmployed, Spiral Can Be Relentlessly Downward
Patrick E. Tyler & Edmund L. Andrews _NY Times_
US OverHauls Administration to Govern Iraq
"Officials said the impetus for the over-haul stems in part from urgent warnings that the escalating violence and a breakdown of civil order are already paralyzing the effort to rebuild Iraq. 'Unless we do something in the near future, it is likely to blow up in our face.', one official said. Today, black smoke billowed over Baghdad's skyline as looters set fire to the city's former telephone communications center, apparently as a distraction for others who tried to steal cars nearby. On the other side of the city, hundreds of looters, who now range through the city every day, poured into a former palace of Saddam Hussein after American military units decided to vacate it. Baghdad is once again becoming a city of almost hourly eruptions of gun-fire. Criminals are shooting at other criminals, officials said. Families are settling scores, and some Iraqis are just taking potshots at American forces."
Laura M. Holson _NY Times_
Pixar Executives Not Quite Ready to Forsake Others for Disney Alone
"Steven P. Jobs and his team at Pixar Animation Studios are feeling pretty good these days... 'Finding Nemo' may be Pixar's most important movie since 'Toy Story', both at the box office and with its business partner, the Walt Disney Company. Mr. Jobs, Pixar's chief executive, is hoping movie-goers will flock to see the father-and-son-fish tale scheduled to open on May 30. But for some, the real drama is whether Pixar will remain in partnership with Disney. Under a marketing and distribution deal dating to the early 1990's and set to expire in 2005, Pixar splits movie profits equally with Disney, which gets a distribution fee. Mr. Jobs wants more and is renegotiating to keep up to 90% of the profit... From left, Steven P. Jobs, the chief of Pixar, Lee Unkrich, Andrew Stanton, John Lasseter and Richard Cook are the team behind 'Finding Nemo', which may be Pixar's most important film since 'Toy Story'... Mr. Jobs has already met with executives at AOL Time Warner, which owns Warner Brothers, Sony Pictures Entertainment and the News Corporation, the owner of Twentieth Century Fox..."
Jayne O'Donnell & Richard Willing _USA Today_
Prison time gets harder for white-collar crooks
"The first prominent white-collar offender sentenced after Enron, WorldCom and a host of other business giants imploded in scandal, Rusnak ran into a Justice Department unwilling to guarantee that executive felons like him would do easy time in 'Club Fed'-style prison camps. Now, more will do much longer sentences in tougher prisons... After last year's scandals, the Justice Department began toughening up on plea bargains to ensure that most pin-striped felons, whose crimes are economic as opposed to violent or drug-related, end up like Rusnak. Congress passed a law greatly increasing sentences for crime in the suites. The U.S. Sentencing Commission last month finalized guidelines doubling some white-collar sentences to 10 years and others to 20... James Comey, U.S. attorney for the Southern District of New York, whose office prosecutes more white-collar cases than any other, thinks the get-tough policy will deter white-collar crime and help restore faith in the stock market... The federal prison system has changed dramatically since the mid-1980s. With increased drug crime prosecution, the population grew to 160K by 2000 from 19K in 1980. The federal system is at 131% of capacity, more overcrowded than every state prison system but New Jersey's. Increasingly, federal prisoners are young, foreign-born and drug law violators. Drug and immigration violators make up about 65% of the federal prison population."
Julie Rannazzisi _CBS.MarketWatch.com_
Dow rallies to 4-month high: Dollar slides, bonds advance
"The Dow Jones Industrial Average rose 122 points to its highest close in four months as buyers set a bullish tone on Monday... The Dow Jones Industrial Average jumped 1.4% to 8,726, its loftiest level since January 14. The Nasdaq Composite added 21 points, or 1.4%, to 1,541 and the Nasdaq 100 Index advanced 16 points, or 1.5%, to 1,160. The Standard & Poor's 500 Index tacked on 1.3% while the Russell 2000 Index of small-capitalization stocks rose 1.1%. Volume came in at 1.36G on the NYSE and at 1.77G on the Nasdaq Stock Market. Advancers out-numbered decliners by 23 to 10 on the NYSE and by 20 to 12 on the Nasdaq."
Allan Sloan _NewsWeek_
Severe Asset Restructuring Syndrome is spreading through the airline and steel industries as they struggle for survival
"The seminal event was the favorable contract Ross negotiated with the United Steel Workers in December. By buying the plants in a bankruptcy proceeding rather than buying LTV, Ross left behind LTV's multi-billion-dollar 'legacy costs': under-funded pension plans and commitments to provide cheap health insurance to retirees. Ross's labor contract let him cut the blue-collar work force by about a third from the LTV days, and he slashed the non-unionized white-collar staff by about half. So with fewer employees and no legacy costs, he can make steel far cheaper than LTV or any of the other old-line steel companies. This cost advantage put International Steel in a position to buy the assets of bankrupt Bethlehem Steel last month. It paid $1.5G for choice pieces of a company that had $6G to $7G of pension short-falls and health-care commitments."
Peg Tyre & Daniel McGinn _NewsWeek_
She Works, He Doesn't
"Many such couples have simply decided that no matter how much lip service companies pay to 'family friendly' policies, it's simply not possible to integrate 2 fast-track careers and kids without huge sacrifices."
James M. Pethokoukis _US News & World Report_
Confident Consumer: a rebound in mood and earnings raises hopes for the economy
"Even though Wall Street posted a positive April, the market still lacks for a clear direction -- despite first-quarter-earnings reports that generally beat beaten-down expectations... According to Zacks Investment Research, it looks like first-quarter profits overall will be up about 11% with sales up less than half of that... Maybe what's really needed is an adjustment of expectations. While it's easy -- and understandable -- to be impatient after years of recession and a bear market, employers, workers, and investors should not forget that things are getting better. Earnings tumbled 17% in 2001, inched up 4% in 2002, and are expected to rise 13% this year and 19% for 2004. A similar upward trend is forecast for sales: After falling 8% in 2001, and an additional 2% in 2002, analysts expect them to rebound 5% in 2003 and then climb 12% in 2004... Despite slow sales growth (3%), technology companies managed to squeeze out profit gains of 16%. A sense of improving fortunes in the critical sector has driven the Nasdaq composite index (comprised largely of tech stocks) 15% higher since mid-March."
John Leo _US News & World Report_
Taking it off the streets
"He was on public property at the time but was charged with trespassing because he was outside the zone established for demonstrators that day. The zone was on the edge of a highway, a half-mile away from the president, where neither Bush nor the media were likely to notice... Federal charges against out-of-place but peaceful protesters are unusual, particularly when the charges carry maximum penalties that run to six months in jail and a $5K fine. Perhaps when the case comes to trial, we will learn more, including why the feds bothered to file charges five months after a minor and apparently harmless act of defiance... Keeping protesters a half-mile from the action is becoming a standard tactic... At least 20 campuses have set up 'free-speech zones', effectively converting 99% of the campus into a giant censorship zone... To be effective, many protests have to be site-specific. A protest against administrators needs to be mounted at the administration building, not off in some corner where officials can avoid noticing. But penning students into one or 2 small areas strongly appeals to administrators afflicted with an authoritarian bent. At some schools, students are now being punished for handing out leaflets in an unauthorized area. Twelve Florida State students were arrested for refusing to move their anti-sweat-shop protest to a designated zone."
Eric A. Taub _NY Times_
Special (and Mundane) Effects of the Movies on TV
"The threshold for entering the business has lowered as the cost of the hardware and software necessary to create special effects has plummeted. 'Two years ago, people were spending $30K for a special effects work-station.', said Steven B. Frankel, a managing director of Adams, Harkness & Hill, a Boston-based investment bank that tracks the post-production industry. 'Today they can do the same thing on a $2K Dell machine that's part of a Linux cluster. And the software costs half of what it did just one year ago.' The result has been substantial cost-cutting, with some companies offering to do now-routine digital effects for less than $2K each. Richard J. Anobile, a producer in Toronto, said he recently paid about $2,600 to a multi-service post-production company for 4 computer effects for a television show, including several small explosions."
Robert Pear _NY Times_
New Study Finds 60M UnInsured At Some Time During Year
"Nearly 60M people lack health insurance at some point in the year, the Congressional Budget Office said today, adding that official estimates fail to distinguish between people who lack coverage for a few months and those who are uninsured for a full year or more. Members of Congress, administration officials, lobbyists and advocates often cite the Census Bureau when they declare that 41 million people have no health insurance."
David Leonhardt _NY Times_
Graduates Lower Sights in Stagnant Job Market
"When North Carolina seniors receive their diplomas here on Sunday, only about 15% of them will have jobs awaiting them, half the percentage that did a few springs ago, according to a university estimate. Another 25% will enroll in graduate school, leaving about 6 in 10 seniors without a long-term plan come Monday morning. The nation's class of 2003 was the last one to enter college while the stock market was still rising, but it is graduating into the worst hiring slump in 20 years, one that is now into its second year..."
"Niel Woller Christensen, retired Navy Chief, past Master of his Masonic lodge, TKE, knight of the Order of Kadosh, died this evening at approximately 18:00EDT, leaving cousins in Nevada and numerous friends in Tallahassee and across the country."
Poll: Consumer confidence is fading: Confidence declines for a third straight week as economic distress reasserts itself.
"The ABC News/Money magazine Consumer Comfort Index, based on ratings of current economic conditions, stands at -24 on a scale of positive-100 to negative-100 for the week ended May 11. The index surged by 13 points from March 23 through April 20, reaching a 7-month high... 27% of Americans rate the nation's economy as excellent or good, down from 29% the previous week. The poll's lowest level of economic confidence, 7%, was set in late 1991 and early 1992. People's optimism for their own finances slipped 2%, as 52% of respondents rate their own finances as excellent or good versus 54% the week prior. This is still well above the lowest level of confidence recorded in this category, which was set at 42% in 1993 March... This week's results are based on 1,001 interviews in the week ended 2003 May 11..."
Steven R. Weisman & Neil MacFarquhar _NY Times_
Colin Powell, in Riyadh, Sees Sighs of Al Qaeda in Series of Explosions
"The United States Embassy said that at 2 of the compounds the booby-trapped vehicles came to the rear gate and detonated there, prompting a gun-fire with security guards, but in some cases the explosives-laden vehicles breached the walls and exploded within the compounds. At the third compound, vehicles crashed through the gates, killing the armed guards on duty. [One of the attacks was at Vinnell Corp., a subsidiary of Northrup Grumman.]"
Patrick E. Tyler _NY Times_
Iraqis Voice Concerns on US Shuffle
"America's new civilian administrator for Iraq, L. Paul Bremer III, arrived in Baghdad today as several members of the team of his predecessor, retired Lt. Gen. Jay Garner, and General Garner himself prepared to leave over the coming weeks in a sudden overhaul that has rattled Iraqi political leaders. Massoud Barzani, who will play a crucial role in the formation of the interim government in Iraq, said in an interview today that the United States risked squandering its victory over Saddam Hussein by allowing chaos and anarchy to run unchecked in the country. Mr. Barzani said he had been close to General Garner ever since they worked together a decade ago when Iraq's minority Kurds fled by the hundreds of thousands to the Turkish border region to escape the wrath of Mr. Hussein after an unsuccessful uprising following the Persian Gulf war in 1991."
Ellen Lee _Contra Costa Times_
Job losses sap morale of workers
"One month ago, Kevin Flanagan took his life in the parking lot of Bank of America's Concord Technology Center, on the afternoon after he was told he had lost his job. It was 'the straw that broke the camel's back', his father said, even though the 41-year-old software programmer suspected it was coming. He knew that his employer, Bank of America Corp., like other giant corporations weathering the economic storm, was cutting high-tech jobs. He knew that Bank of America was sending jobs over-seas [thus earning them the name change to Bank of India]. He had seen his friends and co-workers leave until only he and one other person remained on the last project Flanagan worked on... Flanagan's parents say that he complained about the company's move to shift jobs out of the United States and talked about taking care of problems that contractors in India couldn't solve... About two years ago, Bank of America [now Bank of India] created the Global Delivery Center to identify projects that could be sent off-shore. In the Fall of 2002, it signed agreements with Infosys, whose USA head-quarters are in Fremont, and Tata Consulting Services [TCS], 2 of the largest players in information-technology consulting and services in India... Employees at Concord, who spoke on condition of anonymity, described shrinking project teams as work is shuffled around. One veteran worker said that in the middle of a project, he and his team members were asked to hand over documentation and explain their work to a group of engineers from India. He and his co-workers were then transferred to another project. A short time later, he lost his job. Gagnon confirmed this, saying that in some cases it made sense to have workers train their over-seas successors before they are let go."
Art Carden _Ludwig von Mises Institute_
What Is Wealth Inequality?
Index of articles on mises.org
Trade Deficit Widened in March
"The trade deficit widened in March to the second-largest on record as imports of oil jumped, a government report said today. The nation imported $43.5G more in goods and services than it exported, after a revised $40.4G short-fall in February, the Commerce Department said. The March total compares with a record $44.9G deficit in December. Analysts had expected a $41G deficit... Exports rose 0.6%, to $82.8G in March from $82.3G the previous month. Shipments abroad of semiconductors, pharmaceuticals and petroleum products increased. Consumer goods exports rose 5.6%, to $7.3G in March, after declining 7.5% in February."
Jonathan Burton _CBS.MarketWatch.com_
Fund managers bullish on tech stocks
"Investment professionals are increasingly bullish about the U.S. market - in particular, technology stocks... Indeed, about 9 of every 10 of U.S. fund managers responding to the monthly survey taken between May 1 and May 8 believe the U.S. economy will be stronger in a year, up from 40% last October... About 60% -- the largest percentage in a year -- believe prices for goods and services in the U.S. will rise over the coming 12 months... Just 11% of managers are under-weight technology in their portfolios against a bench-mark index, compared to 34% in February."
Elisabeth Malkin _NY Times_
Once-Weakening Peso Rebounds, Creating Economic Commotion
"Two months ago, Mexico's financial authorities were worried that the peso was weakening too fast. Now some believe it has become too strong."
Bernard Simon _NY Times_
Sudden Pain for Canadians Who Export to US
"Canadian exporters now get 14% less of their own money for every American dollar they earn."
Jonathan Fuerbringer _NY Times_
How High Can the Euro Go Compared to the US Dollar?
"The dollar's 8.7% plunge against the euro since March 21 has already made existing predictions for 12 months from now obsolete."
Stephen Kinzer _NY Times_
As Funds Disappear, So Do Orchestras
"Nearly a dozen orchestras nationwide have either closed or are in danger of doing so, blaming their woes on the weak economy."
Kelly Pate _Denver Post_
Jobless rally in DC for extended benefits
"Laid-off workers will rally today in Washington, D.C., in hopes of spurring Congress to extend federal unemployment benefits... Labor groups say the need for continued federal help is greater than ever, pointing to continued lay-offs, anemic new-job growth and an unemployment rate of 6% nationwide and 5.7% in Colorado. More than 3M people would benefit from an extension, according to the National Employment Law Project, which helped organize today's rally, expected to draw more than 300 laid-off workers from the Northeast. More than 1.1M out-of-work Americans, including 15,900 in Colorado, will run out of federal benefits at the end of May, the employment law project estimates. Another 2.1M people nationwide, and 31,200 in Colorado, will use up state unemployment benefits between June and November... Employers fund unemployment insurance through taxes. The federal fund is now at $21G. To date, $13.2G in federal benefits have been paid to 4.7M workers nationwide, according to the U.S. Department of Labor. In Colorado, nearly 66K people have received $199M in federal benefits."
Thomas Fuller _NY Times_
How M$ Warded Off Rival
"At least 90% of the world's personal computers [hobble along] on Windows software. But M$ wanted still more. Last summer, Orlando Ayala, then in charge of worldwide sales at M$, sent an e-mail message titled M$ Confidential to senior managers laying out a company strategy to dissuade governments across the globe from choosing cheaper alternatives to the ubiquitous Windows computer software systems. Mr. Ayala's message told executives that if a deal involving governments or large institutions looked doomed, they were authorized to draw from a special fund to offer the software at a steep discount or even free if necessary. Steven A. Ballmer, M$'s chief executive, was sent a copy of the e-mail message."
Heather Boushey _Center for Economic and Policy Research_/_NY Times_
College Students' Debt
"Over the past 2 decades, college costs have more than doubled while grant aid per full-time student increased by slightly less than two-thirds. Students have made this up by borrowing more, so that today's graduates begin their careers burdened with a level of debt unknown to previous generations."
US Bankruptcies Rise to Record High
"Bankruptcies rose to 1.61M from 1.5M in the 12-month period ended 2002 March, the Administrative Office for the U.S. Courts said in a release. The number of bankruptcies in the first quarter rose to 412,968, up 4.5% from the previous quarter, the court office said... Business filings were down 5.8% in the 12-month period to 37,548. But non-business filings, the vast majority of bankruptcies, rose 7.4% to 1.57M."
Rachel Koning _CBS.MarketWatch.com_
Core PPI drop most in 9 years: Jobless claims, average ease but stick above 400K
"Price cuts for energy, clothes, cigarettes and cars were behind a record drop for the producer price index in April, government figures showed Thursday... Wholesale prices fell 1.9% last month, the Labor Department said Thursday. The previous record was a 1.6% drop in 2001 October. The closely watch core rate - sans food and energy - fell 0.9%, its largest decline since 1.2% in 1993 August. Separately, the Labor Department reported the average of weekly jobless claims fell 7,500 in the latest period to 439,750. It was the lowest level since the week ended April 12. Economists looked for a level near 442K... Food prices rose 0.9% last month, led by more expensive vegetables, fruits and most meat... Meanwhile, for just the week ending May 10, first-time requests for jobless benefits fell 13K to 417K, the lowest in more than a month... Insured unemployment stood at 3.77M, up 120K and the highest since 2001 November 17. The 4-week average of continuous claims stood at 3.66M, an increase of 57K and the highest since 2002 June."
Jeff Madrick _NY Times_
What the Economy Needs Most Now
"A lower dollar can stimulate the economy by making America's exports cheaper. Though it takes a while, this is particularly helpful to struggling manufacturers. It also makes imports more expensive, enabling domestic producers to capture more market share... The dollar has been falling since early last year and is now down about 8% against a large basket of currencies and much more against the euro. But to generate adequate stimulus, it will have to fall further. The customary fear that it will reignite inflation is hardly a danger now."
David Barstow & Lowell Bergman _NY Times_
Criminal Inquiry Under Way at Large Pipe Manufacturer
"The investigation began in January, the same month the company was the subject of articles by The New York Times and a documentary on the PBS television program 'Frontline'. They described how McWane, a private conglomerate owned by one of Alabama's wealthiest families and employing 5K workers, had recorded more than 4,600 injuries since 1995 while also illegally polluting the air and water in several states where it owns foundries. Several former McWane employees interviewed for the series said they had since been contacted by Justice Department prosecutors and by criminal investigators from the Environmental Protection Agency. Last week, a senior investigator described the inquiry as 'very significant, substantial and nationwide'."
Sam Lubell _NY Times_
To Register Doubts on Electronic Voting, Press Here
"They warn of equipment malfunction, unchecked tampering and the lack of secure proof for each vote. A group of more than 100 technologists, led by David Dill, a professor of computer science at Stanford University, has called for tighter security measures on electronic voting apparatus and a 'voter-verifiable audit trail', meaning a permanent record of each vote that can be checked for accuracy even after the election. (The group's 'resolution on electronic voting' is at Verifiable Electronic Voting.)... According to the Federal Election Commission, by 2002 19.6% of votes nationwide were recorded on touch-screen equipment, up from 3.9% in 1992. Another 31.6% of votes in 2002 were recorded using optical scanning equipment."
Saul Handsell _NY Times_
Man Charged with Fraud in Spam Case
"The man, Howard Carmack, 36, pleaded not guilty and was released yesterday on $20K bail. Last week, Mr. Carmack was ordered to pay $16.4M to EarthLink, the Internet provider he used to send the spam, after he did not respond to a civil suit the company had brought in federal court in Atlanta. Mr. Carmack was charged with 4 felony and 2 misdemeanor counts, the most serious of which carries a prison sentence of 3.5 to 7 years. Mr. Carmack previously was convicted of forging postal mail orders, a lawyer involved in the case said... Mr. Carmack was charged with forgery because he replaced his own e-mail return address with those of other people, according to the complaint... He was also charged under New York's law against identity theft, which took effect last year, based on accusations that he used stolen credit card numbers to sign up for 343 Internet accounts from EarthLink. The company estimates that Mr. Carmack in the last year sent about 825M e-mail messages that offered software for use by spammers, lists of e-mail addresses and herbal sexual stimulants."
Bombers Attack 18 Shell Stations in Pakistan; 4 Employees Injured
"Police spokesman Malik Sheikh said 2 men on a motorcycle went from one station to the next before dawn, placing small explosive devices in garbage cans... Royal Dutch-Shell Group is a British-Dutch firm based in London..."
Rachel Koning _CBS.MarketWatch.com_
CPI falls 0.3% largely on energy; core rate flat
"On a year-over-year comparison, core CPI is up just 1.5%, the lowest since 1966, Labor officials confirmed."
Leigh Strope _AP_/_Yahoo!_
Unemployment Again an Issue for Congress
"About 80K jobless workers per week will become eligible for federal unemployment benefits after May 31, but the benefits won't be there unless Congress acts... Unless Congress acts, the federal jobless program will expire May 31... States have $5.7G in their trust funds they could tap to pay for extra benefits, he said. Also, Republicans note that the May 31 expiration isn't a complete cutoff. Workers currently receiving federal benefits will continue getting their entire amount, generally 13 weeks, through the summer... About 2.8M people have exhausted all available aid, according to the Labor Department. Data was not available on how many have found jobs."
Mark Landler _NY Times_
3 European Economies Contract, Causing Fears of Global Damage
"Germany, Italy and the Netherlands reported that their economies unexpectedly contracted in the first 3 months of the year."
Rex Crum _CBS.MarketWatch.com_
Can tech's bulls stay in the running?: Sector's run-up fuels Nasdaq rise, but questions remain
"If numbers don't lie, then it's hard to believe that the two-month rally in technology stocks is anything but real... And after President Bush declared an end to combat in Iraq on May 1, the Nasdaq Composite Index broke through the 1,500-point ceiling for the first time since last June, closing at 1538.53 Friday for its fourth weekly gain in the last 5 weeks... To be sure, there are plenty of unanswered questions that skeptics say give them concern, not the least of which is that the price to earnings ration of the Nasdaq 100 Index...stood at 32.3 on Friday. That's almost twice what value investors traditionally say is a reasonably-priced level for stocks. Others question how much longer can companies produce income that is based to a large extent on cost cutting? And how can stocks continue to rise when almost nobody is predicting an increase in capital spending this year?"
Julie Rannazzisi _CBS.MarketWatch.com_
Dow climbs for 3rd straight week; Consumer sentiment rises; Treasuries spike
"The Dow Jones Industrial Average gave up 34 points, or 0.4%, to 8,678. The index rose 0.8% on the week, but was knocked lower Friday by shares of GM, Home Depot, Citigroup and General Electric. Limiting the Dow's downside was buying in shares of AT&T, Hewlett-Packard, Johnson & Johnson and SBC Communications. The Nasdaq Composite eased 12 points, or 0.8%, to 1,538 and the Nasdaq 100 Index erased 8 points, or 0.7%, to 1,154. The Standard & Poor's 500 Index inched down 2 points, or 0.3%, to 944. The Russell 2000 Index of small-capitalization stocks wilted 1.7%... Volume totaled a healthy 1.5G on the NYSE and 1.75G on the Nasdaq Stock Market."
Douglas Jehl _NY Times_
Suicide Bombs Kill at Least 14 in Casablanca
"Attackers used car bombs and detonated another device to strike Jewish, Spanish and Belgian targets, according to Morocco's state news agency."
Gregory Jordan _NY Times_
More Students in Writing Programs Expect (and Get) Hollywood Offers
"Like it or not, creative writing programs have become forces on the literary landscape."
Karen Pierog _Yahoo!_/_Reuters_
States Take Action on Broken Job Promises
"With the slumping U.S. economy eating into corporate balance sheets, some companies are shuttering plants and other job-rich facilities made possible by financial assistance from state and local governments."
Jyoti Thottam _Time_
Deflation: Why Aren't Your Prices Falling?
"The core Consumer Price Index (CPI), which the Fed chairman watches, is up only 1.5% (and could turn negative, the Fed warns), but it doesn't include volatile food and energy prices. The cost of services, which includes out-of-pocket expenses that you notice most, has risen nearly twice as much as the core CPI -- 2.8% in April over the year before. Car insurance rose 9%, consumer health premiums 8%, college tuition 7%. Altogether, services make up about 24% of household spending. Then there's housing, which accounts for 32% of spending. It rose 2.2%. Off-setting these increases is a 1.7% drop in prices for goods like cars, clothing and computers, which account for 23% of spending... Food and energy prices (the remaining 21% of spending) have been rising (energy sharply) over the past few months but are expected to fall later this year. If you include them, the overall CPI was up 2.2% in April."
Steven Greenhouse _NY Times_
Deciding Who Hurts Most in a Slump
"The study by the Community Service Society, a non-profit group that helps the poor, found that 78% of the city's unemployed are workers in manufacturing, construction, service, clerical and sales jobs, while 22% of the unemployed are white-collar workers, defined as executive, managerial, professional or technical... Mark K. Levitan, a senior policy analyst at the Community Service Society and author of the study, _A Portrait of Inequality: Unemployment and Joblessness in New York City, 2002_... His study found that executives and managers make up 14.5% of the city's labor force but just 9% of the unemployed, while professional and technical workers comprise 20% of the work force, but just 13% of the unemployed. In contrast, blue-collar workers, defined as those in manufacturing, construction and repair work, represent 20% of the labor force but 30% of the unemployed... Using nationwide numbers based on employer pay-roll records, Dr. [Irwin] Kellner said managerial and professional specialty workers represent 17% of the unemployed. That is nearly double the 9.5% level during the 1990-91 recession and up from 13% three years ago, before the current slump started... New York City has lost 200K jobs over the past 2 years... Since the spring of 2001, the city's jobless rate has jumped to 8.5% from 5.3%."
Daniel Kadlec _Time_
Where Did My Raise Go?: Shrinking pay-checks are the new reality for many Americans. How global markets and a weak economy are affecting how we work -- and how much we make.
"For the 500K workers laid off since January, the average job search has stretched to a 19-year high of nearly 5 months -- about twice the duration of the typical severance package. According to out-placement firm Challenger, Gray & Christmas, 17% of those who do find work -- nearly double the historical percentage -- are settling for less pay. The net result of the various pressures on pay: in the first 3 months of 2003, median weekly earnings adjusted for inflation fell 1.5%, according to the U.S. Labor Department. That's the biggest drop since 1991, according to Jared Bernstein, an economist at the Economic Policy Institute, a research group based in Washington... Cost pressures will be so intense during the next expansion, business experts say, that companies are likely to stick to their guns. They will out-source more work -- including skilled and white-collar tasks -- to cheaper labor markets. They will embrace pay-for-performance schemes, which generally reward only the top-ranked workers at each wage level. And they will shift more of the costs and risks of illness and retirement to workers, especially in steel and other heavy industries... even among the top 10% of earners 25 and older, average earnings adjusted for inflation dropped 1.4% in the first quarter of 2003 from the same period last year, according to the Labor Department. At the other end of the spectrum, wages for young college grads fell 1.5% in 2002, reports the Economic Policy Institute. One job title defying the trend is ceo: pay for chief executives rose 15% in 2002, according to Equilar, a firm that studies ceo compensation. That amounts to about 200 times the pay of the average worker, up from 56 times in 1989, according to the Journal of Economic Issues. Nowhere is this disparity starker than in the audacious pension guarantees and bonuses proposed for top executives at struggling AMR, parent of American Airlines. The carrier recently asked the unions representing its machinists, flight attendants and pilots for $9G in wage give-backs and other concessions over 5 years to keep the jets flying... Meanwhile, the brass at AMR quietly landed pension guarantees worth $41M -- benefits that, unlike those of the workers, will be protected even if AMR goes bankrupt."
Laura VanDerKam _USA Today_
System wastes PhD brain-power
"Academics, too, must choose whether they love the early works of Proust enough to drive a school bus so they can stay in academia. Few ask that question. If they did, much of the market problem would take care of itself: These incredibly intelligent individuals would pursue careers with businesses, government agencies, secondary schools and non-profits that desperately need their brains. Instead, many of the tens of thousands of Ph.D.s graduating these next few weeks will face a reality in which they never use their degrees. A few may become big-shot professors. But aspiring academics shouldn't bank on it, or devote 7 years to trying -- unless they love studying so much they don't care whether the investment of time returns nothing but the privilege of devoting themselves to their work."
Robert B. Reich _NY Times_
Get a Job
"Applications to both medical and law schools increased this year, while more people than ever are taking the standardized tests for graduate school. Those who can borrow or whose parents can afford it probably figure another degree is worth the cost and will win them a better-paying job when the economy turns up. But the market value of advanced degrees is unlikely to rise enough to make the investments worth it, especially after the supply of people with such degrees expands. Even before the economy foundered, the median take-home pay of lawyers and doctors was dropping, and many newly minted Ph.D.'s couldn't find university appointments. Many college graduates would do better to lower their sights in the short term and take a 'go-for' job (as in 'go for coffee') in an industry or profession that interests them."
Aviel D. Rubin _abc News_
Prescription for Privacy: How to Keep Your Medical Records Private
"The government is stepping up efforts to put users in charge of their own medical records with the Health Insurance Portability and Accountability Act, a long and complicated piece of legislation with a privacy version and a security version. The privacy version became law on April 14 and it's changing how hospitals, pharmacists, doctors, and medical supply vendors do business... Visit the Web site of most security/high-tech startups and you'll see 'HIPAA Compliant' in big letters. Nobody knows what that means -- the law hasn't been tested in court -- but no company wants to be the first one in violation."
Ron Paul _Ron Paul Library_
Border Tragedy Reveals Deeper Problems
Ann Huggett _American Daily_
Want To Get Our Economy Rolling Again? Stop Importing Workers & Exporting Jobs!
"A businessman I know, who has a cash register where his heart should be, was smirking over his reverse discrimination practice of hiring only cheaper immigrant Asian IT workers. Not only did he crow about his profits but he had the nerve to claim that American IT professionals were actually inferior to their Asian counterparts! Speaking as an out-of-work IT professional, whose husband and brother are out-of-work IT professionals, and who has many, many friends who are out-of-work IT professionals, I let him have it verbally right between the eyes. Add up all the tens of thousands of laid-off workers in this country then multiply this manís hiring practices by the thousands of other businesses which do the same and you can see why the IT industry is not only damaged but failing. It won't matter how many tax cuts President Bush manages to squeeze through Congress if the people, who used to hold the jobs, pay their mortgages, pay their taxes, and purchase goods and services can't do anything but collect unemployment. Standard economic theory holds that for every dollar earned, 6 more dollars of wealth are generated from the circulation of that earned dollar. When you have foreign workers earning money in place of native workers, those earned dollars end up being sent back to that immigrant's country of origin usually to support an extended family. That means a net transfer of wealth out of the US. To add insult to injury, many large corporations are even outsourcing jobs directly to foreign countries now rather than bother hiring in anyone immigrant or otherwise. What also gets my dander up is when these immigrant workers openly brag about their so-called superiority. When they do that I quiz them about basic programming skills like C++ and usually get a blank stare. Most job agencies dread handling them because they out and out lie on their resumes. Just try to check up on work histories from the Indian subcontinent!... In California, Asian employers, who don't even bother to hide their discriminatory hiring practices, are bringing in prostitutes and janitors from India under H1-B and L-1 visas... Currently only 5% of graduates in the Computer Sciences at American colleges are finding jobs right out of school... Right now 55% of all British 50 years and older are out of work and it's nearly impossible to find an American IT worker over 50 still in the work force. These are the men and women who made businesses thrive AND WORK to begin with."
Jim Grichar _Lew Rockwell_
Abolish the FDA!
Lou Dobbs "MoneyLine" _CNN_ Mad Cow Disease Found in Canada; U.S. on High Alert for Terror Attacks; Exporting America
"JAN HOPKINS, CNN CORRESPONDENT (voice-over): Bangalore, India's home to 100K high tech workers many of them employed by American companies. Across all of India 1M people work for U.S. based companies, like GE Capital, Oracle, and MSFT. $3G in services are exported from India to the United States each year."
Census: Los Angeles Area Fastest Growing in 2001
"Overall, over 285K people moved to the Los Angeles-Long Beach area in 2001, or roughly the same number of people who live in big cities like Raleigh, NC or St. Paul, MN. Nearly one-third of those new southern California residents arrived from abroad. The Chicago region was second in the growth spurt, adding 640 residents per day, followed by New York, Riverside-San Bernardino, CA and Atlanta. Just under 9.5M people called Los Angeles-Long Beach home, tops in the nation. The New York metro area was next at 9.1M, while Chicagoland had almost 8.2M people."
Keith Bradsher _NY Times_
Dollar's Slide Is Helping Red China and SouthEast Nations
"[Red China] and most southeast Asian nations have linked their currencies to the dollar, so the dollar's slide has pulled down the value of their currencies in key markets. This has made their exports more competitive in Europe and even Japan. Even in the United States, their main export market, companies in [Red China] and southeast Asia have lost none of their competitiveness. That is because 'everything we buy or sell, materials and finished products, is all denominated in dollars.', said Bruce Grill, a shoe broker here who helps American stores buy shoes from Chinese factories. 'We're not affected by' the dollar's decline... According to International Monetary Fund and People's Bank of [Red China] figures for March, the most recent month available, Japan had $496.2G, China had $316G, Taiwan had $171G, South Korea had $124G and Hong Kong had $114G [in US currency balances]."
_Professional Contractors Group_
Free-Lancers Question PM Over Work Permits
"Newly elected PCG chair Simon Griffiths has today written to Tony Blair following an exchange during Prime Minister's Question Time in which the PM seemed to suggest that there are insufficient numbers of skilled IT free-lancers available to fill vacancies in the UK. 'It is the PCG's belief that tens of thousands of skilled IT free-lancers are currently without work in the UK while many companies continue to bring in non EU workers to fill these vacancies.', said Griffiths... 'It is alarming if the Prime Minister is unaware of the fact that so many highly skilled IT free-lancers are currently without work and we believe the long term consequences of this will blunt the UK's competitive edge.'"
Howard W. French & Ken Belson _NY Times_
Bush and Japan Leader, Koizumi, Share Concern Over Deflation
"The Federal Reserve chairman, Alan Greenspan, made that clear when he said recently that deflation, while a distant threat, was of greater concern now than the historic enemy, inflation... Prices in Japan fell a record 3.5% from January to March, suggesting that deflation is accelerating despite efforts by the Bank of Japan, which has already pushed interest rates to zero... The government funneled $80G into the banks in 1999, hoping that would ease the crisis. But last weekend, the nation's fifth-largest bank, Resona Holdings, said it would need a cash infusion of $17.3G to survive... While a boon for consumers who can now buy computers for half of what they paid two years ago, the flood of cheap products has triggered a vicious price war that has destroyed balance sheets on both sides of the Pacific. In years past, that would have led to calls for tariffs and bans. But that response is no longer appropriate because American and Japanese companies operate the same factories in [Red China] that produce the deflation in the first place... 'It is not enough to build roads and bridges, to print money and lower interest rates, or spend money on defense.', [Robert] Feldman [of Morgan Stanley in Tokyo] said. 'You also have to move money resources into new areas and retrain people, which is very hard.'"
David E. Rosenbaum & David Firestone _NY Times_
Republicans Cave In: $318G Deal Is Set in Congress for Cutting Taxes
"The agreement, brokered by Vice President Dick Cheney today in a climactic bargaining session, calls for taxes to be reduced by $318G over 10 years, far less than the $726G originally sought by the president and even less than the $350G approved by the Senate last week... Beginning in about six weeks, less money would be withheld from workers' paychecks to reflect the lower tax rates, and checks worth $400 per child would be mailed to 25M families."
Mike Meyers _Minneapolis Star Tribune_
Empty buildings the legacy of Minnesota manufacturing slump
"In the past 3 years, the metropolitan area has lost about 32K manufacturing jobs -- or nearly 1 of every 7 employed producing goods in the year 2000. More than 14M square feet in industrial space is up for lease or sale locally... Valley Green Business Park in Shakopee has enough empty industrial space for lease to accommodate 10 Target stores or maybe 100 bowling alleys -- nearly 1.3M square feet gone idle. Much of the park's 42% vacancy rate came from the setbacks of Eden Prairie-based ADC Telecommunications, one of Minnesota's fastest-growing companies in the 1990s that lately has suffered a decline in demand. About a year ago, ADC walked away from a 500K-square-foot Valley Green building before it was completed, said Bill Ritter, senior vice president of Welsh Companies, a real estate brokerage firm based in Minneapolis."
Hubs of Commerce: The Best US Places for Business and Careers
Gene Nelson, PhD _V Dare_
Mourning An American Programmer Who Lost His Job -- And Took His Life
Joel Mowbray _Town Hall_
State Department undermining Shrub
"Speaking to a group of Palestinians and left-wing Israelis in Israel recently, a high-ranking State Department official took the time to disparage the 'conservative' and 'Christian' suporters of [president Shrub], his ultimate superior..."
Nat Worden _The Street_
Jobless Claims Jump
"Initial jobless claims rose by 7K last week to 428K... On the bright side, the 4-week moving average fell 7,750 to 433K, its lowest level since April 12."
Margaret Quan _EE Times_
Critics warn new visa bill doesn't go far enough
"U.S. representative John L. Mica, R-FL, introduced legislation this week aimed at limiting the number of L-1 visas multi-national corporations can use to transfer employees between other countries and the U.S. or out-source them to third parties. Mica said the bill, HR 2154, would close 'a loop-hole in current immigration law and protecting American jobs'. The bill prevents employers from renting employees to third parties once they arrive in the U.S.A., a practice Mica said provides USA corporations a 'back door to cheap labor'... The L-1 visa is one of several non-immigrant visa categories created to enable corporations to bring in workers from other countries. Visa holders are called 'intra-company transferee' and the maximum stay for the category is 7 years. According to Mica, there are currently over 325K L-1 visa holders in the United States... companies turned to the L-1 as a way to get around restrictions [of the H-1 visas]... The number of L-1 visas issued rose 51% between 1997 and 2001, from 80,065 to 120,538, according to CIS... To get around the new L-1 visa policy proposed by Mica, Siemens would simply say it was sub-contracting the project to a company like Tata. Then, critics said, Tata could say visa holders were working solely for Tata, not Siemens, even though visa holders might make frequent visits to the Siemens site, Matloff said."
Mike Tarsala _CBS.MarketWatch.com_
Insider stock selling is on the rise
"Insider stock sales totaled $1.8G halfway through May -- more than any full month so far this year, said analysts at market research firm Thomson Financial. May seems poised to be only the second month in the past year to top the 5-year monthly insider sales average of $2.4G... Meanwhile, insider buying in May totaled $66 million -- about one-third of the five-year monthly average of $181M. Normal spring stock selling partly explains higher insider selling, Gerber says. The old adage, 'Sell in May and go away.', often applies to company brass. Insiders sold nearly $3G of stock in 2002 May -- the highest monthly amount that year. And they sold about $2.5G of stock in 2001 -- tied for the 2001 high."
House GOP OKs Unemployment Compensation Insurance Benefit Extension
"The federal program, providing 13 weeks of emergency benefits to people who exhaust their state aid, won't pay out benefits to new applicants after May 31 unless Congress acts. Congress adjourns Friday for a holiday recess. The legislative pace quickened Thursday as the Labor Department reported that new applications for state unemployment insurance last week rose to the highest level in 2 weeks. That surprised economists. New claims from laid-off workers have remained above the 400K mark associated with a sluggish job market for 14 straight weeks... the House agreement, and a promise by Senate Republicans to act by Friday... The GOP House plan, estimated to cost $7.3G, would continue through December 31 the current federal program that provides 13 weeks of benefits to jobless workers who exhaust their state benefits, generally 26 weeks. Six states with high unemployment would get 26 weeks: Alaska, Oregon, Washington, Connecticut, Massachusetts and Pennsylvania. But left out are an estimated 1.1M workers who have used up all their state and federal benefits, and are still without jobs, according to the Center for Policy and Budget Priorities, a liberal think tank."
Steve Gelsi _CBS.MarketWatch.com_
Biotech, software pace gains
"Stocks rallied Thursday as a spike in Altria shares fed the Dow Jones Industrial Average and surging biotech and software stocks pushed the Nasdaq higher. The Dow rose 77 points, or 0.9%, to 8,594. The Nasdaq Composite Index rallied 17 points, or 1.2%, to 1,507 and the Standard & Poor's 500 Index gained 8 points, or 0.9%, to 931... Biotech stocks surged 4.1%... Retail stocks rose 1.7%... Software stocks surged 2.7% and airline stocks recovered 3.8%."
Virginia Postrel _NY Times_
Demon Deflation: NOt Here, Now
"'The probability of an unwelcome substantial fall in inflation, though minor, exceeds that of a pickup in inflation from its already low level.', the Fed governors said. On the heels of that statement, the federal government last week reported first a 1.9% drop in wholesale prices and then only a modest increase in consumer prices. The 'core' rate, which excludes food and energy, was 1.5%... relative price changes [drops] mean consumers have more income to use elsewhere... Even if there were tough competition in every industry, that would just mean low profit margins, not falling prices throughout the economy... Not being able to charge more because the value of your products isn't rising relative to other goods is different from not being able to charge more because the value of each dollar, regardless of how it is spent, is rising. Only the latter is deflation... Unexpected changes in the overall price level, by contrast, effectively rewrite all sorts of contracts. Dollar amounts specified today have a different value tomorrow. In the case of deflation, the promised sum buys more than expected... If widgets are selling for fewer dollars than expected, the widget maker has a hard time meeting its payroll and debt service. If the company can't just cut everyone's salary to correct for deflation, it will lay off workers. And if it can't renegotiate its loans, it may default. The same thing can happen in an industry facing tough competition, of course. But when the cause is deflation, it happens not just in one sector but throughout the economy. Resources don't move to more productive uses. They simply disappear. As a result, unexpected deflation can lead to a downward spiral, where each round of cutbacks brings others. (If the deflation is expected, people will write contracts to take account of the changes, just as today's mortgage rates include a premium for expected inflation.) The problem is intensified if, as in Japan, financial institutions and labor markets are rigid and slow to adapt. Fortunately, that prospect isn't likely in the United States. If anything, trends are moving in the opposite direction. The falling dollar raises the cost of goods, while the growing federal deficit creates inflationary pressures."
Katie Hafner _NY Times_
Computing's Lost Allure
"Today, empty classroom seats, like the vacant offices once occupied by high-flying start-ups, are among the unmistakable repercussions of the dot-com bust... Now, spooked by lay-offs and disabused of visions of overnight riches, many under-graduates are turning away from computer science as if it were somehow cursed... At Carnegie Mellon University, applications to the School of Computer Science for next fall are down 36% from their peak in 2001; applications to Virginia Tech's computer science department have declined 40% since 2001. At M.I.T., renowned for its computer science curriculum, 20% fewer freshmen declared electrical engineering and computer science as their central focus this spring than did in 2001 or 2002... The number of graduate students entering Ph.D. programs in computer science rose 21% last year, according to the Taulbee Survey, an annual report compiled by the Computing Research Association [CRA], a non-profit research group. M.I.T. officials said that the graduate program in computer science had received about 3K applications for next fall for 120 places, up from 2K applications 4 years ago... According to the Taulbee Survey, enrollment in computer science departments nearly doubled between 1995 and 2000."
Ellen Ullman _NY Times_
The Orphans of Invention
"Enormous sums of money were lost in the great Internet bust, and analysts are still wringing their hands over the industry's fall from grace. Has technology, one economist recently wondered, become 'just another crummy factor of production'? But something more was lost in the bust... what might be called industrial memory. The depth of this history was made clear on 1998 December 9, when 1,500 people gathered in an auditorium at Stanford University to honor Douglas C. Engelbart, inventor of the computer mouse. By then he was 73 years old, and his fortunes in the industry had been uneven. In the 30 years since he had given his first public demonstration of the mouse, the lab he had worked in lost its government financing, and subsequent corporate life had not been kind to him. But that day, something remarkable happened: after Mr. Engelbart spoke, the audience rose to applaud him. The ovation went on and on, in waves, as Mr. Engelbart fought back tears... And for the few years of the boom, the industry was large enough to employ several generations of programmers, from 22-year-old Web-page coders to 50-year-old experts in C++. There was, in that moment, a passing on of generational memory... In Silicon Valley alone, 27K software positions disappeared between the spring of 2001 and the spring of 2002... It was to remember that real innovation... comes from mysterious places, wild people, dreamers and tinkerers, and to remember all the skepticism they had to endure."
Genard C. Armas _AP_/_Hartford Courant_
Census: More Staying in Labor Force Past 65
"In 1980, about 3M people - 12.6% of the 24.2M residents 65 and older - were in the labor force. The share of older workers declined to 11.9% in 1990, but has risen steadily since then, census data show. By 2002 March, the number of older people holding jobs or looking for work had swelled to almost 4.5M - 13.2% of the 65-and-older population of 33.8M... About one-third of those 65 and older live alone. That's virtually unchanged since 1980. Roughly 1 in 10 live in poverty. More than 8 of 10 homes headed by an older person are owned, a high since 1982, but in line with the overall growth of home-ownership in the United States. About 18% of men 65 and older were in the labor force, almost twice the rate for women. Although some seniors have simply delayed retirement and others have taken the opportunity to open small businesses, many were forced back into the labor market... Congress voted in 1983 to raise the retirement age from 65 to 67 by 2027..."
GOP Leaders Call for Extension of Unemployment Compensation Insurance Benefits
"The current federal program provides 13 weeks of emergency benefits to people who exhaust their state aid. The new measure, headed for passage, would extend the federal program to December 31, costing $7.3G. Without congressional action, new applicants who exhausted their state benefits would get no federal help after May 31. The bill would allow recipients in six states with high unemployment -- Alaska, Oregon, Washington, Connecticut, Massachusetts and Pennsylvania -- to get 26 weeks of federal aid... 'I will admit my No. 1 economic priority is not to extend unemployment benefits.', said Rep. David Dreier, R-CA. 'My No. 1 economic priority is to create jobs.'"
_San Jose Mercury News_
Call for extension of jobless benefits
"The measure, expected on the House floor by Friday before the holiday recess, would give jobless workers who exhaust their state benefits after May 31 -- when the current federal program ends -- an extra 13 weeks of federal benefits. People in 6 states with high unemployment would get 26 weeks. Those states are Alaska, Oregon, Washington, Connecticut, Massachusetts and Pennsylvania."
6 more bodies found at Stonehenge; Archeologists say group lived around 2300BC
"Archaeologists who last year unearthed the remains of a Bronze Age archer at Stonehenge said Wednesday they have found 6 more bodies near the mysterious ring of ancient monoliths. The remains of 4 adults and 2 children were found about half a mile from that of the archer, dubbed 'The King of Stonehenge' by Britain's tabloid press. Archaeologists said he came from Switzerland and may have been involved in building the monument... the group is believed to have lived around 2300 B.C., during the building of Stonehenge at Amesbury, 75 miles southwest of London, said Wessex Archaeology, which excavated the site... The grave contained four pots belonging to the Beaker Culture that flourished in the Swiss Alps during the Bronze Age..."
S. Srinivasen _AP_/_Information Week_
Indian and Red Chinese Firms Team for Off-Shore Out-Sourcing Deals: The joint venture will handle IT assignments for US and European businesses
"A programmer typically earns $12K a year in India, while a similar professional would earn $60K in the United States... The privately owned VMoksha and CDC Out-Sourcing, a unit of Chinadotcom Corp., a Shanghai-based technology company listed on the Nasdaq stock exchange, have set up a joint venture, with the [Red Chinese] company holding a 51% equity stake and the Indian firm holding the rest."
Leigh Strope _San Diego Union-Tribune_
Congress Passes Jobless Benefits Bill "The federal program is scheduled to expire May 31, so Congress had to act this week to provide extra benefits for jobless workers who would exhaust state benefits starting in June. The bill extends the program through the end of the year. Earlier, Republicans accused Democrats of playing political tricks in their failed attempt to win extra aid for more than 1M long-term jobless workers not covered in the bill... Earlier Friday, the Senate passed a $350G tax-cut package. Republicans said it would boost the economy and help create jobs, but Democrats disagreed... The economy has lost 2.7M jobs since Bush took office, and the nation's unemployment rate stands at 6% -- 2 percentage points higher than the last year of Bill Clinton's presidency. About 8.8M people remain without jobs (and continue to actively seek work)."
nam _Cert Times_
IT Industry Ready for Apprenticeship Program
"CompTIA, the Computing Technology Industry Association is preparing entrants for the IT work-force through a new apprenticeship program. CompTIA completed research this year showing clear industry demand for an IT-specific apprenticeship program. On average an entry-level IT employee receives a minimum of 12 months of on-the-job training before reaching full mastery. Funded through a grant from the U.S. Department of Labor, Employment and Training Administration, the program is in pilot phase at a number of sites in the US."
William L. Watts _CBS.MarketWatch.com_
Congress passes $350G tax cut: VP Cheney casts tie-breaker in Senate, Bush set to sign
"The package [makes a slight decrease] the taxes paid by individuals on corporate dividends and capital gains, makes income tax rate cuts previously scheduled for 2006 effective this year, and provides child credit rebate checks of up to $400 per child for some parents. Among other things it also provides incentives designed to boost business investment. The package contains $330G in tax cuts and $20G in aid to cash-strapped states... The plan significantly scales back Bush's center-piece proposal that aimed at fully eliminating the income tax paid by individuals on previously taxed corporate income distributed as dividends. Instead, the plan follows a House proposal that cuts the tax on capital gains from 20% to 15% for most individuals, then drops the tax rate on dividends to the same rate. Lower-income investors would be taxed at a 5% rate on dividends and capital gains. The rate for lower-income investors would drop to zero in 2007. Under current law, dividend income is taxed at personal income tax rates as high as 38.6%. The new rates apply to capital gains realized on or after 2003 May 6, and to dividends received after 2003 January 1... It would accelerate the increase in the child tax credit to $1,000 from $600, retroactive to January 1, and provides for refund checks of up to $400 per child for around 25M households."
Steve Gelsi _CBS.MarketWatch.com_
Stocks bullish on marginal rise
"Still, the Dow broke a 3-week winning streak with a down performance in the last 5 days, mostly on jitters Monday and Tuesday on a string of terror attacks in Morocco, Saudi Arabia and Israel and a case of Mad Cow disease in Canada. The index has gained ground for 3 straight days, but it's still behind its week-ago level of 8,678... The Dow Jones Industrial Average rose 7 points, or 0.1%, to 8,601. The Nasdaq Composite Index gained 2 points, or 0.2%, to 1,510. The Standard & Poor's 500 Index added 1, or 0.1%, to 933. Volume was under 1.2G shares on the New York Stock Exchange, well below the average level of about 1.4G. In sector action, biotech stocks jumped 2.6% as shares stayed hot on the heels of optimism over new cancer drugs. Sector leader Genentech rose 3.6% to $60.93. Internet stocks rose 1.5% amid buying in the tech sector. Utilities jumped 3.7%..."
Qualcomm's Technology Gains in India
"Qualcomm Inc., whose wireless technology is used by 147M mobile phone users, expects 6M Indian subscribers to use phones based on its code division multiple access, or C.D.M.A., technology by the end of the year... An Indian tribunal is to decide on a petition by cellular phone operators who use the global system for mobile communications, or G.S.M., standard, whether companies should be allowed to offer mobile phone services using C.D.M.A. technology."
David Lazarus _San Francisco Chronicle_
Real risks in Kaiser's contracts
"Kaiser Permanente wasn't happy about my column detailing the Oakland health care giant's outsourcing of tech support to companies in India. I wrote that overseas contractors have access to Kaiser patients' medical data, including lab results and drugs taken; members' personal information, including financial records and home addresses; and pay-roll files for 135K Kaiser employees and 11K physicians, including salaries and Social Security numbers... I've heard from dozens of past and present Kaiser workers in recent days, and they say that HIPAA in no way serves as a guarantee that patients' and employees' private information will remain private... Indeed, this is one of the flaws in the HIPAA system. While violations by a domestic contractor could lead to hefty fines, an overseas outsourcing firm is not subject to U.S. laws and regulations... HIPAA does not require organizations like Kaiser to actively monitor the activities of 'business associates' such as Indian outsourcing firms... Rather, action would be called for only if Kaiser should learn of inappropriate behavior. By then, of course, it's already too late... Kaiser may be fully HIPAA-compliant, in other words, but that doesn't ensure the privacy of its 8.3M members... any time a third party -- a police investigator, say -- requests members' medical data, Kaiser is obliged under HIPAA to keep detailed records of who accessed the files. But if a techie in New Delhi opens the same files, no records are required."
Mark Schwanhausser & Jack Davis _San Jose Mercury News_/_Silicon Valley_
Pay-Checks Plunged for Bosses
"The 754 highest-paid executives at the valley's largest companies took home $1G last year, according to the Mercury News' annual executive pay study. That total, which included salary, bonus and estimated stock options gains, was only about one-fourth of the $3.8G in 2001 and one-fifth of the record $4.7G in 2000. For the second consecutive year, the recession clawed its way into overall pay for the valley's top bosses. The median pay-check fell to just more than $534K in 2002 after cracking $1M in 2000. You have to go back to 1998 to find a time when the biggest pay-check in 2002 -- $34.6M to Siebel Systems' Chief Executive Officer Thomas M. Siebel -- would have made the cut of top 10 compensation packages. And Nvidia CEO Jen-Hsun Huang's $13M -- which ranked 10th last year -- would have barely made it onto the list of 100 biggest pay-checks 2 years ago... The stock market foundered for the third straight year, shrinking option gains. In just 2 years, the valley's top executives have seen the value of their vested, unexercised options shrivel from $16G to $2.2G. At the peak of the boom in 2000, Silicon Valley's bosses relied on stock options for 87% of their $4.1G in pay. Last year, however, options provided barely half of the $1G they took home... And then there's billionaire Oracle founder Lawrence Ellison, whose $706M pay-check in 2001 is likely to stand as a valley record for some time to come. His pay in 2002 comprised $38,622 related to corporate benefits and the use of his Gulfstream V jet -- but no salary, bonus or option gains."
Dean E. Murphy _NY Times_
California Grape Rush Withers (3 pages)
"These are tough times for grape farmers across California, where the grape has taken an ignoble tumble from its vaunted position as the state's signature agricultural product. Raisin prices have fallen so low that many farmers cannot cover the cost of hiring help for the harvest. There is such a glut of wine grapes that the state's fastest-growing vintage wine last year sold for $1.99 a bottle. And though table grapes seem to be faring the best, there is no room in that family-dominated industry for new growers because of rising costs and stiff foreign competition... About 90% of all grapes grown in the United States come from California, where vineyards cover an area about the size of Rhode Island and amount to a $2.6G industry. Only the dairy business generates more agricultural dollars for the state... the down-turn enters its fourth growing season for some grape types and there are fears that it has not yet reached bottom... bankruptcies and foreclosures in many parts of the state are on the rise. Retirements are being wiped out. Farmers are taking second and third jobs. Some are even walking away from their land... By one estimate, 70K acres of raisin, wine and table grapes were plowed under in the last year in the Central Valley alone, the state's largest grape growing region, according to the California Association of Wine Grape Growers... A report by the California Agricultural Statistics Service showed that the 2002 harvest produced 3.79M tons of grapes that were crushed for wine or juice concentrate, up 12.5% from the year before. The over-supply further depressed prices, as growers made an average of $462 per ton, 17% less than in 2001, with the high-end Napa Valley growers getting $2,942 per ton and the low-end Fresno-area growers just $136 per ton... Wine from Chile, Australia and South Africa; raisins from Turkey; table grapes from Chile and Mexico -- all of it relatively inexpensive and in increasingly great supply."
Carrie Kirby _SF Chronicle_
Visa's abuse provokes opposition from techies: L-1 regarded as threat to workers
"Much like the H-1B before it -- an equally obscure visa that rose to prominence when American workers complained they were being displaced by its recipients -- the L-1 is catching the ire of tech workers and the eye of government regulators who disagree on whether the visa is being used legally. In the middle of the spat are Indian firms that undertake tech projects for USA companies, including many in the Bay Area, on a contract basis. The L-1 visa was originally intended for multi-national companies that need to transfer key employees to USA divisions. But in recent years, out-sourcing firms such as Wipro Technologies, Infosys Technologies and Tata Consultancy Services [TCS] have stepped up their use of the L-1 visa to bring programmers and other professionals from India to work at the offices of USA clients... Restrictions that apply to H-1B, but not L-1, include an annual limit on the number of visas issued and a requirement that the visa applicant have a bachelor's degree or higher. H-1B visa applicants have to pay a $1,000 fee toward training American workers; L-1 applicants don't. Visa law also requires workers with H-1Bs to be paid the prevailing wage in the region where they work, although the Department of Labor [DoL] does not routinely check up on this... 'If an L-1 comes into the United States to work, they're coming to work for their specific company that petitioned for them, not for another company that they're being contracted out to. That would be a fraudulent use of an L-1 visa.', said Christopher Bentley, spokesman for the Bureau of Citizenship and Immigration Services [USCIS], a division of the Department of Homeland Security that replaced Immigration and Naturalization Services. The bureau is assessing the L-1 and other visa programs for fraud, he said... L-1 visas have been used in relative obscurity since 1970."
Vincent Safuto _The Treasure Coast Florida Palm_/_E.W. Scripps Press Journal_
Our economic souls are at risk
"It's the economic threat posed by corporations eager to export jobs over-seas. In the realm of economics, the terror threat level is at red-plus... My work e-mail has been filled of late [with] tales told by working Americans of jobs lost and indignities piled upon indignities. These are knowledge workers, information systems workers and other white-collar Americans. Well-educated people from Florida, from North Carolina, from New Jersey, from other places, too, some retrained from previous lost jobs into the 'hot' field of computers and the Internet, who now find themselves retraining Indian replacements brought to this country on L-1 visas. These Americans tell me corporations are using the L-1 visa to hire Indians in India, bring them to the United States, train them for the jobs Americans are soon to lose, and then send them back to India with both the work and the Americans' jobs... Train your Indian replacement, or else. These are people, Americans, who have been ordered to train their replacements for a final few months of employment -- and train them correctly -- on threat of immediate termination and loss of severance."
politicians mull largely ineffective H-1B and L-1 visa reforms
"USA representative John Mica, R-FL, introduced a bill last week that would prohibit companies such as Tata Consultancy Services [TCS] and Infosys Technologies Ltd. from using L-1 visas to transfer a worker from their Indian head-quarters to their USA subsidiaries, then hire that person out to U.S. companies. Mica says that violates the spirit of the law, which was to let multinational companies transfer specialists to the United States. He wants to ban transfers of L-1 holders to third-party companies... An InformationWeek analysis of USA Bureau of Labor Statistics [BLS] found the unemployment rate among 'IT' workers rose to 5.2% in 2002, from 3.7% in 2001. Mica's office says there are more than 325K L-1 visa holders in the United States, and the USA Immigration and Naturalization Service issued 79,100 H-1B visas in 2002 -- well below the 195K cap, which will drop to 65K in 2004."
Keith Girard _CBS.MarketWatch.com_
In-fighting over trade-war response: Small business, unions square off against multi-mationals
"The global economy is often portrayed as a dynamic market-place, but the reality is far different. International trade is based on a mishmash of arcane treaties that governments have artfully manipulated to their advantage over the years. The United States has never been very adept at playing this game, as evidenced by its stunning defeat in 2001 August before an arbitration panel of the World Trade Organization - the culmination of a more than 30-year legal battle... Of all the exporting manufacturers in the United States, 93% are small and mid-sized companies, with anywhere from 10 to 2,000 employees, according to a 2001 survey by the National Association of Manufacturers. Companies that size that export typically add jobs 20% faster than ones that remain solely domestic, and are 9% less likely to go out of business, the survey found. They employ about 9.5M people in total... [One] bill would provide a tax benefit based on the percentage of goods produced domestically. If all of a company's production were based here, for example, it would get the full benefit; a company that made only half its goods here would get half the benefit and so on. In effect, the legislation would create a tax penalty for shifting production abroad, said Thea Lee, the AFL-CIO's assistant director for international economics. The competing proposal sponsored last year by House Ways and Means Committee Bill Thomas, R-CA, would cut a collection of corporate taxes 'most of which would mainly benefit companies with over-seas production facilities', Lee said... Meanwhile, the EU notification hangs like a death sentence over hundreds of small and mid-size domestic businesses struggling to compete against heavily subsidized foreign companies... According to government figures released this month, 95K factory workers lost their jobs in April, continuing a 33-month trend of job losses, the longest since the Great Depression. In all, the United States has lost 2.6M manufacturing jobs since 1998, nearly 13% of the total factory work-force."
Jonathan D. Salant _AP_/_Yahoo!_
Off-Shore Companies Make $1G in Deals with US Government
"Companies that reduced their U.S. tax bill by incorporating over-seas did $1G worth of business with the federal government last year, an Associated Press computer analysis of federal contracts showed. The Bermuda-based consulting company Accenture Ltd., a spin-off of the former Big Five accounting firm Arthur Andersen [recently caught red-handed up to its elbows in the Enron fraud, hence the 'we're a new company' scam], was the biggest federal customer. It received $662M in contracts between 2001 October 1, and 2002 September 30, mostly from the Transportation Security Administration... The process is known as corporate inversion... Corporations that have moved over-seas spent $5M to lobby Congress and the federal agencies and donated $1.2M to campaigns in 2001 and 2002, according to an AP analysis of data from Political Money Line, an Internet site. To fight legislation restricting their ability to move off-shore, the companies have assembled an all-star team of lobbyists, including former Sens. Slade Gorton, R-WA, and Dennis DeConcini, D-AZ; former House Ways and Means Committee Chairman Bill Archer, R-TX; and former House Appropriations Committee Chairman Bob Livingston, R-LA, according to disclosure forms filed with the House and Senate."
Otto Pohl _NY Times_
Scientists to Make the Kilogram Right Again
"The kilogram is defined by a platinum-iridium cylinder, cast in England in 1889. No one knows why it is shedding weight, at least in comparison with other reference weights, but the change has spurred an international search for a more stable definition... Even the apparent change of 50 micrograms in the kilogram -- less than the weight of a grain of salt -- is enough to distort careful scientific calculations... The meter is now the distance light travels in one-299,792,458th of a second, and a second is the time it takes for a cesium atom to vibrate 9,192,631,770 times. Each can be measured with remarkable precision, and, equally important, can be reproduced anywhere. The kilogram was conceived to be the mass of a liter of water, but accurately measuring a liter of water proved to be very difficult. Instead, an English goldsmith was hired to make a platinum-iridium cylinder that would be used to define the kilogram."
Death Throes of a Crippler: Poliomyelitis
"On 1977 October 26, in Somalia, a young man came down with a rash. It was smallpox. But the fellow, who survived, was remarkable, for he had the planet's last case of naturally occurring smallpox. Eleven years after smallpox became the first disease to be wiped off the face of the earth, health ministers from around the world voted to make polio the second. That goal is very close. But the campaign is short of money. Another $275M is needed to finish the job by 2005 -- a sum that would be repaid manyfold if polio vanished... In the late 1980's, most countries had polio cases, and 350K people contracted the disease each year. By last year there were fewer than 2K cases, all in 7 countries. A vast majority occur in 2 Indian states and in Nigeria and Pakistan. But recent financial constraints caused cut-backs in special vaccination days in those areas. The 1,919 cases reported last year were up from 329 in 2001."
Lynn Franco_Conference Board_
Consumer Confidence Edged Up in May
"Labor market conditions also deteriorated. Consumers reporting jobs are hard to get jumped to 32.6% from 29.4%. Those claiming jobs are plentiful slipped to 12.6% from 13.0%."
Julie Rannazzisi _CBS.MarketWatch.com_
Blue chips pare early losses: Confidence up in May and Dollar sets fresh lows vs. Euro
"Consumer confidence rose to 83.8 in May from April's 81 but came in below economists' forecasts for a reading of 85.4... New home sales rose 1.7% in April to a 1.028M rate, ahead of expectations for a 983K level. And existing home sales climbed 5.6% to a 5.84M annual rate, ahead of projections for a 5.66M rate. Cornering currency rates, the dollar edged down 0.4% to 116.41 yen while the euro advanced 0.4% to $1.1910, easing off a record high of about $1.1925. The euro blasted through its previous high set after its inception in early 1999... The UBS Index of Investor Optimism, in fact, slipped to 42 in May after jumping to 66 last month. UBS noted that 58% of investors say that now is a good time to invest -- the highest level since June 2002 -- up from 54% in April."
Bambi Francisco _CBS.MarketWatch.com_
Big 4 Internet names on fire: eBay, Amazon, Yahoo!, USAI hit fresh 52-week highs
"[eBay] traded at $102.36 in recent trading. USA Interactive... shot up 4% to $37.30... Amazon.com rose 5% to $34.43, a fresh 52-week high. Yahoo topped $30."
Julie Rannazzisi _CBS.MarketWatch.com_
Nasdaq, Dow post big gains: Consumer confidence, housing data fuels rally
"The Nasdaq jumped more than 3% and the Dow Jones Industrial Average rang up triple-digit gains Tuesday as positive consumer confidence and April new home sales data stoked buying... The Dow Jones Industrial Average rallied 179 points, or 2.1%, to 8,781, buoyed by Eastman Kodak, General Motors, Home Depot, Intel and M$. Altria Group, Boeing and AT&T were among the few decliners. The Nasdaq Composite climbed 46 points, or 3.1%, to 1,556 and the Nasdaq 100 Index swelled 42 points, or 3.8%, to 1,172. The Standard & Poor's 500 Index gained 2% while the Russell 2000 Index of small-capitalization stocks put on 2.2%. Volume came in at a healthy 1.5G on the NYSE and at 1.9G on the Nasdaq Stock Market. Winners smashed losers by 23 to 10 on the NYSE and by 23 to 9 on the Nasdaq... New home sales rose 1.7% in April to a 1.028M rate, ahead of expectations for a 983K level. And existing home sales climbed 5.6% to a 5.84M annual rate, above projections for a 5.66M rate... Biotech stocks logged gains for a fourth consecutive session..."
Donald Manzullo & Michael R. Czinkota _Washington Times_
Exports and imports
"U.S. manufacturing needs policy help, now. Low exports and a surge of imports have left the sector vulnerable, endangering future economic progress and hollowing out our defense industrial base. Our trade deficits for goods with Mexico, Germany, Japan and [Red China] are huge and getting bigger. Last year, the U.S. deficit with just [Red China] was $103G. We have an imbalance of $111G in motor vehicles alone. The imbalance is actually greater than even we can quantify, because there is no way to measure the amount of foreign parts in U.S.- exported goods. U.S. firms clearly don't do enough exporting. It's not that they don't want to. There are simply too many bureaucratic obstacles for many of them to overcome. Compared to almost 34% for the European Union and 26% for [Red China], U.S. exports pale, with only 11% of total gross domestic product. Almost half of all import shipments come from foreign affiliates, captive suppliers and U.S. subsidiaries."
Jackie Judd & Jody Hassett _abc News_
Few Jobs for New Graduates: Class of 2003 Faces a Different World From When They Entered College (with video)
"Now, prospects can be described as dismal. Job postings at the campus Career Services Office are down by a third, as are visits by recruiters... Graduate schools that worried about a brain drain 4 years ago are being inundated with applications."
Ken Belson _NY Times_
Frugal Japanese Dig Into Savings
"to make ends meet, the 40-something housewives have had to cut their spending, take part-time jobs and -- shockingly, for Japan -- dip into their savings. For decades, the Japanese routinely socked away 10% to 20% of their incomes... Japan's household savings rate fell to a postwar low of 6.9% in 2001, the last year for which complete figures are available, from 11% in 1999 and 14% in 1990. Based on preliminary data, the savings rate fell another two percentage points in 2002, economists said. Within a decade, if current trends persist, Japan's savings rate will hit 1.5%, according to HSBC Securities, pushing it below America's, which rose to 3.7% in 2002... By 2010, more than 22% of Japan's 127 million citizens will be at least 65 years old, up from 17% just 3 years ago. By 2015, the elderly will out-number the young, because of a record low birth-rate. With interest rates near zero and life insurance companies cutting pay-outs, pensioners are already having a harder time."
Bank of America tech worker's suicide linked to off-shore out-sourcing
"One month ago, Kevin Flanagan took his life in the parking lot of Bank of America's Concord Technology Center, on the afternoon after he was told he had lost his job. It was 'the straw that broke the camel's back', his father said, even though the 41-year-old software programmer suspected it was coming... He knew that Bank of America was sending jobs over-seas. He had seen his friends and co-workers leave until only he and one other person remained on the last project Flanagan worked on..."
Jon Groat _Medill News Service_/_CBS.MarketWatch.com_
Alleged US skilled-worker "shortage" spurs call for training: Jobs allegedly desperate for applicants: Government urged to address phony skilled-labor "shortage"
"Some say the government has done little to alleviate the skilled-worker shortage [glut!] in a time when April's unemployment figures show 8.8M people out of work and looking for jobs. Under the $6.6G Workforce Investment Act of 1998, federal, state and local partnerships set up almost 2K One-Stop Career Centers with 7,500 offices around the country. The goal was to replace the Job Training Partnership Act and provide a variety of job-seeking services and training under one roof."
Jennifer Loven _AP_/_Yahoo!_
New Tax Refunds to Start Within Weeks
"President Bush's signature on tax-cutting legislation will within weeks start speeding refunds to parents and fattening paychecks and investor earnings... after a $1.35T [over 10 years] tax cut in 2001, a $96G stimulus last Fall and the new $350G [spread over 10 years] package..."
August Cole _CBS.MarketWatch.com_
Dow ekes out gains as dollar rises
"The Dow closed up 12 points, or 0.1%, at 8,793. Shares of Citigroup, American Express, Hewlett-Packard, McDonald's and Walt Disney propped up the blue-chip gauge. Among its decliners were Altria Group, Merck, International Paper and AT&T. The euro lost 0.5% to $1.175, with the greenback climbing 0.8% to 118.21 yen. The beleaguered buck reached multiyear lows against the euro on Tuesday, falling below the European currency's January 1999 launch rate. The Nasdaq gained 6.6 points, or 0.4%, to 1,563.2, while the Nasdaq 100 Index rose fractionally to 1,173.3. The S&P 500 climbed 0.2% while the Russell 2000 Index of small-cap stocks added 0.6%. Volume amounted to 1.49 billion shares on the New York Stock Exchange, with 2.01G on the Nasdaq. Big Board advancers edged decliners by a margin of 9 to 7, and by 19 to 14 on the Nasdaq."
New Tax Refunds to Start Within Weeks: President Bush's Signature on Tax-Cutting Legislation Will Within Weeks Start Speeding Refunds
"President Bush's signature on tax-cutting legislation will within weeks start speeding refunds to parents and fattening paychecks and investor earnings. Bush was to turn a 10-year, $350G package of tax rebates, lower rates, new breaks for businesses and investors and aid to states into law Wednesday at a ceremony in the White House's East Room."
Simon Romero _NY Times_
$1.3G Deal Seen for NextWave Radio Spectrum
"Last December, Verizon Wireless agreed to buy spectrum in cities including New York, Boston and Minneapolis from Northcoast Communications for $750M. In that deal, Verizon paid about $1.60 a potential subscriber for the licenses. If Cingular pays $1.5G for 20% of NextWave's licenses, it would be paying about $1.86 a potential subscriber, a rate that would value all of NextWave's spectrum at approximately $7G, according to Mr. Mallitz... The brain-child of Allen B. Salmasi, a former top executive at Qualcomm, NextWave, which is based in Hawthorne, NY, recently reaffirmed its intent to build a nationwide wireless network to transmit data for companies, a plan it hopes will allow it to compete better in an industry crowded with well-financed companies."
Paul Eng _abc News_
A Heads-Up on Hostiles: High-Tech Specs to Help Soldiers Spot Suspected Terrorists
"The Digital MP's camera pod, attached to the left temple of the eye-glasses in the photo, sends what the wearer sees back to the computer. Matching photos are then shown to the wearer using the tiny display attached on the right side of the glasses... Called the Digital MP, and developed at the U.S. Army's Soldier System Center in Natick, Mass., along with various tech companies, it's a small, wearable computer system designed to act as a mobile security system for military police officers, or MPs... But at the heart of the system is an eyeglass-mounted camera and display system developed by MicroOptical Corp. in Westwood, MA. The camera monitors what the soldier or MP sees, then feeds the images back to the belt-mounted computer. The computer then scans the images for faces by using software developed by Identix Corp., formerly Visionics, in Jersey City, NJ... The software is keyed to spot common facial features, such as the distance between a person's eyes and the corners of the mouth. Once those points are mapped, they can be compared mathematically to other faces -- say, a digitized book of mug shots of most-wanted terrorists -- stored in the computer... What's more, they've developed a much more capable system. For instance, with Wi-Fi, a wireless networking scheme popular in portable consumer computers, Digital MPs can share information, pictures and videos among similar units in a soldier's squad... Also, language translation software, currently in development by researchers, could ease communications between soldiers and the foreign nationals they may need to interact with... But Chandler admits it will still take some research work -- and further funding -- to get Digital MPs fully up to speed. Limited tests of the facial-recognition feature, for example, still shows the units have a hard time picking out faces in bright, sunny conditions."
David Leonhardt _NY Times_
Retail Sales Pace Picks Up, Hinting of Broader ReBound
"Retail sales at chain stores rose last week at a faster pace than they had for most of the previous month, according to two surveys released today. In one survey, conducted by the Bank of Tokyo-Mitsubishi, sales increased 3.1% compared with the week a year earlier, the biggest gain since January... One closely followed measure -- consumers' near-term expectations for the economy -- rose this month, the University of Michigan reported on Tuesday. A second common harbinger of turning points is the percentage of Americans saying they expect the next five years to bring periods of widespread unemployment, and that declined to 36% in May, from 51% in March, the University of Michigan said... 'What we have is the first surge in confidence.', Mr. Curtin said. 'I think we will see some slide. The question is how much.'"
Rex Nutting _CBS.MarketWatch.com_
Q1 GDP increase revised higher to 1.9%: Before-tax corporate profits up 12.5% year-over-year
"Real gross domestic product grew at a 1.9% annual pace in the first 3 months of the year, up from the 1.4% recorded in the fourth quarter and ahead of the 1.6% first-quarter estimate published a month ago, the Commerce Department said Thursday... The economy grew 2.1% in the past four quarters, the slowest year-over-year growth in the past year. Economists are forecasting more weakness for the current quarter, with current estimates at about 1.8% annual growth... Economists figure the economy must grow at its potential of about 2.5% to 3.5% for several quarters in order to bring the unemployment rate down from its current 6%. The figures are adjusted for seasonal variations and for price changes. In current dollar terms, annualized GDP was $10.7T in the first quarters, up 4.4% from the $10.59T in the fourth quarter... Business investments in structures advanced 0.4% while investments in equipment and software fell 6.3%, the first decrease in 4 quarters. Imports dropped 7.1% and exports fell 1.4%."
Rachel Koning _CBS.MarketWatch.com_
Unemployment compensation insurance claims average falls but still atop 400K: High level of continuous benefits shows weak job market
"The average of first-time filings for unemployment insurance stands at a 6-week low... The closely watched seasonally adjusted four-week moving average stood at 427K for the week ended last Saturday, slightly larger than the 425K predicted by economists, according to Labor Department statistics. Still, that's a decrease of 7,250 to the lowest level since the week ended April 12... For just the week ended May 24, initial claims fell 9K to 424K. The level of claims has remained above the pivotal 400K mark for a 15th straight week... The number of continuous jobless benefits collections stood at 3.76M, a gain of 83K from the previous week and the loftiest level since the week ended 2001 November 17, Labor officials confirmed. The 4-week moving average of continuous claims stood at 3.71M, an increase of 26,750 and the highest level in about a year. The insured unemployment rate increased to 3% from 2.9% in the previous week."
David Firestone _NY Times_
Tax Law Omits Child Credit in Low-Income Brackets
"A last-minute revision by House and Senate leaders in the tax bill that President Bush signed today will prevent millions of minimum-wage families from receiving the increased child credit that is in the measure, say Congressional officials and outside groups. Most tax-payers will receive a $400-a-child check in the mail this summer as a result of the law, which raises the child tax credit, to $1,000 from $600. It had been clear from the beginning that the wealthiest families would not receive the credit, which is intended to phase out at high incomes... Because of the formula for calculating the credit, most families with incomes from $10,500 to $26,625 will not benefit. The Center on Budget and Policy Priorities, a liberal group, says those families include 11.9M children, or 1 of every 6 children under 17... nearly half of all tax-payers in [Arkansas] had adjusted gross incomes that were less than $20K... Families with incomes lower than $10,500 will also not receive the refund checks. But under the 2001 tax revision, they would not have been eligible for either the $600 or the $1,000 credits because they do not pay federal taxes... The Senate provision that did pass was intended to help those families making $10,500 to $26,625 who do pay federal taxes and could have taken all or part of the $600 credit. The provision, which would have cost $3.5G, would have allowed those families to receive some or all of the extra $400 in the new law. Most families with children who make about $30K or less are also eligible for the earned income credit, which the law does not not change. In addition, the law has a few other benefits for low income earners, like expanding the lowest tax bracket and a temporary reduction in the penalty on two-income couples."
Sandra Blakeslee _NY Times_
Rapie-Fire Video-Games Build Certain Visual Attention Skills
"Experienced players of these games are 30% to 50% better than nonplayers at taking in everything that happens around them, according to the research, which appears today in the journal Nature. They identify objects in their peripheral vision, perceiving numerous objects without having to count them, switch attention rapidly and track many items at once. Nor are players simply faster at these tasks, said Dr. Daphne Bavelier, an associate professor of cognitive neuroscience at the University of Rochester, who led the study. First-person action games increase the brain's capacity to spread attention over a wide range of events. Other types of action games, including those that focus on strategy or role playing, do not produce the same effect... as little as 10 hours of play substantially increased visual skills among novice players... the improved visual attention skills did not translate to reading, writing and mathematics. Nor is it clear that they lead to higher I.Q. scores, although visual attention and reaction time are important components of many standardized tests... increased capacity for visual attention was helpful in tasks as diverse as flying, driving, radiology and airport screening. Dr. Bavelier is an expert on how experience changes the brain, particularly the effects of congenital deafness on visual skills and attention... The first tested the ability to localize targets in a cluttered environment and spread visual attention over a wide area ó a skill that many elderly drivers lose. Gamers performed at least 50% better than nongamers, Dr. Bavelier said. The second involved the ability to say, instantly, how many objects were flashed on a screen. Most people can do this with up to four objects, Dr. Bavelier said. Above that, they start counting. Gamers could identify up to 10 items on a screen without counting."
Rachel Koning _CBS.MarketWatch.com_
Chicago area manufacturing expands
"Chicago-area factories unexpectedly expanded production in May, the latest regional purchasing managers survey showed Friday. The index stood at 52.2 from 47.6 in April. A reading above 50 indicates factory-sector growth... The measure of production rebounded a significant 9.5 points to 60.5, for the highest reading in 3 months. New orders improved 10 points to 54.6, also the best reading since February... The latest report shows backlogged orders remain weak, still below 50, at 44.4. The employment component of the index fell to 43.6 from 43.7 in April. Prices paid fell to 53.7 from 55.9 last month."
American firms exporting more jobs: Also weakening dollar, tax changes and more
"Pick up the phone for customer service or a help desk, and you may be calling India, [Red China] or the Philippines. More and more companies are finding educated workers for less money overseas, as Ed Crane reports."
March Job Openings Down from Year Earlier
"In its latest Job Openings and Labor Turnover Survey (JOLTS), the Labor Department said 2.864M jobs were available in March, well below 3.188M a year earlier. Total private-sector job openings stood at 2.475M in March, compared with 2.739M a year before."
Steve Gelsi _CBS.MarketWatch.com_
Dow hits new high for 2003
"All but 3 of the Dow's 30 components traded higher, with the biggest gains in Caterpillar, 3M, Home Depot and United Technologies. Wal-Mart and Intel dipped slightly... The Dow Jones Industrial Average piled on 139.08 points, or 1.6%, to 8,850. The blue chip index broke through its high of 2003 of 8,842 set back on January 14. It finished the last trading day of May with a year-to-date gain of 6.03%... The Nasdaq Composite rallied 20 points, or 1.3%, to 1,595. The tech-heavy index approached its 52-week high of 1,631 set on May 30 of last year. It's also up about 40% from its 1,114 low back in October and ahead by 19.23% so far in 2003. The Standard & Poor's 500 Index ascended 1.5% while the Russell 2000 Index of small-capitalization stocks advanced 1.9%. Chip and hardware issues spearheaded advances in the tech sector while broader market gains were clustered in the biotech, oil service, retail and defense sectors."
Janny Scott _NY Times_
Unemployment Rate in NY City Drops with Rise in Private-Sector Jobs
"The unemployment rate in New York City dropped in April for the second time in two straight months, this time to 8.3% from 8.5%, according to monthly data released yesterday by the State Department of Labor... The city comptroller, William C. Thompson Jr., said private-sector jobs in the city had increased by 10,700, when seasonally adjusted. He said the increase amounted to the largest single-month gain since September 2000... Statewide, the number of private-sector jobs grew by 9,400 after seasonal adjustment, according to the Labor Department... The state's unemployment rate rose to 6.1% from 6.0%."
Katie Hafner & Daniel Preysman _NY Times_
Special Visa's Abuse for Tech Workers Is Challenged
"In the nearly [over] 3 years since the technology bubble burst, the use of L-1 visas to bring in workers -- with a large percentage from India -- has become a popular strategy among firms seeking to cut labor costs. The number of these temporary visas granted rose nearly 40% to 57,700 in 2002 from 41,739 in 1999. The visas are intended to allow companies to transfer employees from a foreign branch or subsidiary to company offices in the United States. But they are now routinely used by companies based in India and elsewhere to bring their workers into the United States and then contract them out to American companies -- in many instances to be replacements for American workers... Officials at the Bureau of Citizenship and Immigration Services, or B.C.I.S. [USCIS], a division of the Department of Homeland Security that over-sees the granting of L-1 and other work visas, say the bureau is conducting an assessment of the L-1 visa to determine whether there is misuse. 'If this is a company offering the services of their employee to go work for another company, it sounds dubious.', said Bill Strassberger, a spokesman for B.C.I.S. [USCIS]. 'To bring someone in ostensibly as an intra-company transfer and then put him to work for somebody else and then to say that we're paying him still, that just sounds like someone's trying to really stretch the envelope on that visa category.', Mr. Strassberger said... Unlike the H-1B visa, the L-1 does not require employers to pay workers prevailing wages. In addition, there is no cap on the number of L-1 visas. This has ignited an outcry among technology workers who have lost jobs and say that foreign contract workers are paid substantially less than prevailing wages in the industry... And as others have claimed, Mr. O'Neill said that in many cases, existing technology employees are asked to train their replacements. The L-1 visa requires that the foreign workers possess specialized knowledge of the work to be done... Wipro plans to lobby against Mr. Mica's bill. If it becomes law, said Sridhar Ramasubbu, investor relations manager at Wipro, the company will simply turn back to H1-B visas... Controversy over the visa, which has been in existence for 33 years, is not entirely new. Three years ago, the General Accounting Office [GAO] reported that the the Immigration and Naturalization Services, the precursor to B.C.I.S. [USCIS], had found a high incidence of fraudulent use of L-1 visas and had called abuse of the visas 'the new wave in alien smuggling'."
IT Executives Expect Job Gains in 3rd Quarter of 2003
"[Robert Halfwit International's] findings are based on a survey of 1,400 CIOs from companies with at least 100 workers. Of those, 10% plan to expand their information technology divisions in coming months. Only 3% were planning cut-backs."
Dice Report: 26,497 job ads
Total 26,497 Java 3,372 C/C++ 4,080 body shop 12,421 permanent 15,883
Evelyn Nussenbaum _Business 2.0_
Short-Circuiting the New Paper Pushers: Those HR bureaucrats have been replaced by cold-hearted robots. So you need a new set of strategies to win them over.
"New 'applicant management' software is turning the impersonal processes of trying to float your resume to the top of the pile into an even more impersonal show-down between man and bot."
the effects of NAFTA on USA-Mexican trade and GDP (with graphs)
"In 1982, after Mexico had increased tariffs and established other restrictions and controls in response to a balance-of-payments crisis, its average tariff rate stood at 27%, and the country required importers to obtain permits for all imports. Mexico then began a series of major economic reforms. It became a member of the General Agreement on Tariffs and Trade (GATT) in 1986. It reduced the portion of imports requiring licences to 36% in 1985, 27% in 1986, and 22% by the end of 1988. It lowered the maximum tariff rate from 100% in 1982 to 20% in 1988 and reduced the average tariff rate to 25% in 1985, 19% in 1987, and 10% in 1988. According to one source, the average rate subsequently edged up to 12% by 1993 (another source indicates that it remained at 10%)... In 1993, just before the agreement went into effect, 51.2% of imports from Mexico (by value) entered the United States duty free, and the average tariff on the remaining imports was 4.24%, for an overall average tariff rate of 2.07% (see Figure 1). By 2001, the percentage of imports from Mexico entering duty free had risen to 86.8%, and the average duty on the remainder had declined to 1.37%, for an overall average tariff rate of just 0.18%. On the Mexican side, the average tariff rate, which was roughly 12% in 1993, had declined to only 1.3% by 2001... Average U.S. tariff rates were calculated as the ratio of 'calculated duties' to the customs value of imports for consumption."
Paul L. Jaskow _MIT_
the difficult transition from government-forced monopolization to competition in electricity markets in the USA 🇺🇸
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