EFCA Sponsors Says Card Check May Go Bye-Bye

Senator Tom Harkin, D.-Iowa, says compromise is in order to save the Employee Free Choice Act, specifying that the card check provision will no doubt have to be dropped.

"Compromises are going to be made," said Harkin, 69. "It probably won’t be card check [as part of the final law], because too many people are opposed to it now."

Card check allows organizers to unionize a company by merely getting 50-percent-plus-one of the employees to sign off on the idea. No election need be held, but the union (har de har har) could still ask for one.

Business is unilaterally opposed to it, with the U.S. Chamber of Commerce calling the EFCA "Armageddon." (New York Governor David Paterson has already created card check in his state by fiat–executive order. Henceforth, all businesses receiving government assistance in just about any form in his state will be subject to card check unionization.)

Harkin said he’s hoping that the compromise bill he’s negotiating with fellow senators will win the "grudging support" of both labor and "some business." For its part, labor says card check is non-negotiable and absolutely essential, and from the business side comes the stance that, even with card check gone, the EFCA is still Armageddonish with its binding arbitration provision.

The proposed law mandates a two-year binding contract be imposed if the company and union fail to agree upon a contract after 90 days of direct negotiations and another 30 days of mediation. In the words of Rodney King, "Can’t we all just get along?" Evidently not.


NOTE: The details in this blog are provided for informational purposes only. All answers are general in nature and do not constitute legal advice. If legal advice or other expert assistance is required, the services of a competent professional should be sought. The author specifically disclaims any and all liability arising directly or indirectly from the reliance on or use of this blog.
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Peering into Our Future? Spain’s Unemployment at 17 Percent

Actually, I’m not referring to the level of unemployment when I say “Peering into Our Future.” If you follow Shadow Stats, you’ll know that we’ve already gone well past that figure (into the 20-percent range).

What I’m referring to is the black market that developed in response to the recession, which has become a major source of income for the unemployed.

Also, a spate of labor laws make it easier for people to be unemployed in Europe (while offering almost no chance for advancement or career change during normal times).

So, if you want to know our future under Obama, read “Spain Largely Avoids Unrest Even as Economy Slumps.”


NOTE: The details in this blog are provided for informational purposes only. All answers are general in nature and do not constitute legal advice. If legal advice or other expert assistance is required, the services of a competent professional should be sought. The author specifically disclaims any and all liability arising directly or indirectly from the reliance on or use of this blog.
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Obama Billionaire Backers Nix EFCA–Surprised?

Warren Buffett, the sage of Omaha, was the first Obama-aire to come out against the EFCA (Employee Free Choice Act) and its card-check unionization. Now he’s been joined by three other Obama-backing billionaires (did you realize that the Democratic Party has a much higher concentration of voters who make more than $100,000 a year than the GOP has?). The three nay-sayers all hail from Chicago.

One, Penny Pritzker, a Hyatt zillionaire, actually ran Obama’s campaign finance committee, the one that racked up about $750 million (with nine-figure contributions from unions) for the presidential campaign and another $53 million just for the inauguration.

Neil Bluhm, founder of the private equity firm Walton Street Capital and gatherer of $160,000 for the Obama campaign, just says no as well, and is joined by another billionaire, Lester Crown, who runs an eponymous investment firm. Crown gave the max personal contribution allowable under the law to Obama.

What took them so long, or did they just notice Obama’s true stripes?


NOTE: The details in this blog are provided for informational purposes only. All answers are general in nature and do not constitute legal advice. If legal advice or other expert assistance is required, the services of a competent professional should be sought. The author specifically disclaims any and all liability arising directly or indirectly from the reliance on or use of this blog.
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History of At-Will Employment: Created Out of Thin Air?

I‘d always heard about how Major League Baseball’s exemption from antitrust law was based on a long-ago Supreme Court decision that ruled the sport did not (catch this one: DID NOT) engage in interstate commerce. Funny thing is, no Supreme Court decision since that one nearly 90 years ago has ever overturned its obviously false finding.

What I didn’t realize until I just read a Personnel Concepts white paper was that at-will employment–the arrangement under which employer and employee are free to part company for any reason at all (except discrimination, which is covered by several laws)–was similarly created by court fiat.

(At will, of course, is the concept employers use to keep the fear of termination fresh in their employees’ minds, while it provides employees with the cover to quit at any time. Some exchange of equal benefits, huh?)

Now, common law at the time held that jobs were agreed to last a minimum of one year both here and in Great Britain, but along came a guy named Horace Wood who wrote a treatise on how the courts had long held that employment was at will, subject to termination at any moment for any reason (no one worried too much about racism and discrimination back in the 19th century). Though Wood pretty much made up his interpretations of case history on employment, after that courts high and low ruled that all employment was at will.

Cute achievement by Mr. Wood, this. And the title of his treatise was…

Master and Servant.

“Get to work, you servants, or I’ll fire your asses!” is a concept now enshrined in our nation’s jurisprudence.


NOTE: The details in this blog are provided for informational purposes only. All answers are general in nature and do not constitute legal advice. If legal advice or other expert assistance is required, the services of a competent professional should be sought. The author specifically disclaims any and all liability arising directly or indirectly from the reliance on or use of this blog.
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Lesson of Japan: Maybe We Do Need EFCA

Japan’s dirty little immigration secrets are starting to come to light, and they’re not pretty.

A little history from The Japan Times: Back in the 1980s, “official” Japan became worried that labor was getting too expensive, threatening its manufacturing and exports. Importing cheap labor was at first ruled out as a solution because it would debase Japan’s “homogeneous” racial stock, but that proved to be tatemae, a facade, as the nation began importing workers from China as “trainees.” Not being citizens, they didn’t have to be paid the minimum wage and they could be worked long, long hours.

Later, Japan also starting inviting Nikkei, foreigners of Japanese descent who mostly do not speak Japanese, to work in the country. Like the trainees, they are not citizens and thus not subject to any labor laws. Reports of working both of these groups as many as 16 hours a day and paying them just $400 a month abound, which you can read about in more detail in the article.

Now, with a severe economic downturn hitting Japan, the trainees and Nikkei have been the first to be fired. The trainees have no choice but to return home, where they face disgrace and possible prison time for not being able to repay their sponsors for sending them over. The Nikkei are being offered “golden parachute” payments of $3,000 for each worker and $2,000 for each dependent to return home and never come back!

The Japan Times concludes, and this sounds eerily like America:

It’s epiphany time. Japan’s policymakers haven’t evolved beyond an early Industrial-Revolution mind set, which sees people (well, foreigners, anyway) as mere work units. Come here, work your ass off, then go ‘home’ when we have no more use for you; it’s the way we’ve dealt many times before with foreigners, and the way we’ll probably deal with those Indonesian and Filipino care workers we’re scheming to come take care of our elderly.

Wow, I truly feel sorry for these people. It’s even making me reconsider my opposition to unions and the Employee Free Choice Act (EFCA). The phrase “mere work units,” in particular, sticks in my craw.

The article is truly eye-opening, a must read.


NOTE: The details in this blog are provided for informational purposes only. All answers are general in nature and do not constitute legal advice. If legal advice or other expert assistance is required, the services of a competent professional should be sought. The author specifically disclaims any and all liability arising directly or indirectly from the reliance on or use of this blog.
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American Dream Destroyed by…Real Estate?

I‘ve always thought of the American Dream as including home ownership. You know, having your own place to tool home to and relax after a hard day’s travail.

Now, two economists at Chapman University (which is actually fairly near the American Dream abode to which I retire each evening) have asked a serious, intriguing question–and come up with a penetrating answer.

Steven Gjerstad and Vernon L. Smith ask why the collapse of the $10-trillion Dot-Com Bubble at the turn of the century had nary a ripple effect on the economy, while the recent collapse of the $3-trillion Housing Bubble sank the world.

The answer is, simply, that the Dot-Com losses were all absorbed by individuals and institutions and were not, like the Housing Bubble, encased in weird investment instruments and sold to banks and investment houses the world over. (To say nothing of their then being insured by AIG, which is now on the hook for most of the worldwide losses.)

One caveat here: It’s $3 trillion in lost equity to date, but we don’t yet know the final amount, so the comparison may be incomplete.

However, and here’s where it gets interesting, while virtually everyone blames our current downturn on the housing bust, the Great Depression–the only other period with similar devastation to the world economy–is usually attributed to a stock market crash and a tight-money policy by the Federal Reserve and other world banks.

Throwing orthodoxy out the window, Messrs. Gjerstad and Smith pin the blame for both catastrophes on housing and consumer debt (while saying more research needs to be done on the Great Depression). To be precise, they note that total mortgage debt outstanding grew from $9.35 billion in 1920 to $29.44 billion in 1929, eerily similar to recent trends. They write:

It appears that both the Great Depression and the current crisis had their origins in excessive consumer debt–especially mortgage debt–that was transmitted into the financial sector during a sharp downturn.

So, the authors answer their own question by asserting that consumer debt “can be transmitted quickly and forcefully into the financial system” and was both in 1929 and in 2008.

So if you want to live the American Dream, don’t go into debt. Pay cash for that house, dammit! (I only wish I could.)


NOTE: The details in this blog are provided for informational purposes only. All answers are general in nature and do not constitute legal advice. If legal advice or other expert assistance is required, the services of a competent professional should be sought. The author specifically disclaims any and all liability arising directly or indirectly from the reliance on or use of this blog.
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Merging and Purging Their Way to Billion$

I‘m no fan of the Employee Free Choice Act (EFCA), but the principle of organizing for better wages and benefits is a sound one–until it’s abused. And union abuse is largely what doomed (along with better products from foreign competition) the so-called Big Three automakers in Detroit.

So, in unions you have a good thing in principle, and a bad thing in practice. Look at the routine corruption and power hunger at just about every union in America, and you’ll see that the free pot of cash that unions blackmail out of the employees they bargain for affirms Lord Acton’s observation that “Power tends to corrupt. Absolute power corrupts absolutely.”

Anyway, the picture on the other side isn’t any prettier. As much damage as the unions have done to industry in America, corporate chieftains have sent to their workplace graves millions of employees over the years.

Joseph Schumpeter called capitalism “creative destruction,” and in any act of destruction, something is obviously destroyed–and that something in capitalism is workers’ lives and livelihoods.

The sad fact is, for CEOs, destroying workers’ lives through downsizing pays off big time. A study by the Institute for Policy Studies and United for a Fair Economy (admittedly, two left-leaning groups) shows that CEOs for the 50 companies that did the most downsizing in 2001 averaged 44-percent pay raises the next year. In fact, compensation for downsizing CEOs grew seven times faster than for CEOs in general.

The CEO for Hewlett-Packard since 2005, Mark Hurd, over the years eliminated 40,000 jobs through 31 mergers and acquisitions and reaped a cool $60 million-plus in 2008 alone. Larry Ellison of Oracle, with a personal net worth of $22.5 billion, eliminated 5,000 good jobs with his acquisition of PeopleSoft in 2005 and looks to axe another 5,000-10,000 this year through his acquisition of Sun Microsystems.

Now, to change the subject a bit and return to the plight of the Big Three: When I read over the weekend that the government would end up owning 50 percent of General Motors and the United Auto Workers most of the rest, it brought to mind this perceptive observation of Ronald Reagan’s:

“Government’s view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.”

In the case of the Big Three, Washington and the Democrats not only ruined them with taxes but also with ridiculous regulations like CAFE (Corporate Average Fuel Economy), which forced the automakers to build cars no Americans wanted to buy. Now with the Obamacrats owning GM, we’ll end up with an American version of the Yugo–and with an automaker (or two) that will be forever subsidized by the federal government (in reality, by you, me and all the taxpayers, who will have no say whatsoever in the matter).

Reagan was and always will be right about taxes and government.

To preview GM’s future, just take a gander at these Soviet-mandated cars for the masses now lying in a Russian boneyard:


NOTE: The details in this blog are provided for informational purposes only. All answers are general in nature and do not constitute legal advice. If legal advice or other expert assistance is required, the services of a competent professional should be sought. The author specifically disclaims any and all liability arising directly or indirectly from the reliance on or use of this blog.
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Hostage-Taking Trumps Card Check Anyday

As is their wont, the French reject American culture while embracing and perfecting it, in their own inimitable way.

Take the example of unionization. France is widely unionized. You can hardly visit there without the garbage collectors or air traffic controllers or railway operators going on strike for this or that. They all work for publicly operated entities, which are in turn union strangled, oops, I mean controlled. Anyway, a one- or two-day strike makes for a nice little holiday, n’est-ce pas?

Here in the United States, we argue over card check and whether that should be allowed as the preferred option for union organizing.

In France, they don’t argue–they take hostages.

The latest example comes from the Molex Inc. plant in Villemur-sur-Tam. Owners are threatening to close the plant and have been negotiating with the union, but the union smells a rat, sensing that Molex wants to shift operations to China.

Hence the logical thing to do is take two executives hostage until the company agrees to leave the equipment and workers all in place.

So far, this sounds like a Gallic version of the Republic Windows and Doors stand-off in Chicago of late last year. There, employees staged a sit-down until they got their severance packages.

In France, we’ll just have to wait to see what happens.

Hostages are, however, treated civilly during these stand-offs. Last month, an executive held hostage at 3M was even treated to moules et frites (mussels and fries, a traditional dish) as a snack.

Like I said before, why check cards when you can just hold some hostages until you get what you want?

“Sign here to recognize our union, or we’ll keep you hostage until you do” works faster than gathering all those signatures.


NOTE: The details in this blog are provided for informational purposes only. All answers are general in nature and do not constitute legal advice. If legal advice or other expert assistance is required, the services of a competent professional should be sought. The author specifically disclaims any and all liability arising directly or indirectly from the reliance on or use of this blog.
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Employment Increases in D.C.–and North Dakota?

One can easily understand how employment continues to rise in Washington, D.C., even as every other state in the union continues to stay even (three states) or lose workers to unemployment (the rest save one), but the Peace Garden State (aka Flickertail State and Roughrider State)?

Yup, North Dakota has evidently managed to live both frugally and well to survive and prosper in our current economic turmoil. Hats off to you, North Dakotans. (But if you’re seeking work, your best bet still is Obamaland, which is on a hiring binge–or orgy–following the trillions of dollars in conjured money flooding the place.)

But do you know which state has the highest unemployment (hint: it ain’t California)?

Go to this interactive unemployment map and find the answer.


NOTE: The details in this blog are provided for informational purposes only. All answers are general in nature and do not constitute legal advice. If legal advice or other expert assistance is required, the services of a competent professional should be sought. The author specifically disclaims any and all liability arising directly or indirectly from the reliance on or use of this blog.
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What Takes 7.6 Billion Hours to Produce Each Year?

Now, if you think about it, there’s only one institution in our nation capable of wasting that many hours of people’s time…our good ol’ government.

For the answer to what takes that long, think April 15.

Yup, it takes all of us and our tax preparers and accountants and whoever else is involved 7.6 billion hours each year to comply with our tax filing requirements. To do that much work, it would take 3.8 million full-time employees. And the cost of complying each year comes to $193 billion.

I’m not making these figures up. In fact they come from the IRS itself, in the person of Nina Olson, who is the national taxpayer advocate for said IRS.

Wanna find a nice loophole? No problem, just be prepared to read 3.7 million words in the tax code!

Have a happy April 15, folks.


NOTE: The details in this blog are provided for informational purposes only. All answers are general in nature and do not constitute legal advice. If legal advice or other expert assistance is required, the services of a competent professional should be sought. The author specifically disclaims any and all liability arising directly or indirectly from the reliance on or use of this blog.
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