Thursday, October 29, 2009

Economic numbers a bit deceptive

Some good news to take with a large grain of salt: The economy grew by 3.5 percent after four consecutive quarters of declines. The report was released today and exceeded expectations. However, how much of that growth was driven by the government's temporary "cash for clunkers" program that boosted the auto industry? As with improving real estate numbers mostly due to new government tax incentives, one has to question whether these improved statistics can be sustained without the stimulus money and government intervention.

I suspect that until jobs return and people begin feeling stable in their careers, any recovery will be skewed by various short-term government programs that are propping up certain industries. Ideally, spending must come from individuals not the government for there to be a true economic recovery. Spending won't return until folks feel comfortable with their incomes. Employers must become confident they can begin hiring again. In that regard, there is still a lot of work to be done.

I no longer look to Wall Street or the U.S. Commerce Department for accurate indicators of where the economy is going. It's nice to hear of good news coming from both of those places, but the job market is the engine that provides the power to the economy. Plain and simple, a lasting recovery will be built by opportunities being restored to those who want to work. The middle class has been the backbone of America and will be again if we can reverse the only numbers that truly count -- the unemployment and underemployment numbers. The government can help with this but it can't continue to spend billions to create the temporary illusion that things are improving.

Wednesday, October 28, 2009

Fiats revving up; Jeeps in trouble

Fiat is coming to America. Chrysler recently merged with the Italian car maker. What that means is that fewer traditional Chrysler products will be made while more Fiats will line American car dealerships in the near future. I have mixed emotions about that, leaving aside the whole American-made vs. foreign-made debate.

My first car was a Fiat Spider (like the one pictured above). It was the coolest car that I have ever owned. But I do admit, it fell short of being reliable. Still, a green European two-seater at age 18 isn't a bad ride. It was used and cost me $2,500 in 1979.

Now I own a Jeep. But rumor has it that many Jeep models (which are Chrysler products) will be discontinued. That, of course, will make it harder to get parts for certain models in the future. And forget about resale value.

So while I would appreciate giving a Fiat a spin again one day, I want to keep my Jeep for as long as possible for a variety of reasons. Just not sure how long that will be as Fiats roll onto American shores.

Yankees look bad in 6-1 loss

The World Series is off to a brutal start for the New York Yankees. The lack of timely hitting and poor relief pitching, which nearly did them in during the ACLS, worsened during tonight's game against the Philadelphia Phillies. Even Alex Rodriguez reverted to his unproductive post-season ways, striking out three times. The Yankees better wake up and realize that the defending champion Phillies aren't going to give games away with sloppy play like the L.A. Angels did in the prior series.

Unemployment: A national emergency

I have hammered away on this blog about the seriousness of the unemployment problem and the lack of viable opportunities for the baby boomer generation. I have also told people face-to-face about how bad things are in the job market. Still, I don't get the impression most people understand what is truly happening in this country. On a more personal level, I don't think there are many people who can relate to the feelings of the unemployed or underemployed. Last night, my feelings were once again validated.

If you didn't catch PBS's Frontline show Close to Home last night, I would recommend you go to this web site and watch it: http://www.pbs.org/wgbh/pages/frontline/closetohome/. While at the site, I would also suggest reading some of the articles about how the middle class, and particularly men over 50, are being systematically eliminated from the workplace and not being permitted back in. This is no longer opinion. This is a fact. Baby boomers, for whatever reason, are being plucked out of the workplace at a time when they should be paying their children's college tuition or accelerating their retirement savings. What was once considered the prime earning years are now a financial wasteland for many families. Even folks getting by on one salary have to wonder what the future holds if the other spouse, usually the husband, can't return to work in 2010.

Maybe some employers view these older employees as too expensive to keep in bad times. But as someone pondered in Close to Home, would that commercial jet have landed safely in the Hudson River several months ago if a lesser-experienced pilot was in command?

Experience use to count. In my mind, it still makes good business sense to retain as much institutional knowledge as possible. But in the panic to throw people overboard in order to save money, companies are often cutting lose people who are least likely to find new work in a terrible recession. Perhaps some of these people have grown stale and haven't learned new skills, but most folks are more than willing to be retrained or have taken the initiative to stay current on their own. Many are even willing to take pay cuts in order to stay employed. Those options are only explored by the best of companies such as CF Martin Guitars, which I explored in an earlier post.


Why should you watch this show? Well, even if you're employed or young, you are probably going to know of someone soon who loses their job or can't get back into the workforce. Could be a spouse or a parent. Could be a good friend. If you want to remain in that person's life, you better understand what they are facing on a daily basis. It's not just being without a paycheck. It's bigger than that and it eats away at the inner fabric of what once made those folks productive members of society. Few have ever accused baby boomers of being loafers, yet many are collapsing under the hopelessness of the current job market. The unemployed are losing their identities. Empathy can help to a degree, particularly from close friends and former colleagues. Job leads can help even more, of course.

The unemployed are being silently cast out at an alarming rate. If you can't find a job, even though you've led a responsible life and are doing all the "right things" to seek work, something is wrong. The deck being stacked against the over-50 crowd creates individual and societal hardships. When their diploma and 30 years of experience are deemed as negatives by employers because they're too old or too overqualified, and when they get tired of trying to swim upstream or reinvent themselves, bad things can happen. There is a domino effect. Nothing as bad as this crisis happens without spilling over into almost every segment of culture and economy. Even businesses that are somewhat immune to the recession will face problems.

If my neighbor's house is foreclosed on, the value of my home goes down. We all have a stake in this.

When a 60-year-old man hasn't been employed in years, do you think he's going to be able to afford a proper funeral for his parents? Not even the classic, so-called recession-proof funeral home business is going to go unscathed if people don't get back to work soon, rebuild savings and pay taxes.
As it is, teachers, once thought to be in short supply, are losing their jobs in cities such as Detroit and Washington.

The PB
S documentary, filmed mostly in New York, is very well done. It tells the stories of the unemployed through the words of the victims and the hairstylists who come into contact with these middle class folks on a daily basis. People who cut hair tend to be like bartenders -- they hear it all in a very up close and personal way. They don't need unemployment statistics to understand how widespread this problem is becoming and what the ramifications are if things don't improve. In some ways, hairstylists have more empathy for the unemployed than the friends and former colleagues of layoff victims do. I don't think that is because friends and former colleagues are bad people. I just think the problem isn't on their radar screens every day.

At one point in the show, the film-maker follows a former human resources manager in his mid 50s to a support group for jobless people. She is struck by the overwhelming number of men in their 50s attending the event. These are mostly people who held white-collar jobs, which dispels the myth that this recession is mainly hitting the manufacturing sector in the heartland.

The film also makes the point that people who are being laid off today are well-respected, talented folks who did nothing to deserve being let go from their jobs. Still, it is hard to break the stereotype that anyone who has been laid off is somehow damaged goods or of lesser ability.

We're entering a critical time with this unemployment situation. Things are not getting better despite what you might hear on the network news, which itself has been hit hard by the recession and is of lesser journalistic quality these days. State benefits and personal savings are running out. Folks in their 50s are beginning to give up, or worse, get sick from the stress of looking for work. They spend hundreds of hours applying for jobs that they have no chance of landing because of age discrimination or application saturation.

Why are political leaders allowing this to continue? It seems we need a summit of sorts to attack this problem on multiple levels. Businesses need to be more fair in hiring and firing practices.
That's not going to happen unless there is a mandate to clean up practices that have led us to this mess.

Where is the mainstream news media in all of this? The best reporting on the unemployment crisis seems to be on PBS and HBO, as well as some fringe publications and blogs. Everyone else seems to be trailing behind, like they did going into the Iraq war.


The documentary points out that the wealthy, in this case in ritzy Manhattan, don't really notice what's happening to the middle class yet. No surprise there. I would add that those who are currently employed, even at lower incomes, also don't have a full understanding of the situation. But with each passing day, more people are getting first-hand knowledge of the tragedy of prolonged unemployment. Even the rich will eventually feel the pain if no one is patronizing their businesses.

If those who are in their 50s don't get a fair chance to become reemployed soon, the next 15-20 years will transform this country into a sea of elderly welfare cases. Not a pretty picture. Those who are working will have to support the millions who haven't worked in years. The strain on social services and the deficit will spin out of control. There will be streets lined with senior citizens begging and living in tent cities - folks who once were tops in their fields. Close to Home profiles several people who are candidates for this sort of fall from grace.

President Obama likes to use the phrase "now is the time" when giving speeches. But it seems those were just campaign words. I don't see a sense of urgency in him when it comes to job creation or in enforcing age discrimination laws. Just enforcing labor laws alone would create a more level playing field for 50somethings. Instead, Obama seems to distance himself from the problems that are truly becoming a national disaster, maybe because he honestly has no viable solution. Or, like with other people of considerable privilege, any president would be too far from the problem to see what a hairstylist sees every day. If he really wants to give people hope, he must find a way to get people of all ages back to work.

The unemployment problem is moving closer to home each day. Companies need to do more to jump start business. They need to hire people and to give everyone a fair chance regardless of age. Government needs to play a role in the recovery, too, but not just by throwing around stimulus money. Small businesses need a break. This is a national emergency and needs to be treated as such. I don't have the answers. I just having a growing sense that more attention needs to be given to this problem so that millions of unemployed people aren't forgotten.

Like during the Great Depression, there are too many once-proud workers who aren't being given a chance. Companies are failing, stores are closing and tax rolls are declining. The American dream is turning into a nightmare for millions. The unemployed don't have ribbons or marches in Washington. But in terms of numbers and ramifications, I can't think of too many causes more in need of a cure.

Monday, October 26, 2009

Another Bronx tale

In the movie, A Bronx Tale, Sonny (the local mobster) tells an impressionable young boy who he calls "C" that he shouldn't care about Mickey Mantle because Mickey Mantle doesn't care about him. The boy, an avid Yankees fan, takes the advice to heart and soon realizes the mobsters can do more for him than any baseball idol.

I root for the Yankees and am glad they are going to the World Series. I even met Mantle back in his playing days. But at age 52, and in one of life's real binds at the moment, it's hard for me to generate the kind of enthusiasm that I once had for sports and professional athletes. I am happy that Alex Rodriguez has broken his post-season slump, but in reality, A-Rod isn't going to solve my problems. The Yankees aren't going to make me feel better about the dismal job market or the future of our economy.

At best, for most fans of a certain age, sports is a distraction from life's problems for a few hours. Similar to a movie or concert. Grateful the Yankees can take my mind off of a couple hardships, but very well aware that those issues aren't going to go away when the game is over.