Pink Slip Nation

New York Times today details the White House appointment of an overseer to set compensation for top executives at companies currently on what I like to call "corporate welfare." 

It seems these guys just got a caseworker.  Maybe it's time for a home visit.  In what is shaping up to be the most effective use of the title "Welfare to Work," will the titans of capital finally be subjected to the other ends of their own policies?

Obama Names Overseer to Set Pay at Rescued Companies

"The Obama administration on Wednesday appointed a compensation overseer with broad discretion to set the pay for 175 top executives at seven of the nation’s largest companies, which have received hundreds of billions of dollars in federal assistance to survive."

Snip

The mandate given to the new compensation official, Kenneth R. Feinberg, a well-known Washington lawyer, reflects the federal government’s increasingly intrusive role in the corporate affairs of deeply troubled companies."

Emphasis on intrusive is mine.  Really?  Is it intrusive when Buffet  buys a huge stake in your failing company, and than tells you that things are going to change?  We bailed them out. The tax payer stepped up and gave them more money than any of us will see in our lifetimes, barring a trip to Zimbabwe.  I recall Lehman Brothers begging for a little intrusion.
 
The article points out that Mr. Feinberg, a Washington lawyer, will receive no compensation.  How Socialist!  or Communist!  Or something worse!  We better step in with a little bonus program for Mr. Feinberg or he is just not going to be motivated at all.  Something tells me that if the tables were reversed, private industry would be incentivizing Mr. Feinberg with bonuses predicated on the amount of "fat" he could trim from the backs of the CEOs.  Sounds like a plan!

In fact, I think what these guys need is a little dose of the unfettered, free market capitalism that has come to redefine working life in America over the past several decades.  Let's furlough them, cut their hours, make them pay more for crappier healthcare and get their secretaries to start tracking their postage and use of the copy machine.  Water coolers should be replaced with vending machines (more efficient and each employee is responsible for their own consumption). 

Next up, Obama needs to appoint a cubicle Czar, who will be conducting executive reviews with a consultant.  They will be sending out a memo detailing the need for each top executive to detail their contributions to the company.

The corner office will be gone--studies show executives work much better when surrounded with the monotone environment of gray, padded walls approximately 5 feet in height.  And we will want to make sure their computers are visible to the entire office so we can dock them for any personal time. 

Their healthcare costs are atrocious, and they demand way to much pay.  We can fire them, hire younger workers, secure H1 B visas for a replacement and outsource the rest.  Or just fire 3 out of 4, and make the remaining executive cover the work of all of them: he'll be so relieved and desperate to keep his job that he will be a real company asset. 

Of course, the most efficacious time of the year to fire executives would be right before Christmas near the start of the next corporate year and before bonuses are issued.  But maybe we don't want to waste that long because everyweek's pay is a drag on the company's bottom line.  Of course, when they do receive their Friday notification, they will have an hour to gather their things and receive an escort out of the building. Better not downsize them on a Monday or they might touch down on the hellipad at work on Tuesday, all hopped up on Hennessy and ready to shoot the place up.
 

Eating money

More financial bloodshed in the yuppie market: seems there is no taste for overpriced gourmet oddities like mango chili vinegar or chocolate covered goji berries--even if they are tasty.
 
Balducci's Makes a Quiet Exit From Manhatten

“Do you really need chipotle raspberry finishing sauce? What is finishing sauce?” asked Barbara Colasanti, a 45-year-old teacher who lives in the West Village, as she perused the scanty pickings at Balducci’s vaulted, marble-walled and echoingly empty Chelsea store at Eighth Avenue and West 14th Street. “People don’t need all this stuff. It’s a lesson.”

The closing of Balducci’s, the World War II-era gourmet market that was once the foremost pit stop for New York foodies, elicited myriad reactions from its customers, who met news of its last days in the city with surprise, sadness and, in the case of Ms. Colasanti, shrugs. Some viewed the closing as tragic, others as a necessary corrective in these newly pared-back times.

While I still maintain that those stupid bowl bathroom sinks will remain the most iconic symbol of the excess, I suppose the $5 chocolate bar can't be that far behind.

Happy baseball

At the risk of adding to the already crowded field of obscure economic indicators such as lipstick sales (up during recessions) and lotto tickets (the poor gamble more in a down economy), I'd like to introduce the cut in Yankee tickets as the latest indication that finance is continuing to take a hit, no matter talk of a pay rebound for Wall Street.

From the NYTIMES, Yankees Slash the Price of Top Tickets
"The Yankees cut by up to 50 percent the price of the $2,500-a-game Legends Suite seats for full season-ticket holders at their new stadium on Tuesday. They also announced that holders of the ticket plans behind home plate would be given an equal number of tickets free."

snip

“A few weeks ago I indicated that in light of the economy we would review the pricing of a small number of our premium locations at Yankee Stadium,” he said. He added that the team had sold 85 percent of its 4,000-plus premium seats.

While New York may be ground zero for the financialization that got us into this mess, the affects of the economic destruction Wall Street set into play is only now starting to impact the source of this mess directly. 

Of course, with the Yankees the cost of "take me out to the ball game" is more like take me out to the cleaners: $2500 bucks a pop is pretty steep.  Something tells me hot dog sales are pretty stingy with this crowd, too.  And for the record, Pink Slip Nation hates baseball, and dislikes hotdogs--though if one must indulge, she endorses Pinks.

So I'm sitting here on the final day of the California Democratic Party Convention waiting for the upcoming fight over whether the party will officially endorse propositions 1A-F.  California is essentially fubared--we're being told that we can either blow up the budget or sign our death warrant.  A coterie of elected officials have come out to shill for a decidedly unpopular slate of propositions at the caucuses and events, only to have activists and the brave few willing to stand against the deal the party brokered exhort everyone to vote no. 

What we're really looking at isn't just a political deal, but the financial future of the state.  We can vote for a short term fix (1A-F) that will get us through the current crunch, with no promise we won't be back at the table if things continue to get worse, and with a spending cap that will essentially ham string any future spending.  Colorado only recently repealed a spending cap that had starved the state of investment and threatened to strip funding for education and social services to an extreme extent that even many conservatives could not stomach.  Many grassroots activists view 1A with suspicion, a ticking time bomb California Republicans have placed in the mix to strip the state of its abiliy to fund programs thus far beyond their party's power to remove.

Or we can fight for the long term, and vote down the whole lot.  The risk of course, is that while Dems got Republicans to finally agree to a mix of cuts and fee/tax increases in the last go round, the Republicans might simply refuse to compromise.  The Republican primary system and the extent to which our districts have been gerrymandered mean the Republican party's main power lies in its ability to blackmail and strong arm the state.   They have only enough seats to prevent an easy 2/3rds majority for Demcorats, and tie up the budget process and their Governor is termed out.  It's likely their next candidate will be one of the extreme, right-wing Republicans who are increasingly marginalized in all but the reddest of districts.

Voters need to wake up to the fact that when it comes to their money, their dollars, and the state spending so many more depend on in these tough economic times--an extrememe minority party is essentially in chage until the 2/3rds rule can be overturned.  It seems crazy that the small band of legislators whom fewer and fewer voters send to Sacramento to represent them on the issues, gets to decide how to fund them.

But today the focus is on whether the delegates to the party are going to advise voters to hold their nose and pull the trigger, or simply say no.  The fact that this round of propositions has been greated with such silence by interest groups that nomally take a vocal stance in recommending how everyone should vote, is an indication of how conflicted activists and interest groups feel.  If activists vote not to endorse on 1A, which seems likely, they won't be the only ones.  Get used to the sound of silence, becuase it is hard for anyone to get excited about the options facing voters on May 19th.

Unhappy meal

Tough economic times can impact all levels of your life.  Not only are many stressing about keeping their job or struggling to pay the rent or mortgage, but even day to day concerns like the food we eat present a layered challenge.  While there are many for whom the challenge remains putting food on the table, the rest of us face the increasingly daunting task of eating healthy at a time when cost and time constraints, coupled with the stress of worry, make it that much harder.

From Newsweek-- The Economics of Eating:

Living off a dollar menu may save you money now, but you'll pay for it in the long run:

Lean times lead to bad diets. Bad diets lead to obesity. And obesity leads to diabetes, heart disease and other chronic illnesses—not now, but sometime later in life, when today's recession is a memory but Medicare, Medicaid and private insurers are still groaning under its weight. "People are eating cheaper, more fattening foods; care is more difficult to find; and as a result we're going to have more and more people presenting at a later stage of the disease process," says Roslin. "If you're concerned about paying your rent and making ends meet, it's very hard to think about the future implications of diabetes and other illnesses."

Of course, even in flush times we face a smorgasbord of bad choices that are cheap easy and plentiful.  But a bad economy can make that worse:

But one of the most insidious health effects of a downturn is in the area of diet. Eating healthily can be expensive and time-consuming—two qualities Americans currently have little appetite for. Hitting up the drive-through is cheap, no-hassle and easy to rationalize; those off-the-charts levels of fat, sodium and sugar feel like they can be dealt with in better days. Owing in part to psychology like this (lower fuel costs helped too), McDonald's Corp. this week announced that it has defied the worldwide economic downturn, posting a first-quarter profit of $980 million, up percent from last year. Burger King's most recent U.S. sales figures were also up 1.6 percent, according to the chain.

Of course it's not a "happy" meal if it will eventually kill you.  So add food and health to the list of major impacts this recession brings home.  But it also may provide an opportunity to finally do something about the public health issue that processed fast food presents.  If you're interested in the politics and policy behind food, check out Recipe for America.  Change can be slow, but as we reevaluate the role of government and the safety net so many depend on these day, it's worth looking at the root of the problem. 
 

Where's Waldo?

One of the interesting things about modern work life is that it brings one into contact with people of different backgrounds, life experiences, races and cultures.  Most importantly, it introduces people of different financial circumstances to one another--even if they aren't always aware of it. 

It's an unspoken rule that in America, we don't talk openly about our finances; no one admits to the type of credit card debt the average American family holds.  And yet work often exposes you to subtle cues about how other people live.  The secretary who will be taking an 18 hour bus ride to visit her boyfriend for the weekend because the $250 for a flight is too high.  It doesn't matter the ticket is still $100 bucks and will cost her almost 2 days travel time.  Or the lady who works downstairs who doesn’t have a credit card, but a Nick’s Check cashing card.  Then there is the secretary whose kids are constantly calling to say the electric company has turned off the power, despite the fact that she explains to the electric company every month “I pay my bill on the 15^th, not the 5th." But they just don’t get it so every month they turn off her power for a few days because the bill comes due sooner. 

In one of my first jobs out of college, I find myself very aware of money at work.  Especially when accounting drags its feet in reimbursing mileage and expenses.  I turn in my card with every pay sheet only to find that the check covers only a portion.  Sometimes a pay period will come and go with nothing.  “Next time, it comes next time,” the accountant always nods, slightly annoyed.   

” Since I just got paid for July, will August’s check come in October?”  I ask.  She looks at me, deferring “No.  Next time.  You get paid next time.”  Work currently owes me $110.  I can cover it but it annoys me to have to keep track and remember--least they never repay me.  For many employees, this would be a problem, but I am lucky. 

My boss had explained,  “We'll pay for your mileage out, your parking.  If you stop to get a coffee, we’ll pay that too.  No one ever takes me up on it but we will."  He added, "It’s totally appropriate if you get out of a meeting at noon to go get lunch and expect the company will pick it up.“  But as I quickly learned, there is a big disconnect between the boss and the accounting department.  “They shouldn’t make you wait." He told me, "If you need to be reimbursed right away, use a check request to get the money in advance.”

All over America, wages have not kept pace with inflation and you can see it at the workplace if you know where to look.  I pay close attention to my coworkers cars--not because I'm particularly interested in horsepower, or sleek lines and name brands, but because of what it no longer signals.  Everything is bought on credit these days, especially vehicles.  The boss drives close to the same car as the secretaries.  A few of the workers have older cars that are a little beat up, but most drive $30,000 or more vehicles.  One secretary drives a shiny new oversize SUV she leases because she can’t afford the purchase.  But as she told a friend one day over a coffee break, when she goes on trips she rents an Escalade from a friend that runs a luxury car rental,  “A one-hundred-and-twenty-dollar a day car, I get it for sixty.”

My eye wanders to clothes, purses, shoes--trying to dissect the hidden financial lives of these people.  I know that even the lowest paid among them can’t earn less than 30-40 K yet some of them can’t pay the bills and many carry debt.  What do they spend it on?  Are they just bad with money?  Hidden expenses?  Some of them have had bad breaks.  One woman in particular, I think she just doesn’t know how to deal with money.  She cashes all of her checks at Nick’s check cashing and uses it as her bank.

Gas prices, I am sure, haven’t helped.  Most of my coworkers commute. I was coming in from a conference at 10 am one morning.  As the elevator door slid shut one morning, a woman staggered on.  She caught my eye. “Traffic.”  She pauses dramatically, “Was horrendous.  It normally takes me one hour to get here but it was hell today--took me an hour and a half.”

 
”You know," I calculate,  “If you commute an hour each way every day, you’ve essentially worked 10 hours you weren’t paid for ever week.” 

Her eyes lit up,” I know.” She said, “Isn't it crazy?”

I didn’t have the heart to tell her I lived a mile and a half away.  One of the things I am realizing is that most people just don’t think about these things from the perspective of what it is costing them.  She got it, yet she acted like she didn’t have a choice.   

When I first started working at Initech,I mentioned to a secretary that I only lived a short distance away.  “Oh, my god, we hate people like you!”  she joked, calling to an admin assistant.  “But you rent, right?  I own a home, so I’m out in Valencia.”  The other woman lived in Fullerton.  I should have been geographically shocked, but I once had a friend who lived so far away then when she went on job interviews the firms she interviewed with had never even heard of it.  "Monrovia?” they asked incredulously.  Two hours is too far even by LA standards.

*

I remember reading a series of articles in the LA Weekly about living in LA titled “The L.A. Dream Revisited.”  Since most people in the LA area rent, the series contained the curious subtitle “Beyond the house and the yard…the apartment as object of desire.”  It focused on the people who rent, which the reporters struggled with against a backdrop of record home ownership and housing prices.  As Robert Greene writes, “A majority of Angelenos don’t live in cottages, mansions, or tract houses but in apartments, and there is no living unit more emblematic of LA than the three-story dingbat apartment building, parking spaces underneath, stucco covered…” I read with some amusement an article on a couple who have sold their house to rent because it is such a comparatively good deal.

And yet more and more people have added the additional burden of a long commute into the mix.  More and more people have felt compelled to jump into the real estate market, moving further and further out for affordability, never questioning whether home ownership is a good investment when you calculate the cost of commute times and high prices on lifestyle.

With the rise in gas prices, the effect has been two fold; a loss of time and a money.  That house now costs many more than they realize.  The job that pays 40 K and takes 40 hours a week now pays less for more time when you factor in gas and the 50 hr work that commute creates.  And that assumes you never come in early or leave late, an increasingly difficult balance to strike.

It's the hidden financial lives of coworkers that are changing in subtle ways the American worklife.  It has to affect productivity, and one questions the societal toll as we look to schools to baby-sit and raise the children whose parents are stuck in traffic or the cubicle and can't get back until dinner. Can we reclaim our work lives and roll back the clock?  

Sometimes, the hidden lives of coworkers don't remain so hidden.  The girl who used to cruise to Vegas in the rented Escalade didn't come to work one Monday and rumors swirled about an arrest.  With the skills I'd gleaned from a previous contract job, I looked her up on the LA County jail site: she'd been arrested for check forgery.  Becuase she was in jail and couldn't come to work, she was fired later the next week for failing to come in. 

I left the job a few months later, but sometimes I think about my old coworkers and wonder where they are.  What my boss is doing.  But not very often.  You never know what's really going on in the cubicle next door, or in the millions of cubicles beyond it.  BUt everywhere you look--there's money, a real person, and a story hidden behind them.

So a friend sent me a link to the Wall Street Journal's America's Newest Profession: Bloggers for Hire.  "You can get paid to blog!" he had typed helpfully in the subject line.  The article paints does paint a rosy picture of online ad revenue and opportunities to make oodles of money by being a bunch of opinionated jerks bloggers--especially for those ready to sell their souls to the highest corporate bidder and get busy astroturfing.  Great to see at least one sector is expanding!  Except in typical Wall Street Journal fashion, the article manages to mislead, confuse and sensationalize all at once.  Which is quite an accomplishment given the fact that this guest op-ed is written by pollster Mark Penn--who demonstrated throughout the primary that he wouldn't know a blog if it bit him in the ass.

Still, he offers this helpful evaluation of the blogosphere as a potential career field.  Hurry up!  The Train is leaving without you:

In America today, there are almost as many people making their living as bloggers as there are lawyers. Already more Americans are making their primary income from posting their opinions than Americans working as computer programmers or firefighters.

Well, that doesn't seem too hard! If there is one thing this country has more than enough of, it's lawyers.  Except the American Bar Association lists 1.143 million licensed attorneys in 2007.  Penn cites the Bureau of Labor Statistics for his numbers, but many lawyers actually work in related fields and might not list "lawyer" as their primary occupation.  As is, the number of lawyers he cites of 555,770 is higher than the 452,000 bloggers he cites by 103,770 people (or 23% of the number of bloggers who identify blogging as their primary source of income).  That's not an insignificant difference.  And primary source of income is a pretty vague term.  Those identified don't necessarily cover expenses--or even make much: they just don't have another source of income.  Lawyers on the other hand, have a much more stable salary range. 

As for the $75K income dangled out there as a carrot, it would behoove would-be bloggers considering a career change to read the full quote:

The average annual blogger revenue is more than $6,000. However, this is skewed by the top 1% of bloggers who earn $200k+. Among active bloggers that we surveyed, the average income was $75,000 for those who had 100,000 or more unique visitors per month (some of whom had more than one million visitors each month). The median annual income for this group is significantly lower -- $22,000." (emphasis added is mine).

So don't quit your day job.  Unless of course, you're a lawyer--or Mark Penn.

The article reads like an online bookreport--cute with a bunch of random facts about blogging proffered breathlessly by the author as he catalouges the interesting and wide-ranging world of blogging. 

As bloggers have increased in numbers, the number of journalists has significantly declined. In Washington alone, there are now 79% fewer DC-based employees of major newspapers than there were just few years ago. At the same time, Washington is easily the most blogged-about city in America, if not the world.

or

The United Kingdom has just had a major scandal in which an official at 10 Downing Street had planned to leak to a friendly blogger all sorts of lurid stories

or

Maybe all this self-criticism will propel us forward by putting us on the right track and helping us choose the right products. Maybe it will create a resurgence in the art of writing and writing courses.

Blogging is institutionalizing, and it's becomming harder to break in with traffic, revenue and opportunities to get paid for what so many are currently doing for free.  It's admirable Penn worries about an emerging career field with no saftey net, no access to unemployment insurance and no union organization, but he also makes me want to beat my head against the wall.  I'm tired of having the promise of things dangled in front of me, seemingly easy and within reach only to have them fall away against the cold, hard truth of reality.  And I'm sick of Mark Penn being the one doing it. 

In a nod to the angry populism bubbling up against the corporate jet-set, auto execs parked the company plane and headed off to Washington DC in their company cars.  No word yet on whether they chose to dine at Shoney's or  Denny's, or how many breakdowns occurred along the way. 

Auto Execs Carpool to Washington

So this week, Richard Wagoner of General Motors, Alan Mulally of Ford and Robert Nardelli of Chrysler drove from Detroit to Washington in cars their companies build for a second round of hearings. What those drives were like — it's nine hours from Detroit to Washington — was one topic of interest before the Senate Banking Committee.

Sen. Richard Shelby, R-Ala., the committee's top Republican, popped the big questions: "Did you drive or did you have a driver? Did you drive a little and ride a little? And secondly, I guess, are you going to drive back?"

Chairman Chris Dodd, D-Conn., tried to lighten the mood. "Where'd you stay?" he asked. "What did you eat?"

But this was serious business.

Yes, they were driving back. Mulally explained how he "carpooled" and "drove." "I'm driving back," he said.

Wagoner said he and a colleague split the driving 50-50.

Looks like spammers and the much reviled computer virus have breached the final frontier: space!

NASA confirmed on Wednesday that a computer virus was identified on a laptop computer aboard the International Space Station, which carries about 50 computers.

The virus was stopped with virus protection software and posed no threat to ISS systems or operations, said NASA spokesperson Kelly Humphries.

Citing NASA security policies, Humphries said he could not disclose further details about how the virus was brought to the ISS.

John McCain mocked Barack Obama this morning over the backdrop for his speech Thursday at Invesco field. The stage will feature a series of classical columns evocative of the era in which Caesar reigned, democracy fell to empire and John McCain was born in Panama.  The illusion to the classical era that predates Jesus was particularly troubling for a campaign that has been dogged by troubled relations with the Religious Right. 

The McCain campaign fired off a cuneiform screed to be delivered by runner, since their candidate cannot communicate via blackberry, teh internets (a.k.a. "series of tubes"), email, telephone, telegraph or decoder ring.