When the Going gets Tough...
Of course it is unfair to say that beer-brewer Molson Coors experienced a doubling in profits because the American consumer is feeling as weak-kneed as our economy. Often times people flock towards cheaper brands when money is tight. In addition, the companies themselves often try to reduce costs
to help urge their balance sheet in a positive direction. But the sad fact is, the influences most destructive to our health are generally recession proof.
As stress and struggle continues to seep into the American economy people come home feeling drained and a bit more justified in having a drink after work, smoking a few more cigarettes during the day, or eating a Big-Mac instead of a home-cooked meal. And of course this is all very natural and very human. When people hurt we look for comforts.
But more and more it seems like comforts are something we buy. If you turn on the T.V. you enter the land of consumable comforts, a place where advertisers can take advantage of our emotional responses by causing us to attach them to products. Ironically the emotional responses commercials create generally play on human beings innate desire to belong. Teenagers are shown in acne commercials with all the babes. Middle aged men
are shown drinking a brand of beer and they also have all the
babes! Put on some special deodorant and what do you get? All the babes!
And it is not necessarily bad to be a consumer. But perhaps it does point out a problem that is common within the United States. Many people are not very close to their family or friends. We find emotional comforts from things that have no emotion. And when people do spend time together it is not with the same dedication and consistency that people give to their work. And a specific brand of beer or deodorant is not going to pick up the slack!
When the going gets tough everyone should take some time to visit with the people they love. We should remember that the best emotional comforts are responsive to us and not inanimate. And best of all, friends and family don't (have to) cost a dime. Simply put, when times get tough it is not a time to lust for easy access to material comforts; it is time to re-evaluate what is most important to us as human beings. Most people don't
have to think about it for long.
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 | Long-Term Unemployment and the Side Effects
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The reality of our current situation is that after Obama's first term ends in 2013, millions of U.S. families are still going
to be paying the price for the recession.
Since December of 2007 the jobless rate has been on a rampage, finding its way to 9.5%, the largest jump since the Great Depression. What is worse, the mean duration of unemployment is close to 6 months, the highest on record.
This will affect everyone and four years is not adequate time to perform the enormous number of surgeries that need to take place in this country's economy. And surgery is just the beginning! Then there is the recovery period and the extra checkups to make sure everything went according to plan. This can be exhausting for a single person, but an entire economy? Now that is just painful.
The fact of the matter is, a slow recovery is inevitable. From Detroit's mangled auto industry to Arizona's construction freeze to people like me, college graduates competing with already experienced workers for jobs that are scarce, more and more people are facing the depressive horror of long-lasting unemployment.
Of course layoffs are a typical part of any recession. Weak demand forces companies to cut back in order to survive the long haul. Then workers are normally rehired once the economy recovers. The problem is, things don't seem to bounce back the way they used to.
In the back-to-back recessions of the early 1980's, the jobless rate peaked at 10.8 percent, however, a strong recovery brought that number down to 8.3 percent just one year after the downturn had ended. These days the recovery is much slower if those lost jobs ever come back at all. In the slump of 2001, unemployment peaked 19 months after the recession ended! And it took another three years before the jobless rate came close to pre-recession levels.
These days economists say that our country's high unemployment is likely to persist at least four more years. According to the research firm IHS Global Insight, in Michigan, home of the broken-down U.S. auto industry, nearly 13 percent of jobs may be wiped out completely and the state's labor market is not expected to return to pre-recession strength until after 2015.
The government has noticed there has been a rise in long-term unemployment. But it is a puzzle even to the most skilled economists. When the Congressional Budget Office studied the phenomena in 2007 their only conclusion to the shift can be summed up in three words, "hard to explain." One thing is certain however. The longer people remain out of work the worse their chances get; skills become outdated, big gaps in resumes turn off employers, and young, cheap labor is used to fill in the positions that are available.
According to Boston University sociologist Thomas Cottle, "I see long-term unemployment as a real, treacherous disease. And it kills. It kills." To support his theory Cottle began naming off side effects such as stress, hypertension, depression, alcoholism and drug addiction. Cottle adds that even the rate of dental cavities goes up with unemployment because people find it easier to put off routine dental and medical care.
Thomas Cottle is the author of "Hardest Times: The Trauma of Long Term Unemployment." One of his big concerns is that the recession is beginning to dissolve peoples belief that the American Dream just takes a whole lot of hard work. Just surviving for many Americans is a whole lot of hard work, and getting ahead doesn't seem to be in sight. When people work hard and don't see a result, more and more people are going to feel abandoned and betrayed.
The good news is that in hard times, the most efficient and financially stable companies thrive. New companies can take the place of the old, less efficient companies. (Although Wall Street bailouts are certainly diluting this free market concept!)
Obama's big goal during these hard times will be to show young and old Americans alike that the American Dream is still obtainable; that hard work can be enough. If Obama can give people the hope they need to put their nose to the grindstone and keep it there, he has done a good job. And if he can provide the grindstone, then he has done a great job. Long-Term Unemployment and the Side Effects "Obama's big goal during these hard times should be to show young and old Americans alike that the American Dream is still obtainable."
Wasted Money
With the budget deficit reaching around two million dollars, President Obama has ordered his cabinet secretaries to find $100 million in budget cuts for the fiscal year to show that he too is serious about getting government spending on track. How are they saving money? The Department of Justice is now doing double-sided photocopying. The Forest Service will wait to repaint their new white vehicles green. The Army will start packing more soldiers on R&R flights. And the Navy will delete unused e-mail accounts. With $102 million already found in cuts, the federal deficit has been reduced by about 0.006%.
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| General Motors Continues to Lick its Wounds |
In General Motors' first month after emerging from bankruptcy more than 6,000 workers have accepted buyout offers, and the auto company still plans to cut its hourly workforce by another 7,500 workers by the end of 2009.
General Motors emerged from bankruptcy on July 10th with the help of U.S. government funding. According to the auto company, after the last round of buyouts their total number of U.S. factory workers is down to 48,000, quite a drop from the 114,000 workers they employed just three years ago.
Sherrie Childers Arb, a spokesperson for General Motors
said the company does not plan to offer anymore buyouts but will instead look to achieve cuts through layoffs or by transferring
workers into open positions.
The number one U.S. automaker has seen a 19 percent drop in U.S. sales for July from the year before which is not all that great but certainly better than the 35 percent decline they saw in the first half of the year. One reason for the slightly stronger numbers is the U.S. government's "Cash-for-Clunkers" program which urges consumers to trade in the gas guzzlers for new, greener cars.
In an attempt to cut costs General Motors has shed around 66,000 U.S. workers since 2006, more than half of its factory workforce. The lucky ones received a buyout or retirement package from the automaker that is desperate to reduce costs as they are faced with a slow economy, poor sales and mounting losses.
The Treasury now owns over 60 percent of the company.
Blue-collar workers are not the only ones feeling the pain. The company also plans to cut its white-collar workforce by about6,000 jobs, more than 20 percent. Executive ranks will be cut by around 35 percent.
In 2008 General Motors lost more than $31 billion making its total losses $82 billion in the last four years. The company lost its ranking as the top global automaker in 2008 when it was outsold by Toyota Motor Corp.
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