Thursday, 21 August 2014

09:40 – Here’s a headline I didn’t want to see: Winston-Salem ranks high in national poverty study

Winston-Salem was second to Colorado Springs by this metric, which essentially measures the growth rate of formerly middle-class people in the suburbs falling into poverty as a result of long-term unemployment. It doesn’t mean that the city is the second-poorest in the nation. Far from it. The city itself is actually excluded from this study, which counts only the surrounding suburban and exurban metro area. In terms of numbers and percentages of people in poverty, the Winston-Salem area is far from the worst in North Carolina, let alone the rest of the country. What’s disturbing about the results of the study is that the Winston-Salem metro area has experienced very fast growth in the numbers/percentages of formerly middle-class people who are now living lives of quiet desperation. Their unemployment compensation payments have run out–North Carolina has by far the stingiest unemployment insurance in the nation, both in terms of amount and duration–and they are now surviving on little or no income other than welfare and food stamps. Many married couples where formerly both were employed are now down to one income, and barely making it on that one income.

As I’ve said before, welcome to the new normal, the post-employment society. Even as manufacturing continues to grow in the US–which it has done every year for the last several decades–manufacturing employment continues to fall, as it has done for the last several decades. Factories that employed 5,000 workers were replaced by factories that employed 500 workers, which in turn are being replaced by factories that employ 50 workers, and the output has increased with each reduction in employee head-count. Not the output per employee, you understand, the absolute output. Many manufacturing employees produce literally ten times what their fathers did, and 100 times what their grandfathers did. Robotics is the death-knell for manufacturing employment. Robots are much cheaper than people, and do much better work.

The good news is that the output is all that matters, and manufacturing output is ultimately purely dependent on capital. Ignoring allocated capital costs and profit, something like 99.9% of the price of anything you buy is a result of labor costs. If labor costs could be eliminated entirely, the only costs that remain are allocated capital costs and profit, which are a very small percentage of the whole. (Materials costs are really just disguised labor costs: excluding allocated capital costs and profit, the cost of that ton of steel that goes into a new vehicle is very low. What costs money is getting it out of the ground, smelting it, and transporting it.)

So, the obvious problem is that we have robotically-produced BMWs and TVs and food and everything else consumers want. They’re all incredibly cheap, but no one has a job or any income, so no one can afford to buy anything. There is no consumer demand, so all the factories stop making things and shut down. That’s why I and many other libertarians advocate the Basic Income.

The Basic Income simply means that every adult US citizen gets a check every month from the government. There’s no means testing: we all get the same amount, whether we’re destitute or Bill Gates. That amount might be set at, say, $1,500 per month. And it replaces every government social welfare program at every level from local to federal. No more Social Security, Medicare, Medicaid, AFDC, etc. etc. No more government or military pensions of any type. No more bureaucrats overseeing all these hundreds of social welfare programs, either. No more subsidized government housing or medical care. No more subsidized government anything.

So, like every other married couple who are US citizens, Barbara and I get $36,000/year automatically from the government. We don’t have to work for it; it’s automatic. Bill and Melinda Gates also get $36,000/year, as do all those unemployed married couples that newspaper article was talking about. And any of us that choose to work can earn as much as we like or we can, without affecting our BI payment.

But, as people always ask, what about the huge costs involved in such a program? I always reply, “What costs?” We are already paying them, directly and indirectly. BI is simply a redesigned, much more efficient means of income redistribution than what we have now.


This entry was posted in essays. Bookmark the permalink.

88 Responses to Thursday, 21 August 2014

  1. Miles_Teg says:

    As I’ve said many times (and I think you have too): let the market sort it out.

    There’ll be less jobs in existing sectors but more in service sectors. I no longer do much work in the garden, I pay someone (who is really good at it) to come in periodically and make it nice, cut the grass, and so on. He gets paid and I avoid work I dislike or hate.

  2. Robert Bruce Thompson says:

    Yes, that would be my natural libertarian inclination as well. But the simple fact is that these replacement jobs mostly don’t allow people to earn a decent living. I’m suggesting the BI to avoid a revolution, with the poor and unemployed arming themselves with torches and pitchforks. The problem with our current redistribution system is that it creates haves and have-nots. The clients are in poverty or nearly so. The government employees consume much to much of the redistributed income and live much too well.

  3. Chad says:

    Wouldn’t BI just suffer the same fundamental problem that Minimum Wage does? That is, because everyone makes a minimum amount everything is priced accordingly making that minimum income meaningless. Increases to minimum wage just result in increases to the price of goods and services nullifying the minimum wage increase.

  4. Robert Bruce Thompson says:

    Minimum wage has nothing directly to do with consumer goods prices. In a free market, businesses set prices as high as the market will bear. What the minimum wage does do is destroy jobs, prevent the entry of no- or low-skilled people into the workforce, and unjustly boost the income of unionized employees.

  5. OFD says:

    “As I’ve said before, welcome to the new normal, the post-employment society.”

    Yeah, we’re living the dream here now in that regard. UI has long since run out; down to one income (which is unpredictable as to its arrival here); and one vehicle.

    ” Even as manufacturing continues to grow in the US–which it has done every year for the last several decades–manufacturing employment continues to fall, as it has done for the last several decades.”

    Both of my recent IT interviews were at manufacturing companies; they need hands-on IT drones to keep it all humming. For the time being.

    “That amount might be set at, say, $1,500 per month.”

    If we got $3,000 a month we could just barely cut it here; the mortgage and property tax would be half of that immediately. Heat and electricity another $500. Leaving a grand per month for everything else, including food, meds, vehicle/s, clothes, etc. It could be done but would be very stringent living. One or more likely both of us would continue to work until we are too sick or crippled to do it, or dead. Retirement? You must be joking. That was a brief anomaly in the Western industrial empire that is fast fading away.

    Of course we’ll need another legion of gummint employees to set up and administer the BI and police the inevitable criminals who try to undermine it, and and like any other State program, it will continue to expand infinitely and be rife with corruption and fraud.

    Overcast with showers today here; new grandson has yet to make his appearance and the mom is high-risk and having problems, most or all of which she would not be having if she’d lost about 100 pounds sometime in the last five years. Mrs. OFD and MIL are very nervous and getting crazed about now; the former will probably drive down tomorrow for a few days and the latter on Sunday or Monday with Princess; at least that is the latest “plan.” I will hold the fort up here, per SOP.

  6. Roger Ritter says:

    That would cost approximately 4.4 trillion dollars for the actual payments (looking at the current adult US population times $18,000/year). The current government budget is 3.9 trillion dollars. In addition to the 4.4 trillion, we would also still need some additional money for paying the bureaucracy responsible for sending out the money and keeping track of things like address changes, the military, etc. Call it 5 trillion just to make a round figure. Even at 3.9 trillion for the current budget, we’re borrowing something like 1 trillion/year, so we’d have to borrow an additional 1 trillion or so to pay for this. So, yes, I’d ask where the money is coming from.

    The plan would probably work with a smaller payout – say, half what you propose. $9,000/year/person would leave a single household below the poverty level, and a two-adult (only) household a bit above. That seems like a good baseline for a maintenance payment, with people able to get additional income on their own (even if it’s by combining households to add income and reduce expenses).

  7. Miles_Teg says:

    I’m not a uncritical free markets ideologue but I think the market will fix the problem. If I am one of the rich and smart 1% what point is there for me to automate my factories, sack my carbon-based workers, and then find that I can’t sell my goods? The market will find an equilibrium between reduced human workforce and the need to have customers who can afford to buy my stuff and keep me in business. I also think, at least down here, that the new, different jobs being created are often well paying enough for to provided a decent lifestyle.

    I’m repelled at the idea at just giving away money as suggested by BI, but I’m tending to like the idea because the alternatives are worse.

  8. Robert Bruce Thompson says:

    I don’t insist on $18,000/year, but remember that it’s not only the federal budget that would be paying for this. Localities and states collectively spend a whole lot of money on social welfare programs, including Medicaid and retirement/medical payments to retired employees. All of that goes away.

    As to OFD’s point about legions of bureacrats, managing BI would require about 0.01% or less the number of government employees to manage compared to what we have now. And it’s pretty straight-forward, with few opportunities for fraud or diddling the system. If you’re a US citizen aged 18 or older, you get the Basic Income amount credited to your card every month. Period.

    As to you and Mrs. OFD barely making it on $36,000/year, so what? Continue working, cut expenses, do a reverse mortgage on your house to pull out your equity as a monthly annuity, or whatever.

  9. Robert Bruce Thompson says:

    Incidentally, Dave, I didn’t mean to sound harsh. The question is, would you be better off with the $36,000/year additional that all married couples who are US citizens get, or not?

    Also, I could see BI being run on both a federal and state level. The federal part might be $12,000/year per adult citizen, while the state part might vary from state to state, with high-cost states paying more than low-cost states.

  10. OFD says:

    “If I am one of the rich and smart 1% what point is there for me to automate my factories, sack my carbon-based workers, and then find that I can’t sell my goods?”

    I’ve often wondered about that, too, but have come to the conclusion that they just don’t care; they intend to make their huge bundle and then get out. The future means nothing to them; the past less so; and their fellow citizens and such outmoded concepts as national sovereignty are a joke.

    “As to you and Mrs. OFD barely making it on $36,000/year, so what? Continue working, cut expenses, do a reverse mortgage on your house to pull out your equity as a monthly annuity, or whatever.”

    Oh sure, we’ll do whatever we gotta do, esp. me bringing in as much income as possible as soon as possible. I just don’t think the BI has the proverbial snowball’s chance in this empire; the rulers really don’t care if there are mass die-offs and in fact would welcome them. We’re fast moving to the banana-republic model writ large here. Hunger Games soon to follow or something similar, probably.

    As it is, assuming we see any of our Social Security money in the future, it will work out to roughly that $1,500/month for each of us, but I don’t expect we’ll get that, either.

    “As to OFD’s point about legions of bureacrats, managing BI would require about 0.01% or less the number of government employees to manage compared to what we have now.”

    You may be mistaking your ideal for the reality; we know that the State’s primary directive is to expand its power and thievery. I don’t for a minute think that they wouldn’t screw this up badly. No, the overall objective is to plunder the remaining population and resources as fast and as brutally as necessary to maintain the ruling elites’ hegemony in what is left of the Western industrial societies. At home here in North Murka, increased poverty and violence, and a continually burgeoning and militarized police state. Until they can’t pay their cops and soldiers and gated estate security teams anymore. But that will probably take a real long time.

  11. Chad says:

    In a free market, businesses set prices as high as the market will bear.

    Exactly. So, as minimum wage increases so does what the market can bear thus the price increase. Rinse and repeat until we’re all making $300,000/year but paying $40 for a Happy Meal at McDonald’s.

  12. Robert Bruce Thompson says:

    A very small percentage of workers make minimum wage, and those workers have little discretionary income. A small change in the minimum wage disappears into the statistical noise. Also, to the extent that an increase in minimum wage results in employees being cut, the total pool remains very close to the same. That is, say a business employs four minimum-wage workers at $7.25 per hour or a total of $30/hour. If the minimum wage increases to, say, $10/hour, that business may well cut one of those four employees, leaving three making $10/hour, or a total of, you guessed it, $30/hour.

    Actually, what we’re seeing more of is businesses realizing that paying a bit more per hour can get them more percentage productivity increase than the percentage by which they increased wages. That is, many businesses would choose to employ three people at $10/hour in the first place rather than four at $7.25/hour. Or even two people at $14.50/hour.

    The real problem with many minimum-wage employees is that their skills and work ethic make them worth less than minimum wage. Increasing the minimum wage doesn’t increase the earnings of people like that. It simply puts them out of work.

  13. Jim B says:

    “All of that goes away.”

    Ah, there’s the problem. As often repeated here, any new program or idea would in practice just be added to the already bloated government practices. Governments always seem to grow inexorably until a crisis occurs. Many of us hope that crisis doesn’t come in our lifetime. Some of us will be right.

  14. Ray Thompson says:

    many businesses would choose to employ three people at $10/hour in the first place rather than four at $7.25/hour

    Then why aren’t businesses doing so? There is nothing that says that have to pay minimum wage as they are free to pay higher than minimum wage. Yet many businesses choose to stay at the minimum allowed by law.

    Granted many of the low end workers are not worth more than minimum, many worth less than minimum. Poor work ethic, poor work skills, poor communication skills, etc. Yet businesses continue to hire these people at the minimum wage rather trying to attract employees that are higher on the food chain. Why?

  15. Robert Bruce Thompson says:

    As I said, businesses already are doing that. About the only businesses that hire minimum-wage employees are those that need x number of warm bodies for counter work and so on. Very few businesses hire minimum-wage employees for non-public-facing jobs.

  16. OFD says:

    OFD is apparently employed again; just got an offer on the phone and am now traveling to the gig 40 miles southeast of here for HR orientation, bennies discussion, and “spend some time with the IT team,” which I did yesterday and which was probably the clincher, esp. when it was discovered that they’re seriously considering moving from Windows to Linux. Looks like the pay I was getting at my last gig PLUS nice bennies, including two weeks of vay-cay and 401k, etc.

    IT drone keeping the machines humming at a small- to medium-sized manufacturing company in northern Vermont. They’re big on saving money and they make stuff to order and the objective is to ship it the next day. This should be interesting.

  17. rick says:

    Continuing from yesterday: So what size (or size range) is small enough to handle and big enough to take anywhere? Like OFD and Steve there is a part of me that would like to have a sailboat and sail it around the world.

    My boat is 33 feet long. Towards the bottom end of what would be considered a blue water boat and there are a lot of boats which are much bigger which I would not take in the open ocean. The design and construction of a boat are more important than the size. Much above 4o to 45 feet and a boat is going to be more difficult for two people to handle and much more expensive to buy and maintain.

    Rick in Portland

  18. MrAtoz says:

    OFD is apparently employed again; just got an offer on the phone

    Fantastic Mr. OFD. Congratulations! How will the commute go? Straight shot or stop and go. I hated the commute in DC.

    I imagine your posting here will go down, but that is a good thing with the new job and all.

  19. rick says:

    From yesterday: Ray Thompson says:
    Can I have the same deal?

    If you plan to go to Portland, let me know and I’ll take you out on the Columbia. You can see where I keep my boat at http://wwc.instacam.com/instacamimg/PRTST/PRTST_l.jpg although it is currently in the yard for repairs, so it’s not in the picture. It normally is in the closest row near the far end.

    Rick in Portland

  20. Miles_Teg says:

    Conga-rats Dave, glad to see you becoming a wage slave again… 🙂

  21. OFD says:

    “Fantastic Mr. OFD.”

    We’ll see how fantastic, but hey, any port in a storm, amirite?

    Yep, posting everywhere will do down, as will a bunch of other stuff for a while; I’ll be busier than a one-legged guy, etc., etc.

    “How will the commute go? Straight shot or stop and go.”

    More or less straight shot down two state highways but zero interstate; forty minutes with no traffic or road repairs, like are currently underway in the warm weather. All Vermont countryside farms, fields and woods, and a couple of very small towns, maybe two gas stations on the way. The site itself is in a bigger town behind a Hannaford’s supermarket and off the town’s “strip.” Mostly dirt and gravel roads in and out due to road repairs and ongoing construction. Big-ass warehouse-type building with the manufacturing lines on the ground floor and the IT operations just off the main second floor and office area. Racked M$ and Linux (CentOS) servers plus SonicWall firewall, and all kinds of printing label-makers and gimcracks throughout the building, running on mostly Cat-5 Ethernet and a bit of fiber. Exchange Server, some database stuff, Active Directory, and web-site development duties at some point.

    I’ll have to get up to speed, just as with any IT site on all their stuff the next few weeks.

    Fems here seem to have ironed out the resulting transportation logistics with this and the trips down to MA for baby situation/s. We shall see.

    Off shortly for the HR drill, will report later.

  22. MrAtoz says:

    The Universe is in balance. Reporter murdered by beheading. Obummer on golf course 5 minutes after saying “damn them”. Holder in Ferguson ’cause “it’s personal because I’m Black.” Holder opening an “investigation” into the reporter’s murder. 10,000s of illegals pouring into the country. US Marine still rots in Mexican jail.

    WHAT—-THE—-FUCK!!!

  23. MrAtoz says:

    Perfect front page that summarizes Obummer’s Presidency.

    Have Bergdahl’s parents in the Rose Garden for political points. I guess Foley’s beheading didn’t “make the cut.” Bad pun, I know.

  24. Jim B says:

    Congrats, Dave. Looks like your kind of gig.

  25. medium wave says:

    Congrats, OFD! You certainly earned it!

  26. brad says:

    Congrat’s OFD – not a great commute, but sounds like a good port in the storm.

  27. Robert Bruce Thompson says:

    Huh, I’m not sure what happened, but WordPress apparently ate my post congratulating Dave on the new job. At any rate, way to go, Dave.

  28. bgrigg says:

    OFD, congrats on the job!

  29. Chad says:

    We’ll see how fantastic, but hey, any port in a storm, amirite?

    Now that you have the job you need you may find it easier to get the job you want. Being unemployed is a turn off for a lot of hiring managers (don’t ask me why) and you no longer have that handicap. Also, people who are employed tend to interview better as they’re more relaxed and exude more confidence.

  30. Ray Thompson says:

    You asked what I’m going to be doing in retirement. Well, I applied for a building permit for a new house! It was going to be 100 ft tall and 400 ft wide, with 12 gun turrets at various heights, and windows all over the place and a loud outside entertainment sound system that was going to entertain the whole neighborhood. It would have parking for 200 cars, and I was going to paint it green with pink trim.

    The City Council told me: “Forget it…IT AIN’T GONNA HAPPEN!”

    So, I sent in the application again, but this time I called it a ‘Mosque.’

    …Work starts on Monday.

    I love this country.

  31. Robert Bruce Thompson says:

    Ah. Found my original post in another open Firefox window:

    Congrats, OFD. That’s great. And I’m sure it’s a big load off your mind.

    Just don’t forget your resolution to look at this job as a short/medium-term solution on your journey to being self-employed.

  32. Dave B. says:

    Glad to hear OFD has a job. I am waiting to see how my arm is doing. Just had X-rays taken. Now waiting for the doctor to look at them and my arm.

  33. Lynn McGuire says:

    Congratulations OFD!

    Now hurry up and pay some taxes! You gotta pay to play in this country.

  34. Chuck W says:

    My condolences…er, commendations…no, that’s not right…accolades?…laurels…relief? Well, one of those or something like it and many happy returns.

    Fahty minutes ain’t bad — fer shoe-ah. Think of my 90 minutes one-way to the closest of my teaching jobs 5 days a week for 5 years. Got through a whole lot of podcasts during those years, and now I am a year behind on a mere 20 minute daily podcast these days.

  35. SteveF says:

    Congrats, OFD.

    any port in a storm, amirite?

    Hell, yah.

    Once you’re settled in, you should start developing alternative income streams — paper writing for college students, course development for online unis, whatever. Something so you’re not dependent on the whims of corporations* who don’t give a damn.

    * Or corporate execs or the cost-cutting consultants they bring in. I went through that latter once. A handful of mid-level people were cut — all “productive” types, programmers and some kind of data specialists. So far as I know, no useless middle managers were cut, and believe me, that’s not because there were no useless middle managers. And the top execs were kept on and their sweeet compensation was not cut. Funny how all that worked out. I’m guessing the savings in producers’ just about paid the consultants’ fee, and the loss of their productivity made the exercise a net loss.

  36. OFD says:

    Thanks, all; for the congrats, the encouragement and the tips. As Mr. Chad sez, having a job makes it easier to find another, better one; or in my case have the income stream for pursuing another field now. Either way works for me but time and years runneth short now so I gotta try to do the right thang, amirite?

    Two big surprises today in addition to the one yesterday (that half their servers are Linux): One: the two young guys doing the gig now have their last day tomorrow; as of Monday I’m their one and only IT guy for the whole shebang; been there and done that. Hit the floor running every day. Two: one of their subsidiary companies in an adjoining building assembles and customizes AK-47 knock-offs for a big firearms importer/manufacturer in the next town south of us.

    The other kinda nasty little surprise that Mrs. OFD noticed when I got home just now was they no longer offer health insurance. We’ll have to deal with that via the VA stuff for me and her getting on whatever the state here gins up this next quarter at around $600/month. I’m sure they, like many other employers, just decided to bail the hell out of the whole mess. Us serfs are on our own.

    They mainly manufacture rowing and Nordic exercise machines, and some other random stuff, so they must get the boating and skiing markets, I reckon, among others. I will be checking out the AK-47 shop soonest, however.

    Mrs. OFD now leaving with MIL and Princess on Sunday or Monday for the baby-sitting stuff and moral support down in MA. I’ll be at work. Finally. They’ll be back a week from tomorrow, allegedly, and then Mrs. OFD leaves for the first of three week-long gigs in September. Probably be looking into my next truck in October accordingly.

    Y’all have a wunnerful evening and quit lookin’ at the damn nooz. Take a tee-vee break. Thanks again for the congrats!

  37. eristicist says:

    Well done, OFD. I hope good news keeps coming to you. 🙂

  38. Lynn McGuire says:

    One: the two young guys doing the gig now have their last day tomorrow; as of Monday I’m their one and only IT guy for the whole shebang; been there and done that. Hit the floor running every day.

    Oh my! Why is everything run like a crisis nowadays? This just in time stuff just makes me crazy.

    Two: one of their subsidiary companies in an adjoining building assembles and customizes AK-47 knock-offs for a big firearms importer/manufacturer in the next town south of us.

    Cool! Sounds like a lock down operation though.

    they no longer offer health insurance

    I understand their position entirely. My office manager just got a letter from BCBS that our health insurance will be going up 22% on Dec 1. If, we keep our current plan which I did not think that we could do so.

    Or, behind curtain #2, they have a new Obamacare Silver plan for us that is only 16% more than our current plan.

    It is enough to make one run into the woods screaming and ripping out what hair I left.

  39. Chuck W says:

    I have been taking a TV break since 2001. Have not owned one since then and quit watching it altogether in 1989.

  40. Dave B. says:

    I have been taking a TV break since 2001. Have not owned one since then and quit watching it altogether in 1989.

    I should do that. If it were up to me I would at least dump cable TV and go to an off air antenna and add a DVR from Tivo.

  41. SteveF says:

    Or stop watching the current shows and instead get series after the fact on Amazon Prime, Netflix, or equivalent. Or, for that matter, get the Amazon and Netflix originals, which you can’t get over the air.

  42. Ray Thompson says:

    My office manager just got a letter from BCBS that our health insurance will be going up 22% on Dec 1.

    Same thing here in TN with United Healthcare. Rates going up 21%. Boss is looking at getting insurance through one of the exchanges in TN.

    What is surprising is that last year we had to provide a fairly substantial health history. This year all the companies are allowed to gather is our age and gender. Nothing about health history.

    Paying for all those people with pre-existing conditions who have never had health insurance (and are expensive), plus people that choose not to get health care as their booze and cigarettes are a priority (and are expensive because of smoke and booze conditions), is costing the rest of us a lot of money. Insurance companies are not in business to lose money and the increased cost has to come from somewhere.

    Another interesting twist is that the hospital that my wife used to get a kidney stone blasted wanted payment up front. Same with the urologist who did the procedure. They call the insurance company, find out what the patient has to pay, and I have to pay before they will do the procedure. I guess too many hospitals and doctors were getting stiffed by losers who don’t pay.

  43. Lynn McGuire says:

    They call the insurance company, find out what the patient has to pay, and I have to pay before they will do the procedure. I guess too many hospitals and doctors were getting stiffed by losers who don’t pay.

    That is just the forefront of the changes coming. BTW, they are getting stiffed because of all the new high deductibles. Our deductible is now $2,500 / $5,000. I can hardly wait to see how that changes.

    Many of the doctors (GPs and specialists alike) are considering moving to the concierge plan. Where is addition to their per visit charge, you pay them a yearly fee in order to be able to visit them. And the insurance company will not pay that fee. Kind of what the Japanese used to call, “key money”.

  44. Lynn McGuire says:

    What is surprising is that last year we had to provide a fairly substantial health history. This year all the companies are allowed to gather is our age and gender. Nothing about health history.

    Didn’t the pre-existing conditions start being enforced on Jan 1, 2014?
    http://obamacarefacts.com/pre-existing-conditions.php

  45. Jack Smith says:

    Let’s assume every adult receives $18K / year as proposed.

    This, of course, immediately provides an incentive for a significant proportion of the population to put into office elected officials favoring an increase in this sum. It’s a system with positive feedback and will soon go into saturation either via Zimbabwe-style inflation or confiscatory taxes on those with a job.

    This system could be stabilized with addition of negative feedback – everyone has one vote as the case is now, plus one additional vote per $1,000 of income tax paid in all local, state and national elections. If the tax level becomes too great, presumably there would be sufficient votes to reduce taxes and the dole amount.

    As far as setting prices in a capitalist economy, the business owner should set prices to maximize profit. In an industry with perfect competition, prices tend to be driven towards incremental costs, which is a pathway to bankruptcy if it exists long enough.

    We seem to have settled into a symbiotic relationship between big government and big business, however, with big government doing its best to protect favored industries and companies from competition and/or their mistakes. A few examples include the continued extension of copyright terms so that Disney’s Mickey Mouse remains protected, or the FBI and DHS being turned into the private enforcement arm of the movie industry. And, bailing out GM and “too big to fail” banks from their mis-management. (I really like the extension to “too big to fail” which is “too big to prosecute” What a deal.)

    Big business doesn’t necessarily mind complex regulations as they serve as a barrier to entry.

  46. OFD says:

    It is truly a very strange state of political/economic affairs we’re in nowadays; we seem to be in a sort of corporate fascist oligarchy run by Bolshevik apparatchiks all for the benefit of the so-called One Percent, or, as I prefer, the global elites. It’s almost, but not quite, a mirror image of the old Soviet Union, and the current denizens thereof are gobsmacked by our stupidity and evident physiological inability to study and learn from history.

    I am not hopeful, not by a long shot.

  47. pcb_duffer says:

    I’m paying $325 / month to Blue Cross here in Florida; they are the only company selling policies in my county under Obamacare. That’s for a 90/10 policy with a $5,000 / year deductible. And I’m not counting the costs of the endless hassles and fubars that I went through when I tried to get signed up, and after signing up. Rest assured, if I’m ever again in the position of buying health insurance for me & some employees, Blue Cross isn’t going to get my money, even if it costs more to go with someone else.

  48. Miles_Teg says:

    OFD, how come the two kids are leaving your new employer?

  49. brad says:

    @OFD Wow, one day to hand over all you need to know about a company’s infrastructure. Hope they also left some scribbled notes – long days ahead for a while…

    Still, it’s nice having a free hand to do things the way they need done – hope you have fun with it!

  50. Ray Thompson says:

    Our deductible is now $2,500 / $5,000. I can hardly wait to see how that changes.

    Mine is $4,000/$8,000. Consider yourself lucky. For that my company pays $1200 a month of which I pay 25%. That is going up and we may be forced to get on one of the exchanges. Thanks Obama, another thing you and your wicked witch Pelosi shafted everyone.

  51. brad says:

    Insane – I though health insurance was expensive here, and here it’s pretty ridiculous.

    Of course, none of the perpetrators have or will suffer any consequences…

  52. Robert Bruce Thompson says:

    Obviously, the idea all along was to kill private health insurance and force everyone onto the exchanges. That seems to be working, no surprise. The surprise will come for the insurance companies when they finally realize they’re the intended victims of this assault, and have been all along. The goal, as it always is with the progressives, is leveling. “If everyone can’t have it, no one can have it.” So I expect that ultimately, all US citizens will be covered under Medicare, which bodes very ill for physicians and hospitals. Insurance companies will survive by selling Medicare supplement policies, just like the ones they sell now. And the people who can afford it will move to concierge medicine, which I expect an increasing percentage of doctors to get involved with.

  53. Chad says:

    I know a lot of single guys that just don’t have health insurance. Not because they cannot afford it, but because they choose not to afford it. At some point, with deductibles and copays and premiums, it’s just cheaper to pay cash for medical care. Most major providers have a reduced “cash price” for people paying 100% out of pocket. Sure, there’s the risk that something catastrophic happens and they’re suddenly $100,000 in debt with medical bills, but for the overwhelming majority of healthy young single people it’s cheaper to just pay cash and the risk of having some major happen that racks up a big bill is small enough to be acceptable. Most of these guys go to the doctor maybe once ever 2 or 3 years (Heck, from age 23 to 30 I went to the doctor maybe once). I suppose an HSA would be an alternative to cash.

  54. Robert Bruce Thompson says:

    Yeah, that’s one of the things that’s killing Obamacare: young people just aren’t signing up. I read a pretty credible report about doctor visits by young people. Males aged 18 to 30 visited a doctor on average less than once over that entire 12 years. Females were more likely to visit a doctor, as expected given their different plumbing. But even females averaged something like three visits over 12 years, and I suspect many of those were for birth control prescriptions. Why do birth control pills require a prescription, anyway? They certainly present orders of magnitude lower risk than OTC acetaminophen.

  55. MrAtoz says:

    That’s why there is a penalty (oh, wait, SCOTUS said it’s a tax, bastards) if you don’t have insurance. Gotta make sure the indigent bums get coverage, you know.

  56. Miles_Teg says:

    I spent a week in hospital, including an operation, back in May, my total bill: $0.

    I hired a walking frame for two weeks, they said they’d charge me $6 per week, but never did.

    Next week I’m investigating the possibility of having some sort of surgery on my right knee, after I fell getting off a bus. This knee has been a problem for 30 years. My GP said the initial consultations and scans shouldn’t be expensive. We shall see…

  57. Dave B. says:

    Why do birth control pills require a prescription, anyway? They certainly present orders of magnitude lower risk than OTC acetaminophen.

    Why would women go for the dreaded annual exam if they could get birth control pills without going?

  58. brad says:

    Somehow, the massively increased prices don’t add up for me. I mean: y’all are paying a lot more for insurance, have massively higher deductibles, and the health care providers say they’re getting screwed too. So…just where is all that money going.

    I mean, we were just discussing how Switzerland is at least 2x as expensive as the US, due to exchange rates. Which means that your health care rates are effectively higher than ours are, so…who’s pockets are getting lined? Follow the money…but to where?

  59. Ray Thompson says:

    So…just where is all that money going.

    Malpractice insurance, insurance and hospital CEOs, lobbying money and lawyers. Insurance companies are making money. When they start to lose money they just appeal to the state to allow their rates to rise which also allows other insurance companies to raise their rates.

  60. Chad says:

    Hey now, the medical and insurance bureaucracy and bullshit in the US creates a lot of jobs. 🙂

  61. Robert Bruce Thompson says:

    As I’ve said repeatedly, this is what happens when a huge percentage of the population is economically useless. We now have more make-work jobs than real, productive jobs. It’s just a very clumsy, very inefficient substitute for the Basic Income.

  62. SteveF says:

    “If everyone can’t have it, no one can have it.”

    Almost right. The party leaders and the nomenklatura can have it, but no one else.

    So I expect that ultimately, all US citizens will be covered under Medicare

    Again, almost right. Everyone within US borders, citizen or otherwise, will be in Medicare. Everyone except the party leaders and nomenklatura, who will have their own system.

  63. medium wave says:

    OFD, how come the two kids are leaving your new employer?

    I second that question.

  64. Lynn McGuire says:

    OFD will probably be at work until midnight with those two fellas hitting the street.

    Am I the only one wondering if he walked to work today as the women headed south?

  65. Lynn McGuire says:

    But what do people do with their free time if they get a check for breathing? Get high and make more babies?

  66. Lynn McGuire says:

    BTW, I am loving the new galaxy s5. The battery alone is awesome, still at 80% now while I am Carrollton. But the screen is awesome also.

  67. medium wave says:

    OFD will probably be at work until midnight with those two fellas hitting the street.

    Perhaps his new employer will set up a cot for him in the server room and allow him conjugal visits on the weekends. (I wish I were kidding.) 😐

  68. Chad says:

    Perhaps his new employer will set up a cot for him in the server room and allow him conjugal visits on the weekends. (I wish I were kidding.) 😐

    I worked with a guy from Pakistan that used to use the server room for privacy to pray toward Mecca. We had a pretty trouble free network as I recall, so perhaps Allah kept it all running. 🙂

  69. Chuck W says:

    Thanks for the report on the S5. I don’t know what happened, but along about March, after having gotten 2 days off one battery charge since I first got the phone (over a year), I am now getting only about 5 hours tops off the charger on my S3. I did not change the OS or take any updates until a week or so ago, thus I doubt it is anything to do with updates. It’s exasperating, because on non-workdays when I am out and about, I have no way of charging. When I am at work doing video, I can plug it in as we are recording. It is not the battery, because I bought a new one — stamped as made only 3 months ago, — and I get exactly the same battery life as the old one: not enough! I am eligible for a new phone on 1 September, and that is also the release date for the Galaxy F also known as the Samsung Alpha. However, it will be released in Russia first; no word on a date for US availability.

    I have to do something about this battery issue soon, because my phone is dead by mid-afternoon on most days. Settings show the only apps running beside the OS are Google Play, which is necessary for the Contacts backup, and occasionally Amazon Kindle, which I have never used on this phone and have no idea how it got on the phone. Probably standard Sprint issue. Sprint, of course, has no idea why the deterioration and tell me I should not expect to get a full day from an S3. Then why did I get more than 2 days for over a year?

    BTW, I paid $200 up front for the phone; you now have to pay only $49 up front for the S3; and they tell me the Alpha will be more than $200 when it comes out. Not sure exactly why I pay upfront, but it has to do with the fact that I am on the friends and family plan of an employee.

  70. Chuck W says:

    Ruh-roh. Just read that the Alpha has a much smaller battery than my S3. I can’t like that.

  71. Ray Thompson says:

    I have to do something about this battery issue soon, because my phone is dead by mid-afternoon on most days.

    Get one of these.

    http://www.amazon.com/10000mAh-Dual-Port-Compact-External-Portable/dp/B009USAJCC/ref=sr_1_3?s=wireless&ie=UTF8&qid=1408803037&sr=1-3&keywords=anker

    They work quite well.

  72. Lynn McGuire says:

    I paid $180 for my s5. Plus a $30 upgrade fee to verizon.

    That Ankar works well for charging up your phone. But it is heavy for carrying in your pocket. And makes the phone a pain to use while plugged in.

  73. OFD says:

    Beeyooteeful day on da Bay today; I slept like the dead last night after an 18-hour first day at work, LOL.

    “OFD, how come the two kids are leaving your new employer?”

    One is going off to college in northern NH and the other heads to the Air Force next month in the great Lone Star State. They busted their young butts getting info and intel together for me and showing me around, etc., etc, both smaht, hahd-working good kids, basically just outta tech high school. I’d hire both of them anywhere in a hahtbeat. College boy is gonna major in CS and Biz and wants to get more into programming and storage area networks; AF boy wants to get into electronics. So I’m a 61-year-old grandpa replacing two high-school kids, basically, but at my old Big Blue pay plus bennies and a mix of Windows and Linux machines for a company that is manufacturing stuff! I suspect they want my background/experience/maturity so they can ramp up operations; they just bought more substantial real estate nearby and they are pushing me already to get up to speed on PHP/MySQL for web development so they can ditch the high-priced developers they’ve been using. So I have a chance to work with a smorgasbjord of IT stuff for a while. As I get into some other line of work that will take care of us in future.

    “Now hurry up and pay some taxes! You gotta pay to play in this country.”

    Just back from the P.O.; certified letter from the IRS claiming we owe more thousands from 2012 returns. On top of many thousands already paid and still paying and with the monthly nut not reducing the principal. We are fast coming to the time to retain a good tax lawyer here.

    “Am I the only one wondering if he walked to work today as the women headed south?”

    It’d be a forty mile hike over hill and dale through beautiful scenery, mostly still emerald-green with mist in the hills, between the mountains, and largely farms, fields and woods. Leaves changing now, though. I’ll have the cah for the next several weeks, as wimmenz are heading south in MIL’s cah and then Mrs. OFD will be gone on cross-country gigs for much of September. We’re looking at getting a second vehicle when she gets back. I kinda want a Tundra but she’s pushing for a RAV4.

    I expect to get “emergency” calls at home a few times from now on and will either fix something via remote logins (kids set me up with the VPN, so I’m using Putty to connect to the Linux servers and M$’s Remote Desktop app for the Windows boxes). Or I may have to just drive on down and deal with it. About forty minutes with no traffic, maybe eight more minutes than my commute to Big Blue, which I just heard is now not selling but planning to expand and are hiring again, LOL.

    “Perhaps his new employer will set up a cot for him in the server room and allow him conjugal visits on the weekends. (I wish I were kidding.)”

    The “server room” is adjacent with connecting door to my large office w/window overlooking woods and propane farm and local construction firm cement dispenser. I may stow an inflatable mattress, etc. in there for whatever, since we are likely to have nighttime production blowups plus wintuh weathuh stuff going on. Got bathroom and showers across the mezzanine from me, plus nicely equipped kitchen with six-burner gas stove, three microwaves, toaster oven, full-size fridge, sink, etc. If stuck there I could do alright by myself; I’ll keep some grub on hand, as well. And I see the kid has VLC on his Windows 8 laptop/monitor setup, so I could also watch movies. They told me they’re getting me a new iPhone 5s and my specs for a laptop. And I can do whatever I want with any still-operational machines piled up in the office and server room. Got my personal iPhone 4 all set up with their Exchange/Outlook email, too, which I can see is gonna be a PITA.

    Here’s OFD’s new machine mix that he’s gotta maintain:

    Win7 and 8 desktops and laptops, plus all the damn printers and label printers, the latter of which are CRITICAL.

    Windows 2003 Server running Exchange 2007 (adding/deleting email users, etc.)

    Windows Server 2012 (domain controller).

    (2) CentOS 6.5 servers running a whole bunch of stuff.

    SonicWall NSA 220 firewall box.

    Plus, of course, all the network wiring, connections, putting out fires, something different every day, the life of a sys/net/security admin again. But this time for a place that actually still makes stuff here in-country. With about the most scenic commute possible. And a fair amount of autonomy.

  74. SteveF says:

    Holy smokes, sounds like you not only landed on your feet, you snatched the brass ring on the way.

  75. Robert Bruce Thompson says:

    Congrats. Sounds like an ideal gig, other than the commute.

    I’d sure hold out for the Tundra and its one-ton payload. With the RAV4, you’d have to make about five times as many trips to the LDS store to haul back the same ton of stuff that Tundra can haul in one load. I’m not sure how the mileage compares, but at 20,000 miles per year in RT commute that might be an issue.

  76. Lynn McGuire says:

    I would price any new car / truck purchase with $6 gasoline. If you cannot afford the vehicle with that gas price then do not buy it.

    I am probably totally wrong as usual but the epa is getting ready to drop some serious global warming taxes on the refineries. CO2 emission taxes. The clean air does have provision for fees in it that have never been implemented.

  77. OFD says:

    Yup, 20k miles per year at current gas prices for whatever size the tanks are on a Tundra and RAV4, which I don’t have off the top of my head right now. Probably $500-600/month at this time. If the prices go to six bucks and up, then so will the monthly nut, of course. I’d prefer the Tundra but the mileage is roughly ten miles less per gallon than the RAV4. What to do, what to do…

    “Holy smokes, sounds like you not only landed on your feet, you snatched the brass ring on the way.”

    We’ll see about that; right now I’m ramping up on Windows again, CentOS/RHEL again, network security again, and believe it or not, CSS, HTML5, PHP and MySQL. Two online courses in the latter four things and another one on the SonicWall (owned by Dell) stuff. Probably as much as I can do during work hours, and another couple of hours every night at home, plus working on FFL application paperwork. And the 200-year-old house. I figger I can get by on seven hours sleep a night as long as I eat good and hydrate and stay loose, man.

  78. Lynn McGuire says:

    What specs do you have for the assistant that you are going to hire?

  79. OFD says:

    No one has said anything to me about hiring an assistant or even another IT person so fah. They’ve had one guy doing it all before there, and apparently having the two young guys was an anomaly. Some of their support is outsourced; esp. the developer end of things, which they would like to eliminate and evidently have me doing it. But if they ramp up operations and expand into more real estate that needs more IT infrastructure, I’m pretty sure they’ll have to get me some help. Hell, they may have to, anyway; I’m an old decrepit SOB.

  80. Ray Thompson says:

    Two online courses in the latter four things and another one on the SonicWall (owned by Dell) stuff.

    We have a Sonicwall that I know little about. My advice is to pay Dell for yearly maintenance which includes support. The little buggers are so complicated that even if you figure it out (rules, resources, etc.) you will have forgotten it when you need it. The support is not much per year, about $40 a month for our device. Worth it in my opinion.

    hiring an assistant or even another IT person so fah

    I am the sole IT staff at my organization, 11 employees, four Windows Servers (one for the WEB, one for storage and development, one for Email, one for storage only), 13 desktops (one spare, one test box).

    We also have a device by OnQ that backups all our servers and can stand in for a server or two in case of downtime. Fairly seamless transition as the device remains current by taking snapshots of the servers every 12 hours (you can change that). Gives one time to analyze the problem, devise a solution, and get the broken server back online. When one of my servers failed I left the backup OnQ device taking the load for three weeks until I got replacement parts ordered and installed. Operations never missed a beat and I did not have to panic. Highly recommended. I would suggest you look into the product. It will make your live easier. Did I mention highly recommended?

    I do the web applications which are written in ColdFusion, I do the SQL Server maintenance, I do the network support (trivial), desktop support (sometimes a pain), multiple printers and some small label printers (8). We do not run exchange but instead use Google services and our own email server (IMail). Exchange is overkill both in resources and cost.

    We do run SQL Server Express as it is a free product as long as your database remains under 10 gig in size. You can run multiple databases within the product and crossing databases within the one instance of SQL is trivially easy.

    No Linux systems. We get licenses from the University of Tennessee that are dirt cheap so cost savings is not the issue. Windows 7 works so we have stayed with the product. We need full versions of Office because of the way we exchange information with chapters. We also absolutely need to run InDesign for the magazine production and the requires Windows or OS/X. OS/X was a pain to integrate within a Windows server environment (well it used to be, don’t know about now).

    So OFD if you need any help with CSS, HTML or SQL give me a shout at my work address of ray at tbp dot org. I may not have the answer but I might give you a clue of where to look or discount where not to look.

    the developer end of things, which they would like to eliminate and evidently have me doing it.

    That is my primary job, web application developer. I come from a coding background started back in the late ’60s. The rest of the stuff I learned as needed and probably forgotten a lot along the way. I am probably as old as you, maybe not as decrepit, but I may be able to provide some wisdom and help in that area.

  81. OFD says:

    “The support is not much per year, about $40 a month for our device. Worth it in my opinion.”

    The unit only cost a grand so I dunno if they’d spring for Dell support at that rate if they think I can suss it out. Dell/SonicWall also have online training courses, the introductory ones being free.

    “We also have a device by OnQ that backups all our servers and can stand in for a server or two in case of downtime.”

    I will certainly look into that; currently there are two Barracuda machines for backups to an external drive; I was impressed by the Mondo backup app I saw, though, at least for the Linux servers.

    “Exchange is overkill both in resources and cost.”

    That’s what is seems to me, as well; even with a couple of hundred employees, most of whom they wanna give email to, evidently.

    “So OFD if you need any help with CSS, HTML or SQL give me a shout…”

    Thanks much; roger that.

    ” I am probably as old as you, maybe not as decrepit, but I may be able to provide some wisdom and help in that area.”

    Undoubtedly, across the board. Appreciated!

  82. Ray Thompson says:

    That’s what is seems to me, as well; even with a couple of hundred employees, most of whom they wanna give email to, evidently.

    Look into using Gmail. You don’t have the hassles of maintain email hardware and software. You can use corporate domains on Gmail. We only maintain the email server now because we send a lot of emails from the web applications.

    Exchange for 200 people will keep a person almost busy full time with mailbox problems, users borking passwords, etc.

    The unit only cost a grand so I dunno if they’d spring for Dell support at that rate

    That is about all that ours cost. A small unit, couple of VPN slots, net extender, firewall, anti-virus (if you choose to purchase it), and anti-spam. Again, the rules and the resources definition is sort of bizarre unless you understand the stuff. I don’t but perhaps an old line propeller head such as yourself may have no issues.

    wo Barracuda machines for backups to an external drive

    We also do that type of backup to an external drive. We use “Backup for Workgroups” that allows us to keep generations of files and avoids duplication. “FileA” on three different servers will only appear once in the backup but can be restored on it’s original box. We keep a years worth of file changes and deleted files are never removed from that backup resource.

    help with CSS, HTML

    A program to validate the HTML and CSS is almost a must. You can miss so much especially when PHP is “printing” the output HTML. Tables with missing cells, missing end tags, styles incorrect, etc. Really hard to catch with HTML that is dynamically generated.

    I went through our scripts and converted everything to HTML 5 and used such a validation program. The scripts were a mess in the generated output code. Not surprising. Cleaned all of that up over about three months. It is amazing that stuff display correctly at all. Still some differences between browsers that is annoying.

    Anyway, I can get around HTML fairly good, CSS so-so, SQL enough to get some pretty good queries and performance. When you use PHP you will be having PHP sending the query to the DB and it is easy to generate dynamic queries with PHP thus being able to make more intelligent queries.

    DO NOT ever pass a parameter to the database directly in the query. That will subject you to SQL injection attack. Instead pass as a parameter. Also don’t store the parameter in a SQL variable and then use that variable in the SQL. SQL injection risk. Always pass as a parameter. Painful lesson on this from some code I inherited from some zit faced know-it-all.

    You should also at this point have changed all the passwords on the systems. I know you know to do this but it bears repeating. Don’t want to give those kids any more access to the system.

  83. OFD says:

    “Exchange for 200 people will keep a person almost busy full time with mailbox problems, users borking passwords, etc.”

    Indeed. I don’t wanna do that. Others also swear by Google apps and gmail for this sort of enterprise. I may run it by the powers.

    “I don’t but perhaps an old line propeller head such as yourself may have no issues.”

    I can grok it but don’t really need the extra hassle. Be nice if they’ll pay for the support outside.

    “We keep a years worth of file changes and deleted files are never removed from that backup resource.”

    Another issue I’ll have to visit with the powers on at some point; I like the backup solutions for Linux but may just stick with the Barracudas for the Windows machines. (they consider locating a backup machine in the adjacent building sufficiently “off-site” for backups and disaster preparedness, looks like.)

    I’m a total noob on the HTML, CSS, and PHP stuff; had some DBA experience twelve years ago with SQL on Access databases with the state. But the matriarchy cretins back then had to have it all converted constantly to Excel spreadsheets ’cause that’s all they knew and cared to know.

    The powers were in a mad hurry to get the kids to give me all the info and intel as fast as possible all day Friday so the passwords to everything are now in the “book” they made the kids put together and leave in my office/server room area in case one of them has to roll in for a graveyard shift blowup/fix instead of me. The kids had them all memorized but they did not strike me, and I’m an old buzzard who’s been around, as the types who had hard feelings and would damage the place or mess me up. So right now I have them, the kids have them, and the COO and CFO have them. I will set about changing them this week and adjusting the “book” entries accordingly. If this weekend the kids got in and wrecked everything, well, that’s on all of them, not me.

  84. Lynn McGuire says:

    I moved the MX record on my main domain to Google apps about four? years ago. I have never regretted it. And get this, they are still not charging me. I would gladly pay if they required it but they keep on grandfathering me in with my 12 email accounts.

  85. MrAtoz says:

    We also moved our MX to Google. Only 6 emails, but works great.

  86. OFD says:

    I’ll see how much time and effort is involved with maintaining the Exchange 2007/Outlook deal at the site; if too onerous, I’ll really push moving to Google Apps; they may buy that but not the standard Linux email and contact options like Evolution and Thunderbird. Although there was scuttlebutt about eventually moving everything over to Linux at some point, but the Google Apps would be good in either case.

    The subject of VOIP was also brought up during the interview and I’ve never worked with that, either, so we’ll see.

  87. brad says:

    I just moved my wife’s little company to VoIP. It works fine, but the whole thing was more of a pain than I expected. The four big things:

    – Software: You can host the VoIP software, or you can have a cloud service. There are zillions of choices; the one I chose is European only, but to name an example that is available in North America, you could look at swyx.com. The choice of software may decide what kind of hardware (phones, etc.) you can use.

    – QoS isn’t supported by all of our network devices, and anyway, I couldn’t find a single, standard way to identify VoIP packets. Our network is a mix of private and commercial grade stuff – maybe if you only have commercial grade equipment, this will be easier/possible.

    – Firewall rules. VoIP uses what seems to be an unnecessarily large range of ports, and different VoIP solutions name slightly different sets of ports for control and data. Standard stuff: opening ports, and maybe forwarding them to the right place.

    – Internet connection(s). You don’t want the phones going out because a connection goes down, so setting up a redundant connection is advisable. But VoIP cannot (reliably) use multiple connections. So even though you probably want load-balancing for everything else, VoIP must run in failover mode.

    Bottom line: For me, it was really helpful to choose one or two possible solutions, set up a test environment, and just play around with the stuff for a couple of months.

    Edit: Pricing and cost structures vary a lot, and are hard to compare. By the time you add up all the costs, VoIP isn’t really any cheaper than traditional phone service.

  88. OFD says:

    Thanks much for that overview, Mr. brad.

    My inclination is to stick with trad phones/service for a while yet.

Comments are closed.