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The Morning Grumpy – 6/5/12

Filed under: Morning Grumpy

All the news, views, and filtered excellence fit to consume during your morning grumpy.

1. An interesting take on Obama and the white working class.

The problem, as on almost all issues relating to government’s role, is centered on whites, particularly those in the working class….Just 18 percent believe Obamacare will leave their family better off, compared to 38 percent who believe they will be worse off as a result.

….Gallup Polling in March 2010 found that while few whites expected to personally benefit from the law, a majority of them believed it would benefit low-income families and those without health insurance. That suggested they viewed health care reform primarily as a welfare program that would help the needy but not their own families.

We’re still operating off cultural assumptions that the tax dollars of white working class voters are being funneled to “lazy” lower class voters. It’s not a eureka moment, but it’s interesting to see the issue illustrated by polling results. Obama won the battle by getting Obamacare passed, but he lost the war on the messaging. People still overwhelmingly support the components of the bill when presented with them, but think the bill is bad for them. How did a Presidential candidate with such incredible communication skills lose so solidly on this front as a President?

2. Another cool idea from Detroit, pop-up retail shops in commercial districts with high vacancy rates.

“A lot of retailers are enthusiastic about a retail comeback because they remember downtown shopping at Winkleman’s, Kresge and Hudson’s department store when they were young,” Kazmierak said. “They are curious about the big players who are igniting this retail movement downtown.

Sound familiar?

The Downtown Detroit Partnership recently hired Heather Kazmierak as retail program manager to entice suburban retailers in Wayne, Oakland, Macomb and Washtenaw counties to sign short-term leases in vacant stores along Woodward Avenue.

The newest addition to downtown is D:Hive Detroit, a multipurpose facility on Woodward Avenue. Margarita Barry, owner of 71Pop.com, opened the first short-term boutique last week and seeks to recruit other entrepreneurs with limited start-up capital.

Temporary retail stores have become a permanent part of the Metro Detroit and nationwide retail scene because there is too much vacant space and not enough retailers willing to sign long-term leases.

Perhaps this is an idea for Seneca Street, Main Street, and other locations around Buffalo.

3. The following is a common story in the new economy. Caterpillar, a heavy machine company reported $15BN in profits on $60BN in revenue for FY11.  CEO Douglas Oberhelman earned $16.9 million in 2011 in salary, bonuses, stock and option awards and retirement plan contributions. Also, healthy dividends were paid to shareholders and forward looking guidance on both revenue and profit were very healthy. So, what’s the next move for the company? If you guessed “break the union and get wage and benefit concessions”, you nailed it!

780 union members went on strike May 1 after rejecting the company’s proposal for a new six-year pact. Union officials said the deal offered no raises while weakening seniority rights and increased health care costs at a time when Caterpillar was making record profits.

Bruce Boaz, an assembler at the Joliet plant for 39 years, repeated what other union members have said. “With all the money this company is making, all we want is a fair deal. (In previous contracts,) we gave away stuff when times were bad. Now it’s time for us to reap some benefits.”

The deal also eliminated the pension plan for younger workers. You might remember when Fortune Magazine wrote that Caterpillar was “crushing it” when it came to profitability. Guess that’s MBA newspeak for “screw the workers who helped us do it”. America 2012!

4. Some “inside the numbers” analysis on swing state economies and why the national unemployment numbers might not hurt President Obama in the general election.

Most of the swing states by the third quarter of this year will have a lower unemployment rate than the national average,” said Xu Cheng, a senior economist at Moody’s Analytics who compiled the latest state-by-state economic data and updated Moody’s voting model for POLITICO. “And most of the battlegrounds will be below 8 percent unemployment, which will negate the ‘grumpy voter effect.’” Cheng was referring to data suggesting voters will discount by half any improvement in joblessness if the national rate remains above 8.

An interesting, yet very cautious analysis.

5. Ezra Klein makes the Keynesian case for Mitt Romney…based on assumptions of Republican actions in the event of an Obama victory and the ensuing gridlock.

The Congressional Budget Office estimates that if Congress gridlocks this year — if it simply gets nothing done — the economy will take a $607 billion hit in 2013 as the Bush tax cuts expire, the payroll tax cut expires and assorted spending cuts kick in. Falling off that “fiscal cliff,” they predict, will throw us back into recession.

Speaker John Boehner has said he wants another debt-ceiling showdown. We’re not expected to hit the debt ceiling until February or March, and so the only scenario in which the debt ceiling matters is one in which Congress has already pushed us over the fiscal cliff. So as bad as the last debt-ceiling crisis was — and Gallup’s polling showed it did more damage to consumer confidence than the fall of Lehman Bros — this one would be worse.

However, if Romney wins…

Time magazine asked (Romney) about cutting spending in 2013. “If you take a trillion dollars for instance, out of the first year of the federal budget, that would shrink GDP over 5 percent,” Romney said. “That is by definition throwing us into recession or depression. So I’m not going to do that, of course.” You couldn’t have gotten a clearer definition of Keynesian budgeting from Obama.

There’s a good chance that a Romney administration would extend both Bush and Obama’s tax cuts and delay the scheduled spending cuts. Congress would raise the debt ceiling after Romney promised congressional Republicans that he’d sign some variant of Paul Ryan’s budget as soon as it’s sent to him. Somewhere along the way, Romney would pass both more short-term tax cuts and a long-term transportation bill — something Republicans have been blocking under Obama — that doubles as an infrastructure package and includes, to secure Republican support, the Keystone XL oil pipeline.

An interesting argument, which Klein describes as “vote for us or the recovery gets it”. I assume this will be undercurrent throughout election season.

Fact Of The Day: The Texas Department of Justice keeps track of all the last statements of those executed by the state and posts those words to the Internet shortly after they die.

Quote Of The Day: “This land is your land and this land is my land, sure, but the world is run by those that never listen to music anyway.” – Bob Dylan

Video Of The Day: “We Stopped Dreaming” – Neil DeGrasse Tyson

Song Of The Day: “Don’t Come Knocking” – Bono with Andrea Corr

Follow me on Twitter for the “incremental grumpy” @ChrisSmithAV

Email me links, tips, story ideas: chris@artvoice.com


  • BlackRockLifer

    Obama may have a problem with working class whites but I don”t believe Romney will benefit. Romney turns off those same voters with his elitist attitude and his total disconnect from the reality of life and the problems facing the average American.

    • peteherr

      Interesting. If that is true, voter turnout should be low this year. Wonder if that will happen.

      • BlackRockLifer

        Romney has real problems, he does not connect with the average Joe, fails miserably at motivating the base, and the Mormon thing does not sit well with the conservative Christians. This election is Obamas to lose.

      • Jesse Griffis

        Any election is an incumbents to lose. Just look at the reelection statistics (95+% on a national level).

        The fact that Romney is even close is a sad commentary on Obama’s leadership mad skillz.

  • Ceart

    No comment so far about the GOP cross-endorsement of DA Frank Sedita, just days after he was shocked by a verdict in what should have been a slam-dunk case?

    • Nope. I generally don’t write about local party politics anymore. Everyone is terrible. The GOP doesn’t have the money to waste on that race in a Presidential election year in which turnout will be high for Obama in a very blue county. Sedita has great name recognition and half the populace thinks they’re voting for his Father. Why bother?

      • Ceart

        Swell. I get it. There simply isn’t enough commentary on national politics.

        Too bad, though. Shining a little daylight on the local goings-on might help the situation, or at least that’s the theory anyway. But you’re right: everyone (including me, I guess) is too stupid to “get it” anyhow, and we’re all doomed, and so on.

        Really gets me all charged up to click on Artvoice looking for an alternative to the Buffalo News, 2, 4, 7, & 930.

      • Geoff, Alan, and Buck write frequently about local news, politics, and development on this website and in print. I do something a little different.

        I don’t think anyone is “too stupid” to get it, not at all. I spent nearly ten years writing about local politics on my previous site and I’ve shined my fair share of light on horrible people doing horrible things in and around WNY. I’m just a little burned out on the topic. It doesn’t mean I won’t ever write about local news, but it’s not going to be a frequent topic.

        I think you’ll enjoy the work of all the other writers we have on Artvoice.com and in Artvoice who might better cover the topics you’re interested in.