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When the poor stop going to McDonald’s, we’re all in trouble

20 Jun

mcdonalds-meal

Businesses like Wal-Mart and McDonald’s haven’t been doing well.

 

People without a lot of money usually go to these places, but because they now have even less money, they’ve stopped going. When people who work at Wal-Mart and McDonald’s can no longer afford to shop and eat there, it’s a sure sign of a coming, broad-based financial decline.

 

It will affect us all, even the rich, who don’t amount to much if they can’t get the poor to give them money.

 

Reports show that the parade of U.S. customers into Wal-Mart fell 1.4 percent during the first quarter. That followed a decline of 1.8 percent in the prior year.

The discount retailer blamed the bad winter weather but also cited cuts in food stamps, higher payroll taxes and the increased cost of health care.

 

You know things are bad when Wal-Mart relies on the food stamp program to move product.

 

Walm-MartRecent U.S. sales at McDonald’s also have declined, by 1 percent. To lure back low-end customers, the burger behemoth increased its value menu, but that hurt profits even more.

 

What’s happening is the downward pressure on income is leading to downward pressure on sales.

 

Henry Ford used to pay his people well so they could buy cars. If Wal-Mart and McDonald’s have any sense, they and the other minimum-wage shops will copy this strategy. Not doing so will have consequences. It could turn the U.S. into another Japan – the bad one, not the good one.

 

Japan was once the globe’s supreme economic power. It made and sold great products while setting new standards for manufacturing. Flush with cash, Japanese investors bought up billions in prime New York real estate, and nearly everything else. During this period, in the mid-80s, I visited Hawaii, which seemed more like Japan. Japanese tourism and culture were so strong that hippie beach bums peddling sailing lessons had to learn Japanese.

 

Then came the bust, the swoon and massive disinflation. It began around 1990. People in the U.S. don’t understand disinflation. It’s when prices fall and fall and fall and still no one buys anything. The economy becomes comatose. Seems impossible, until you look at Japan, where disinflation has been a cruel fact of life for a couple decades.

 

 

According to Bloomberg Businessweek, one contributor to Japan’s disinflation is falling wages. The recent habit of businesses there, as in the United States, is to avoid hiring full-time workers and instead contract with temporary workers who earn less and have no job security. These temps now make up about 40 percent of the Japanese work force. They are paid about 38 percent less than full-time workers.

 

The financial and social divide between the two kinds of workers has grown and is causing multiple calamities. For example, no one wants to marry a temp. This depresses birthrates and is making Japan a nation of elderly people. Banks won’t give temps mortgages, which doesn’t encourage building. These and other negative trends cascade and the country stagnates.

 

In the current era, U.S. corporations have reaped huge profits from selling to the developing world. But those markets, at least to some degree, are cooling and maturing. The bread-and-butter American markets may have to be revived in order to maintain profits. That could require a higher minimum wage and more opportunity for the middle class. The government and the business community finally are waking up to this.

 

The Great Cure for so much – including crime and falling education standards — is to put money back in the hands of traditional spenders. For a time, greed will blind us to this reality. Then the cash register stops ringing and we see.

 

Wal-Mart and McDonald’s — and all the other places where you can work full-time and not earn a living — now see. Each is probably afraid to take the first big step. Sooner or later someone has to, otherwise that first big step will be involuntary and it will send us over a cliff.

 

Think about the return of the 25-cent McDonald’s hamburger. Think about taking the family out for one on a very special night, maybe once every couple of months. That disinflation, and it will make 15 percent inflation seem like good times.

 

Now, we wait.

 

By Lanny Morgnanesi

Goldman Sachs: Altruism for a profit

27 May

goldman-sachs,jpg

Investment powerhouse Goldman Sachs has made money with schemes that were ingenious, inventive, complex, arcane, morally vacant and, some might say, criminal. Now it hopes to make money by exploiting the dysfunctions of government.

 

Goldman has long mastered the art of generating cash without actually producing a product. Its techniques include:

 

  • Using influence to rig a trading system in its favor.
  • Finding a market where it can buy low and then finding a second market where it can sell high.
  • Identifying gross inefficiencies that are costing someone or something money and offering to fix them.

 

Goldman’s new plan is along the lines of the third. The firm is financing crime reduction measures in Massachusetts in exchange for a percent of what is saved by not having to incarcerate thugs.

 

Ingenious, inventive, complex.

 

New profit center for investors

New profit center for investors

This type of investment carries an extra dividend: It makes Goldman Sachs – a villain in the eyes of the Occupy movement – look like a Good Guy. Indeed, the investment vehicle designed to reduce crime is called a social impact bond, or in Wall Street parlance, an SIB.

 

Some view these investments as a marriage between capitalism and charity, but capitalism is the strong, dominant partner.

 

Bloomberg Businessweek reported on Goldman and the SIBs in early May. Writer Esme E. Deprez cites a prediction by the Rockefeller Foundation that the market for SIBs is growing and by 2015 will reach $500 million.

 

That’s a lot of social impact, enough to give government the idea that it no longer is responsible for maintaining order and structure in society. Or has it already decided that?

 

According to the Businessweek article, Goldman is investing $9 million and betting that crime will go down – or more accurately that young men will spend fewer days in jail.

 

The bonds help fund a program called the Massachusetts Juvenile Justice Pay for Success Initiative. In that program, a non-profit agency called Roca works with young adult males on probation. The agency provides outreach, therapy and training. After two years, participants are supposed to leave, take a steady job and lead a crime-free life.

 

If a graduate stays out of jail for a year, Massachusetts saves $12,400. If the state is able to reduce crime enough to close a 300-person prison, it saves $47,500 per inmate.

 

This is how the SIBs and Goldman get paid off.

 

In this particular case, Goldman has partnered with other investors who financed an additional $12 million in bonds, making the total $21 million.

 

The bonds earn 5 percent no matter what, but pay nothing else until the men in the program manage to spend 22 percent fewer days in jail. There’s a sliding scale for payment, with a maximum of $27 million being paid to bond holders if jail time is reduced by 70 percent.

 

It’s a risk, like a junk bond, but $27 million for a $21 million investment is pretty good money (28 percent profit) and worthy of the risk.

 

Roca had been working with 375 men. With the SIB money, it can handle 550.

 

A skeptic might look at all this and ask:

 

  • Why doesn’t Massachusetts put up the $21 million itself and forego the $6 million payout to investors?

 

  • Why doesn’t society as a whole recognize that employed people from stable families commit fewer crimes?

 

  • Why does the nation exclude million of people from an otherwise viable system of commerce, education and opportunity and allow the existence of acres and acres of urban decay that breed crime and insanity?

 

There are clear answers to these questions. I won’t go into them because our preference is to ignore them, deny them and maintain a monstrous blind spot in spite of religious teachings, well-intended laws and glorious, inclusive rhetoric.

 

But as a culture, we have reached an all-time low when we allow things to get so bad

that Goldman Sachs can make money off our failures. The promise of money, more so than altruism or mere brotherhood, does seem to get things done. Perhaps we can turn the VA hospitals over to Goldman. With all those returning vets, there’s got to be a profit in there somewhere.

 

By Lanny Morgnanesi

 

Is the son of a god a god? The problem of famous sons

13 Apr

 

charlie  parker

 

In Bob Dylan’s remarkable autobiography, “Chronicles Vol. 1,” there is a retelling of the evening he went to see a performance by Frank Sinatra Jr.

 

It was an unusual turn in the book. After reading about the young man from Minnesota finally winning the day amongst all the competing voices of Greenwich Village, we have him stopping in – very deliberately – on someone so apart from folk culture that the attraction cannot immediately be understood.

 

Dylan very much liked the performance. He liked the voice and style of the man who could never, ever, stand outside his father’s shadow. In the book, Dylan expresses true sadness for the predicament of the junior Sinatra, perhaps knowing that someday his own children would face this struggle for meaning, purpose and acceptance.

 

bobdylan1I’m not sure why, but we expect greatness from the off springs of the great, or at least some semblance of distinction. And like Dylan, we take the disappointment to heart.

 

There was a great man of jazz that many young people may not know. His name was Charlie Parker, but everyone called him “Bird.” He played the saxophone and was an incredible innovator and force in the world of music. “Birdland,” a jazz club in New York, was named in his honor.

 

Frank-Sinatra-jrJust recently Charlie Parker’s son died and I read his obit. I hadn’t known this man even existed, but apparently he lived a couple towns over from mine, in Lansdale, Pa. Learning of his simple, pedestrian life, one of relative failure, troubled me.

 

The great man’s son – Charles Baird Parker — had for a time worked in the bakery of his local supermarket. But for many years prior to his death he was unemployed. He lived off the royalties of his father’s music.

“The jazz world expected Baird to fill Bird’s shoes,” his late mother, dancer Chan Woods, wrote of her son. “Those expectations almost destroyed him.”

 

I’m sure his father, who died in 1955 at age 34, wasn’t around much to guide him. Bird, for all his success with music, had nearly destroyed himself with drugs and alcohol. Sometimes he would play on the street for drug money. It is even said that he once pawned his instrument.

 

Yet Bird is a music god, and the common belief is that the son of a god also deserves worship. Because it is impossible to worship a supermarket baker, we end up feeling sorry for the baker and for the god.

 

The obituary did not list the time and date of the funeral. Had it done so, I might have gone. I can’t say why. It would have been strange … about as strange as Bob Dylan going to a performance by Frank Sinatra Jr.

 

Lanny Morgnanesi

 

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Let me tell you a story about a man, a horse and a joke

5 Apr

The jokes of a people tell you much about the people.

A little hobby of mine is to learn of and listen to the jokes of foreign cultures. I’m proud to say that with patience, an open mind and an attention to the nuances of language, I’ve been able to laugh alongside many a hysterical foreigner.

In so many cases, it’s really about the language, which because it is not English can be used in ways that English cannot.

Chinese, for example, has so many sound-alike words that there is an entire genre of Chinese comedy called Cross Talk, where Abbott and Costello-like characters stand on stage and grossly misunderstand each other. These bits are much like “Who’s On First.”

This week, large numbers of Chinese people are cracking up not over misunderstood language but over a short video. It is of a man getting brutally kicked in the head by a horse. The humor is not in that brutality but in a message conveyed by the kick – a message that has nothing to do with animals.

Here’s the background.

In China, there is a popular idiom that translates literally to: “Pat the horse’s ass.”

When someone pats the horse’s ass, they are sucking up to the boss or flattering people to get ahead. We use the similar expression, “kissing ass” or “brown nosing.”

While many Chinese have benefited from patting the horse’s ass, there is a danger to the practice if it is too transparent. It can backfire. Most Chinese who watch their sycophantic colleague advance would prefer that they fail. No one likes as ass kisser.

In the video widely circulating among Chinese, the victim, prior to being kicked so hard and so directly, walks across the street and actually pats the horse’s ass.

The payoff for doing so is pretty damn clear.

And that’s why it is so funny to this culture that relies heavily on metaphor and symbolism. The humor is achieved without a single word.

All right now Mister and Misses America — DO YOU GET IT?

Lanny Morgnanesi

https://www.youtube.com/watch?v=n5pN5kR8vco

I never ate there, but I always expected a line

30 Mar

7_13_500x362

I once dated a woman who knew Philadelphia much better than I. On the few occasions when we passed Broad and Belfield Avenue, she’d say, “There’s always a line at the Shrimp Corner.”

And there always was.

My friend spoke these words as if they were a cliché, something that had been repeated a thousand times by a thousand people. But I had never heard the expression and I didn’t know the Shrimp Corner.

For me, it had escaped the notoriety of, say, Pat’s King of Steaks on Passyunk Avenue in South Philadelphia. I knew there was always a line at Pat’s. I’d waited in it at 3 a.m. Pat’s was in an Italian neighborhood and I felt comfortable there. People went there after Phillies games. The very different Shrimp Corner is in North Philadelphia, a poor, high-crime area. I’m sure it is considered home to many, but to those in the suburbs, sadly, it was simply a place to avoid.

On Yelp someone advises that before going to the Shrimp Corner one should “practice standing around and looking tough so no one messes with you.”

philly-360-creative-ambassador-brandon-pankey-spot-check-sid-booker-s-shrimp.582.345.cFormally known as Sid Booker’s Shrimp Corner, the takeout eatery opened in 1966. As the name suggests, it juts out on a block that forms an acute angle. To order, you walk up to a window made of bulletproof glass. The food is not cheap. A dozen batter-fried shrimp with fries costs about $20. The rest of the building, painted pink, houses Sid Booker’s Stinger Lounge.

Because of the Shrimp Corner, I thought about my old girlfriend this month. As circumstance would have it, I drove by Broad and Belfield three times in the last four weeks. Each time, there was no line at the Shrimp Corner.

What changed?

When I first saw the Shrimp Corner more than a couple decades ago, North Philadelphia may have been at its lowest. It was in great deterioration. I know so little of these neighborhoods, but I do recall how the homes and small business were sinfully neglected. Some were actually falling down. On Broad Street, the main thoroughfare, there wasn’t a fresh coat of paint to be seen. I doubt a nickel had been invested in the place.

7_15_800x600Then, about the time when real estate prices took off and business loans were easier to get, new shopping centers went up. Franchises like CVS settled in, as did more fast food restaurants. The regional transportation authority, SEPTA, even brought in new buses.

Meanwhile, a so-so college in the heart of North Philadelphia was expanding. An incredible number of well-designed, multi-story buildings appeared on Broad Street — for miles. Temple University, once a commuter college for the working class, had become a residential college that was attracting a new generation of students seeking an urban experience.

Houses were fixed up and rented to students. New housing was constructed.

If a Temple student was stupid enough to start selling drugs, he might get busted up in his nice apartment and have his stash and cash stolen. There would be episodes like when three neighborhood girls went around smashing bricks in the faces of female students. But overall, things really seemed to improve.

Today you can drive portions of Broad Street and it looks commercially alive. Some developer even wants to build a $700 million French-themed hotel-casino complex – The Provence – on Broad just south of Vine. He said it will be “one of the most dynamic entertainment destinations on the East Coast”

So why isn’t there a line at the Shrimp Corner?

I don’t know, but I do have a suggestion.

Recently there have been a series of Flash Mobs at old, nearly forgotten, Eleanor Rigby/Father McKenzie type cathedrals. Calling themselves “Mass” Mobs, Catholics are trying to revive these still elegant structures by using social media to fill pews.

If its true that the Shrimp Corner is not the draw it once was, wouldn’t it be fun to organize a Flash Mob – call it a “Flash Fry” — and send the line at the window down the block and all the way to Temple? Sid sure would go for the idea. Maybe he could donate some of the profits to fix up North Philly’s Uptown Theater, which has been trying and trying and trying to come back but can’t.

I have no deep emotional connection to any of this, so it’s not for me to organize an event. Still, I’d love to see North Philadelphia attract more investment and make Broad Street once again a great and grand boulevard.

If not this, then I’d at least  like– for old times sake – to be able to drive by and be correct when I say to a fellow passenger, “There’s always a line at the Shrimp Corner.”

By Lanny Morgnanesi

Call centers: Where foreign accents now sound less foreign

16 Mar

call-center

When something goes wrong with the cable, or the credit card or a household product, the horrid thought of spending long periods of time on the phone with a call center associate becomes real.

In the early phase of these calls, there is a strong, perky, recorded voice – an American voice – telling you what digits to push. For myself, I usually have questions unanticipated by the automated system, meaning I need to speak with an agent.

That point is reached only after shrewd and patient navigation. The digital world fades away and you are routed to a far off place where call centers are cheap to operate. The agents, God bless them, so much want to help.

“Good day! And how may I give you the extraordinary service you deserve to assist with your problem?” an agent said to me recently.

“Well,” I answered. “To begin with, I don’t need extraordinary service. All I need is good service.”

It’s meant as a joke, but it comes off as nasty. Still, the voice on the other end stays positive. But lately, it’s been a strange voice. It does not sound entirely human.

Hence, I’ve concluded that voice synthesizers are being used to strip away heavy foreign accents. But they do a poor job of it.

First, you can still tell the person is foreign. If the synthesizer’s purpose is to let Americans think they are talking to Americans (and not that jobs have been moved overseas), it fails at that.

Second, it makes communications less clear. An extra layer of audio noise is added, making it more difficult to conduct business.

When somebody is already in a foul mood from being on hold, that’s not good.

What strikes me most, however, is the transparent hypocrisy of this effort – if indeed my theory is correct. All these companies are too cheap to pay Americans to answer their phones, yet they are willing to spend extra money on technology to cover this up.

If anyone has knowledge of call centers using technology to strip away foreign accents, please comment here. I sense I’m right, but it’s only a guess.

By Lanny Morgnanesi

 

How long before the great income grab is reversed? Not long.

9 Mar

cbpp income inequality 2011

The first real understanding of my value as a worker came during a company Christmas party.

I was a young reporter for a family-owned media company. My fellow employees and I had already received the gift of a free turkey, and now there was this party, grand and lavish.

It was a time when newspaper margins were around 40 percent. Printing a newspaper was like printing money.

The party was held in a big banquet hall. Hundreds attended. There was a generous buffet, music, dancing and an open bar for the entire evening.

In general, the company did well by its employees. The founder was a tough, bull-headed union-buster, but when I worked there raises were given four times a year, the food in the cafeteria was subsidized and supervisors were honored at an annual dinner.

Upon the death of the old man, his four grown children took over. By chance, I was sitting with one at the Christmas party. She was somewhat shy but sincere when she said to our table, “All of you are responsible for making this company what it is. It would be nothing without you. My family owes everything to you. Our success is your success.”

Prior to that, I had seen myself as an expendable, replaceable cog.

But this co-owner, this daughter of an entrepreneurial risk-taker, was shifting my view. I hadn’t recognized it yet, but she knew that without workers a hundred printing presses could not produce a single paper.

Still, she was neither ready nor willing to change the rules and divide the profits among workers. That’s a different ideology, one totally alien to our system, one that threatens and offends.

Then I went to New York City and found out it wasn’t.

I was still learning the way of the world and on this visit to see friends I discovered how lawyers became partners.

My friends were a former reporter and her boyfriend lawyer. He didn’t go to dinner with us that Saturday night because he was working on an investment banking deal. He was trying to make partner.

When we met up later at a bar, he was in good spirits and had no complaints. As an explanation for missing dinner, he told me a joke: “Why do investment bankers love Friday? Because it is only two more work days until Monday.”

I envied his chance to become a partner. Now that I think of it, he probably was the first person I knew who was capable of using hard work to earn equity ownership in a company.

Why was law different from other professions? To begin with, there is no huge investment needed to start up, nothing like a printing press. Also, lawyers tend to see themselves as professional equals. And there probably is some precedent, a near-ancient tradition, of taking on partners rather than employees.

What’s more, it is easy for the good ones – those who bring in big clients — to leave and hang up their own shingles.

A factory worker doesn’t have that kind of leverage.

But if there exists a universal law of fairness, a standard morality for the value and worth of labor, then leverage shouldn’t be a factor.

Of course, there is no morality in the marketplace. If people will work for substandard wages, that is what you pay them. And so unions came to be.

Unions got their start in ancient Rome

Unions got their start in ancient Rome

We think of unions as a modern concept but the idea and practice go way back. The founders of Rome, in 753 B.C., may be partially to blame. As Rome grew and incorporated other provinces, the new citizens didn’t integrate. They stayed in their towns, kept their habits and traditions and failed to adopt a Roman identify. So an edict was issued requiring people to relocate to districts organized around trades. If you were a carpenter, you lived among all carpenters.

Ethnic differences faded.

Naturally, trade associations formed. It was a new unifier.

In time, these associations became quite powerful.

Even the kings of France had to contend with them. In an age when candles were the chief source of lighting and a significant expense in a large palace, money could be saved by letting them burn to the end.  Practical, but the guild in charge of candles wouldn’t allow it. It required that candles be replaced when half burned.

Unions in the modern era continue to be associated with self-serving, costly inefficiencies. Unlike the lawyers who must enrich their firms in order to become partners, unions too often weaken their companies, making workers liabilities rather than assets.

And companies today are quick to get rid of liabilities.

What unions are good at, however, is their ability to show management the true value of labor. By unifying the powerless, power is created. In speaking with one voice – “no we won’t work for poverty wages” – unions effectively alter the marketplace. They grant the common folk a degree of dignity and allow them to pursue happiness.

But with global competition so fierce, it has become impractical and unwise for unions to advocate uncompetitive practices. What they should advocate is efficiency, innovation, profit and partnership – true equity partnership. Unions gave us the weekend but if the incentive of partnership is applied (making Friday two work days until Monday) companies could get them back.

Would companies actually make their worker’s partners? Under the current climate, no. Even discussing the idea seems ridiculous and beyond farfetched.

But why?

In the golden age of unions – after resistance that included shooting strikers — companies decided there was enough growth and profit to meet the demands of organized labor. With profit in mind, there was a willingness to share. Henry Ford would benefit if he could keep cars rolling off the assembly line and meet the heavy demand.

And besides, workers with money buy things – like cars.

Walter Reuther knew the middle class fueled the economy.

Walter Reuther knew the middle class fueled the economy.

(There’s a great story about Walter Reuther, leader of the United Auto Workers, being shown an automated assembly line.  In a competitive dig, Henry Ford II asked him, “How are you going to get those robots to pay union dues?” Reuther retorted, “Henry, how are you going to get them to buy cars?”)

For the most part, the willingness to share is gone.

According to the Center for Budget and Policy Priorities and many other sources, a significant income gap between classes existed from the 1940s into the 1970s, but it did not grow. But after the early 70s and up to today, income concentration at the top increased dramatically. The last time the disparity was this great was prior to the Depression.

Various sources, including University of California at Santa Cruz Professor G. William Domhoff, in his blog “Who Rules America?,” report that in 2010 about 1percent of the U.S. population possessed 35 percent of the wealth. The top 20 percent had 89 percent, leaving the bottom 80 percent with 11 percent.

Also reported in various places, including the Los Angeles Times, is that from 1993 to 2012, income of the 1 percent rose 86.1 percent while income of the other 99 percent rose 6.6 percent.

As wealth became concentrated at the upper tier, billions in cash was stockpiled by American corporations.

In March, Forbes set the total at $1.45 trillion and listed the top 10 holders of cash, including:

Apple: $137 billion.

Microsoft: $68.3 billion.

Google $48.1 billion.

Pfizer $46.9 billion.

What changed?

For one, the labor market.

When Apple is ready to roll out a new iPhone, poor farmers in Katmandu drop their plows and fly to factories in Malaysia. This is not a rhetorical sentence.

Journalist Cam Simpson documents Apple’s labor supply chain in an incredible piece of investigative reporting for Bloomberg Businessweek.  His story tells how labor brokers fan out to the poor countries of Asia when Apple launches a new product. The people they find pay them for jobs and keep paying as the process continues. Often, they pay with borrowed money and go deeply in debt.

One was Bibek Dhong from Nepal. He paid a single broker the equivalent of six-months wages. The fee secured him a job in Malaysia with Flextronics, one of Apple’s chief suppliers. Before he could pay off his loans, production shifted to another country (better performance) and he lost his position.

His passport was held and he could not get home. He feared he would be arrested. Before he received help from Flextronics, he ran out of money and nearly starved.

Not exactly a union shop.

But as China has realized, when companies get richer, when commerce thrives, when corrupt leaders and their families amass great, visible wealth, expectations rise and workers lose their complacency. They demand more and often get it, until the factories move to a more accommodating country.

Sooner or later, corporations are going to run out of countries.

Sooner or later, a floor will form under the global labor market.  From there, workers will stand.

That’s when corporations are going to need a new plan.

And that’s why I’m suggesting one now.

In the U.S., people are finally waking up to the subtle yet systematic dismantling of the middle class, which has been occurring for decades. With less spending power, average families find it difficult or impossible to send their children to college – once the gateway to upward mobility. Those who do make it to college find it hard to get jobs when they graduate.

The bleakness and lack of opportunity, the malaise of our times, is truly settling in.

Books are being written with titles such as, “The War on the Middle Class,” “Screwed: The Undeclared War on the Middle Class,” and “The Betrayal of the American Dream.”

Income equality has become a topic in columns, blogs and editorial cartoons. The issue, once ignored, is now discussed by the president of the United States and the Pope. Billionaire Warren Buffett said that if class warfare truly exists, his class in winning. Even so, there are defections. One is global billionaire David Sainsbury, who calls for fairer wealth distribution through something called “progressive capitalism.”

To see inside this looming class crisis, look toward Seattle, the home of Boeing.

Timothy Egan, a Pulitzer Prize winning journalist and winner of the National Book Award, wrote an opinion piece in the New York Times Nov. 14 called, “Under My Thumb.” The title refers to Seattle’s position vis-a-vis Boeing.

Like many big corporations, Boeing hold jobs hostage as it demands and gets hefty tax breaks. As Egan points out, when anyone or anything shows resistance, companies like Boeing threaten to leave town.

Boeing is seeking concessions in exchange for keeping assembly of the new 777X jet in Washington State. For its part, the state of Washington provided a incentive package that included an $8.7 billion tax break, which Egan called the largest single state-tax giveaway in the nation’s history.

But Boeing also requires that workers accept cuts in pensions and health care benefits.

Unlike Washington, the workers said no.

Refusing to allow the “Walmartization of aerospace,” the machinists who would build the 777X turned down the offer by a 2-1 vote.

“I’m tired of being slapped in the face,” said John Gilman, who has worked at Boeing for nearly 40 years. “Building airplanes — it takes years of training and skill. The people who run this company used to understand that.”

In reaction to Egan’s piece, one reader commented, “This is just the beginning before Americans ‘storm’ any number of figurative ‘Bastilles.’ ”

Jump now, if you will, to the town of Richmond, California.

In Richmond, like most of the U.S., people were talked into taking home mortgages they couldn’t afford. When the housing bubble burst, they ended up owing more on their mortgages than their homes were worth.

Nothing unusual there.

What is unusual is the protective reaction, possibly unprecedented, taken by the town fathers on behalf of residents. Basically, they told the banks holding the bad mortgages to renegotiate the terms or Richmond would confiscate the properties through eminent domain.

Under this plan, the banks would receive 80 percent of each home’s current worth – much less than the original purchase price –and the town would reform the mortgages so owners can afford them.

Meanwhile, all across the country fast food workers are trying to nearly double their hourly wage to $15.

Not too long ago, the Occupy movement surprised everyone when it surfaced to protest almost everything. It stayed around much longer than anyone expected and started widespread discussion of the 1 percent and vast income disparities.

What else is out there waiting to bubble up? I sense there is a lot.

Nature and the human spirit, in time, tend to correct imbalances. I believe this correction has begun. When there is too much of one thing, the other thing comes.

And when the other thing comes, I hope we are ready for it. We might prepare by realizing that we all have a stake in each other’s well being, that each plays a role in the ultimate success of our society and that respect and dignity should be afforded to all. We are a tribe – we humans — and members of a tribe should look out for each other.

Right now we don’t.

I say, let’s act more like partners. Let’s all rise together.

That means valuing each other properly and recognizing that all roles are important, that we’d be in big trouble if one day no one wanted to pick up the trash.

Providing an equity interest to all workers – even a thin, thin sliver – is progressive and revolutionary. It may even be moral, wise and an effective business strategy. But for it to happen, something cataclysmic must occur, or the vision of something cataclysmic must appear.

In the meantime, it is likely that agendas will slowly change (perhaps preventing any cataclysm). This fall, for example, Bill de Blasio was elected mayor of New York after saying he would trim the gap between rich and poor.

Other politicians, in a discovering of new voting blocs, may decide to do the same and relieve the working poor of its distress, better balance wealth and create a more secure, just and – I think – more prosperous society.

A person with disposable income, after all, fuels the economy and is less of a burden on government.

Tax policy, a major cause of the wealth shift, also will have to change. An almost whimsical proposal comes from Robert Shiller, who on Dec. 8 received the Nobel prize in economics. To stop inequality from rising, he suggests raising taxes on the rich whenever their share of income starts to grow.

Should any of this actually happen, it won’t come solely out of true enlightenment. As always, it will come mostly as a way to preserve and protect – through concessions – the self-interests of the powerful. This is OK. It will come through changing market forces resulting from a shift in culture, attitudes, expectations and action. Those forces, nearly invisible now, seem to be coalescing. I don’t think they can be stopped.

When there is too much of one thing, the other thing comes. That’s the natural law.

Lanny Morgnanesi

In snowy Conshohocken, contemplating a shift of fate

17 Feb

Conshohocken

I invite everyone to read a commentary I wrote for today’s Philadelphia Inquirer. The editors there are skilled, and I believed they improved the essay by removing the final paragraph, which read:

 

Oddly, I felt it necessary to have a plan. After some thought I decided it would be this: For the night I would hide out in the CVS restroom. For breakfast I would have Valentine’s Day chocolates, an entire box. I’d attend 6 a.m. mass and be at the library the minute it opened. And all the while, shower-less and dejected, my heart would long for spring.

 

I leave behind this detached piece of verbiage as a prod that might get you to find out what the hell I was writing about. The photo is only a small hint.

 

Lanny Morgnanesi

Art and the importance of suspending belief, even for Shakespeare

2 Jan

theater-disney

On my own, I’ve been studying filmmaking. I have even made a few short films, including this one. From my studies I know the craft is in turmoil due to vast changes in technology. Critical decisions have to be made on what new technology to use, how to use it and what from the old to keep. With high-definition digital cameras, a film can be as realistic as life, but most filmmakers see this as bad.

Audiences, they say, are used to the imperfections and inexactness of 35 mm film shot at 24 frames per second. For feature films, this “old look” brings the viewer into a world that is not his own, a world where he can suspend belief and enjoy the fiction being created on the screen. If a film is viewed in high-definition, all one may see is a bunch of actors walking around.

In such a case, the real world treads on the world of fantasy.

And so movies are shot with digital cameras but the images are converted later to a format that looks much like 35 mm film.

ShakespearI had a taste of this necessity to suspend belief during the Christmas holidays. It was not at the movies but rather at the gorgeous Academy of Music in Philadelphia. The Pennsylvania Ballet was performing George Balanchine’s version of “The Nutcracker.”

This was a first-class production. I was enjoying myself when suddenly, while watching costumed dancers swirl, jump and create visual poetry, I saw on the stage a painted sheet. Then I saw painted boards. Belief was no longer suspended; the magic had disappeared.

It was just for an instant and it occurred for no apparent reason. While outside the spell of the stage, my mind entertained a passing thought of using digital effects to duplicate a Russian winter. That thought quickly left. I returned once again to an illusion that I was willing and able to accept as real.

In the golden age of radio, that medium was referred to as “the theater of the mind.” But no less a personage than William Shakespeare has pointed out that even theater needs the cooperation of the mind.

I know little of this man and would not dare to interpret him. Still, it seems clear that in the prologue to “Henry V” he finds it necessary to ask his audience to suspend belief.

He seeks pardon for “the flat, unraised spirits that have dared on this unworthy scaffold to bring forth so great an object,” and ask rhetorically if the stage can “hold the vasty fields of France?” He explains, through his chorus, that one crooked figure will have to take the place of a million, and actors of no world standing will pretend to be historic figures, and that the imagination of the audience is required to dress the king.

He pleads, “Think, when we talk of horses, that you see them.”

This from a man who, with a few words, can induce hypnotic visions.

Had some muse or god given him the power to actually bring all of France to the stage and allow a thousand horses to romp across it, would he have accepted the gift? I think not, nor would the best of our filmmakers, nor would the Pennsylvania Ballet.

The power and force of fantasy is, after all, fantasy itself.

In the theater or at the multiplex, please do not watch too closely.

By Lanny Morgnanesi

Meanwhile, the world is burning

8 Nov

Mannequin

When we think of Venezuela, and we often don’t, we think of a socialist country that makes trouble for the U.S. What we should think of is a South American nation obsessed with beauty queens and curvaceous figures.

To attain the ideal look in Venezuela, surgery of various sorts is employed.  Females who have it performed are known as “operated women.”

This is a bit of background for the success story of Eliezer Álvarez, who makes mannequins. (Can you see what’s coming?) His story was told yesterday in the New York Times.

Business was off for Mr. Alvarez. He analyzed the situation and realized his mannequins were not a fair representation of the model Venezuelan woman. So he augmented them, according to the Times, with “bulging bosom and cantilevered buttocks, a wasp waist and long legs.”

It worked. Business picked up. In fact, his “operated” mannequin has become the standard for all clothing stores in Venezuela.

We could look at this turn of events and conclude that such a nation, socialist or not, cannot possibly be a threat to us. Or, we can withhold judgment until the operated mannequins hit our own stores.

As a cultural influence, politics and religion cannot  compare with the undertow of forceful, tenacious displays of sexuality. In the presence of such displays, the intellect of men evaporates. I sense women fall prey to these traps for reasons beyond love, affection, attention and advancement. But I don’t know what they are.

The utter ridiculousness of it all is told in a joke that I don’t think was meant to have much meaning, but in a way it gives a subtext to all of history. I’ll sum it up:

Three women apply for a single bank teller job. The manager tries them out for a day. At closing time, the cash draw of the first is $50 under, the draw of the second is $50 over, and the draw of the third balances perfectly. Who gets the job? The one with the big ….

In the online comments section to the Venezuelan story, and Asian woman who said she is proud of her small breasts wrote:

All I can imagine is someday, future archaeologists will be able to find out so much about our civilization from all the surgical implants and devices found in our empty coffins.

Lanny Morgnanesi