Corporate Greed? What about "Worker Greed"

We hear all the time about “corporate greed.” Do a Google search for that term and you’ll find more than 2 million results. But we almost never hear about “worker greed” (only 3,390 results) or “consumer greed“ (50,500 results). Here’s an excerpt from a Boston Globe story from 2009 about firefighter "pension spiking" that clearly illustrates an example of excessive “worker greed”:

Nearly 30 Boston firefighters with pending disability claims filed for retirement yesterday, just two days before a new state law ends a controversial benefit that allows them to significantly enhance their pensions if they claim career-ending injuries occurred while filling in for a superior at a higher pay grade. 

Of the 29 who filed yesterday, 25 said they were filling in for a superior at the time of their injuries, according to city officials, which makes them eligible for a pension benefit at the higher salary scale. That perk, which can add hundreds of thousands of dollars over a retiree’s lifetime and cost taxpayers millions, will not be available to anyone filing after today. 

“This is highly unusual,’’ said Kathleen Kiely-Becchetti, executive director of the Boston Retirement Board, of the number of firefighters who filed for retirement yesterday while their disability claims were still pending. 

The race to file yesterday is the first obvious reaction to the sweeping pension law that was passed by the Legislature and signed by Governor Deval Patrick earlier this month. The claims filed by the firefighters yesterday – and an expected rash of new claims today – could cost Boston taxpayers millions in additional payouts at a time of major budget constraints, fire officials said. 

Boston Fire Commissioner Roderick J. Fraser Jr. said firefighters are clearly taking advantage of the final days before the new clampdown on enhanced pensions goes into effect. 

“The old system provided a financial incentive for people to file for accidental disability while they were filling in for supervisors,’’ he said. “This illustrates that fact.’’ 

Suspected disability retirement abuses and pension excesses have been a chronic problem at the Boston Fire Department, prompting an inquiry by the FBI. 

A Globe review of city retirement and payroll records last year found that, over the prior six years, 102 Boston firefighters had substantially enhanced their tax-free disability pensions by claiming career-ending injuries while they were filling in for superiors at higher pay grades. Some firefighters have sought the enhanced benefit after filling in for a superior for just one day, leading critics to call it the “king-for-a-day’’ provision. 

MP: Corporate managers and business owners don’t have a monopoly on greed, and consumers and workers don’t have a monopoly on virtue. In their role as consumers and workers, individuals can be just as ruthless, cut-throat, and greedy as some corporate executives, like in the case of the extremely unethical, self-centered behavior of the Boston firefighters described above.

The U.S. Energy Sector Delivers an Economic Stimulus of Almost $1 Billion Every Day

According to a new report from Merrill Lynch, read about it here.

Monday Economic Updates

1.The Chicago Fed’s 85-variable “National Activity Index” improved in June, and provides no evidence of a U.S. recession, see chart above and read more here.

2. Comerica Bank's "Michigan Economic Activity Index" climbed in May to the highest level since early 2005, see chart above. Further, building permits issued in Michigan during the month of May were the highest since October 2007.  Read more here about Michigan's economic recovery.

3. Minneapolis-St. Paul is the latest metro area with a sizzling June real estate report: Home sales increased 13.8%, pending sales increased 16%, the median sales price increased by 10.7% to almost a four-year high of $179,500, average time on the market fell to a six-year low of 113 days, and the "percent of original list price received" increased to almost a five-year high of 96.1%. 

Interesting Fact of the Day: Many of Today's Teens Are Too Busy Surfing and Texting to Drive

The percentage of 19-year-olds in the U.S. who have driver's licenses dropped from 87.3% in 1983 to 69.5% in 2010, according to the University of Michigan's Transportation Research Institute.

"It reflects mostly the increased use of the Internet," said Michael Sivak, research professor and the head of the University of Michigan's Transportation Research Institute. "The virtual contact that is possible through electronic means is reducing the actual physical need of contact among young people. Furthermore, some young people feel that driving interferes with texting and other electronic communication."

Meanwhile, the percentage of people with a driver's license who are 70 or older has increased from 55% in 1983 to 80% in 2010.

Source: USA Today

Retirement Fact of the Day

Three quarters of near retirees (ages 50 to 64) have average total retirement account balances of only $26,395. 

Source via this Sunday NY Times article. 

The Future of Manufacturing: America not China

From the Foreign Policy article: "The Future of Manufacturing Is in America, Not China," by Vivek Wadhwa:

"Ralph Lauren berets aside, the larger trends show that the tide has turned, and it is China's turn to worry. Many CEOs, including Dow Chemicals' Andrew Liveris, have declared their intentions to bring manufacturing back to the United States. What is going to accelerate the trend isn't, as people believe, the rising cost of Chinese labor or a rising yuan. The real threat to China comes from technology. Technical advances will soon lead to the same hollowing out of China's manufacturing industry that they have to U.S industry over the past two decades."

"Several technologies advancing and converging will cause this."

"First, robotics.  The factory assembly that China is currently performing is child's play compared to the next generation of robots -- which will soon become cheaper than human labor."

"Then there is artificial intelligence (AI) -- software that makes computers, if not intelligent in the human sense, at least good enough to fake it. Neil Jacobstein, who chairs the AI track at the Silicon Valley-based graduate program Singularity University, says that AI technologies will find their way into manufacturing and make it "personal": that we will be able to design our own products at home with the aid of AI design assistants. He predicts a "creator economy" in which mass production is replaced by personalized production, with people customizing designs they download from the Internet or develop themselves."

"How will we turn these designs into products? By "printing" them at home or at modern-day Kinko's -- shared public manufacturing facilities such as TechShop, a membership-based manufacturing workshop, using new manufacturing technologies that are now on the horizon."

"By the end of this decade, we will see 3D printers doing the small-scale production of previously labor-intensive crafts and goods. It is entirely conceivable that, in the next decade, manufacturing will again become a local industry and it will be possible to 3D print electronics and use giant 3D printing scaffolds to print entire buildings. Why would we ship raw materials all the way to China and then ship completed products back to the United States when they can be manufactured more cheaply locally, on demand?"

"It's a near certainty that robotics, AI, and 3D-printing technologies will advance rapidly and converge. American companies are already finding the rising cost of labor, shipping costs and time lags, and intellectual-property protection to be major issues in doing business in China."

"The most advanced automobile of today -- the Tesla Roadster -- is already being manufactured in the United States using robotic and AI technologies. Google just announced that it will produce its highly-acclaimed Nexus 7 tablet in the United States. This is just the beginning of the trend. So, let me predict a future headline: 'Protests break out in China over 2020 Summer Olympic uniforms, 3D-printed with U.S.-made technology.'"

HT: Sadanand Dhume

Title IX for America's Most Dangerous Occupation?

Being a firefighter is a very dangerous occupation, although it's been getting slightly safer over time.  According to the National Fire Protection Association, almost 3,600 firefighters died on the job between 1981 and 2011. That's an average of about 115 occupational deaths per year for firefighters, although fortunately there's been a slight downward trend and the  number of deaths last year was only about half the historical average at 61, setting a new record low.

The number of annual injuries for firefighters has been declining as well, but there were still  almost 72,000 incidents last year. That means that almost 200 firefighters were injured on-the-job every day in 2010.  There were slightly more than one million firefighters in 2010 (including 768,150 volunteers), which means that more than 6.5%, and more than one out of every 15 firefighters, were injured or killed on the job in 2010.  That's a lot better than the 10% share of firefighters who were injured or killed in 1991, but it still makes firefighting one of the most dangerous jobs in America (based on both occupational fatalities and on-the-job injuries). 

But there are huge, and persistent gender gaps for firefighters (along with huge gender occupational fatality gaps and huge gender occupational injury gaps), with male firefighters outnumbering female fighters by almost 27-to-1 (96.4% male vs. 3.6% female in 2010). 

Q: Shouldn't the huge gender disparities in firefighting employment, injuries and deaths motivate applying Title IX legislation to this industry with the goal of perfect gender parity?