Walmart Worker Trampled by 2,000 Shoppers

At a Walmart store in Long Island, NY, a tragedy befell a worker the day after Thanksgiving. Could it have been prevented?

Peter Goodman wrote an insightful article on the incident; here's an excerpt:

"It was a tragedy, yet it did not feel like an accident. All those people were there, lined up in the cold and darkness, because of sophisticated marketing forces that have produced this day now called Black Friday. They were engaging in early-morning shopping as contact sport."

If you can't stand up in a crowded theater and yell "fire" then why can a store create a situation where the chances of someone getting hurt are higher?

There is a way to prevent this: increase insurance rates for retail stores between Thanksgiving and New Year's day. Manager will then think twice before opening the doors to their stores as throngs of shoppers egged on by tales of free merchandise or "75% off" wait impatiently. Or maybe it will begin to change the contact sport that has become Black Friday.

U.S. Automakers Dipping into Auto Worker Pension

It's a tough situation to be in.

U.S. automakers fighting for their lives and running out of new sources of cash are dipping into pension funds set aside for its auto workers according to a piece by John Stoll in the "WSJ" ("Pension Agency Sounds Alarm on Big Three," 11/28/08).

The article says that when GM reported an update on its pension earlier in the month it said its plan for hourly workers was underfunded by $500 million because of restructuring expenses. However its plan for salaried employees remains overfunded by at least $500 million.

The U.S. Pension Benefit Guaranty Corp. (like the FDIC but for pensions) acts only if a company's pension plan fails. The U.S. PBGC sent a letter of concern to the big 3 automakers about how pension money is being used. The PBGC has reason to be concerned since it already has a $14 billion deficit (that may not seem like such a bigger number these days unless it's your pension on the line).

Is the writing on the wall? Is is better to walk away pensions still intact or use the pension money to fund U.S. automakers. It depends on whether you believe that the automakers can emerge as sustainable companies. Managers will always say yes, give us another chance. What do workers think?

Breakdown of U.S. Bailout - $8.5 Trillion

If you're wondering how big the U.S. bailout has gotten of U.S. financial institutions, you're not alone. Most media outlets could not explain it last week after the joint Treasury/Fed Reserve announcement that Citigroup would be next in line and would receive a massive $300 billion infusion from the U.S. govt.

Bloomberg news did the only analysis I've seen adding up the total already spent to $3.2 trillion of $8.5 trillion committed. How did the numbers get so big? Here's the analysis (click to enlarge):



As you can see, the much debated and approved Congressional legislation commonly known as "TARP" is only $700 billion of the $8.5 trillion available to either the Bush Administration or the Federal Reserve which is technically not accountable to either the President or Congress.

Are these numbers large? Yes, they are massive, amounting to 60% of the entire U.S. economy.

Keep this in mind next time you hear someone saying: we can't afford to bailout the auto makers and save American jobs.

Resuming "The New Economy" Blog

After a hiatus, I'm resuming this blog I created several years ago. The time seems right to bring new ideas to the fore and participate in the discourse for how to address the challenges facing American workers.