CNBC Names America’s Top States For Business In 2010–How’d Colorado Stack Up? (VOTE)

CNBC recently released their annual assessment of the top states in the nation for business. While Colorado’s overall ranking of no. 3 remains unchanged from last year, several of the components that comprise the ranking shifted considerably. Quality of life increased 8 spots, while cost of living and economy both fell several notches. See more detailed analysis of Colorado’s rank in the slideshow below, and let us know if you agree or disagree with their assessment:

VOTE:

Read more: Ranking States, Education, CNBC Business, Cost of Living, Economy, Slidepollajax, Best States for Business, Business in Colorado, Quality of Life, Denver News

Robert Reich: Why We Can’t Rely on Foreign Consumers to Rescue American Jobs, and Why Today’s "Jobs for America Summit" Is a Bad Joke

Fred Hochberg, president of the Export-Import Bank of the U.S., thinks I’m wrong to worry about a trade war, and that the president’s goal for doubling U.S. exports over the next five years is on track. Writing here on HuffPost, Hochberg says:

Reich’s argument contradicts the message I’ve heard from leaders of the world’s emerging economies who know that American innovation will help sustain their rapid infrastructure growth.

According to data released yesterday by the Department of Commerce, U.S. exports of goods and services increased by 17.7 percent during the first five months of 2010, compared to the same period last year. If this trend continues, the President will meet his goal of doubling exports in five years. The key: targeting export markets strategically.

At the Export-Import Bank, we’re focused on countries that have weathered the global recession and want to grow in areas where U.S. companies have a comparative advantage…. Commerce’s May data illustrate the potential of an export strategy tailored to countries and sectors that suit our strengths.

With due respect, Mr. Hochberg is being misleading. The same Commerce Department report shows that America’s trade deficit with the rest of the world has continued to widen. American businesses sold $152.3 billion of goods and services overseas in May (an increase of just over 2 percent from April) but the U.S. imported $194.5 billion (a jump of 2.9 percent).

In fact, according to the Commerce Department, America’s trade deficit expanded in May to its highest level in 18 months — rising 4.8 percent to $42.3 billion. Our monthly trade deficit with China alone jumped $3 billion, to $22 billion.

When the president promised to double exports over five years in order to create more jobs in the US, most people assumed he was talking about net exports — that is, exports minus imports. A doubling of net exports would help fill the demand gap caused by American consumers who can’t spend what they used to spend because they can no longer borrow to the gills.

But regardless of how much we export, if imports continue to exceed that amount, we’re heading in the opposite direction. Trade can’t possibly be a source of new American jobs. To the contrary, it reduces overall demand in the United States. The widening trade deficit remains a drag on the nation’s economic growth.

As a practical matter, the widening trade imbalance means no more trade agreements because Americans, worried about their jobs, don’t want to risk losing more of them to foreign workers.

Today (Wednesday), leaders of big business are meeting with the President and Vice President (along with former President Bill Clinton) to urge that the White House push stalled trade-opening agreements with South Korea, Panama, and Columbia. And the U.S. Chamber of Commerce is holding a so-called “Jobs for America Summit” to pressure the Administration.

The irony is that many of America’s surging imports are coming from these same American-based companies. They’re either employing foreign workers to make things for sale in the U.S., contracting with foreign companies to do so, or contracting for parts and supplies. Jobs for America Summit? These executives don’t care about American jobs. They care about their own bottom lines. That’s what they’re paid to care about.

But their bottom lines have little or nothing to do with good jobs for Americans. They have to do with good returns for American investors.

Not all corporate executives are marching to the same drummer. Recently, Andy Grove, chairman of Intel, wrote that America should levy an extra tax on the product of offshored labor and give the money to American companies that will use it to grow their U.S. operations and create more jobs in the United States. The only small problem with this idea is it violates international trade law and would almost certainly lead to retaliatory tariffs against American exports. Grove doesn’t seem too bothered. “If the result is a trade war,” he writes, “treat it like other wars — fight to win.”

But trade wars damage everyone, as we should have learned in the 1930s from Smoot-Hawley. What Grove doesn’t say is that over 70 percent of Intel’s revenues now come from its sales abroad. A trade war is the last thing Intel (whose share prices are rocketing) needs.

Yes, America must keep the pressure on our trade partners to open their markets and not manipulate their currencies. By the same token, America also has to reduce its dependence on oil (which accounts for a large portion of our trade imbalance).

But the essential point is we can’t expect foreign consumers to fill the shortfall in demand left by American consumers who can no longer maintain their pre-recession standard of living. The only answer is to lift the standard of living of Americans. How?

That question has direct bearing on the other part of the business agenda at the faux “Jobs For America Summit” at the U.S. Chamber of Commerce. Business executives (all of whom are now raking in just about the same seven- and eight-figure salaries and bonuses they did before the recession) are also telling the President to hold off increasing taxes on the rich (that is, ending the Bush tax cuts that had been scheduled to end this year) and to cut the budget deficit.

But the only way the President could meet both these objectives – other than by cutting Medicare, Social Security, and defense spending, which he won’t – would be to cut back even further on services going to the lower middle class and poor, including those that rely on federal support to state and local governments. Without these, including extended unemployment benefits, tens of millions of Americans are being forced trim their family budgets even more than they did last year. And that means fewer customers to purchase what these companies are selling in the United States.

Someone should remind business executives that their plan for America is eroding their customer base in America.

The way to get jobs back is to increase federal spending in the short term in order to make up for the gap left by consumers and businesses (the fastest way to get this money into circulation is by extending unemployment benefits and aiding stranded state and local governments).

Over the longer term, we can lift the wages of the vast majority of Americans by expanding and extending the Earned Income Tax Credit — an income supplement — up through the middle class, and pay for it by a higher marginal income tax rate on the top. And while we’re at it, exempt the first $20,000 of income from payroll taxes, and pay for that by lifting the cap on Social Security taxes on all incomes in excess of $250,000.

Beyond that, and over the still longer term, America’s vast middle class and the poor more need to be more productive and innovative, so they can add more value to an increasingly integrated global economy. That means better education. Instead of firing school teachers, closing libraries, and increasing tuitions at public universities, we have to do exactly the opposite.

This post originally appeared at RobertReich.org.

Read more: Robert Reich, Unemployment, Imports, Unemployment Rate, Trade, Economy, Economic Crisis, Exports, Free Trade, Jobs, Job Creation, Business News

Some Parents Are Now Stealing Their Children’s Credit (VIDEO)

As if the young didn’t have enough privacy issues to worry about.

Good Morning America reports an alarming new trend of desperate parents stealing their own children’s identities for financial gain.

Take Larry Brazeil Jr., now 27, whose father “stole” his social security card and ran up a $100,000 debt under his son’s name. Larry had no idea until a debt collector called him one day when he was only 19 years old.

“To this day I’m still working on my credit,” he tells ABC’s Mellody Hobson.

“Parents are privy to children’s information,” Linda Foley of the Identity Theft Resource Center told GMA. “And if they’re desperate enough, or if they’re that type of person, they seem to have no reluctance using their children’s social security number.”

WATCH the video here:

Read more: Family Dysfunction, Credit, Poor Credit, Economy, Identity Theft, ABC News, Credit Crunch, Privacy, Parents, Business News

Simon Johnson: David Axelrod’s Talking Points

David Axelrod was on the Diane Rehm show this morning — a great opportunity to connect with listeners who will actually stop what they are going and pay attention, at least for a short while. He was awful.

He had even the most basic facts wrong — it’s not “8 million people have lost their jobs” but rather “more than 8 million jobs have been lost” since December 2007. He rambled — it was hard to see his point, particularly in the introduction. But most of all, there was no narrative — why exactly did we have a recession, why has it been so bad, and why aren’t the jobs coming back?

Without a narrative, how can anyone make sense of the past 18 months?

Axelrod can choose his narrative — and obviously doesn’t need to agree, for example, with the view that the financial system became dangerous and now needs to be reined in — but he has to say something coherent. You can’t just make isolated points like “the fiscal stimulus helped” or (even more confusing) “we’ll now address the budget deficit.”

There was really no explanation for why the economy has become such a difficult place for so many people. How did we go from apparent prosperity in 2007 to the deepest recession of the past 50 years? And how are we going to get the jobs back?

Blaming things on the Republicans in some vague sense (e.g., tax cuts) also doesn’t make sense to people. If you want to get partisan, you have to connect the dots in a convincing manner — otherwise people will (rightly) tune out.

Does the problem here lie with the economic briefing that Axelrod received before going on air? If so, changing those responsible would be an obvious first step.

But the issue may be deeper — or higher up the administration. It is entirely possible, based on what we are seeing and hearing now, that even Axelrod and other members of the political wing of the White House don’t really understand what happened (the big banks blew themselves up) — and why they are now so powerless to do anything about it (after being rescued, the banks fought hard to block effective change). The credit system remains fundamentally damaged and unfixed; this undermines expectations for the future in many ways and slows the recovery of jobs.

This post originally appeared at The Baseline Scenario.

Read more: David Axelrod, Financial Crisis, Simon Johnson, Finance, Economic Crisis, Business News

Stephen Herrington: Can You Deflate Your Way Out of a Recession?

The number one concern of Americans is jobs, getting them, losing them, how much they pay. The number two concern is the federal deficit, its size and where it’s being spent. The GOP is busy exploiting both.

There are two approaches to dealing with these concerns that are time tested to be diametric political opposites. One is for government to borrow and prop up the economy to prime employing our way out of the debt, the progressive position. The other is to do nothing and let the economy contract and so puncture the debt bubble that caused the Great Recession, the hard conservative position. To quote Rand Paul, “people may need to take a cut in pay.” The GOP position is neither. Their position is to exploit the situation to tar the political opposition with failure, a non solution which equates to doing nothing.

Stimulating the economy in times of contraction is so well proven an effective solution for both jobs creation and debt retirement that it just does not need much scrutiny. It’s just a matter of being able to accept the depth and lack of traction of the ditch the GOP and Reaganomics has put us in. On the other side, one might expect the GOP to recognize that no elected government has ever conspired to let the economy contract, not even Hoover or Reagan, until now, as the GOP filibusters a second stimulus bill and extending unemployment benefits.

Stimulus is complex, there’s no doubt. But it is a qualitative certainty that the Great Depression grew out of economic conditions in 1929 that were not dissimilar to what preceded 2008. The one lesson learned from the Depression that is seldom challenged is that the money supply was tightened by the Fed when it should not have been. But then, like now, pumping money into the economy would have simply duplicated the malinvestment bubbles that caused the crash. That is a real risk of stimulus, but as the banks are not lending the injected liquidity but are investing in hedge funds or U.S. Treasuries, a different bubble, not a consumer/realty bubble, is in the making. It’s a different outcome from initial monetary measures that has no precedent. Profit motives do complicate, endlessly.

Fed is acting on monetarist principles to stimulate the economy and the banks are thwarting the Fed by hoarding, not making loans, reducing the money supply to the non hedge fund economy, in effect, though unintentionally, duplicating what the Fed did wrong in 1929. There is a standoff between bank regulators and the Fed over loan practices, nullifying the injection of capital. Not good by a monetarist’s way of thinking. So we, even as we try to be monetarists, fail.

That leaves the Federal government to supply stimulus through incentives and programs paid for through borrowing. Federal borrowing is being partly fueled by banks that are using their hoarded funds to buy Treasuries, which is a less efficient means of stimulus through the Fed, with 3.75% off the top/year. Lets hope they can work this out.

Doing nothing and letting the economy contract is uncharted territory for modern western governments. Without capital injection, inflation, some presume that there is a natural level of commerce and money supply, supported by solid companies and workers, beyond which the economy will not contract. It is also presumed that having contracted to a level of maximum efficiency and absolute need, that the economy will stabilize and will begin to grow again. No one has ever tried this with an economy of this size and complexity. One has to think about futurist predictions, during the 70s, that the complexity of our system means that if one cog fails, the whole thing will fail. Not to be too dire, but there might be more that can go wrong with letting the economy contract than meets the eye. As if what meets the eye weren’t bad enough already.

Doing nothing assumes that when the economy has contracted to a point, a point that can be predicted by no one, it will grow by attracting new investment.

A high of 25% unemployment was reached in the Great Depression, and no one knows how high unemployment could have gone, where the economic bottom would have been, because there was government stimulus intervention after it got to that point. There is no reason to believe that private investment of scale will happen until the bottom for the economy is reached. The only signal that a bottom has been reached is growth itself. There was no increase in private investment during the Depression, in fact there was a prominent decrease until after WWII, once the war spending had doubled the size of the U.S. economy.

At the bottom of the Great Depression, debt deflation became the issue for lenders. Collateral for loans depreciated as much as fifty percent. This has a freezing effect on investment as they saw in the Depression.

As Keynes, wrote, once banks realize that deflation has significantly impaired the value of their collateral:

…they become particularly anxious that the remainder of their assets should be as liquid and as free from risk as it is possible to make them. This reacts in all sorts of silent and unobserved ways on new enterprise. for it means that banks are less willing than they would normally be to finance any project…

Had WWII not created unprecedented demand for goods and services backed up by war fueled doubling of wages, we might still be in the Great Depression, with lenders still waiting for a sure thing. Of course all capital would have evaporated by now.

Further, since all the world is investing in countries where labor is in the low tens of percent equivalent to current U.S. wages, then it seems obvious that no one will invest here until that level of wage contraction is reached. Global capital, which now all U.S. capital of consequence is, will happily wait for us to bootstrap ourselves out of a second Great Depression, without the help from capital or government. That sidelined capital will be destroyed in speculation on an economy to which it does not promote growth.

The portrait of a future along the track of doing nothing for the economy is so real that those who lived through the Great Depression can still feel ghost starvation. The fact that government, banking and business are duplicating, in too many cases just out of ignorance, the motives and actions that led to the first great debt bubble recession becoming the Great Depression should not be lost on government, business or the public.

That the GOP in the Senate screws around trying to get some seats back by allowing the economy to run toward the brink of disaster should not be lost on the government, business or the public either. A depression is quicksand. The deeper you sink the harder and more expensive it is to get out. It took the most gargantuan debt to GDP the country has ever seen, WWII, to dig out of the mess that the Republicans made back in 1929.

It took a trillion dollars just to halt the collapse of 2008-9. It might take another trillion to reverse it, another 8% added to the debt. Wages will have to rise to fill the gap in the economy formerly occupied by easy credit. Investors will have to see growth before they invest in the real economy again. Spending is how it’s done, and the deficit doesn’t matter until and unless the economy is working again. Our ability to service debt is a more certain thing, given competent economic policy, than is our ability to endure a total collapse of the global economy.

Republicans will be sorry when they get the economy that they seek to create in order to win back control and discredit, ironically, the things that could save them personally. This is the worst brinkmanship we have ever seen, because in 1937 when the GOP convinced FDR to halt stimulus spending, they just didn’t know. Then they thought they were right and were proved wrong. Now they have forgotten. So they hold up not only further stimulus but even the basic unemployment extensions that no Congress has held back since unemployment was enacted. And they do it all to gain back control so that they can do nothing. Doing nothing is not an option and neither should then be Republicans.

The public never knew what exactly happened in the Great Depression, just that it got better, bit by bit. FDR held them together while the world experimented with giant economies on the brink of total collapse. Lessons learned and are now lost. They are lost on Senators and Congressmen who are unwilling to care about consequences further away than the next election. The lessons are lost on bankers and businessmen that are bent on making the same mistakes that ruined their grandfathers. They are lost on a public enamored of Ayn Rand fictions of self reliance in a world where you can’t get breakfast without a container ship being involved. And it is all not about the long term, to borrow from Mia Farrow in Rosemary’s Baby calling up the devil scene, “this is no dream, this is really happening”. To you, right here and now.

Capitalism has failed twice in a century, socialism only once.

Read more: Congress, Economic Stimulus Package, Federal Budget Deficit, 2010 Elections, Economic Crisis, Gop, Federal Reserve, Politics News

Northrop sees ship unit attracting buyer interest

ATLANTA (Reuters) – Defense contractor Northrop Grumman Corp said on Wednesday its shipbuilding operations could attract “a number of interested parties” should it decide to sell the division.

Customized Old Spice Guy Voicemail Messages

Continuing on his quest to take over the Internet , the Old Spice guy recorded a special message that you can download and cut up to use an outgoing voicemail message.
This is going to get us all so much action.

Watch Video ›

Census defies anti-government boycott calls

WASHINGTON (Reuters) – The $15 billion U.S. Census is near completion with a response rate unchanged from a decade ago, defying concerns it might be derailed by anti-government sentiment and widespread violence against census takers.