1. You can answer many seemingly difficult questions quickly.
2. You are often confident that something is true long before you have an airtight proof for it.
3. You are comfortable with feeling like you have no deep understanding of the problem you are studying.
4. Your intuitive thinking about a problem is productive and usefully structured, wasting little time on being aimlessly puzzled.
5. When trying to understand a new thing, you automatically focus on very simple examples that are easy to think about, and then you leverage intuition about the examples into more impressive insights.
6. You go up in abstraction, "higher and higher". The main object of study yesterday becomes just an example or a tiny part of what you are considering today.
7. The particularly "abstract" or "technical" parts of many other subjects seem quite accessible because they boil down to maths you already know. You generally feel confident about your ability to learn most quantitative ideas and techniques.
8. The particularly "abstract" or "technical" parts of many other subjects seem quite accessible because they boil down to maths you already know. You generally feel confident about your ability to learn most quantitative ideas and techniques.
9. Spoiled by the power of your best tools, you tend to shy away from messy calculations or long, case-by-case arguments unless they are absolutely unavoidable.
10. You develop a strong aesthetic preference for powerful and general ideas that connect hundreds of difficult questions, as opposed to resolutions of particular puzzles.
11. Understanding something abstract or proving that something is true becomes a task a lot like building something.
12. You are good at generating your own questions and your own clues in thinking about some new kind of abstraction.
13. You are easily annoyed by imprecision in talking about the quantitative or logical.
14. On the other hand, you are very comfortable with intentional imprecision or "hand waving" in areas you know, because you know how to fill in the details.
15. You are humble about your knowledge because you are aware of how weak maths is, and you are comfortable with the fact that you can say nothing intelligent about most problems.
Sunday, December 25, 2011
Saturday, December 24, 2011
More Solar Firms Set to Burn up as Prices Sink
(Reuters) - Only four years ago, hundreds of start-ups optimistically built factories and churned out solar panels to meet rising demand. Now, closures and failure loom for many.
The brutal shakeout is a dramatic reversal for an industry that has seen overall global growth of more than 30 percent annually over the past decade and this year will reach new records for solar panel sales.
Only a handful of manufacturers are now profitable in the face of too much capacity, which has contributed to a plunge in prices, and as government subsidies have been curbed. European banks that lent billions for solar installation have also pulled back as they struggle in the euro zone credit crisis, and debt-laden Chinese solar companies are in danger of burning up.
Solar profit margins that often approached 50 percent in 2007 have in many cases disappeared altogether. The pain - namely bankruptcy for some key players in the sector - may get much worse before it begins to ease.
"When you look at some of those balance sheets and how levered those companies are, and you look at how thin their profit margins are, it can really make your hair stand on end," said Kevin Landis, portfolio manager of the Firsthand Alternative Energy Fund, whose top holdings include Swiss solar equipment maker Meyer Burger Technology AG and U.S. equipment maker GT Advanced Technologies Inc.
And while sliding prices are making solar more competitive, the prospect of new cheap supplies of natural gas around the world is undermining those gains.
The continuing shakeout is seeing many of the early entrants to the solar industry either fail or sell out. A whole new breed of big investors, such as Warren Buffett and Google Inc, or oil industry companies such as TransCanada Corp, are moving into solar power production. Some, including oil giant Total, have even entered the tumultuous panel manufacturing market. Its rival BP Plc, however, said this week it was exiting the solar business entirely.
Asian conglomerates that already have solar panel manufacturing operations, such as Japan's Sharp Corp or South Korea's LG Corp, could scoop up their smaller, struggling rivals, or simply allow them to fold and benefit from reduced capacity.
The rapid march down in prices and the Darwinian survival of only the fittest - without the aid of large government subsidies - is making solar power more competitive against conventional energy sources, such as oil, coal and nuclear power. That means that for homeowners, businesses and utilities, the choice to go solar is more attractive and attainable than ever.
GLOBAL GLUT
Still, even the most efficient manufacturers are troubled. First Solar, the U.S.-based low-cost leader, last week announced job cuts, saying 2012 profits would be up to 50 percent below Wall Street forecasts. A week earlier, another big U.S. solar company, MEMC Electronic Materials Inc, said it would cut a fifth of its staff and idle some facilities.
At the heart of the downturn is a massive global glut of panels and huge excess production capacity that has driven prices down more than 40 percent in 2011.
"The prices that we're seeing today are likely not covering manufacturing costs in many cases," said Ralph Romero, director in management consulting for Black & Veatch, which provides engineering and due diligence consulting services to solar manufacturers.
The pain for the solar manufacturers has been acute, with most shares in the sector dropping more than 60 percent. First Solar, a one-time Wall Street darling, is the worst-performing stock in the Standard & Poor's 500 index this year, down more than 73 percent.
A number of companies have already lost their fight for survival, such as Germany's Solon SE and Solar Millennium, which both sank into insolvency this month. That follows U.S. companies Evergreen Solar, SpectraWatt and Solyndra, the last of which shut down operations in September despite its controversial gobbling up of more than $500 million of U.S. government support.
Even China's notoriously aggressive small, private manufacturers are closing factories. In fact, experts predict much of an estimated 49.8 gigawatts of global solar cell production will have to be shuttered so that companies can profitably meet expectations of far lower global demand.
A GLOOMY OUTLOOK
Prices for solar panels started 2011 near $1.60 per watt, but a buildup of inventory forced manufacturers into a fire sale toward the end of the second quarter that has pushed prices to near $1 per watt now. Romero said prices for polysilicon panels, the dominant technology, may stabilize around that level, though others see declines continuing well into next year.
SolarCity, one of the largest U.S. solar installers, is anticipating a further slide early in 2012. "I do think 85 cents is probably close to the floor," said Lyndon Rive, its CEO.
That price could spell difficulties for some major names, including U.S.-listed Chinese companies Suntech Power Holdings , which has the biggest capacity for making panels in the world, and LDK Solar Co , one of the largest makers of polysilicon wafers used to make panels, industry analysts and investors say.
LDK did not respond to questions about its financial health. A spokesman for Suntech emphasized the company had cemented its position as the largest supplier of panels globally, and that it is increasing its market share.
Like other China-based companies, Suntech and LDK won massive credit lines from state-backed banks. Two years ago, that was seen by many in the industry as an unfair handout that allowed them to outflank rivals in Germany or the U.S.
But now that debt, about $2.2 billion for Suntech and $3.6 billion for LDK, is proving a huge burden.
"Maybe because (LDK) are so big they get some kind of sweetheart debt deal that prevents the company from going under, but I would find it really hard to believe that the current equity holders are going to be spared," said Morningstar solar industry analyst Stephen Simko, who added that Suntech also looks particularly vulnerable.
LDK's debt has swelled $800 million in the past 12 months to almost three times its net asset value, and analysts see it showing negative free cash flow of about $1.1 billion this year and $375 million in 2012, Thomson Reuters I/B/E/S data show.
On the same basis, Suntech negative free cash flow is likely to approach $800 million this year, and $200 million in 2012.
Concerns are also swirling in the debt markets, where LDK's 4.75-percent bonds due in April of 2013 are priced at around 68 cents on the dollar, according to Thomson Reuters data. Markit data, however, shows that issue priced at 47 cents to 51 cents on the dollar. Suntech's debt that matures in March of 2013 is priced at 41 to 42 cents on the dollar, according to Thomson Reuters and Markit.
"We exceeded both our shipment and gross margin guidance for the third quarter and ended the quarter with over $560 million of cash and restricted cash," Rory Macpherson, Suntech's director of investor relations, said in an email.
"We are also implementing a range of initiatives that will strengthen our financial position over the next 12 months. These include accelerating cost-down programs, improving working capital by $200 million by the end of the year, reducing operating expenses by 20 percent in 2012, limiting capital expenditures to maintenance only, and monetizing non-core assets."
THE GAS THREAT
First Solar's projects have drawn the interest of large corporate partners such as U.S. utilities MidAmerican and NRG in part because the company's panels are the cheapest - making them ideal for large projects. First Solar makes panels from cadmium telluride rather than pricey polysilicon, the key component for more than 80 percent of global supply.
First Solar has said its costs are expected to drop more than 10 percent to 65 cents per watt by the end of next year, excluding the costs of running production below capacity.
That might be just enough to allow it to sell its panels at a discount to its polysilicon-based rivals - a discount it needs because its panels are not typically as efficient at turning sunlight into electricity, a fact acknowledged by both the company and industry experts alike.
Only three others, China's Yingli Green Energy Holding, Trina Solar Ltd and Jinko Solar Holding Co, are expected to get costs low enough to sell profitably at 85 cents per watt next year.
Recognizing the darkening market economics, First Solar's CEO Mike Ahearn has said the company will shift sales away from Europe, a market that had been supported by subsidies.
Germany, the world's top solar market, has gradually been ratcheting down its solar subsidy, while other large markets such as Spain, Italy and the Czech Republic dramatically cut back subsidies that had led to a boom in demand.
First Solar plans to get more power out of each panel and cut building costs for solar power plants to get the cost of electricity production down to $100 to $140 per megawatt hour in the next three years. That would be less than half the price a year ago and near the $90 per megawatt hour cost of a new nuclear plant.
However, it has a long way to go still to be competitive against other energy sources - it would still be nearly double the cost of a coal-fired power plant and triple that of natural gas plants, according to U.S. Department of Energy data.
And those natural gas plants represent one of the biggest threats to solar power in the United States, since the advent of hydraulic fracturing drilling technology has opened up decades' worth of gas supply. Utilities are rushing to build new gas-fired plants that can produce electricity cheaply.
Even with an 85-cent per watt price in sight for some, the industry will still need government support. And that backing will be available in fewer places and often under less generous terms.
"Without subsidies solar PV is still not in a position to be competitive across the board," Romero said.
Solar is competitive today in some places where power prices are very high, Romero said, such as California. That, as well as the state's mandate that it source one third of its electricity generation from renewable sources by 2020, has led to a boom in the building of solar projects there.
But the trend is "on the down slope" now as the state has fulfilled much of its requirement, said Ahearn. That's another reason First Solar and others are looking at new markets.
EMERGING MARKETS
First Solar is betting that its 2015 cost will be low enough to drive business in India, and some other markets, to win new contracts that need no government subsidy.
It is not alone in trying to break into such markets. Suntech, Yingli and Trina have all said they would target places like India. The only problem is that it will take several years at least to develop enough business to be profitable in those markets and competition could be intense.
"Over 95 percent of historical demand for PV has come from subsidy-driven markets, principally in Europe. The strategy of shifting focus to frontier markets makes sense in the long run but demand there is quite limited for the time being," Raymond James analyst Pavel Molchanov said.
The new, promising solar markets most often cited by manufacturers include India, Southeast Asia and South Africa. Such markets not only enjoy abundant sunlight, which makes the economics of solar more attractive, they also have strong appetites for new sources of power and in many locations lack the grid infrastructure needed to build large power plants. That's another advantage for solar, which can be deployed on a small scale without the need for new transmission.
Also, in many emerging markets such as India, the use of diesel generators keeps electricity prices high - making solar more competitive.
"The economics in a lot of emerging markets makes solar very attractive without needing the incentives we have in the U.S. because of the cost of power in those countries and because solar eliminates the need for transmission," said Marty Klepper, co-head of the energy and infrastructure projects practice at Skadden, Arps, Slate, Meagher & Flom LLP.
The Indian government has a goal of generating 20 GW of electricity from grid-connected solar energy and 2 GW of off-grid solar by 2022 against just 54 MW installed at the end of 2010. India recently lowered its forecast for when solar would be competitive with grid electricity by five years to 2017.
In the U.S. though, conditions are worsening - and not just because of the threat of a cheap gas supply.
The industry is decrying the expiration at the end of this month of a program that allows solar project owners to recover 30 percent of the cost of construction in the form of a cash grant. The program will revert to a tax credit next year, making it useful only to those seeking to reduce their tax bill.
"Projects that have yet to commence construction are all at risk," said Darren Van't Hof, director of renewable energy investments for U.S. Bank, a unit of U.S. Bancorp. "Investors without a tax appetite are going to be challenged to stay in the market."
The chances that Congress will renew the cash grant program have dimmed, and that could hit demand immediately.
"We're projecting a big upswing in our business next year and I don't know if we'll get that if this goes away," said Tony Clifford, CEO of U.S. project developer Standard Solar.
NEW INVESTORS
One of the few bright spots is that despite the headwinds, there is new investment coming into solar power production.
Most recently, Warren Buffett offered the industry a major vote of confidence when his MidAmerican Energy Holdings bought First Solar's $2 billion Topaz Solar Farm, which at 550-megawatts is one of the two largest being built in the world. MidAmerican bought 49 percent of another First Solar project a week later, a move it said was part of a strategy to "aggressively" pursue opportunities in renewable energy.
Other big names, such as Bank of America and utility giants Exelon and NextEra, have also been investing in solar power projects. Bank of America has put its heft behind a plan to build more than $1 billion in solar projects on military housing with SolarCity, while Exelon and NextEra have each bought major First Solar projects.
Google has been an investor for several years and on Tuesday made its latest move, saying it would team up with private equity firm KKR to buy four California plants.
Winners are expected eventually to emerge but the question is how much more carnage there will be before that happens. "There is going to continue to be this natural rate of attrition where smaller companies sort of die off and the big companies who have been looking at the market and moving in will continue to make a bigger impact," said Firsthand's Landis.
The brutal shakeout is a dramatic reversal for an industry that has seen overall global growth of more than 30 percent annually over the past decade and this year will reach new records for solar panel sales.
Only a handful of manufacturers are now profitable in the face of too much capacity, which has contributed to a plunge in prices, and as government subsidies have been curbed. European banks that lent billions for solar installation have also pulled back as they struggle in the euro zone credit crisis, and debt-laden Chinese solar companies are in danger of burning up.
Solar profit margins that often approached 50 percent in 2007 have in many cases disappeared altogether. The pain - namely bankruptcy for some key players in the sector - may get much worse before it begins to ease.
"When you look at some of those balance sheets and how levered those companies are, and you look at how thin their profit margins are, it can really make your hair stand on end," said Kevin Landis, portfolio manager of the Firsthand Alternative Energy Fund, whose top holdings include Swiss solar equipment maker Meyer Burger Technology AG and U.S. equipment maker GT Advanced Technologies Inc.
And while sliding prices are making solar more competitive, the prospect of new cheap supplies of natural gas around the world is undermining those gains.
The continuing shakeout is seeing many of the early entrants to the solar industry either fail or sell out. A whole new breed of big investors, such as Warren Buffett and Google Inc, or oil industry companies such as TransCanada Corp, are moving into solar power production. Some, including oil giant Total, have even entered the tumultuous panel manufacturing market. Its rival BP Plc, however, said this week it was exiting the solar business entirely.
Asian conglomerates that already have solar panel manufacturing operations, such as Japan's Sharp Corp or South Korea's LG Corp, could scoop up their smaller, struggling rivals, or simply allow them to fold and benefit from reduced capacity.
The rapid march down in prices and the Darwinian survival of only the fittest - without the aid of large government subsidies - is making solar power more competitive against conventional energy sources, such as oil, coal and nuclear power. That means that for homeowners, businesses and utilities, the choice to go solar is more attractive and attainable than ever.
GLOBAL GLUT
Still, even the most efficient manufacturers are troubled. First Solar, the U.S.-based low-cost leader, last week announced job cuts, saying 2012 profits would be up to 50 percent below Wall Street forecasts. A week earlier, another big U.S. solar company, MEMC Electronic Materials Inc, said it would cut a fifth of its staff and idle some facilities.
At the heart of the downturn is a massive global glut of panels and huge excess production capacity that has driven prices down more than 40 percent in 2011.
"The prices that we're seeing today are likely not covering manufacturing costs in many cases," said Ralph Romero, director in management consulting for Black & Veatch, which provides engineering and due diligence consulting services to solar manufacturers.
The pain for the solar manufacturers has been acute, with most shares in the sector dropping more than 60 percent. First Solar, a one-time Wall Street darling, is the worst-performing stock in the Standard & Poor's 500 index this year, down more than 73 percent.
A number of companies have already lost their fight for survival, such as Germany's Solon SE and Solar Millennium, which both sank into insolvency this month. That follows U.S. companies Evergreen Solar, SpectraWatt and Solyndra, the last of which shut down operations in September despite its controversial gobbling up of more than $500 million of U.S. government support.
Even China's notoriously aggressive small, private manufacturers are closing factories. In fact, experts predict much of an estimated 49.8 gigawatts of global solar cell production will have to be shuttered so that companies can profitably meet expectations of far lower global demand.
A GLOOMY OUTLOOK
Prices for solar panels started 2011 near $1.60 per watt, but a buildup of inventory forced manufacturers into a fire sale toward the end of the second quarter that has pushed prices to near $1 per watt now. Romero said prices for polysilicon panels, the dominant technology, may stabilize around that level, though others see declines continuing well into next year.
SolarCity, one of the largest U.S. solar installers, is anticipating a further slide early in 2012. "I do think 85 cents is probably close to the floor," said Lyndon Rive, its CEO.
That price could spell difficulties for some major names, including U.S.-listed Chinese companies Suntech Power Holdings , which has the biggest capacity for making panels in the world, and LDK Solar Co , one of the largest makers of polysilicon wafers used to make panels, industry analysts and investors say.
LDK did not respond to questions about its financial health. A spokesman for Suntech emphasized the company had cemented its position as the largest supplier of panels globally, and that it is increasing its market share.
Like other China-based companies, Suntech and LDK won massive credit lines from state-backed banks. Two years ago, that was seen by many in the industry as an unfair handout that allowed them to outflank rivals in Germany or the U.S.
But now that debt, about $2.2 billion for Suntech and $3.6 billion for LDK, is proving a huge burden.
"Maybe because (LDK) are so big they get some kind of sweetheart debt deal that prevents the company from going under, but I would find it really hard to believe that the current equity holders are going to be spared," said Morningstar solar industry analyst Stephen Simko, who added that Suntech also looks particularly vulnerable.
LDK's debt has swelled $800 million in the past 12 months to almost three times its net asset value, and analysts see it showing negative free cash flow of about $1.1 billion this year and $375 million in 2012, Thomson Reuters I/B/E/S data show.
On the same basis, Suntech negative free cash flow is likely to approach $800 million this year, and $200 million in 2012.
Concerns are also swirling in the debt markets, where LDK's 4.75-percent bonds due in April of 2013 are priced at around 68 cents on the dollar, according to Thomson Reuters data. Markit data, however, shows that issue priced at 47 cents to 51 cents on the dollar. Suntech's debt that matures in March of 2013 is priced at 41 to 42 cents on the dollar, according to Thomson Reuters and Markit.
"We exceeded both our shipment and gross margin guidance for the third quarter and ended the quarter with over $560 million of cash and restricted cash," Rory Macpherson, Suntech's director of investor relations, said in an email.
"We are also implementing a range of initiatives that will strengthen our financial position over the next 12 months. These include accelerating cost-down programs, improving working capital by $200 million by the end of the year, reducing operating expenses by 20 percent in 2012, limiting capital expenditures to maintenance only, and monetizing non-core assets."
THE GAS THREAT
First Solar's projects have drawn the interest of large corporate partners such as U.S. utilities MidAmerican and NRG in part because the company's panels are the cheapest - making them ideal for large projects. First Solar makes panels from cadmium telluride rather than pricey polysilicon, the key component for more than 80 percent of global supply.
First Solar has said its costs are expected to drop more than 10 percent to 65 cents per watt by the end of next year, excluding the costs of running production below capacity.
That might be just enough to allow it to sell its panels at a discount to its polysilicon-based rivals - a discount it needs because its panels are not typically as efficient at turning sunlight into electricity, a fact acknowledged by both the company and industry experts alike.
Only three others, China's Yingli Green Energy Holding, Trina Solar Ltd and Jinko Solar Holding Co, are expected to get costs low enough to sell profitably at 85 cents per watt next year.
Recognizing the darkening market economics, First Solar's CEO Mike Ahearn has said the company will shift sales away from Europe, a market that had been supported by subsidies.
Germany, the world's top solar market, has gradually been ratcheting down its solar subsidy, while other large markets such as Spain, Italy and the Czech Republic dramatically cut back subsidies that had led to a boom in demand.
First Solar plans to get more power out of each panel and cut building costs for solar power plants to get the cost of electricity production down to $100 to $140 per megawatt hour in the next three years. That would be less than half the price a year ago and near the $90 per megawatt hour cost of a new nuclear plant.
However, it has a long way to go still to be competitive against other energy sources - it would still be nearly double the cost of a coal-fired power plant and triple that of natural gas plants, according to U.S. Department of Energy data.
And those natural gas plants represent one of the biggest threats to solar power in the United States, since the advent of hydraulic fracturing drilling technology has opened up decades' worth of gas supply. Utilities are rushing to build new gas-fired plants that can produce electricity cheaply.
Even with an 85-cent per watt price in sight for some, the industry will still need government support. And that backing will be available in fewer places and often under less generous terms.
"Without subsidies solar PV is still not in a position to be competitive across the board," Romero said.
Solar is competitive today in some places where power prices are very high, Romero said, such as California. That, as well as the state's mandate that it source one third of its electricity generation from renewable sources by 2020, has led to a boom in the building of solar projects there.
But the trend is "on the down slope" now as the state has fulfilled much of its requirement, said Ahearn. That's another reason First Solar and others are looking at new markets.
EMERGING MARKETS
First Solar is betting that its 2015 cost will be low enough to drive business in India, and some other markets, to win new contracts that need no government subsidy.
It is not alone in trying to break into such markets. Suntech, Yingli and Trina have all said they would target places like India. The only problem is that it will take several years at least to develop enough business to be profitable in those markets and competition could be intense.
"Over 95 percent of historical demand for PV has come from subsidy-driven markets, principally in Europe. The strategy of shifting focus to frontier markets makes sense in the long run but demand there is quite limited for the time being," Raymond James analyst Pavel Molchanov said.
The new, promising solar markets most often cited by manufacturers include India, Southeast Asia and South Africa. Such markets not only enjoy abundant sunlight, which makes the economics of solar more attractive, they also have strong appetites for new sources of power and in many locations lack the grid infrastructure needed to build large power plants. That's another advantage for solar, which can be deployed on a small scale without the need for new transmission.
Also, in many emerging markets such as India, the use of diesel generators keeps electricity prices high - making solar more competitive.
"The economics in a lot of emerging markets makes solar very attractive without needing the incentives we have in the U.S. because of the cost of power in those countries and because solar eliminates the need for transmission," said Marty Klepper, co-head of the energy and infrastructure projects practice at Skadden, Arps, Slate, Meagher & Flom LLP.
The Indian government has a goal of generating 20 GW of electricity from grid-connected solar energy and 2 GW of off-grid solar by 2022 against just 54 MW installed at the end of 2010. India recently lowered its forecast for when solar would be competitive with grid electricity by five years to 2017.
In the U.S. though, conditions are worsening - and not just because of the threat of a cheap gas supply.
The industry is decrying the expiration at the end of this month of a program that allows solar project owners to recover 30 percent of the cost of construction in the form of a cash grant. The program will revert to a tax credit next year, making it useful only to those seeking to reduce their tax bill.
"Projects that have yet to commence construction are all at risk," said Darren Van't Hof, director of renewable energy investments for U.S. Bank, a unit of U.S. Bancorp. "Investors without a tax appetite are going to be challenged to stay in the market."
The chances that Congress will renew the cash grant program have dimmed, and that could hit demand immediately.
"We're projecting a big upswing in our business next year and I don't know if we'll get that if this goes away," said Tony Clifford, CEO of U.S. project developer Standard Solar.
NEW INVESTORS
One of the few bright spots is that despite the headwinds, there is new investment coming into solar power production.
Most recently, Warren Buffett offered the industry a major vote of confidence when his MidAmerican Energy Holdings bought First Solar's $2 billion Topaz Solar Farm, which at 550-megawatts is one of the two largest being built in the world. MidAmerican bought 49 percent of another First Solar project a week later, a move it said was part of a strategy to "aggressively" pursue opportunities in renewable energy.
Other big names, such as Bank of America and utility giants Exelon and NextEra, have also been investing in solar power projects. Bank of America has put its heft behind a plan to build more than $1 billion in solar projects on military housing with SolarCity, while Exelon and NextEra have each bought major First Solar projects.
Google has been an investor for several years and on Tuesday made its latest move, saying it would team up with private equity firm KKR to buy four California plants.
Winners are expected eventually to emerge but the question is how much more carnage there will be before that happens. "There is going to continue to be this natural rate of attrition where smaller companies sort of die off and the big companies who have been looking at the market and moving in will continue to make a bigger impact," said Firsthand's Landis.
Saturday, December 17, 2011
Watching Football to Death
LONDON (Reuters) - Watching your favorite football team trying to hang on to a precarious lead in the dying minutes of a match is enough to frazzle anyone's nerves, but for one Manchester United fan the stress was nearly too much.
The 58-year-old woman gets so anxious she has to take treatment for a life-threatening condition brought on by watching knife-edge games at the Old Trafford stadium.
The condition, known as an Addisonian crisis, comes about when the adrenal glands do not produce enough of the stress-reducing hormone cortisol, a lack of which can lead to low blood pressure and even a coma.
"We believe that our patient was having difficulty mounting an appropriate physiological cortisol response during the big games and therefore we present this as the first description of Manchester United-induced Addisonian crisis," said Dr Akbar Choudhry who treated the patient.
Doctors suspected the condition when the woman started getting bouts of anxiety, palpitations, panic, light headedness, and a sense of impending doom towards the end of matches.
The symptoms were less serious when the home side was playing a lower-rated team.
An Addisonian crisis, which is a manifestation of Addison's disease, is difficult to diagnose because the main symptoms include fatigue, lethargy and low mood -- often experienced by otherwise healthy people and frequently reported in many other chronic conditions.
"Luckily, the patient was on holiday for United's 6-1 defeat by local rivals Manchester City in October," Choudhry said in a report on BMJ.com.
"But, by this time, doctors had fine-tuned her therapy and she has remained symptom-free during recent tense contests against Sunderland and FC Basel," he added.
Treatment coincided with the start of the 2011/12 football season and the patient has managed to attend all games at Old Trafford without any adverse effects.
The 58-year-old woman gets so anxious she has to take treatment for a life-threatening condition brought on by watching knife-edge games at the Old Trafford stadium.
The condition, known as an Addisonian crisis, comes about when the adrenal glands do not produce enough of the stress-reducing hormone cortisol, a lack of which can lead to low blood pressure and even a coma.
"We believe that our patient was having difficulty mounting an appropriate physiological cortisol response during the big games and therefore we present this as the first description of Manchester United-induced Addisonian crisis," said Dr Akbar Choudhry who treated the patient.
Doctors suspected the condition when the woman started getting bouts of anxiety, palpitations, panic, light headedness, and a sense of impending doom towards the end of matches.
The symptoms were less serious when the home side was playing a lower-rated team.
An Addisonian crisis, which is a manifestation of Addison's disease, is difficult to diagnose because the main symptoms include fatigue, lethargy and low mood -- often experienced by otherwise healthy people and frequently reported in many other chronic conditions.
"Luckily, the patient was on holiday for United's 6-1 defeat by local rivals Manchester City in October," Choudhry said in a report on BMJ.com.
"But, by this time, doctors had fine-tuned her therapy and she has remained symptom-free during recent tense contests against Sunderland and FC Basel," he added.
Treatment coincided with the start of the 2011/12 football season and the patient has managed to attend all games at Old Trafford without any adverse effects.
Inflated Home Sales Figures from 2007-10 to Be Lowered
National home sales figures will be lowered dating back to 2007 after the private trade group that collects them said the numbers were too high.
The National Association of Realtors said Monday it will release the downward revisions for previously occupied homes on Dec. 21.
The Realtors consulted with several government and private housing market experts, including the Federal Reserve, the Department of Housing and Urban Development, the Mortgage Bankers Association, the National Association of Home Builders, mortgage giants Fannie Mae and Freddie Mac and CoreLogic, the California-based data firm that first raised doubts about the annual numbers earlier this year.
CoreLogic estimated that the Realtors group overstated sales in 2010 by at least 15%.
Among the reasons for the inflated figures, the Realtors group says: changes in the way the Census Bureau collects data, population shifts and some sales being counted twice. Last year's total sales figure of 4.91 million was the worst in 13 years.
The changing numbers could impact how economists view data from the trade group. It could also affect companies who use the figures for hiring and expansion plans.
[Via Usa Today]
The National Association of Realtors said Monday it will release the downward revisions for previously occupied homes on Dec. 21.
The Realtors consulted with several government and private housing market experts, including the Federal Reserve, the Department of Housing and Urban Development, the Mortgage Bankers Association, the National Association of Home Builders, mortgage giants Fannie Mae and Freddie Mac and CoreLogic, the California-based data firm that first raised doubts about the annual numbers earlier this year.
CoreLogic estimated that the Realtors group overstated sales in 2010 by at least 15%.
Among the reasons for the inflated figures, the Realtors group says: changes in the way the Census Bureau collects data, population shifts and some sales being counted twice. Last year's total sales figure of 4.91 million was the worst in 13 years.
The changing numbers could impact how economists view data from the trade group. It could also affect companies who use the figures for hiring and expansion plans.
[Via Usa Today]
Thursday, December 1, 2011
How to Lose Money with Groupon
A London bakery recently experienced the worst-case scenario of offering a Groupon for a small business, and it cost the owner thousands.
Need a Cake bakery owner Rachel Brown decided to put up a 75% discount on a dozen cupcakes on the site, which dropped the price down to $10 from $40.
Apparently, people really love getting cupcakes cheap, because she was rushed by throngs of customers in a cupcake frenzy. 8,500 people signed up, and her crew of eight had to make 102,000 cupcakes to meet the orders.
Brown lost $3 per batch because she had to hire 25 extra workers to help, and she ended up losing $20,000 because of it, which is a ton for a small biz. It wiped out her profits for the year, reports the Daily Mail.
"Without doubt, it was my worst ever business decision," she told the BBC. "We had thousands of orders pouring in that really we hadn't expected to have. A much larger company would have difficulty coping."
This is just the latest in Groupon small business horror stories. A story popped up in September about a Portland cafe losing $8,000 because of a Groupon, which prompted a personal letter from founder and CEO Andrew Mason.
It brings up the always-present question about the daily deals site: does Groupon suck for small businesses?
Well, it looks like most small businesses think so. An overwhelming majority of 70% hate Groupon, if the latest survey from iContact is to be believed.
As for Brown and her bakery, the experience may have cost her 20 grand, but what about all the exposure she's getting for her store? Great, right? It doesn't hurt, but it probably wasn't worth the cost.
Small businesses like this bakery thrive on relationships with their local customers, not crowds of outsiders coming in to snatch up a free lunch.
Getting new customers is great, but in this case, the bakery rewarded the wrong customers. Those 8,500 people that rushed for the Groupon probably won't be coming back to pay for the same cupcakes at quadruple the price.
Only those the store has nurtured relationships with for a long time (in Brown's case, 25 years), should be the ones rewarded. They're the ones that keep coming back for more.
[Via Business Insider]
Need a Cake bakery owner Rachel Brown decided to put up a 75% discount on a dozen cupcakes on the site, which dropped the price down to $10 from $40.
Apparently, people really love getting cupcakes cheap, because she was rushed by throngs of customers in a cupcake frenzy. 8,500 people signed up, and her crew of eight had to make 102,000 cupcakes to meet the orders.
Brown lost $3 per batch because she had to hire 25 extra workers to help, and she ended up losing $20,000 because of it, which is a ton for a small biz. It wiped out her profits for the year, reports the Daily Mail.
"Without doubt, it was my worst ever business decision," she told the BBC. "We had thousands of orders pouring in that really we hadn't expected to have. A much larger company would have difficulty coping."
This is just the latest in Groupon small business horror stories. A story popped up in September about a Portland cafe losing $8,000 because of a Groupon, which prompted a personal letter from founder and CEO Andrew Mason.
It brings up the always-present question about the daily deals site: does Groupon suck for small businesses?
Well, it looks like most small businesses think so. An overwhelming majority of 70% hate Groupon, if the latest survey from iContact is to be believed.
As for Brown and her bakery, the experience may have cost her 20 grand, but what about all the exposure she's getting for her store? Great, right? It doesn't hurt, but it probably wasn't worth the cost.
Small businesses like this bakery thrive on relationships with their local customers, not crowds of outsiders coming in to snatch up a free lunch.
Getting new customers is great, but in this case, the bakery rewarded the wrong customers. Those 8,500 people that rushed for the Groupon probably won't be coming back to pay for the same cupcakes at quadruple the price.
Only those the store has nurtured relationships with for a long time (in Brown's case, 25 years), should be the ones rewarded. They're the ones that keep coming back for more.
[Via Business Insider]
Saturday, November 19, 2011
U.S. Alcohol Consumption Hits 25-Year High
The booze business is recession proof, just ask your neighborhood bartender. They know the following to be true: When times are good, people enjoy a cocktail. When times are rough, people enjoy two cocktails. A recent Gallup poll shows alcohol consumption hit a 25-year high in 2010, with 67 percent of Americans reporting drinking alcoholic beverages. This number approaches the all-time booze benchmark of 71 percent set in the 1970s.
Many believe the economy can contribute to the rise in alcohol consumption, but perhaps not in the obvious way. A poor economy may not drive the masses to drink, but it sure gives people the extra time to have an adult beverage or two – especially if they have lost their job or are staying at home on weekends to save cash.
Social drinking is a relative term, and it has myriad meanings from coast to coast. Location, culture and upbringing influence alcohol intake just as much as age, sex and weight.
U.S. citizens in the far West and the Upper Plains states drink the most, reports the Washington-based Beer Institute.
The deep south and Mid-Atlantic are among the driest parts of the country.
What state came out on top of the tap? New Hampshire had the most widespread booze consumption in the poll. The average adult in that state doubled the national per capita average, gulping an average of 6.7 gallons of wine each and 3.8 gallons of liquor in 2010. Some in the health industry attribute this to the state’s popularity for both winter and summer vacations.
Americans drank the most wine on record last year, roughly 2.3 gallons apiece. Spirits climbed 18 percent to 1.5 gallons per person, while beer intake dropped 7 percent to 20.7 gallons, reports the Beer Institute.
[Via Fox 9 News]
Many believe the economy can contribute to the rise in alcohol consumption, but perhaps not in the obvious way. A poor economy may not drive the masses to drink, but it sure gives people the extra time to have an adult beverage or two – especially if they have lost their job or are staying at home on weekends to save cash.
Social drinking is a relative term, and it has myriad meanings from coast to coast. Location, culture and upbringing influence alcohol intake just as much as age, sex and weight.
U.S. citizens in the far West and the Upper Plains states drink the most, reports the Washington-based Beer Institute.
The deep south and Mid-Atlantic are among the driest parts of the country.
What state came out on top of the tap? New Hampshire had the most widespread booze consumption in the poll. The average adult in that state doubled the national per capita average, gulping an average of 6.7 gallons of wine each and 3.8 gallons of liquor in 2010. Some in the health industry attribute this to the state’s popularity for both winter and summer vacations.
Americans drank the most wine on record last year, roughly 2.3 gallons apiece. Spirits climbed 18 percent to 1.5 gallons per person, while beer intake dropped 7 percent to 20.7 gallons, reports the Beer Institute.
[Via Fox 9 News]
Saturday, November 12, 2011
More Homes Heat with Wood, Raising Pollution Risks
Mostly to save money, Matthew Walton switched a few years ago from heating his home with natural gas to wood, becoming a modern-day Paul Bunyan.
"The access to cheap wood made a difference," says Walton, a carpenter who lives on heavily forested land in Keene, N.H., where he chops his own fallen or dead trees.
"It saves us a bundle," he says, adding his wood stove can manage all winter with just two cords because he added insulation and good windows to his tidy, 1,300-square-foot home.
As energy prices rise, and winter approaches, more Americans are turning to wood to heat their homes, some hurrying to cash in on tax credits for efficient stoves that expire next month.
This upswing is prompting federal officials, concerned about the health and environmental impact of burning wood, to update 23-year-old certification criteria for stoves and set the first requirements for outdoor wood boilers, which heat water that's piped into homes.
"We are not in the business of telling people how to heat their homes," says Alison Davis of the Environmental Protection Agency, which plans to propose the new rules next year. But if they want to burn wood, Davis urges them to buy an EPA-certified stove and operate it properly so no smoke gets inside the house.
She says boilers are "significantly more polluting" than wood or pellet stoves because they have short stacks and use 10 times as much wood. Even so, she says those meeting the EPA's 2007 voluntary standards are 90% cleaner than older ones. "The technology has improved for wood stoves," Davis says, as has the research on the dangers of wood burning.
Wood heating's upswing
The number of U.S. households heating with wood rose 34% nationwide from 1.8 million in 2000 to 2.4 million in 2010 — faster than any other heating fuel, according to Census data.
"We're seeing a rise mainly in states with high oil and gas prices," most notably in Michigan and Connecticut, says John Ackerly of the Alliance for Green Heat, a nonprofit group that promotes wood stoves.
"It's a combination of rising energy prices and the economic downturn," he says, adding low- and middle-income households are much more likely than others to use wood for primary heating. In rural areas, he says many cut their own wood and in the suburbs, they get it free when trees fall.
He expects wood will become more popular this winter, citing the projected rise in household heating costs. Compared to last winter, heating will cost 3% more with natural gas and 8% more with oil this year, according to the U.S. Energy Information Administration.
Retailers are gearing up. U.S. shipments of pellet stoves, considered the most efficient way to burn wood, jumped 59% in the second quarter of this year, compared to the same time last year, and pellet fireplace inserts rose 72%, according to Leslie Wheeler of the the Hearth, Patio and Barbecue Association, an industry group.
"We're expecting those numbers to continue to increase," Wheeler says, because of high fuel prices. She says the tax credits expiring this year — up to $300 for EPA-certified stoves — are not as generous as in 2009 and 2010 when they covered 30% of the cost, up to $1,500. She says many cost $3,000 to $4,000 with installation.
Wood's dirty downside
The problem is that most Americans burn wood in old, dirty devices. Traditional fireplaces are so inefficient they don't heat a room unless they've been retrofitted with a wood or pellet insert.
Of the 10 million wood stoves being used in the U.S., 70% to 80% are not EPA-certified and emit 70% more pollution than those that are, says Lisa Rector of the nonprofit NESCAUM (Northeast
States for Coordinated Air Use Management.) She says most of the 500,000 outdoor wood boilers don't meet EPA's voluntary standards.
Several Northeast and Western states have "burn bans" and other rules to limit wood burning, particularly when air quality is bad.
"People don't realize burning wood is a source of pollution, indoors and outdoors, especially when you're using an older stove," says Janice Nolan of the American Lung Association. She says it can emit tiny particulate matter — soot and ash — that gets lodged in the lungs and toxic substances such as benzene, carbon monoxide and methane.
Walton says he bought an EPA-certified stove that does not emit smoke inside his home. He sees a health benefit in chopping wood and an aesthetic one in burning it, adding: "The stove has a certain ambience."
[Via USA Today]
"The access to cheap wood made a difference," says Walton, a carpenter who lives on heavily forested land in Keene, N.H., where he chops his own fallen or dead trees.
"It saves us a bundle," he says, adding his wood stove can manage all winter with just two cords because he added insulation and good windows to his tidy, 1,300-square-foot home.
As energy prices rise, and winter approaches, more Americans are turning to wood to heat their homes, some hurrying to cash in on tax credits for efficient stoves that expire next month.
This upswing is prompting federal officials, concerned about the health and environmental impact of burning wood, to update 23-year-old certification criteria for stoves and set the first requirements for outdoor wood boilers, which heat water that's piped into homes.
"We are not in the business of telling people how to heat their homes," says Alison Davis of the Environmental Protection Agency, which plans to propose the new rules next year. But if they want to burn wood, Davis urges them to buy an EPA-certified stove and operate it properly so no smoke gets inside the house.
She says boilers are "significantly more polluting" than wood or pellet stoves because they have short stacks and use 10 times as much wood. Even so, she says those meeting the EPA's 2007 voluntary standards are 90% cleaner than older ones. "The technology has improved for wood stoves," Davis says, as has the research on the dangers of wood burning.
Wood heating's upswing
The number of U.S. households heating with wood rose 34% nationwide from 1.8 million in 2000 to 2.4 million in 2010 — faster than any other heating fuel, according to Census data.
"We're seeing a rise mainly in states with high oil and gas prices," most notably in Michigan and Connecticut, says John Ackerly of the Alliance for Green Heat, a nonprofit group that promotes wood stoves.
"It's a combination of rising energy prices and the economic downturn," he says, adding low- and middle-income households are much more likely than others to use wood for primary heating. In rural areas, he says many cut their own wood and in the suburbs, they get it free when trees fall.
He expects wood will become more popular this winter, citing the projected rise in household heating costs. Compared to last winter, heating will cost 3% more with natural gas and 8% more with oil this year, according to the U.S. Energy Information Administration.
Retailers are gearing up. U.S. shipments of pellet stoves, considered the most efficient way to burn wood, jumped 59% in the second quarter of this year, compared to the same time last year, and pellet fireplace inserts rose 72%, according to Leslie Wheeler of the the Hearth, Patio and Barbecue Association, an industry group.
"We're expecting those numbers to continue to increase," Wheeler says, because of high fuel prices. She says the tax credits expiring this year — up to $300 for EPA-certified stoves — are not as generous as in 2009 and 2010 when they covered 30% of the cost, up to $1,500. She says many cost $3,000 to $4,000 with installation.
Wood's dirty downside
The problem is that most Americans burn wood in old, dirty devices. Traditional fireplaces are so inefficient they don't heat a room unless they've been retrofitted with a wood or pellet insert.
Of the 10 million wood stoves being used in the U.S., 70% to 80% are not EPA-certified and emit 70% more pollution than those that are, says Lisa Rector of the nonprofit NESCAUM (Northeast
States for Coordinated Air Use Management.) She says most of the 500,000 outdoor wood boilers don't meet EPA's voluntary standards.
Several Northeast and Western states have "burn bans" and other rules to limit wood burning, particularly when air quality is bad.
"People don't realize burning wood is a source of pollution, indoors and outdoors, especially when you're using an older stove," says Janice Nolan of the American Lung Association. She says it can emit tiny particulate matter — soot and ash — that gets lodged in the lungs and toxic substances such as benzene, carbon monoxide and methane.
Walton says he bought an EPA-certified stove that does not emit smoke inside his home. He sees a health benefit in chopping wood and an aesthetic one in burning it, adding: "The stove has a certain ambience."
[Via USA Today]
Friday, November 11, 2011
South Korea's Wasted Youth
There are not many excuses for turning up late to South Korea's national college entrance exam.
The most important day in a student's life, it determines which university - if any - each of them will go to and, by extension, what their future salary and status is likely to be.
And to ensure its students have the best possible chance, for one day every year Korea changes its aircraft flight schedules, holds up the morning rush-hour, and even discourages the military from moving outside its bases.
South Korea's education system is held up as a model around the world.
Some 80% of its high-school students now go on to further education.
But according to South Korea's president, that academic success is creating its own "social problem" - a youth unemployment rate of 6.7% in October, more than twice the national average, even as parts of the labour market are hungry for workers.
"Because there are so many people graduating from university at the moment, and looking only for high-end jobs, there's a mismatch between the job-hunters, and the positions available," explains Kim Hwan Sik, director of vocational training at the Education Ministry.
The problem began with mass lay-offs after the Asian financial crisis in the late 1990s, he says.
When companies began hiring again, they found a glut of graduates willing to fill entry-level positions, putting pressure on all school-leavers to get a degree.
So these days, applicants' skills often fail to match employers' needs, according to Mr Kim. In addition, Korea loses years of much-needed earnings while they study.
Recipe for success?
Koo Woonmo, 17, is doing things differently. He has already decided he wants to become a chef.
So rather than spend his school years cramming for the university entrance exam, he is learning practical skills at a specialist culinary high school.
Today's lesson: red bean noodles.
"My mum and dad didn't want me to go to this school, because in Korean culture men aren't supposed to cook in the kitchen," he says.
"People said 'Don't go', but I wanted to. I don't want to be a normal student. I don't want to work that hard."
It is quite normal for school children in South Korea to spend 14 hours a day studying for the college entrance exam - sometimes for years on end.
Parents often spend up to half the family's income on private tuition to help their off-spring beat the competition.
Equal worth?
These days, the government would rather have more students who think like Woonmo and opt for vocational training.
But even at Woonmo's vocational high school, half the students currently go on to higher education.
The head teacher here, Min-oo Sohn, says the school is coming under pressure from the government to reduce that number. But it is a policy he fears will create a two-tier system.
"I personally feel this is going to increase polarisation between those who go to university and those who go to vocational schools," he said.
"And by trying to draw a line - when these students are just teenagers - over whether they want to go to university or not, it's making those decisions more rigid."
The government says it is well aware of the problems facing students who skip university.
"If someone straight out of high school is treated with less respect or financial return than a graduate, who on earth would want to take that route?" the education ministry's Kim Hwan Sik says.
"There needs to be a recognition that four years of experience on the job is equal to a degree.
"First the government needs to set a model example for employers, so that public institutions don't discriminate against high-school leavers. If the government takes the lead, changes will eventually trickle down to the private sector as well."
Two-tier system
To hammer the message home, the South Korean president, Lee Myung-bak, has been touring vocational schools recently, highlighting the career choices of what he calls Korea's new pioneers.
But he is up against some stiff opposition - not so much from students, perhaps, as from their older relatives.
In South Korea, parents will do almost anything to get their children into university.
At Seoul's main Buddhist temple, the price of an undergraduate in the family is two hours of prayer - every day - since July.
Hundreds of parents and grandparents have been turning up at these special examination-prayer sessions each afternoon to bow 108 times to the huge golden Buddhas staring down from the temple rafters.
Among them is Ju-sung Eun. Her granddaughter is sitting the college entrance exam this year, and Ms Ju-sung has been coming every day to pray for her success.
The government's plan to wean people away from university does not go down well with her.
"I don't agree with it," she says. "I think going to university is important for a person and I hope my granddaughter will achieve that."
It is a route that was not open for Ms Ju-sung in her day.
"I'm over 70," she cackles.
"In those days we didn't go to university. And because I didn't go, that makes my hope for my grandchildren even stronger."
Ms Ju-sung is old enough to remember the days before democracy, when a small group of elites ran this country.
The problems South Korea faces now are different - the results of its academic and financial success.
But for Ms Ju-sung - and many others here - fear of ending up on the wrong side of a two-tier system still runs deep.
[Via BBC News]
Thursday, November 10, 2011
10 Best Words for Indicating Excessive Drunkenness
1 Trashed
2 Smashed
3 Blitzed
4 Lightheaded
5 Blotto
6 Blacked out
7 Slizzard
8 Shitfaced
9 Rat-arsed
10 Plastered
2 Smashed
3 Blitzed
4 Lightheaded
5 Blotto
6 Blacked out
7 Slizzard
8 Shitfaced
9 Rat-arsed
10 Plastered
Monday, October 24, 2011
Southern Europe's Lost Generation Stuck in Junk Jobs
SYLVIA KNEW THINGS WOULD BE TOUGH, BUT NEVER LIKE THIS
With a masters' degree in publicity, the 24-year-old has been working for more than two years, full-time, in an internship that is starting to feel like it will never end.
Paid 300 euros a month for the same work as the salaried public relations professionals who sit next to her, she doesn't earn enough to move out of her parents' house and her bus pass and lunch expenses eat up most of her pay.
But despite feeling her multinational employer is flouting rules that limit the use of worker contracts with no benefits, she's not about to complain to the labor office since she considers herself blessed to have a job at all.
"Since I was little my parents urged me to get a university degree to find good work. But I'm lucky to have any work at all. There were 30 of us in my graduating class and I'm one of the ones who is doing the best with their career," Silvia said. She did not want her last name used in case of repercussions at work.
With Spain's youth unemployment higher than 40 percent and its overall joblessness the highest in the European Union at one in five, young professionals accept any conditions as they try to start their careers.
The story is much the same in neighboring Portugal and Italy where more and more people have so-called junk jobs: temporary contracts that used to be common in tourism, farming and construction but are now used by all kinds of companies.
With the economy sluggish and the euro zone debt crisis strangling credit, businesses are keener than ever to avoid open-ended contracts with expensive severance pay.
A quarter of Spain's workforce is on temporary contracts, as is 23 percent of Portugal's, compared with a European Union average of 14 percent.
In Spain, Portugal and Italy, a rigid dual system has emerged. Middle-aged people have stable jobs with benefits. They are expensive to fire and protected by masses of legislation. Meanwhile, younger workers are stuck in a revolving door of temporary contracts that are easy to abuse.
The two-track job market is stunting economic growth, studies show. Temporary workers get trapped for longer and longer periods without benefits, which affects output and makes southern Europe less competitive.
"You cannot just leave one segment of the labor market fully untouched and not motivate people to go to the job where they fit best... you might create employment in the short term but in the end it's a dead-end road," said Ton Wilthagen, a labor expert at Tilburg University in the Netherlands.
1000 EUROS A MONTH AIN'T SO BAD AFTER ALL
The curse of the mileurista -- the Spanish-language term for a temporary worker who earns a thousand euros a month without benefits -- is not new. Young professionals in southern Europe have found a permanent position elusive for some time.
But the lost generation has wandered deeper into a maze as the euro zone debt crisis intensifies. Economic growth is slowing again and public sector jobs are disappearing as governments try to bring huge public deficits under control.
"We used to talk about mileuristas like it was a bad thing. Now it's good. A 1000-euro a month temporary contract is decent," said Jose Maria Marin, labor expert and contemporary history professor at Spain's National University of Distance Education.
In Rome, 27-year-old Federico has moved from one temporary job to another since he graduated in history in 2009. A 1000-euros-a-month is starting to look like an unobtainable dream.
"I was interviewed today for a one-year job but I didn't like it because they were offering me 500 euros a month to work 10 hours a day," said Federico, who did not want his last name used since prospective employers could search for him on the Internet.
So far he has held out for a job in his chosen field of media or marketing. He wants to move out of his parents' house but he needs a permanent job contract in order to sign a rental agreement. With more than a quarter of Italians from 15-24 years old out of work he's starting to get desperate.
"Sometimes I feel frustrated, and I start to send off lots of CVs, even to companies I don't like, just so I have more chance of finding something," he said.
The phenomenon of young people living with their parents is another thing holding back economic growth, creating a vicious cycle for job creation. If they were setting up new households they would be stimulating the housing market as well as consumer spending.
Another risk for economies with high percentages of temporary workers, notes Wilthagen, is that banks are shy of lending to people without permanent employment, further holding back consumption.
FOOT IN THE DOOR
Theoretically, a temporary contract is a foot in the door to prove yourself as a good hire.
But in southern Europe many supposedly temporary hires renew contracts year after year and do the same jobs as the permanent hires around them, just without the job security or benefits. This creates an enduring second-class job tier similar to the phenomenon of "permatemps" in the United States in the 1990s.
In Spain only 20 percent of temporary contracts led to permanent positions in 2008, one of the lowest rates in the European Union, according to a study by Ruud Muffels, a labor market expert at Tilburg University. His analysis of Eurostat data showed that mobility was better in Italy and Portugal.
Pedro Portugal, a labor market expert at Nova University in Lisbon, said conversion rates of temporary contracts to permanent ones have decreased in Portugal to under 20 percent from 50 percent in the late 1990s.
Many Portuguese companies abuse a freelance contract called the "green receipt," using it to hire full-time, in-house workers, said Joao Labrincha, an organizer of marches earlier this year against state austerity measures.
He said that "green receipt" workers often have fixed schedules like any other employee, but have no right to holidays, social security, health insurance or severance pay.
Even the government misuses the contracts.
"I've worked for the state under green receipts for more than five years. The system is rather perverse. Many of my colleagues are also under these precarious conditions, some of them have been temporary workers for the last 10 years," said a middle manager at the Portuguese Institute of Museums, who asked not to be named.
It's difficult to transition into a permanent job when no such posts are being created. In Spain, 80 percent of new job contracts signed in the last decade were temporary contracts -- businesses just aren't creating permanent positions.
"Firms tend to link temporary contracts, to chain one after the other, with the effect that very few young people get transformed from temporary to permanent. This has a very negative impact on young people starting their careers," said Anita Woelfl, economist with the OECD.
ANY JOB IS BETTER THAN NO JOB
In 2010, under pressure from the European Union to reform its labor market and make it easier for companies to hire and fire, Spain's Socialist government passed reforms meant to phase out temporary contracts and make permanent contracts cheaper for employers.
But less than a year later the government did a U-turn after the 2010 reform failed to put a dent into the country's unemployment rate, which continued to rise.
"We'd rather have people on a temporary job than without a job," said Labor Minister Valeriano Gomez when the government rolled back the reforms, introducing new rules that allow companies to extend some temporary contracts for up to three years.
Spain is becoming a country of people who are "apprentices until 33 and can't retire until 75," said union leader Ignacio Fernandez Toxo, criticizing the new rules, which included a new type of contract that gives companies more leeway to hire trainees for extensive periods with no benefits.
The extended trainee contract was designed to retrain jobless men now in their late twenties or early thirties who dropped out of school as teenagers during Spain's housing boom to work in well-paid construction jobs until the building sector collapsed in a pile of bad debt.
In Portugal, where the jobless rate is 12 percent, significantly lower than Spain's, the government has stuck to reforms that reduce and cap severance pay.
Juan Jose Dolado, an economist at Madrid's Universidad Carlos III, said Spain should have kept its eye on the long-term goal and moved the country toward a one-contract system with phased-in severance pay benefits.
"It was like crossing the river and being in the middle. They got scared in the middle, they didn't move forward to reach the other side, they went back," Dolado said.
The Socialists, expected to lose November 20 general elections after eight years in power, are now campaigning on pledges to crack down on abuse of temporary contracts.
The center-right opposition People's Party, or PP, poised to win the November vote, says it wants to revive the original labor reform and move Spain toward one type of job contract, such as the one Dolado envisions.
But analysts say the PP may also flinch when it comes to cracking down on temporary contracts because they worry the short-term effect will be to put people out of work at a time when joblessness is the top concern of Spanish voters.
Meanwhile, workers like Juan Francisco Seller, will continue to give their labor away, hoping a "real" job materializes. Seller is 27 and has a pharmaceutical degree. He's been working for free in a hospital in Valencia for a year, doing research with a laboratory team.
He has turned down paid work outside of his field, in order to keep his C.V. professional.
"I'm one of those who have patience and I'm really clear that other options don't appeal to me and I really like this field," he said. But "in the end it drives you crazy."
[Via Reuters]
With a masters' degree in publicity, the 24-year-old has been working for more than two years, full-time, in an internship that is starting to feel like it will never end.
Paid 300 euros a month for the same work as the salaried public relations professionals who sit next to her, she doesn't earn enough to move out of her parents' house and her bus pass and lunch expenses eat up most of her pay.
But despite feeling her multinational employer is flouting rules that limit the use of worker contracts with no benefits, she's not about to complain to the labor office since she considers herself blessed to have a job at all.
"Since I was little my parents urged me to get a university degree to find good work. But I'm lucky to have any work at all. There were 30 of us in my graduating class and I'm one of the ones who is doing the best with their career," Silvia said. She did not want her last name used in case of repercussions at work.
With Spain's youth unemployment higher than 40 percent and its overall joblessness the highest in the European Union at one in five, young professionals accept any conditions as they try to start their careers.
The story is much the same in neighboring Portugal and Italy where more and more people have so-called junk jobs: temporary contracts that used to be common in tourism, farming and construction but are now used by all kinds of companies.
With the economy sluggish and the euro zone debt crisis strangling credit, businesses are keener than ever to avoid open-ended contracts with expensive severance pay.
A quarter of Spain's workforce is on temporary contracts, as is 23 percent of Portugal's, compared with a European Union average of 14 percent.
In Spain, Portugal and Italy, a rigid dual system has emerged. Middle-aged people have stable jobs with benefits. They are expensive to fire and protected by masses of legislation. Meanwhile, younger workers are stuck in a revolving door of temporary contracts that are easy to abuse.
The two-track job market is stunting economic growth, studies show. Temporary workers get trapped for longer and longer periods without benefits, which affects output and makes southern Europe less competitive.
"You cannot just leave one segment of the labor market fully untouched and not motivate people to go to the job where they fit best... you might create employment in the short term but in the end it's a dead-end road," said Ton Wilthagen, a labor expert at Tilburg University in the Netherlands.
1000 EUROS A MONTH AIN'T SO BAD AFTER ALL
The curse of the mileurista -- the Spanish-language term for a temporary worker who earns a thousand euros a month without benefits -- is not new. Young professionals in southern Europe have found a permanent position elusive for some time.
But the lost generation has wandered deeper into a maze as the euro zone debt crisis intensifies. Economic growth is slowing again and public sector jobs are disappearing as governments try to bring huge public deficits under control.
"We used to talk about mileuristas like it was a bad thing. Now it's good. A 1000-euro a month temporary contract is decent," said Jose Maria Marin, labor expert and contemporary history professor at Spain's National University of Distance Education.
In Rome, 27-year-old Federico has moved from one temporary job to another since he graduated in history in 2009. A 1000-euros-a-month is starting to look like an unobtainable dream.
"I was interviewed today for a one-year job but I didn't like it because they were offering me 500 euros a month to work 10 hours a day," said Federico, who did not want his last name used since prospective employers could search for him on the Internet.
So far he has held out for a job in his chosen field of media or marketing. He wants to move out of his parents' house but he needs a permanent job contract in order to sign a rental agreement. With more than a quarter of Italians from 15-24 years old out of work he's starting to get desperate.
"Sometimes I feel frustrated, and I start to send off lots of CVs, even to companies I don't like, just so I have more chance of finding something," he said.
The phenomenon of young people living with their parents is another thing holding back economic growth, creating a vicious cycle for job creation. If they were setting up new households they would be stimulating the housing market as well as consumer spending.
Another risk for economies with high percentages of temporary workers, notes Wilthagen, is that banks are shy of lending to people without permanent employment, further holding back consumption.
FOOT IN THE DOOR
Theoretically, a temporary contract is a foot in the door to prove yourself as a good hire.
But in southern Europe many supposedly temporary hires renew contracts year after year and do the same jobs as the permanent hires around them, just without the job security or benefits. This creates an enduring second-class job tier similar to the phenomenon of "permatemps" in the United States in the 1990s.
In Spain only 20 percent of temporary contracts led to permanent positions in 2008, one of the lowest rates in the European Union, according to a study by Ruud Muffels, a labor market expert at Tilburg University. His analysis of Eurostat data showed that mobility was better in Italy and Portugal.
Pedro Portugal, a labor market expert at Nova University in Lisbon, said conversion rates of temporary contracts to permanent ones have decreased in Portugal to under 20 percent from 50 percent in the late 1990s.
Many Portuguese companies abuse a freelance contract called the "green receipt," using it to hire full-time, in-house workers, said Joao Labrincha, an organizer of marches earlier this year against state austerity measures.
He said that "green receipt" workers often have fixed schedules like any other employee, but have no right to holidays, social security, health insurance or severance pay.
Even the government misuses the contracts.
"I've worked for the state under green receipts for more than five years. The system is rather perverse. Many of my colleagues are also under these precarious conditions, some of them have been temporary workers for the last 10 years," said a middle manager at the Portuguese Institute of Museums, who asked not to be named.
It's difficult to transition into a permanent job when no such posts are being created. In Spain, 80 percent of new job contracts signed in the last decade were temporary contracts -- businesses just aren't creating permanent positions.
"Firms tend to link temporary contracts, to chain one after the other, with the effect that very few young people get transformed from temporary to permanent. This has a very negative impact on young people starting their careers," said Anita Woelfl, economist with the OECD.
ANY JOB IS BETTER THAN NO JOB
In 2010, under pressure from the European Union to reform its labor market and make it easier for companies to hire and fire, Spain's Socialist government passed reforms meant to phase out temporary contracts and make permanent contracts cheaper for employers.
But less than a year later the government did a U-turn after the 2010 reform failed to put a dent into the country's unemployment rate, which continued to rise.
"We'd rather have people on a temporary job than without a job," said Labor Minister Valeriano Gomez when the government rolled back the reforms, introducing new rules that allow companies to extend some temporary contracts for up to three years.
Spain is becoming a country of people who are "apprentices until 33 and can't retire until 75," said union leader Ignacio Fernandez Toxo, criticizing the new rules, which included a new type of contract that gives companies more leeway to hire trainees for extensive periods with no benefits.
The extended trainee contract was designed to retrain jobless men now in their late twenties or early thirties who dropped out of school as teenagers during Spain's housing boom to work in well-paid construction jobs until the building sector collapsed in a pile of bad debt.
In Portugal, where the jobless rate is 12 percent, significantly lower than Spain's, the government has stuck to reforms that reduce and cap severance pay.
Juan Jose Dolado, an economist at Madrid's Universidad Carlos III, said Spain should have kept its eye on the long-term goal and moved the country toward a one-contract system with phased-in severance pay benefits.
"It was like crossing the river and being in the middle. They got scared in the middle, they didn't move forward to reach the other side, they went back," Dolado said.
The Socialists, expected to lose November 20 general elections after eight years in power, are now campaigning on pledges to crack down on abuse of temporary contracts.
The center-right opposition People's Party, or PP, poised to win the November vote, says it wants to revive the original labor reform and move Spain toward one type of job contract, such as the one Dolado envisions.
But analysts say the PP may also flinch when it comes to cracking down on temporary contracts because they worry the short-term effect will be to put people out of work at a time when joblessness is the top concern of Spanish voters.
Meanwhile, workers like Juan Francisco Seller, will continue to give their labor away, hoping a "real" job materializes. Seller is 27 and has a pharmaceutical degree. He's been working for free in a hospital in Valencia for a year, doing research with a laboratory team.
He has turned down paid work outside of his field, in order to keep his C.V. professional.
"I'm one of those who have patience and I'm really clear that other options don't appeal to me and I really like this field," he said. But "in the end it drives you crazy."
[Via Reuters]
Saturday, October 22, 2011
Rich-Poor Gap Growing
The gap between the United States’ rich and poor continued to grow last year, according to new government wage data.
With pay down and fewer jobs available, the Social Security Administration’s figures highlight one of the major issues of the Occupy Wall Street movement - widening income disparity.
The SSA said 50 percent of workers made less than $26,364 last year — and most Americans have fewer job opportunities available to them. But the wealthiest Americans are relatively unscathed, with those earning $1 million or more jumping 18 percent from 2009.
Total employment fell again last year, dropping from 150.9 million in 2009 to 150.4 million in 2010. And in 2007, at the height of the recession, there were still 5.2 million more jobs than in 2010, the AP wrote.
The average income for Americans was $39,959 last year, but the median wage was just $26,364. The SSA wrote that this shows “the distribution of workers by wage level is highly skewed,” the AP reported.
Occupy Wall Street protesters have demonstrated across the country in recent weeks against what they deem the unfair income disparity between the U.S.’s top wage earners and average Americans.
[Via Politico]
With pay down and fewer jobs available, the Social Security Administration’s figures highlight one of the major issues of the Occupy Wall Street movement - widening income disparity.
The SSA said 50 percent of workers made less than $26,364 last year — and most Americans have fewer job opportunities available to them. But the wealthiest Americans are relatively unscathed, with those earning $1 million or more jumping 18 percent from 2009.
Total employment fell again last year, dropping from 150.9 million in 2009 to 150.4 million in 2010. And in 2007, at the height of the recession, there were still 5.2 million more jobs than in 2010, the AP wrote.
The average income for Americans was $39,959 last year, but the median wage was just $26,364. The SSA wrote that this shows “the distribution of workers by wage level is highly skewed,” the AP reported.
Occupy Wall Street protesters have demonstrated across the country in recent weeks against what they deem the unfair income disparity between the U.S.’s top wage earners and average Americans.
[Via Politico]
Sunday, October 9, 2011
Nearly Half of U.S. Lives in Household Receiving Government Benefit
Families were more dependent on government programs than ever last year.
Nearly half, 48.5%, of the population lived in a household that received some type of government benefit in the first quarter of 2010, according to Census data. Those numbers have risen since the middle of the recession when 44.4% lived households receiving benefits in the third quarter of 2008.
The share of people relying on government benefits has reached a historic high, in large part from the deep recession and meager recovery, but also because of the expansion of government programs over the years.
Means-tested programs, designed to help the needy, accounted for the largest share of recipients last year. Some 34.2% of Americans lived in a household that received benefits such as food stamps, subsidized housing, cash welfare or Medicaid (the federal-state health care program for the poor).
Another 14.5% lived in homes where someone was on Medicare (the health care program for the elderly). Nearly 16% lived in households receiving Social Security.
High unemployment and increased reliance on government programs has also shrunk the nation’s share of taxpayers. Some 46.4% of households will pay no federal income tax this year, according to the nonpartisan Tax Policy Center. That’s up from 39.9% in 2007, the year the recession began.
Most of those households will still be hit by payroll taxes. Just 18.1% of households pay neither payroll nor federal income taxes and they are predominantly the nation’s elderly and poorest families.
The tandem rise in government-benefits recipients and fall in taxpayers has been cause for alarm among some policymakers and presidential hopefuls.
Benefits programs have come under closer scrutiny as policymakers attempt to tame the federal government’s budget deficit. President Barack Obama and members of Congress considered changes to Social Security and Medicare as part of a grand bargain (that ultimately fell apart) to raise the debt ceiling earlier this year. Cuts to such programs could emerge again from the so-called “super committee,” tasked with releasing a plan to rein in the deficit.
Republican presidential hopefuls, meanwhile, have latched onto the fact that nearly half of households pay no federal income tax, saying too many Americans aren’t paying their fair share.
[Via The Wall Street Journal]
Nearly half, 48.5%, of the population lived in a household that received some type of government benefit in the first quarter of 2010, according to Census data. Those numbers have risen since the middle of the recession when 44.4% lived households receiving benefits in the third quarter of 2008.
The share of people relying on government benefits has reached a historic high, in large part from the deep recession and meager recovery, but also because of the expansion of government programs over the years.
Means-tested programs, designed to help the needy, accounted for the largest share of recipients last year. Some 34.2% of Americans lived in a household that received benefits such as food stamps, subsidized housing, cash welfare or Medicaid (the federal-state health care program for the poor).
Another 14.5% lived in homes where someone was on Medicare (the health care program for the elderly). Nearly 16% lived in households receiving Social Security.
High unemployment and increased reliance on government programs has also shrunk the nation’s share of taxpayers. Some 46.4% of households will pay no federal income tax this year, according to the nonpartisan Tax Policy Center. That’s up from 39.9% in 2007, the year the recession began.
Most of those households will still be hit by payroll taxes. Just 18.1% of households pay neither payroll nor federal income taxes and they are predominantly the nation’s elderly and poorest families.
The tandem rise in government-benefits recipients and fall in taxpayers has been cause for alarm among some policymakers and presidential hopefuls.
Benefits programs have come under closer scrutiny as policymakers attempt to tame the federal government’s budget deficit. President Barack Obama and members of Congress considered changes to Social Security and Medicare as part of a grand bargain (that ultimately fell apart) to raise the debt ceiling earlier this year. Cuts to such programs could emerge again from the so-called “super committee,” tasked with releasing a plan to rein in the deficit.
Republican presidential hopefuls, meanwhile, have latched onto the fact that nearly half of households pay no federal income tax, saying too many Americans aren’t paying their fair share.
[Via The Wall Street Journal]
Wednesday, October 5, 2011
Wood Gas Vehicles: Firewood in Fuel Tank
During the Second World War, almost every motorised vehicle in continental Europe was converted to use firewood.
Wood gasification is a proces whereby organic material is converted into a combustible gas under the influence of heat - the process reaches a temperature of 1,400 °C (2,550 °F). The first use of wood gasification dates back to 1870s, when it was used as a forerunner of natural gas for street lighting and cooking.
In the 1920s, German engineer Georges Imbert developed a wood gas generator for mobile use. The gases were cleaned and dried and then fed into the vehicle's combustion engine, which barely needs to be adapted. The Imbert generator was mass produced from 1931 on. At the end of the 1930s, about 9,000 wood gas vehicles were in use, almost exclusively in Europe.
The technology became commonplace in many European countries during the Second World War, as a consequence of the rationing of fossil fuels. In Germany alone, around 500,000 producer gas vehicles were in operation by the end of the war.
A network of some 3,000 "petrol stations" was set up, where drivers could stock up on firewood. Not only private cars but also trucks, buses, tractors, motorcycles, ships and trains were equipped with a wood gasification unit. Some tanks were driven on wood gas, too, but for military use the Germans preferred the production of liquid synthetic fuels (made out of wood or coal).
In 1942 (when the technology had not yet reached the height of its popularity), there were about 73,000 producer gas vehicles in Sweden, 65,000 in France, 10,000 in Denmark, 9,000 in both Austria and Norway, and almost 8,000 in Switzerland. Finland had 43,000 "woodmobiles" in 1944, of which 30,000 were buses and trucks, 7,000 private vehicles, 4,000 tractors and 600 boats.
Woodmobiles also appeared in the US, Asia and, particularly, Australia, which had 72,000 vehicles running on woodgas. Altogether, more than one million producer gas vehicles were used during World War Two.
After the war, with gasoline once again available, the technology fell into oblivion almost instantaneously. At the beginning of the 1950s, the then West-Germany only had some 20,000 woodmobiles left.
[Via Low-tech Magazine]
Wood gasification is a proces whereby organic material is converted into a combustible gas under the influence of heat - the process reaches a temperature of 1,400 °C (2,550 °F). The first use of wood gasification dates back to 1870s, when it was used as a forerunner of natural gas for street lighting and cooking.
In the 1920s, German engineer Georges Imbert developed a wood gas generator for mobile use. The gases were cleaned and dried and then fed into the vehicle's combustion engine, which barely needs to be adapted. The Imbert generator was mass produced from 1931 on. At the end of the 1930s, about 9,000 wood gas vehicles were in use, almost exclusively in Europe.
The technology became commonplace in many European countries during the Second World War, as a consequence of the rationing of fossil fuels. In Germany alone, around 500,000 producer gas vehicles were in operation by the end of the war.
A network of some 3,000 "petrol stations" was set up, where drivers could stock up on firewood. Not only private cars but also trucks, buses, tractors, motorcycles, ships and trains were equipped with a wood gasification unit. Some tanks were driven on wood gas, too, but for military use the Germans preferred the production of liquid synthetic fuels (made out of wood or coal).
In 1942 (when the technology had not yet reached the height of its popularity), there were about 73,000 producer gas vehicles in Sweden, 65,000 in France, 10,000 in Denmark, 9,000 in both Austria and Norway, and almost 8,000 in Switzerland. Finland had 43,000 "woodmobiles" in 1944, of which 30,000 were buses and trucks, 7,000 private vehicles, 4,000 tractors and 600 boats.
Woodmobiles also appeared in the US, Asia and, particularly, Australia, which had 72,000 vehicles running on woodgas. Altogether, more than one million producer gas vehicles were used during World War Two.
After the war, with gasoline once again available, the technology fell into oblivion almost instantaneously. At the beginning of the 1950s, the then West-Germany only had some 20,000 woodmobiles left.
[Via Low-tech Magazine]
Saturday, October 1, 2011
To Outfox the Chicken Tax, Ford Strips Its Own Vans
Several times a month, Transit Connect vans from a Ford Motor Co. factory in Turkey roll off a ship here shiny and new, rear side windows gleaming, back seats firmly bolted to the floor.
Their first stop in America is a low-slung, brick warehouse where those same windows, never squeegeed at a gas station, and seats, never touched by human backsides, are promptly ripped out.
The fabric is shredded, the steel parts are broken down, and everything is sent off along with the glass to be recycled.
Why all the fuss and feathers? Blame the "chicken tax."
The seats and windows are but dressing to help Ford navigate the wreckage of a 46-year-old trade spat. In the early 1960s, Europe put high tariffs on imported chicken, taking aim at rising U.S. sales to West Germany. President Johnson retaliated in 1963, in part by targeting German-made Volkswagens with a tax on imports of foreign-made trucks and commercial vans.
The 1960s went the way of love beads and sitar records, but the chicken tax never died. Europe still has a tariff on imports of U.S. chicken, and the U.S. still hits delivery vans imported from overseas with a 25% tariff. American companies have to pay, too, which puts Ford in the weird position of circumventing U.S. trade rules that for years have protected U.S. auto makers' market for trucks.
The company's wiggle room comes from the process of defining a delivery van. Customs officials check a bunch of features to determine whether a vehicle's primary purpose might be to move people instead. Since cargo doesn't need seats with seat belts or to look out the window, those items are on the list. So Ford ships all its Transit Connects with both, calls them "wagons" instead of "commercial vans." Installing and removing unneeded seats and windows costs the company hundreds of dollars per van, but the import tax falls dramatically, to 2.5 percent, saving thousands.
Customs officials won't discuss individual company's strategies, but Stephen Biegun, Ford's vice president for international governmental affairs, says the practice complies with the letter of the law. "We are free-traders, full stop," he says.
Foreign auto makers have long crossed swords with the chicken tax. Toyota Motor Corp., Nissan Motor Co. and Honda Motor Co. took the straightforward route and built plants in the U.S.
Subaru, owned by Fuji Heavy Industries Ltd. of Japan, imported a small pickup in the 1980s called the Bi-drive Recreational All-terrain Transporter, or BRAT. But it wasn't a taxable truck, because it had two lawn-chair-like seats bolted to the open bed. (President Reagan owned a red one, according to Subaru.)
With the globalization of the auto industry, American companies have joined the game. Until recently, Chrysler Group LLC imported Dodge Sprinter vans made in Düsseldorf, Germany, by former owner Daimler AG. The engine, transmission, axles and wheels were removed, allowing the truck bodies to cross the border as auto components, which aren't subject to the tax. Daimler then reassembled the vehicles at a factory in Ladson, S.C.
Ford launched the Transit Connect in 2002. The compact commercial van with a distinctive raised roof was designed to haul goods through urban areas with tight streets. Since then, more than 600,000 of the vehicles have been sold.
When gas prices spiked, Ford saw a market among small-business owners in the U.S. Prices start at $20,780, much lower than would have been possible if Ford had to cover the chicken tax. Sales are off to a fast start. In August, Ford sold more than 2,200 in the U.S.
"It's great for city driving," said Duff Goldman, owner of Charm City Cakes in Baltimore and star of Ace of Cakes on the Food Network. "It's shorter, smaller and has really good fuel economy." He bought a black Transit Connect last month. Since he doesn't carry passengers, his van has no windows or seats in the back.
The vans leave Turkey on cargo ships owned by Wallenius Wilhelmsen Logistics. Once they arrive in Baltimore, they are driven into a warehouse, where 65 workers from the shipping company's WWL Vehicle Services Americas Inc. convert them into commercial vehicles amid the blare of rock music and the whirring of industrial fans.
On a recent afternoon, a handful of vans passed through the warehouse unmolested as passenger wagons. But the vast majority were lined up to have windows pulled out, and they all had their rear seats removed.
In one lane, supervisor Robert Dowdy watched as two workers removed the rear side windows. They cut out the rubber seal with a special knife and popped out the glass using suction cups. The space is plugged with a metal panel that cures for 15 minutes before being tested outside for waterproofing.
At the start of that same lane, Mayso Lawrence unhooked a rear seat belt as easily as he would pop the top off a soda bottle. Using a drill, he quickly unscrewed six bolts to free the seats. Workers at the other end dump the seats into cardboard boxes, which are hoisted onto an open tractor-trailer and shipped to Ohio. Ford says the shredded seat fabric and foam become landfill cover, while the steel is processed for other uses.
"I never thought about why we take out the seats, but if that's what the customer wants, that's what we'll give them," Mr. Lawrence said.
With the seat removed, Mr. Lawrence puts in a new floor panel to cover the holes, toots the horn to signal he's finished, then gets to work on another van. The whole process takes him less than five minutes.
Rob Stevens, chief engineer for Ford's commercial vehicles, says the auto maker decided against shipping the seats back to Turkey for use in the next wave of vans for the U.S.
"We thought going through the recycling process was best," he said. "The steel is valuable."
[Via The Wall Street Journal]
Their first stop in America is a low-slung, brick warehouse where those same windows, never squeegeed at a gas station, and seats, never touched by human backsides, are promptly ripped out.
The fabric is shredded, the steel parts are broken down, and everything is sent off along with the glass to be recycled.
Why all the fuss and feathers? Blame the "chicken tax."
The seats and windows are but dressing to help Ford navigate the wreckage of a 46-year-old trade spat. In the early 1960s, Europe put high tariffs on imported chicken, taking aim at rising U.S. sales to West Germany. President Johnson retaliated in 1963, in part by targeting German-made Volkswagens with a tax on imports of foreign-made trucks and commercial vans.
The 1960s went the way of love beads and sitar records, but the chicken tax never died. Europe still has a tariff on imports of U.S. chicken, and the U.S. still hits delivery vans imported from overseas with a 25% tariff. American companies have to pay, too, which puts Ford in the weird position of circumventing U.S. trade rules that for years have protected U.S. auto makers' market for trucks.
The company's wiggle room comes from the process of defining a delivery van. Customs officials check a bunch of features to determine whether a vehicle's primary purpose might be to move people instead. Since cargo doesn't need seats with seat belts or to look out the window, those items are on the list. So Ford ships all its Transit Connects with both, calls them "wagons" instead of "commercial vans." Installing and removing unneeded seats and windows costs the company hundreds of dollars per van, but the import tax falls dramatically, to 2.5 percent, saving thousands.
Customs officials won't discuss individual company's strategies, but Stephen Biegun, Ford's vice president for international governmental affairs, says the practice complies with the letter of the law. "We are free-traders, full stop," he says.
Foreign auto makers have long crossed swords with the chicken tax. Toyota Motor Corp., Nissan Motor Co. and Honda Motor Co. took the straightforward route and built plants in the U.S.
Subaru, owned by Fuji Heavy Industries Ltd. of Japan, imported a small pickup in the 1980s called the Bi-drive Recreational All-terrain Transporter, or BRAT. But it wasn't a taxable truck, because it had two lawn-chair-like seats bolted to the open bed. (President Reagan owned a red one, according to Subaru.)
With the globalization of the auto industry, American companies have joined the game. Until recently, Chrysler Group LLC imported Dodge Sprinter vans made in Düsseldorf, Germany, by former owner Daimler AG. The engine, transmission, axles and wheels were removed, allowing the truck bodies to cross the border as auto components, which aren't subject to the tax. Daimler then reassembled the vehicles at a factory in Ladson, S.C.
Ford launched the Transit Connect in 2002. The compact commercial van with a distinctive raised roof was designed to haul goods through urban areas with tight streets. Since then, more than 600,000 of the vehicles have been sold.
When gas prices spiked, Ford saw a market among small-business owners in the U.S. Prices start at $20,780, much lower than would have been possible if Ford had to cover the chicken tax. Sales are off to a fast start. In August, Ford sold more than 2,200 in the U.S.
"It's great for city driving," said Duff Goldman, owner of Charm City Cakes in Baltimore and star of Ace of Cakes on the Food Network. "It's shorter, smaller and has really good fuel economy." He bought a black Transit Connect last month. Since he doesn't carry passengers, his van has no windows or seats in the back.
The vans leave Turkey on cargo ships owned by Wallenius Wilhelmsen Logistics. Once they arrive in Baltimore, they are driven into a warehouse, where 65 workers from the shipping company's WWL Vehicle Services Americas Inc. convert them into commercial vehicles amid the blare of rock music and the whirring of industrial fans.
On a recent afternoon, a handful of vans passed through the warehouse unmolested as passenger wagons. But the vast majority were lined up to have windows pulled out, and they all had their rear seats removed.
In one lane, supervisor Robert Dowdy watched as two workers removed the rear side windows. They cut out the rubber seal with a special knife and popped out the glass using suction cups. The space is plugged with a metal panel that cures for 15 minutes before being tested outside for waterproofing.
At the start of that same lane, Mayso Lawrence unhooked a rear seat belt as easily as he would pop the top off a soda bottle. Using a drill, he quickly unscrewed six bolts to free the seats. Workers at the other end dump the seats into cardboard boxes, which are hoisted onto an open tractor-trailer and shipped to Ohio. Ford says the shredded seat fabric and foam become landfill cover, while the steel is processed for other uses.
"I never thought about why we take out the seats, but if that's what the customer wants, that's what we'll give them," Mr. Lawrence said.
With the seat removed, Mr. Lawrence puts in a new floor panel to cover the holes, toots the horn to signal he's finished, then gets to work on another van. The whole process takes him less than five minutes.
Rob Stevens, chief engineer for Ford's commercial vehicles, says the auto maker decided against shipping the seats back to Turkey for use in the next wave of vans for the U.S.
"We thought going through the recycling process was best," he said. "The steel is valuable."
[Via The Wall Street Journal]
Saturday, September 24, 2011
Cross-country Quest on Foot Leads Traveler Through Bucks
Before she even opens her mouth, Catherine Li’s story begins to reveal itself.
The tale, in short, describes the seven-month, 3,000-mile journey of a young woman walking alone across the country for no particular reason other than to welcome the unknown.
Her story is written all over her feet. The cuts, scrapes and mosquito bites say more than any cluster of words ever could.
It can be seen within the tattered 52-page direction guide printed off Google Maps, hand-bound with string.
But mostly, it can be seen in her eyes, which still seem to be trying to process everything she’s witnessed during her trek.
And her relentless smile indicates that most of the memories are good ones.
Li, 24, began her epic excursion in Daly City, just outside San Francisco. She’s survived on her humble savings account and the kindness of strangers as she makes her way toward New York City.
She was taken in Tuesday night by James “Mac” MacDade of Langhorne, after one of his neighbors suggested Li knock on his door to ask permission to set up her tent in his yard.
Mac said he was taken aback by her polite nature and amazing tale and offered her a couch in his house. Li left the area Thursday morning, eager to embark on the last leg of the walk.
“Mac has been extremely kind in letting me stay here,” Li said Wednesday. She came to America from China 10 years ago and speaks with a slight accent.
Aside from the sheer magnitude of the trip, what makes her story so hard to believe is that she has, for the most part, chosen to stay under the radar.
There is no blog or Facebook page chronicling her moves. She isn’t tweeting. She has no official sponsor.
So, while she gets asked a million questions by most people she encounters — many of whom are concerned for her safety — the one she hears most is simply, “Why?”
“People always ask me that,” she said with a laugh. “At first, I was so urgent (to respond) so I just started to tell them all the feelings I was having but I realized that was tough to do. So I just boil it down to the short version: I just felt like walking. I just decided to click over to living in the actual moment instead of inventing all these fantastic fantasies for the future.”
Though she tries her best to avoid attention, the sight of a young woman walking along a desolate road with a shopping cart — filled with a tent, a sleeping bag and other essentials — is not one often seen.
She said she’s been stopped countless times by police officers who are curious about her intentions and worried about her well-being. One still insists she check in on her cell phone to let him know she’s safe.
“A homeless person with a cell phone; that’s a new one, right?” Li said jokingly from Mac’s front porch.
And yes, Li said she hears it all. Some call her a bum, others label her as crazy and some just flat-out don’t believe her story.
“It’s all right,” she added. “People are different and sometimes, it’s hard to comprehend when you first encounter something out of the norm.”
According to Li, most people are surprisingly giving.
“People have given me a lot of support,” she said. “They give me McDonald’s gift cards and insist I take them. One time I went into a store and found $20 just sitting in my cart outside. I have no idea who left it.”
Li said she began with just a wheeled suitcase, but soon found that pushing a shopping cart was the way to go. The one she uses now came from a Sears department store in Flagstaff, Ariz.
“Just for the record, I did not steal it,” she said. “I actually went to the mall security guard and asked him for it. I left him my phone number and said if Sears had any problems, I would be willing to pay.”
Li said she plans to return the cart on her way home which, she added, will be done by more conventional modes of travel.
But on the way to NYC, she’s strictly walking.
“To be honest, I did take a few rides,” she admitted. “One time, a policeman escorted me out of a certain area at night, but the next day I asked him to take me back to the same spot. I don’t want to cheat.”
Li estimates she walks 15 miles a day; at sunset, she begins to look for shelter or a place to pitch her tent.
“I always make sure to ask permission before I set up my tent on someone’s property. It’s only right,” she added.
Along the way, she said, the little things have given her the most pleasure.
“The clouds in Ohio, were just so perfectly shaped,” she said, “like the most innocent drawings from a child.”
She said she realizes the dangers of such an undertaking and that she’s been fortunate so far.
“When you’re on a trip like this, you get so much closer to the truth about yourself,” Li added.
And while she understands that walking across the country might not be for everyone, she said that even the tiniest of adventures can lead to that same inner truth.
“A quest is different for everyone,” she said, “but the courage is the same.”
[Via MSN]
The tale, in short, describes the seven-month, 3,000-mile journey of a young woman walking alone across the country for no particular reason other than to welcome the unknown.
Her story is written all over her feet. The cuts, scrapes and mosquito bites say more than any cluster of words ever could.
It can be seen within the tattered 52-page direction guide printed off Google Maps, hand-bound with string.
But mostly, it can be seen in her eyes, which still seem to be trying to process everything she’s witnessed during her trek.
And her relentless smile indicates that most of the memories are good ones.
Li, 24, began her epic excursion in Daly City, just outside San Francisco. She’s survived on her humble savings account and the kindness of strangers as she makes her way toward New York City.
She was taken in Tuesday night by James “Mac” MacDade of Langhorne, after one of his neighbors suggested Li knock on his door to ask permission to set up her tent in his yard.
Mac said he was taken aback by her polite nature and amazing tale and offered her a couch in his house. Li left the area Thursday morning, eager to embark on the last leg of the walk.
“Mac has been extremely kind in letting me stay here,” Li said Wednesday. She came to America from China 10 years ago and speaks with a slight accent.
Aside from the sheer magnitude of the trip, what makes her story so hard to believe is that she has, for the most part, chosen to stay under the radar.
There is no blog or Facebook page chronicling her moves. She isn’t tweeting. She has no official sponsor.
So, while she gets asked a million questions by most people she encounters — many of whom are concerned for her safety — the one she hears most is simply, “Why?”
“People always ask me that,” she said with a laugh. “At first, I was so urgent (to respond) so I just started to tell them all the feelings I was having but I realized that was tough to do. So I just boil it down to the short version: I just felt like walking. I just decided to click over to living in the actual moment instead of inventing all these fantastic fantasies for the future.”
Though she tries her best to avoid attention, the sight of a young woman walking along a desolate road with a shopping cart — filled with a tent, a sleeping bag and other essentials — is not one often seen.
She said she’s been stopped countless times by police officers who are curious about her intentions and worried about her well-being. One still insists she check in on her cell phone to let him know she’s safe.
“A homeless person with a cell phone; that’s a new one, right?” Li said jokingly from Mac’s front porch.
And yes, Li said she hears it all. Some call her a bum, others label her as crazy and some just flat-out don’t believe her story.
“It’s all right,” she added. “People are different and sometimes, it’s hard to comprehend when you first encounter something out of the norm.”
According to Li, most people are surprisingly giving.
“People have given me a lot of support,” she said. “They give me McDonald’s gift cards and insist I take them. One time I went into a store and found $20 just sitting in my cart outside. I have no idea who left it.”
Li said she began with just a wheeled suitcase, but soon found that pushing a shopping cart was the way to go. The one she uses now came from a Sears department store in Flagstaff, Ariz.
“Just for the record, I did not steal it,” she said. “I actually went to the mall security guard and asked him for it. I left him my phone number and said if Sears had any problems, I would be willing to pay.”
Li said she plans to return the cart on her way home which, she added, will be done by more conventional modes of travel.
But on the way to NYC, she’s strictly walking.
“To be honest, I did take a few rides,” she admitted. “One time, a policeman escorted me out of a certain area at night, but the next day I asked him to take me back to the same spot. I don’t want to cheat.”
Li estimates she walks 15 miles a day; at sunset, she begins to look for shelter or a place to pitch her tent.
“I always make sure to ask permission before I set up my tent on someone’s property. It’s only right,” she added.
Along the way, she said, the little things have given her the most pleasure.
“The clouds in Ohio, were just so perfectly shaped,” she said, “like the most innocent drawings from a child.”
She said she realizes the dangers of such an undertaking and that she’s been fortunate so far.
“When you’re on a trip like this, you get so much closer to the truth about yourself,” Li added.
And while she understands that walking across the country might not be for everyone, she said that even the tiniest of adventures can lead to that same inner truth.
“A quest is different for everyone,” she said, “but the courage is the same.”
[Via MSN]
Sunday, September 18, 2011
Arkansas Town Searching for Toe-sucking Assailant
LITTLE ROCK, Arkansas (Reuters) - There's nothing illegal about a foot fetish but police in Conway, Arkansas, are looking for a toe-sucking man they said has crossed the line into assault.
Police have received two complaints in the past week about a man who seems desperate to suck women's toes -- whether they want him to or not.
"We want him off the streets," said Conway police spokeswoman LaTresha Woodruff.
Last Saturday, Ruth Harris, 83, told police she was sitting in a chair in front of her apartment when a man approached and said he liked her feet. According to a police report, the man took off one of her shoes and began sucking on her toe.
"The man then asked if he could kiss her and she had told him no and told him he was crazy," the report stated.
The man left quickly after people walked into the apartment complex's courtyard.
On Tuesday, police received another call from a woman who said that on Saturday she was shopping when she noticed a man staring at her.
The man then told the woman that he had a foot fetish and that "her toes are so long and succulent" and he wanted to suck them. When the woman's cell phone rang, the man retreated.
She told police the man had "messed up toes."
It is not the first time that Conway has dealt with this sort of complaint. In the 1990s, a man who was known as the "Toe Suck Fairy" kept Arkansans captivated with his foot fondling antics in Conway and Little Rock.
That assailant, Michael Robert Wyatt, pretended to be a podiatrist in order to fondle and suck a Conway woman's toes at a clothing store. He received probation, a fine and court-ordered therapy but his probation was revoked after he was arrested in another town on similar charges.
In 1991, he was convicted of making threats for telling a convenience store clerk that he wanted to cut off her feet and suck her toes while she bled to death.
Wyatt was sentenced to four years in state prison. He served just more than one year in prison, according to Conway police.
Some two decades later, police have not ruled out the possibility that the current toe-sucker could be the same man.
Thursday, September 15, 2011
US to Slash Marcellus Shale Gas Estimate 80%
The US will slash its estimate of undiscovered Marcellus Shale natural gas by as much as 80 percent after a updated assessment by government geologists.
The formation, which stretches from New York to Tennessee, contains about 84 trillion cubic feet of gas, the US Geological Survey said in its first update in nine years. That supersedes an Energy Department projection of 410 trillion cubic feet, said Philip Budzik, an operations research analyst with the Energy Information Administration.
“We consider the USGS to be the experts in this matter,” Budzik said in an interview. “They’re geologists, we’re not. We’re going to be taking this number and using it in our model.”
The revised estimates, posted on the agency’s website, are likely to spur a debate over industry projections of the potential value of shale gas.
Range Resources Corp. (RRC), Cabot Oil & Gas Corp. (COG) and Goodrich Petroleum Corp. (GDP) were subpoenaed by New York Attorney General Eric Schneiderman over whether they accurately represented the profitability of their natural-gas wells in the region, according to a person familiar with the matter. The subpoenas, sent Aug. 8, requested documents on formulas used to project how long the wells can produce gas without additional drilling using hydraulic fracturing, or fracking.
The previous Geological Survey estimate in 2002 said the Marcellus Shale contained about 2 trillion cubic feet of gas. The 42-fold increase is the result of “new geologic information and engineering data,” the agency said. The Marcellus formation may hold from 43 to 144.1 trillion cubic feet, the agency said.
Technology Advances
Advances in the technology used to recover shale gas led the Energy Department to more than double its estimate of recoverable shale resources, to 827 trillion cubic feet, in an April report and to project that the nation has enough natural gas to heat homes and run power stations for 110 years. Shale gas is recovered by fracturing, a technique in which millions of gallons of chemically treated water are forced underground to break up rock and allow gas to flow.
“One fifth of a big number is still a big number,” Kevin Book, managing director at ClearView Energy Partners LLC, a Washington-based policy analysis firm, said today in an interview. “It shouldn’t tell you anything about your conclusions. It should tell you what you need to know about estimates. They get revised.”
Budzik said much remains unknown about the Marcellus. Most drilling by companies such as Chesapeake Energy Corp. (CHK) and Range Resources Corp. has occurred in the northeast corner of Pennsylvania, Budzik said. New York has banned drilling until the state completes environmental regulations.
‘Sense Of Proportion’
“There hasn’t been a lot of drilling elsewhere yet,” Budzik said. “Layer on that the fact that over the next 30 years, the technology is going to evolve. It will have an impact on our projections. We all need to keep a sense of proportion here.”
The Energy Information Administration, the data-gathering arm of the Energy Department, will incorporate the USGS estimates in its annual energy outlook, which should be issued by the end of the year, Budzik said.
The Marcellus Shale assessment covered areas in Kentucky, Maryland, New York, Ohio, Pennsylvania, Tennessee, Virginia, and West Virginia.
[Via Bloomberg]
The formation, which stretches from New York to Tennessee, contains about 84 trillion cubic feet of gas, the US Geological Survey said in its first update in nine years. That supersedes an Energy Department projection of 410 trillion cubic feet, said Philip Budzik, an operations research analyst with the Energy Information Administration.
“We consider the USGS to be the experts in this matter,” Budzik said in an interview. “They’re geologists, we’re not. We’re going to be taking this number and using it in our model.”
The revised estimates, posted on the agency’s website, are likely to spur a debate over industry projections of the potential value of shale gas.
Range Resources Corp. (RRC), Cabot Oil & Gas Corp. (COG) and Goodrich Petroleum Corp. (GDP) were subpoenaed by New York Attorney General Eric Schneiderman over whether they accurately represented the profitability of their natural-gas wells in the region, according to a person familiar with the matter. The subpoenas, sent Aug. 8, requested documents on formulas used to project how long the wells can produce gas without additional drilling using hydraulic fracturing, or fracking.
The previous Geological Survey estimate in 2002 said the Marcellus Shale contained about 2 trillion cubic feet of gas. The 42-fold increase is the result of “new geologic information and engineering data,” the agency said. The Marcellus formation may hold from 43 to 144.1 trillion cubic feet, the agency said.
Technology Advances
Advances in the technology used to recover shale gas led the Energy Department to more than double its estimate of recoverable shale resources, to 827 trillion cubic feet, in an April report and to project that the nation has enough natural gas to heat homes and run power stations for 110 years. Shale gas is recovered by fracturing, a technique in which millions of gallons of chemically treated water are forced underground to break up rock and allow gas to flow.
“One fifth of a big number is still a big number,” Kevin Book, managing director at ClearView Energy Partners LLC, a Washington-based policy analysis firm, said today in an interview. “It shouldn’t tell you anything about your conclusions. It should tell you what you need to know about estimates. They get revised.”
Budzik said much remains unknown about the Marcellus. Most drilling by companies such as Chesapeake Energy Corp. (CHK) and Range Resources Corp. has occurred in the northeast corner of Pennsylvania, Budzik said. New York has banned drilling until the state completes environmental regulations.
‘Sense Of Proportion’
“There hasn’t been a lot of drilling elsewhere yet,” Budzik said. “Layer on that the fact that over the next 30 years, the technology is going to evolve. It will have an impact on our projections. We all need to keep a sense of proportion here.”
The Energy Information Administration, the data-gathering arm of the Energy Department, will incorporate the USGS estimates in its annual energy outlook, which should be issued by the end of the year, Budzik said.
The Marcellus Shale assessment covered areas in Kentucky, Maryland, New York, Ohio, Pennsylvania, Tennessee, Virginia, and West Virginia.
[Via Bloomberg]
Tuesday, September 13, 2011
Median Male Worker Makes Less Now Than 43 Years Ago
While the fact that a record number of Americans are living in poverty should not surprise anyone at this point, what should surprise many is that according to the Census report of Income, the median male is now worse on a gross, inflation adjusted basis, than he was in 1968.
While back then, the median income of male workers was $32,844, it has since declined to $32,137 as of 2010. And there is your lesson in inflation 101 (which we assume is driven by the CPI, which likely means that the actual inflation adjusted income decline is far worse than what is even reported). The only winner: women, whose median inflation adjusted income over the same period has increased by 188%. That said, it is still at 65% of what the median male makes. So injustice all around. And now, it is time to be patriotic again and buy a Pontiac Aztek.
[Via Zero Hedge]
While back then, the median income of male workers was $32,844, it has since declined to $32,137 as of 2010. And there is your lesson in inflation 101 (which we assume is driven by the CPI, which likely means that the actual inflation adjusted income decline is far worse than what is even reported). The only winner: women, whose median inflation adjusted income over the same period has increased by 188%. That said, it is still at 65% of what the median male makes. So injustice all around. And now, it is time to be patriotic again and buy a Pontiac Aztek.
[Via Zero Hedge]
Sunday, September 11, 2011
Ikea's US Factory Churns Out Unhappy Workers
A union-organizing battle hangs over the Ikea plant in Virginia. Workers complain of eliminated raises, a frenzied pace, mandatory overtime and racial discrimination.
When home furnishing giant Ikea selected this fraying blue-collar city to build its first U.S. factory, residents couldn't believe their good fortune.
Beloved by consumers worldwide for its stylish and affordable furniture, the Swedish firm had also constructed a reputation as a good employer and solid corporate citizen. State and local officials offered $12 million in incentives. Residents thrilled at the prospect of a respected foreign company bringing jobs to this former textile region after watching so many flee overseas.
But three years after the massive facility opened here, excitement has waned. Ikea is the target of racial discrimination complaints, a heated union-organizing battle and turnover from disgruntled employees.
Workers complain of eliminated raises, a frenzied pace and mandatory overtime. Several said it's common to find out on Friday evening that they'll have to pull a weekend shift, with disciplinary action for those who can't or don't show up.
Kylette Duncan, among the plant's first hires, quit after six months to take a lower-paying retail job. "I need money as bad as anybody, but I also need a life," said Duncan, 52. She recalled having to cancel medical appointments for her ailing husband because she had to work overtime at the last minute.
Some of the Virginia plant's 335 workers are trying to form a union. The International Assn. of Machinists and Aerospace Workers said a majority of eligible employees had signed cards expressing interest.
In response, the factory — part of Ikea's manufacturing subsidiary, Swedwood — hired the law firm Jackson Lewis, which has made its reputation keeping unions out of companies. Workers said Swedwood officials required employees to attend meetings at which management discouraged union membership.
Plant officials didn't return calls and declined to meet with a Times reporter who visited the Virginia facility. Swedwood spokeswoman Ingrid Steen in Sweden called the situation in Danville "sad" but said she could not discuss the complaints of specific employees. She said she had heard "rumors" about anti-union meetings at the plant but added that "this wouldn't be anything that would be approved by the group management in Sweden."
The dust-up has garnered little attention in the U.S. But it's front-page news in Sweden, where much of the labor force is unionized and Ikea is a cherished institution. Per-Olaf Sjoo, the head of the Swedish union in Swedwood factories, said he was baffled by the friction in Danville. Ikea's code of conduct, known as IWAY, guarantees workers the right to organize and stipulates that all overtime be voluntary.
"Ikea is a very strong brand and they lean on some kind of good Swedishness in their business profile. That becomes a complication when they act like they do in the United States," said Sjoo. "For us, it's a huge problem."
Laborers in Swedwood plants in Sweden produce bookcases and tables similar to those manufactured in Danville. The big difference is that the Europeans enjoy a minimum wage of about $19 an hour and a government-mandated five weeks of paid vacation. Full-time employees in Danville start at $8 an hour with 12 vacation days — eight of them on dates determined by the company.
What's more, as many as one-third of the workers at the Danville plant have been drawn from local temporary-staffing agencies. These workers receive even lower wages and no benefits, employees said.
Swedwood's Steen said the company is reducing the number of temps, but she acknowledged the pay gap between factories in Europe and the U.S. "That is related to the standard of living and general conditions in the different countries," Steen said.
Bill Street, who has tried to organize the Danville workers for the machinists union, said Ikea was taking advantage of the weaker protections afforded to U.S. workers.
"It's ironic that Ikea looks on the U.S. and Danville the way that most people in the U.S. look at Mexico," Street said.
The Swedwood factory is situated on the outskirts of Danville, in the midst of rolling tobacco country, just north of the North Carolina border.
For most of the last century the town of 45,000 relied on textiles and tobacco for jobs. Today the riverfront is lined with empty red brick warehouses and crumbling mills. With the unemployment rate high — currently at 10.1% — the city has put muscle behind attracting new companies, including Ikea.
"They've definitely given jobs to people that desperately needed them here," city manager Joe King said.
Swedwood says it chose Danville to cut shipping costs to its U.S. stores. The plant has been run mostly by American managers, along with some from Sweden.
The facility looks like a series of interlocking, windowless white boxes — as neat as an Ikea store — with a blue-and-yellow Swedish flag flying out front. Employees inside produce Expedit bookshelves, which start at $69.99 in Ikea stores, and Lack coffee tables, which retail for as little as $19.99.
Low prices have helped Ikea weather the economic downturn. The company made 2.7 billion euros in profit last year, up 6.1% from 2009, according to its most recent financial statements.
Still, last fall, Swedwood eliminated regularly scheduled raises and made cuts to some pay packages in Danville. Starting pay in the packing department, for example, was reduced to $8 an hour from $9.75. Steen said the changes were made to free up more money to pay incentive bonuses to top performers.
The median hourly wage in the Danville area is $15.48, according to the Virginia Employment Commission.
Current and former plant employees said they resented the unpredictable work hours and high-pressure atmosphere. The plant assesses penalty points for violations of work rules; workers who accumulate nine of them can be fired.
"It's the most strict place I have ever worked," said Janis Wilborne, 63, who worked at the plant for two years and quit last year.
Six African American employees have filed discrimination complaints with the Equal Employment Opportunity Commission, claiming that black workers at Swedwood's U.S. factory are assigned to the lowest-paying departments and to the least desirable third shift, from 11 p.m. to 7 a.m.
"If we put in for a better job, we wouldn't get it — it would always go to a white person," said Jackie Maubin, who worked the night shift in the packing department until last year, when she was fired on her birthday.
Swedwood has been trying to settle four of the discrimination complaints through mediation. The company initially offered Maubin $1,000. She settled for $2,000. She said she needed the money to keep her car from being repossessed.
Global competition has motivated all manner of companies to seek out low-cost sources of production, said Ellen Ruppel Shell, the author of the book "Cheap: The High Cost of Discount Culture." Ikea is no exception. What's different, she said, is that the company has done such a good job of burnishing its own corporate image.
"There's a mythology around the company," Shell said. "That's why these kinds of revelations surprise a lot of folks."
[Via LA Times]
When home furnishing giant Ikea selected this fraying blue-collar city to build its first U.S. factory, residents couldn't believe their good fortune.
Beloved by consumers worldwide for its stylish and affordable furniture, the Swedish firm had also constructed a reputation as a good employer and solid corporate citizen. State and local officials offered $12 million in incentives. Residents thrilled at the prospect of a respected foreign company bringing jobs to this former textile region after watching so many flee overseas.
But three years after the massive facility opened here, excitement has waned. Ikea is the target of racial discrimination complaints, a heated union-organizing battle and turnover from disgruntled employees.
Workers complain of eliminated raises, a frenzied pace and mandatory overtime. Several said it's common to find out on Friday evening that they'll have to pull a weekend shift, with disciplinary action for those who can't or don't show up.
Kylette Duncan, among the plant's first hires, quit after six months to take a lower-paying retail job. "I need money as bad as anybody, but I also need a life," said Duncan, 52. She recalled having to cancel medical appointments for her ailing husband because she had to work overtime at the last minute.
Some of the Virginia plant's 335 workers are trying to form a union. The International Assn. of Machinists and Aerospace Workers said a majority of eligible employees had signed cards expressing interest.
In response, the factory — part of Ikea's manufacturing subsidiary, Swedwood — hired the law firm Jackson Lewis, which has made its reputation keeping unions out of companies. Workers said Swedwood officials required employees to attend meetings at which management discouraged union membership.
Plant officials didn't return calls and declined to meet with a Times reporter who visited the Virginia facility. Swedwood spokeswoman Ingrid Steen in Sweden called the situation in Danville "sad" but said she could not discuss the complaints of specific employees. She said she had heard "rumors" about anti-union meetings at the plant but added that "this wouldn't be anything that would be approved by the group management in Sweden."
The dust-up has garnered little attention in the U.S. But it's front-page news in Sweden, where much of the labor force is unionized and Ikea is a cherished institution. Per-Olaf Sjoo, the head of the Swedish union in Swedwood factories, said he was baffled by the friction in Danville. Ikea's code of conduct, known as IWAY, guarantees workers the right to organize and stipulates that all overtime be voluntary.
"Ikea is a very strong brand and they lean on some kind of good Swedishness in their business profile. That becomes a complication when they act like they do in the United States," said Sjoo. "For us, it's a huge problem."
Laborers in Swedwood plants in Sweden produce bookcases and tables similar to those manufactured in Danville. The big difference is that the Europeans enjoy a minimum wage of about $19 an hour and a government-mandated five weeks of paid vacation. Full-time employees in Danville start at $8 an hour with 12 vacation days — eight of them on dates determined by the company.
What's more, as many as one-third of the workers at the Danville plant have been drawn from local temporary-staffing agencies. These workers receive even lower wages and no benefits, employees said.
Swedwood's Steen said the company is reducing the number of temps, but she acknowledged the pay gap between factories in Europe and the U.S. "That is related to the standard of living and general conditions in the different countries," Steen said.
Bill Street, who has tried to organize the Danville workers for the machinists union, said Ikea was taking advantage of the weaker protections afforded to U.S. workers.
"It's ironic that Ikea looks on the U.S. and Danville the way that most people in the U.S. look at Mexico," Street said.
The Swedwood factory is situated on the outskirts of Danville, in the midst of rolling tobacco country, just north of the North Carolina border.
For most of the last century the town of 45,000 relied on textiles and tobacco for jobs. Today the riverfront is lined with empty red brick warehouses and crumbling mills. With the unemployment rate high — currently at 10.1% — the city has put muscle behind attracting new companies, including Ikea.
"They've definitely given jobs to people that desperately needed them here," city manager Joe King said.
Swedwood says it chose Danville to cut shipping costs to its U.S. stores. The plant has been run mostly by American managers, along with some from Sweden.
The facility looks like a series of interlocking, windowless white boxes — as neat as an Ikea store — with a blue-and-yellow Swedish flag flying out front. Employees inside produce Expedit bookshelves, which start at $69.99 in Ikea stores, and Lack coffee tables, which retail for as little as $19.99.
Low prices have helped Ikea weather the economic downturn. The company made 2.7 billion euros in profit last year, up 6.1% from 2009, according to its most recent financial statements.
Still, last fall, Swedwood eliminated regularly scheduled raises and made cuts to some pay packages in Danville. Starting pay in the packing department, for example, was reduced to $8 an hour from $9.75. Steen said the changes were made to free up more money to pay incentive bonuses to top performers.
The median hourly wage in the Danville area is $15.48, according to the Virginia Employment Commission.
Current and former plant employees said they resented the unpredictable work hours and high-pressure atmosphere. The plant assesses penalty points for violations of work rules; workers who accumulate nine of them can be fired.
"It's the most strict place I have ever worked," said Janis Wilborne, 63, who worked at the plant for two years and quit last year.
Six African American employees have filed discrimination complaints with the Equal Employment Opportunity Commission, claiming that black workers at Swedwood's U.S. factory are assigned to the lowest-paying departments and to the least desirable third shift, from 11 p.m. to 7 a.m.
"If we put in for a better job, we wouldn't get it — it would always go to a white person," said Jackie Maubin, who worked the night shift in the packing department until last year, when she was fired on her birthday.
Swedwood has been trying to settle four of the discrimination complaints through mediation. The company initially offered Maubin $1,000. She settled for $2,000. She said she needed the money to keep her car from being repossessed.
Global competition has motivated all manner of companies to seek out low-cost sources of production, said Ellen Ruppel Shell, the author of the book "Cheap: The High Cost of Discount Culture." Ikea is no exception. What's different, she said, is that the company has done such a good job of burnishing its own corporate image.
"There's a mythology around the company," Shell said. "That's why these kinds of revelations surprise a lot of folks."
[Via LA Times]
Saturday, September 10, 2011
Why Adolf Hitler Hated Jews
Let's first start by saying that anti-semitism existed in Western Europe prior to the birth of Hitler, with pogroms against Jews occurring long before Kristallnacht. Jews, as well as other minorities, had long been the established scapegoats. Since the Middle Ages, Jews were forced by European Christians to work & reside in ghettos, preventing assimilation. Only certain occupations were open to Jews, such as banking & moneylending; trades which made some Jews, like the Rothschilds, wealthy but also the targets of envy and hate.
The scapegoating of European Jews was often politically and religiously expedient to those in power, such as the Catholic Church, and those seeking power. Martin Luther, the German founder of Protestantism, was a vehement anti-semite who wrote vicious rhetoric about the Jews and worked toward their expulsion from many German towns as early as 1536.
Adolf Stoecker had formed the Christian Social Workers' party in 1879 and by 1883 riots, as well as the burning of a synagogue in Neustettin, were stoked by Stoecker's call for a "final victory" against the Jews. He was followed by Professor Eugen Euhring, speaking at Berlin University, of the "obligation to drive an inferior race from public honor", and Gottingen University's Paul de Legarde's (aka Boetticher) suggestion of a three-fold program: the Germanizing of Austria, the conquest of Russia, and the expulsion of Jews to Palestine.
This would have been the zeitgeist in which Hitler was born.
During his youth, Hitler found himself in Vienna struggling to become an artist and attempted to pass the entrance examinations at the Academy of Fine Arts. He failed. At this point, Hitler became a drifter and struggled to survive from time to time as a day laborer. In Vienna, Hitler would have encountered a thriving Jewish community, where Jews held distinguished positions in universities, such as the one that just rejected him, and private financial institutions. He also would've encountered open anti-semitism in print and on the street. It is speculated that Hitler blamed all of his personal failures on the Jews, despite the fact that it was a Hungarian Jew by the name of Josef Neumann who once saved him from starvation.
Hitler's personal anti-semitism grew as his public political power and megalomania grew. One of his greatest political enemies were the Communists. Although Jews made up the ranks of every political group, Jewish participation in contemporary left wing politics of the early 20th century was established and formidable, going back to Karl Marx. Hitler's sad theories of a "master race" conveniently tied into the annihilation of his political opponents as well.
And yet, Hitler wasn't unaware of the absurdity of his "master race theory". He admits as much when he was quoted as saying "I know perfectly well that in the scientific sense there is no such thing as race. But you, as a farmer, cannot get your breeding right without a conception of race. And I, as a politician, need a conception which permits the order than has formerly existed on a historic footing to be abolished."
Again, these are just speculations about why - or how - it was possible that Hitler hated the Jews. It's also likely that he was a certifiable sociopath, in which case no explanation is necessary.
The scapegoating of European Jews was often politically and religiously expedient to those in power, such as the Catholic Church, and those seeking power. Martin Luther, the German founder of Protestantism, was a vehement anti-semite who wrote vicious rhetoric about the Jews and worked toward their expulsion from many German towns as early as 1536.
Adolf Stoecker had formed the Christian Social Workers' party in 1879 and by 1883 riots, as well as the burning of a synagogue in Neustettin, were stoked by Stoecker's call for a "final victory" against the Jews. He was followed by Professor Eugen Euhring, speaking at Berlin University, of the "obligation to drive an inferior race from public honor", and Gottingen University's Paul de Legarde's (aka Boetticher) suggestion of a three-fold program: the Germanizing of Austria, the conquest of Russia, and the expulsion of Jews to Palestine.
This would have been the zeitgeist in which Hitler was born.
During his youth, Hitler found himself in Vienna struggling to become an artist and attempted to pass the entrance examinations at the Academy of Fine Arts. He failed. At this point, Hitler became a drifter and struggled to survive from time to time as a day laborer. In Vienna, Hitler would have encountered a thriving Jewish community, where Jews held distinguished positions in universities, such as the one that just rejected him, and private financial institutions. He also would've encountered open anti-semitism in print and on the street. It is speculated that Hitler blamed all of his personal failures on the Jews, despite the fact that it was a Hungarian Jew by the name of Josef Neumann who once saved him from starvation.
Hitler's personal anti-semitism grew as his public political power and megalomania grew. One of his greatest political enemies were the Communists. Although Jews made up the ranks of every political group, Jewish participation in contemporary left wing politics of the early 20th century was established and formidable, going back to Karl Marx. Hitler's sad theories of a "master race" conveniently tied into the annihilation of his political opponents as well.
And yet, Hitler wasn't unaware of the absurdity of his "master race theory". He admits as much when he was quoted as saying "I know perfectly well that in the scientific sense there is no such thing as race. But you, as a farmer, cannot get your breeding right without a conception of race. And I, as a politician, need a conception which permits the order than has formerly existed on a historic footing to be abolished."
Again, these are just speculations about why - or how - it was possible that Hitler hated the Jews. It's also likely that he was a certifiable sociopath, in which case no explanation is necessary.
Sunday, September 4, 2011
6 Questions Start-up CEO Should Ask of Angel Investor
1. Are you a check-writer?
2. Did you bring your checkbook with you?
3. Would you like to use my pen?
4. Do you know how to spell $250,000?
5. Do you know today's date?
6. Do you mind signing your name on that line?
2. Did you bring your checkbook with you?
3. Would you like to use my pen?
4. Do you know how to spell $250,000?
5. Do you know today's date?
6. Do you mind signing your name on that line?
What Percent of Women Who Get Married Take Their Husband's Last Name?
Sometime while Hillary Clinton was switching her name from Hillary Rodham to Hillary Clinton and back again and back back again, an important threshold was crossed — people stopped caring. When Hillary initially kept her surname after marrying Bill, it was a blow against the patriarchy and for women’s liberation, but today such surname-keeping has lost its cachet.
In the 1990s the number of women keeping their maiden name upon marriage began to dip, according to a fascinating study published in The Journal of Economic Perspectives. This snapback to taking a husband’s surname is mostly an elite phenomenon, since among most people it never went out of style. Roughly 90 percent of women take their husband’s surname. It is among college-educated women that surname-keeping flowed and is now ebbing.
Surname-keeping took hold in the 1970s. Legal restrictions that forced women to take their husbands’ surnames began to be overturned or ignored. Women began to marry later and get more professional degrees, both of which made them more attached to their surnames. Ms. became popularized as a way to avoid the repression of Mrs. Keeping a surname was considered a way for a woman to keep her identity.
The number of women in The New York Times’ wedding announcements keeping their surnames was 2 percent in 1975 and had reached 20 percent by the mid-1980s, according to the Journal study. Then the trend stalled. Among women in the Harvard class of 1980, 44 percent retained their surname, but in the class of 1990, only 32 percent did. According to Massachusetts records, the percentage of surname-keepers among college graduates in that state was 23 percent in 1990, 20 percent in 1995 and 17 percent in 2000.
Why? The study’s authors write: “Perhaps some women who ‘kept’ their surnames in the 1980s, during the rapid increase in ‘keeping,’ did so because of peer pressure, and their counterparts today are freer to make their own choices. Perhaps surname-keeping seems less salient as a way of publicly supporting equality for women than it did in the late 1970s and 1980s. Perhaps a general drift to more conservative social values has made surname-keeping less attractive.”
Indeed, the decline in sur- name-keeping might mean that marriage is being taken slightly more seriously. “I think it will strengthen marriage,” says University of Virginia professor Steven Rhoads, author of “Taking Sex Differences Seriously.” “It’s a sign that someone intends it to be a unit, that this is a marriage, and it is for the duration.”
It certainly shows that, for whatever reason, younger women are moving beyond old feminist obsessions. Writing in the online magazine Slate, Katie Roiphe argues that “the maiden name is no longer a fraught political issue. These days, no one is shocked when an independent-minded woman takes her husband’s name, any more than one is shocked when she announces that she is staying at home with her kids.”
In the waning of a certain kind of self-conscious feminism, women are freer to make their own choices — including traditional ones.
Finally, there is simply the hassle factor. It can be difficult for a mother who doesn’t share her child’s last name to pick him up from school or travel with him. Hyphenation has its own perils. Writer Frederica Mathewes-Green reports receiving mail for people named Mathwas-Green, Mathers-Crein, Vatherwes-Green and Mebhews-Creen, among others. Her hyphenation won’t be carried on by any of her children, and she doesn’t regret it.
In an essay on the decline of feminism in the City Journal, Kay Hymowitz notes that feminist pioneer Patricia Ireland wrote that a woman taking her husband’s name “signifies the loss of her very existence as a person under the law.” Women who want to get on with their lives and with their marriages greet that kind of old-school feminist call-to-arms with a decidedly 21st century “ho-hum.”
In the 1990s the number of women keeping their maiden name upon marriage began to dip, according to a fascinating study published in The Journal of Economic Perspectives. This snapback to taking a husband’s surname is mostly an elite phenomenon, since among most people it never went out of style. Roughly 90 percent of women take their husband’s surname. It is among college-educated women that surname-keeping flowed and is now ebbing.
Surname-keeping took hold in the 1970s. Legal restrictions that forced women to take their husbands’ surnames began to be overturned or ignored. Women began to marry later and get more professional degrees, both of which made them more attached to their surnames. Ms. became popularized as a way to avoid the repression of Mrs. Keeping a surname was considered a way for a woman to keep her identity.
The number of women in The New York Times’ wedding announcements keeping their surnames was 2 percent in 1975 and had reached 20 percent by the mid-1980s, according to the Journal study. Then the trend stalled. Among women in the Harvard class of 1980, 44 percent retained their surname, but in the class of 1990, only 32 percent did. According to Massachusetts records, the percentage of surname-keepers among college graduates in that state was 23 percent in 1990, 20 percent in 1995 and 17 percent in 2000.
Why? The study’s authors write: “Perhaps some women who ‘kept’ their surnames in the 1980s, during the rapid increase in ‘keeping,’ did so because of peer pressure, and their counterparts today are freer to make their own choices. Perhaps surname-keeping seems less salient as a way of publicly supporting equality for women than it did in the late 1970s and 1980s. Perhaps a general drift to more conservative social values has made surname-keeping less attractive.”
Indeed, the decline in sur- name-keeping might mean that marriage is being taken slightly more seriously. “I think it will strengthen marriage,” says University of Virginia professor Steven Rhoads, author of “Taking Sex Differences Seriously.” “It’s a sign that someone intends it to be a unit, that this is a marriage, and it is for the duration.”
It certainly shows that, for whatever reason, younger women are moving beyond old feminist obsessions. Writing in the online magazine Slate, Katie Roiphe argues that “the maiden name is no longer a fraught political issue. These days, no one is shocked when an independent-minded woman takes her husband’s name, any more than one is shocked when she announces that she is staying at home with her kids.”
In the waning of a certain kind of self-conscious feminism, women are freer to make their own choices — including traditional ones.
Finally, there is simply the hassle factor. It can be difficult for a mother who doesn’t share her child’s last name to pick him up from school or travel with him. Hyphenation has its own perils. Writer Frederica Mathewes-Green reports receiving mail for people named Mathwas-Green, Mathers-Crein, Vatherwes-Green and Mebhews-Creen, among others. Her hyphenation won’t be carried on by any of her children, and she doesn’t regret it.
In an essay on the decline of feminism in the City Journal, Kay Hymowitz notes that feminist pioneer Patricia Ireland wrote that a woman taking her husband’s name “signifies the loss of her very existence as a person under the law.” Women who want to get on with their lives and with their marriages greet that kind of old-school feminist call-to-arms with a decidedly 21st century “ho-hum.”
Thursday, August 25, 2011
Married Rich in San Diego
Money and politics have long been married to each other in San Diego, where four of the city's most powerful women made their way to the top after marrying local captains of commerce and industry. Union-Tribune publisher Helen Copley, ex-mayors Maureen O'Connor and Susan Golding, and McDonald's heiress Joan Kroc all started their lives with humble means, only to find fortune and power in the arms of wealthy husbands.
The women married their money in the '70s and '80s. In the '90s, it was the men's turn. Three of the city's most prominent civic players, UCSD chancellor Robert Dynes, San Diego Unified School District superintendent Alan Bersin, and San Diego city councilman Scott Peters, are married to rich wives. Each spouse is probably worth millions of dollars, according to the personal financial disclosure statements the men are required to file.
But having money has proved a mixed blessing for these San Diegans. Along their path to wealth and influence, two of the women, Copley and Golding, and one of the men, Dynes, reinvented part of themselves, sanitizing their biographies by erasing marriages, divorces, and the recriminations that followed. And the surnames of the children of Copley and Golding were later changed. For Bersin, Dynes, and Peters, spousal wealth has raised questions about conflicts between their official roles and the financial holdings of their wives.
Fifty years ago this spring, Copley was a secretary in Cedar Rapids, Iowa, when, according to court documents, she became pregnant after a tryst with a fellow worker at a dairy company. At 29, she married the child's father, John Hunt, in one county, divorced him two weeks later in another, and, accompanied by her mother, headed west to San Diego, where she gave birth to a son on January 31, 1952. Years later, asked about the father of her child, Copley would say, "I never talk about him. I don't know where he is, and I don't want to know."
Not long after arriving in San Diego, Helen Hunt got a job at the San Diego Union and its sister paper, the Tribune, where she met publisher James S. Copley, who had inherited his newspaper empire from his adoptive father, Colonel Ira Copley, a one-time Illinois congressman. Smitten by the svelte brunette, Jim Copley made Helen his personal secretary. In August 1965, he divorced his wife and the mother of his two adopted children and married Helen. At the time of their marriage, Jim adopted Helen's 13-year-old son David Hunt, whose birth certificate was altered to eliminate any reference to the boy's birth father.
Seven years later on his deathbed, the publisher drew up trust agreements leaving his wife complete control of his newspaper empire. After Jim died of lung cancer in 1973 at the age of 57, Helen, then 48, consolidated her hold on the company, allegedly locking out Jim's two children by his first marriage, and triggering a lawsuit charging that Helen had looted the children's trusts for the benefit of herself and her son David. After years of litigation, Helen agreed to settle the case in 1982 for a sizable, undisclosed sum.
By the time she named David publisher of the Union-Tribune this April, Helen Copley had spent almost 28 years at the helm of the newspaper company. She had provided political and editorial support to Pete Wilson as mayor, then United States senator, then governor, only to see him blamed for the decimation of the state's Republican Party because of his backing of the anti-immigrant Proposition 187.
Copley used her newspapers to stimulate the city's explosive growth, pushing for North City residential sprawl, convincing voters to approve encroachment of the Naval Hospital expansion into Balboa Park's Florida Canyon, advocating giving away city-owned land for industrial projects, and promoting the Chargers' ticket-guarantee. Few candidates for local office dared challenge the Union-Tribune's dominance, and when they did, they found themselves dispatched to political oblivion.
And yet, though her editorial defeats were few, Copley as publisher never seemed to find her personal bearings. She rarely spoke in public. Her friendship with financier Richard Silberman in the late 1970s became an embarrassment when a reporter at the Evening Tribune accused the paper of spiking a story about Silberman's conflicts of interest stemming from his ownership of the Bazaar del Mundo. When Silberman began dating a young Union reporter, his relationship with Copley cooled. She retreated to her mansion, known as Fox Hill, overlooking the fairways of the La Jolla Country Club, and was seldom again seen by anyone other than close friends.
A few years after his split with Copley, Silberman married Susan Golding on July 22, 1984. Golding arrived for the wedding at Temple Beth Israel in a red Jaguar; Silberman pulled up in a Lamborghini Spada. It was the city's money marriage of the decade. Everyone knew Silberman as the millionaire wonderboy who, along with fellow San Diego State grad Bob Peterson, made a fortune when they sold the Jack In The Box hamburger chain to Ralston Purina more than a decade earlier.
At the time of the wedding, Democrat Silberman -- a self-proclaimed influence-peddler and confidant of former governor Jerry Brown -- was spending hundreds of thousands of dollars to get his new wife elected to the county board of supervisors. Golding, a Republican, had arrived in San Diego in the late 1970s with her husband, attorney Stanley Prowse.
Though she was the daughter of San Diego State president Brage Golding, she and her husband had modest assets. They were soon divorced, and Golding began her political career after striking up a close friendship with political consultant George Gorton, a key advisor to thenSan Diego mayor Pete Wilson.
With Gorton's assistance, Golding won an appointment to the San Diego City Council in January 1981. Two years later, in February 1983, Golding quit her council job to accept an appointment as a functionary in the administration of Governor George Deukmejian. Her council salary had been $35,000. The new job paid $50,784. She and Silberman were soon considering marriage.
"Susan talked to me on the phone about marrying Dick shortly after she had moved to Sacramento in the spring of 1983," her ex-husband Stanley Prowse recalled in a declaration filed in a child-support case Golding brought against him. "She told me that she thought she loved him, and that they were talking about getting married, but that she was nervous about it, particularly in light of their age difference and the fact that she was building her political career as a Republican while he was a prominent Democrat. I told her that I felt her fears were justified and that she should ask him to settle a substantial sum on her when and if they were married, so that she would feel secure and not dependent on him. She told me she thought my advice was sound. I did not doubt that she had followed it when she and Dick were wed the following year."
Golding went on to win her county-board seat, easily defeating a former Silberman protégée, Democratic lawyer Lynn Schenk. For most of her two terms on the board, Golding and Silberman were inseparable, personally and politically. Wiretaps, recorded during an FBI sting that resulted in Silberman's conviction on felony money-laundering charges, showed that Silberman was frequently in contact with Golding's office about arranging government contacts for Silberman's business friends.
Golding's ex-husband Stanley Prowse complained that Silberman was being overly generous to his two children, Vanessa and Sam. "They have both been showered with material things and have had so little interest in birthday and Christmas gifts we have given them that they have often ignored our invitations to visit and claim them." He added, "As I recall, Christmas of 1986 brought a bush plane tour of Alaska, while last Christmas brought a tour of the Far East, complete with surfing in Bali and bar-hopping in Bangkok -- heady stuff for impressionable teenagers."
Prowse was angered by what he charged were Golding's attempts to change the children's surnames. "Several years after our separation, I discovered that she had enrolled them in school as 'Sam Golding' and 'Vanessa Golding' without saying a word to me on the subject. By the time I found out, it was too late to do anything about it without embroiling them in a painful dispute. The sight of 'Golding' in bold letters on the back of Sam's high school letterman's jacket is painful to me, and for years I have received little or no acknowledgement from the children on Father's Day or my birthday. They do not treat [my wife] Joy or me respectfully. Susan has done her best to wipe the slate clean." Both Sam and Vanessa later went to court to make their name-change legal and permanent.
By the time Silberman was convicted on the money-laundering charges in June 1990, his business empire had been shown to be a massive fraud, based more on local myth of his financial infallibility than his balance sheet. A year later, Golding filed for divorce, and Silberman issued a statement from federal prison saying he had lied to his wife. "Unfortunately, I was not always truthful with her regarding critical and vital aspects of my life, and I know I am responsible for the changes in our relationship."
In November 1992, Golding was elected mayor of San Diego, narrowly beating Peter Navarro, the UC Irvine economics professor who was the bête noir of San Diego's establishment. Golding did not remarry, and, to outward appearances, lived a hermetic social life until leaving the public spotlight last year.
In contrast to Copley and Golding, Maureen O'Connor and Joan Kroc seemed to find post-spousal happiness. Kroc, a buxom blonde who at age 27 had met 53-year-old McDonald's founder Ray Kroc while playing piano at a bar in St. Paul, Minnesota, in 1957. For the next six years, they carried on a secret relationship. Ray Kroc divorced his wife, but Joan refused to divorce her first husband, who had become a McDonald's franchisee, and they didn't see each other at all for another six years. Meeting up with Kroc again at a 1969 McDonald's convention in San Diego, Joan finally ditched her husband and married the feisty billionaire.
After Ray Kroc died in January 1984, leaving Joan not only his fortune, but ownership of the San Diego Padres, she styled herself as a grand philanthropist, backing every cause from nuclear disarmament and world peace to the San Diego Zoo and Midwest flood victims. She tried to donate the Padres to the City of San Diego, a plan thwarted by her fellow Major League Baseball owners, who banned public ownership of teams.
Kroc's personal life, too, was more colorful than Copley's. She commissioned a sprawling house in Fairbanks Ranch and purchased a 300-foot yacht (the Impromptu), a helicopter (the Luvduv), a private Gulfstream jet, and a fleet of gold Cadillac Sevilles to provide transportation. She stopped driving the Cadillacs in October 1997 after she rolled one of the Sevilles on Interstate 5 near Clairemont Drive, suffering what were reported to be minor facial lacerations.
Like Kroc and Golding, former mayor Maureen O'Connor has not remarried. As a physical education teacher at a Catholic school, O'Connor, then 25, met Robert O. Peterson while running for the San Diego City Council in 1971. He was 55. Peterson, founder of the Jack In The Box hamburger chain, provided financial backing to O'Connor's subsequent campaigns and married her in 1977 in a European wedding.
Peterson lavished more than $500,000 on O'Connor's first mayoral race against Roger Hedgecock in the 1983 special election to replace Pete Wilson. During his victorious campaign against her, Hedgecock allies accused O'Connor and Peterson of conflicts of interest arising from Peterson's partial ownership interest in the Grant Hotel. A year later, Hedgecock found himself embroiled in the J. David political contribution scandal, but O'Connor declined to run in the June 1984 regular election, saying neither she nor Peterson were ready for another vitriolic go-around with Hedgecock.
Then, in September 1985, with Hedgecock on trial for political corruption and a likelihood that he would be forced from office, Peterson filed for divorce against O'Connor after eight years of marriage. Union-Tribune columnist Tom Blair reported that "the settlement isn't public, but an O'Connor friend says it's sizable. O'Connor, whose maiden name was restored, according to court documents, reportedly was in New York City when the dissolution was filed." Others claimed that the rift was caused by Peterson's opposition to O'Connor's ambition to run for mayor again.
The couple eventually reconciled, and by the spring of 1986, O'Connor was campaigning to replace Hedgecock, who had departed city hall after his conviction on the corruption charges. Vowing to spend no more than $170,000 on the campaign, she won the election that June. When she filed her first financial disclosure statement as mayor, it revealed an array of holdings from Gustaf Anders restaurant -- owned jointly with Union-Tribune publisher Helen Copley, an O'Connor intimate -- to 20 pieces of property in the county, valued well in excess of $2.5 million.
The couple's assets outside San Diego were not disclosed. "We listed anything that could even remotely be construed as doing business with the city," her attorney, David Bain, told the Los Angeles Times. "But it's safe to say that Maureen and Bob have interests outside San Diego that have nothing at all to do with San Diego." Though Bain didn't mention it, it was common knowledge that Peterson owned much of the Northern California resort town of Mendocino, as well as a hotel in Orange County.
"I don't see how anything that she and her husband hold could cause a significant conflict," Bain added. "Her policy has always been not to vote on anything that even remotely could be seen as a conflict, and she'll continue to follow that guideline. But I don't think there are going to be many cases where she might disqualify herself, and if there are, they'll be minor ones."
In December 1989, downtown-hotel magnate Douglas Manchester accused O'Connor of holding up the construction of the city's bay-front convention center while failing to reveal that she and her husband had a financial interest in the 249-room Grand Hotel, across the street from Disneyland. Oscar Irwin, an attorney for the Port of San Diego, defended the mayor, saying she had disclosed the interest earlier, while serving on the Port Commission. "Why are they crying to the press...unless it has to do with Manchester's vindictiveness?" Irwin told the Los Angeles Times.
"I came in as a maverick," O'Connor was quoted as saying, "and I will go out as a maverick." She served only one term as mayor. Peterson died of leukemia at the age of 78 in April 1994, less than two years after she left office. The former mayor, who is seen around town driving a silver Mercedes Benz, now manages much of her late husband's real estate empire, including the properties in Mendocino. On occasion, she has returned to the San Diego political fray, most notably to oppose the Chargers' ticket-guarantee and to speak out against Sempra Energy. She is said to remain friendly with Joan Kroc and Helen and David Copley, political allies and confidants of years past.
As the last decade of the century dawned, three men emerged to inherit San Diego's wealthy-spouse legacy. Alan Bersin was a corporate lawyer in Los Angeles when he married Lisa Foster in 1991. He had met her while working pro bono at a homeless legal clinic. It was her first marriage, his second. Foster was the daughter of Stanley E. Foster, who himself had married into San Diego's wealthy Ratner family almost 50 years earlier.
San Diego's legendary Ratner dynasty had begun in 1921 when Isaac Ratner arrived in town from New York and established United Cap Works on the east side of downtown. From the Depression through World War II, the factory made Navy uniforms and caps. After the war, Isaac's sons Abe and Nathaniel, along with Abe's son-in-law Stan Foster, switched to making menswear and casual clothing, eventually becoming one of the county's biggest employers.
A flood of cheap imports eventually doomed their clothing factory, but the Ratners, led by Foster, sold off that end of the business and switched to licensing their brand name, Hang Ten. Foster also became one of the county's biggest developers of so-called "maquiladora" sites in the South Bay and along Otay Mesa. He snapped up large tracts of cheap agricultural land near the border and developed them into trucking depots and warehouses supporting the burgeoning "twin plant" movement in Tijuana, where low-wage workers toiled making goods for low-duty import into the U.S. By 1991, when he was 64, Foster boasted to a magazine writer that he owned 17 industrial projects with more than two million square feet.
With Silberman's imprisonment and the death of his one-time partner, liberal Republican Robert Peterson, Foster had become one of the few remaining pillars of the city's left-of-center establishment. He backed stiff handgun controls and gave generously to Planned Parenthood and the Democratic party. Bersin had graduated from Yale Law School in 1974, one class behind Bill Clinton, and, like Clinton, had attended Oxford's Balliol College on a Rhodes scholarship. He spoke of his personal relationship with the Arkansas governor and told the Union-Tribune that Hillary Clinton had introduced him to his first wife.
Newly married Bersin and Lisa Foster arrived in San Diego in the spring of 1992, in time for presidential primary season. He took a job as "visiting professor" at the University of San Diego's law school and became a key operative of San Diegans for Clinton. With Clinton's election, Bersin, who had been in town for less than a year, was named United States Attorney. Attorney General Janet Reno designated him U.S. "border czar," a position he used to advocate tough restrictions on immigrants while championing Otay Mesa development and the maquiladora movement.
As it happened, Bersin, Foster, and their wives had a personal interest along the border. County records showed that in January 1992 they had formed a general partnership called Otay Terminal, which snapped up four industrial parcels worth more than $12 million. One of the sites, subsequently leased to a freight-forwarding service, was located less than a quarter-mile from the frontier.
"It's a partnership in which my wife and I have an interest," Bersin explained in a 1998 interview. "I don't know when we made it, but it's something my father-in-law organized. It's a truck -- Consolidated Freight -- transfer point." He pointed out that the Otay Mesa property was purchased in 1992, "before I was U.S. Attorney." Bersin defended himself against allegations that the border-area property holdings of he and his family represented at least an appearance of conflict of interest by saying, "No, because first of all, it's fully disclosed, and it had no bearing on,you know, the requirement is to disclose it. Frankly, none of the decisions I made as a prosecutor were affected by that." He added, "the notion that my role was driven by a desire to feather my own nest, I think, is a little bit far-fetched."
Still, there were skeptics who pointed to Bersin's role in the development of the so-called International Gateway of the Americas project, a shopping and office complex next to the San Ysidro border crossing. "When the proposed International Gateway of the Americas Project was going nowhere," said a San Diego Union-Tribune editorial praising him in March 1998, "it was Bersin who stepped in and cut through the red tape to get the border development project on track." In a later interview, Bersin downplayed his role, saying he was just trying to get better circulation through the notoriously congested border.
In March 1998, the San Diego Unified School District board voted to name Bersin superintendent of schools. Backed by his father-in-law Foster, the Union-Tribune, and other members of the city's old guard, he launched a controversial overhaul of the district.
Last year, when Frances O'Neill Zimmerman -- an opponent of Bersin's restructuring moves, who was the lone hold-out against hiring him -- was up for re-election, Foster and his business and real estate allies spent almost $1 million in a losing bid to unseat her.
Another high-ranking member of San Diego's educational establishment to come to power here after meeting a wealthy wife-to-be is UCSD chancellor Robert Carr Dynes. A physicist who grew up poor in a small Canadian city, Dynes was a researcher at AT&T Bell Labs in New Jersey from 1968 until late 1990, when he became a UCSD professor. His wife-to-be, Frances Hellman, had worked with Dynes at Bell Labs from 1985 to 1987, when she moved to UCSD, also to become a physics professor.
Dynes was named UCSD chancellor in April 1996. Hellman was seated at the chancellor's inaugural dinner table. In May 1998, the couple was wed in San Francisco, where the marriage on Stinson Beach in Marin County was big news. The father of the bride was Warren Hellman, a multi-millionaire investment banker and venture capitalist with close connections to the University of California. Hellman's company, Hellman and Friedman, claims to have raised more than $4.5 billion in investment capital from investors, including the California Public Employees Retirement System, known as CALPERS. A well-known Bay Area philanthropist and political power broker, Hellman is a close ally of San Francisco mayor Willie Brown. Business Week magazine recently referred to the financier as the Warren Buffett of the West Coast.
News of Dynes's wealthy father-in-law did not make it into the Union-Tribune, however. Nor did word of Dynes's bitter split-up from his first wife Christel, still living in New Jersey. Dynes had sued for divorce in July 1996, shortly after he became chancellor. Christel had responded by claiming that Dynes had "deserted" her "on or about January 1, 1991, ever since which time and for more than 12 months last past, [Dynes] has willfully and continuously deserted [Christel Dynes]."
A final divorce decree was issued in January 1998 after a caustic series of court filings. Dynes agreed to give his ex-wife their house in New Jersey, pay her $6000 a month alimony -- about a third of his UCSD salary -- and split all patent royalties with her 50-50.
As chancellor, Dynes had become a friend of Padres owner and venture capitalist John Moores. Named in 1997 by Mayor Susan Golding to a committee exploring whether taxpayers should subsidize a new ballpark, Dynes wholeheartedly endorsed the idea. He and Moores also joined the board of Leap Wireless, a corporate spin-off of Qualcomm, the cell-phone pioneer closely tied to the university. Moores had kind words for his friend. "I would not expect a physicist to have the interpersonal skills and the energy level this guy does," he told the Union-Tribune in November 1998.
As it turned out, Dynes and Moores had something else in common. In October 1999, Moores and Warren Hellman paid an undisclosed sum to take over Blackbaud, Inc., a South Carolina accounting and business-management software company. As part of the deal, Hellman's son, Mick, became Blackbaud's chairman of the board. In a February 2000 interview, Dynes said he had no knowledge of his in-laws' arrangement, and it would not have mattered if he had. (Moores, it also happens, is a member of the University of California board of regents.)
In January 2000, a reporter's inquiries caused Dynes to amend his financial disclosure statement to disclose his wife's assets, which he had not previously reported, as required by state law. It revealed 16 separate interests, each valued at more than $100,000, the maximum reporting category, including holdings in Bank of America, First Capital Corp, and Avon Products, in addition to the Hellman & Friedman Management Fund.
San Diego's latest wealthy wifeambitious husband relationship came to light after last November's election, when attorney Scott Peters beat Linda Davis for the city's District 1 city-council seat. Peters, a self-styled "environmental attorney" and former deputy county counsel, loaned his campaign more than $200,000. The job pays just $60,715. In an interview published in early November, he told the Union-Tribune that he had to put his own money into the campaign because Davis, his opponent, had been endorsed by the building industry. "That's generally where money comes from in San Diego politics, so we've had to make up for that by kicking in our own funds."
Peters, 41, is married to Lynn Gorguze, who, along with her father, Vince, the former president and chief operating officer of Emerson Electric Company, operate a privately owned conglomerate called Cameron Holdings. It is named for Cameron Indoor Stadium at Duke University, the alma mater of both Lynn Gorguze and Peters.
In February 2000, the St. Louis Business Journal reported that Cameron had gross revenues of $350 million. According to that account, Vince Gorguze, originally of St. Louis, began buying small- and middle-sized industrial businesses in 1978 by purchasing Sinclair & Rush, a plastic-molding venture in St. Louis.
His daughter was a senior partner in a Minneapolis investment firm, First Bank Systems, in 1988 when she first joined her father to help raise capital for his purchase of a million-dollar stake in San Diego's Aldila, Inc., a golf-club maker. By November 1990, according to a report in the San Diego Business Journal, Gorguze, then vice president of corporate development for Aldila, was working on a 30,000-square-foot Tijuana maquiladora for the company.
Today, Cameron's biggest single holding is reported to be PlayPower Inc., the largest manufacturer of commercial playground equipment in the country. The firm grossed $143.8 million in 2000, $27 million more than the year before, the St. Louis Business Journal reported this March. "Through its family of companies," the company website says, "PlayPower can satisfy your entire commercial playground, floating dock and boat or personal water craft (PWC) lift requirements. Our product offering includes traditional play systems (both wood and steel), soft contained play systems, water slide, pool slides, free standing slides and swings, benches, tables, floating docks, boat lifts, PWC lifts...the list goes on and on." The company also owns SpectraTurf of Corona, maker of rubberized surfacing for playgrounds and businesses.
Owning a conglomerate has clearly been lucrative for Lynn and Vince Gorguze. But it has presented a raft of complex legal questions for her husband Scott Peters. Because the city is a likely future customer of PlayPower and its subsidiaries, including Miracle Recreation, Peters recently asked the city attorney's office for an official opinion regarding possible conflicts. After researching the issue, the attorneys concluded that Peters would have to be especially vigilant.
"The City has used Miracle Recreation equipment in some of its facilities, and has acquired products from the company both directly, in the case of replacement parts, and indirectly, through a general contractor, in the case of construction and renovation projects," the attorney wrote. "Miracle Recreation does not install playground equipment, and does not have a general contractor's license, therefore, it does not directly bid on City playground construction renovation projects, and does not have any contractual relationship with the City when it provides materials for such projects.
"The February 20, 2001, Council Docket includes an item seeking to add four Park and Recreation Department projects in Council District 6 to the Fiscal Year 2001 Capital Improvement Program budget. Of the four projects, two are 'tot lot' renovations. Additionally, the City Council docket of February 26, 2001, includes a similar item involving five park projects in Council Districts 2, 6, 7, and 8. Two of the five projects are tot lot renovation projects. The two Council items are for the purpose of approving funding for the projects only, neither item involves the award of any contracts.
"Because these Council decisions to fund park projects are preliminary funding items, with no known connection at this time to Miracle Recreation, you do not have a conflict of interest that would disqualify you from participating in these decisions under the Act or Section 1090.
"Future Council actions related to tot lot renovations may involve different facts, and should be analyzed on a case by case basis. Please feel free to call me if you have any further questions about this matter."
The opinion also pointed out that the city council has adopted a broad conflict-of-interest policy, not enforceable by law, more stringent than the state's conflict code: "No elected official...of the City of San Diego shall engage in any business or transaction or shall have a financial or other personal interest, direct or indirect, which is incompatible with the proper discharge of his official duties or would tend to impair his independence or judgment or action in the performance of such duties."
"Under this policy," the attorney explained, "it is each official's responsibility to determine whether he or she has any interest, financial or not, which is 'incompatible with the proper discharge of official duties'
"If an official determines that he or she cannot be objective about a decision because of a financial or personal interest, the official may choose to abstain from participating in discussions or discussions and votes on a particular project.
"You may wish to consider this policy in determining whether or not to participate in these Council decisions on funding projects, which could potentially use Miracle Recreation equipment, even though a determination has been made that there is no legal conflict of interest. It should be emphasized, however, that this is a policy, not a law, and does not have the force and effect of law."
Peters has vowed to avoid any conflicts of interest scrupulously. As a frequently mentioned candidate for Democrat Howard Wayne's seat in the state assembly, his opponents will be watching every move. The legacy left by San Diego's other weddings of wealth and power suggests that the path to success for the ambitious young politician married to money is fraught with peril.
[Via San Diego Reader]
The women married their money in the '70s and '80s. In the '90s, it was the men's turn. Three of the city's most prominent civic players, UCSD chancellor Robert Dynes, San Diego Unified School District superintendent Alan Bersin, and San Diego city councilman Scott Peters, are married to rich wives. Each spouse is probably worth millions of dollars, according to the personal financial disclosure statements the men are required to file.
But having money has proved a mixed blessing for these San Diegans. Along their path to wealth and influence, two of the women, Copley and Golding, and one of the men, Dynes, reinvented part of themselves, sanitizing their biographies by erasing marriages, divorces, and the recriminations that followed. And the surnames of the children of Copley and Golding were later changed. For Bersin, Dynes, and Peters, spousal wealth has raised questions about conflicts between their official roles and the financial holdings of their wives.
Fifty years ago this spring, Copley was a secretary in Cedar Rapids, Iowa, when, according to court documents, she became pregnant after a tryst with a fellow worker at a dairy company. At 29, she married the child's father, John Hunt, in one county, divorced him two weeks later in another, and, accompanied by her mother, headed west to San Diego, where she gave birth to a son on January 31, 1952. Years later, asked about the father of her child, Copley would say, "I never talk about him. I don't know where he is, and I don't want to know."
Not long after arriving in San Diego, Helen Hunt got a job at the San Diego Union and its sister paper, the Tribune, where she met publisher James S. Copley, who had inherited his newspaper empire from his adoptive father, Colonel Ira Copley, a one-time Illinois congressman. Smitten by the svelte brunette, Jim Copley made Helen his personal secretary. In August 1965, he divorced his wife and the mother of his two adopted children and married Helen. At the time of their marriage, Jim adopted Helen's 13-year-old son David Hunt, whose birth certificate was altered to eliminate any reference to the boy's birth father.
Seven years later on his deathbed, the publisher drew up trust agreements leaving his wife complete control of his newspaper empire. After Jim died of lung cancer in 1973 at the age of 57, Helen, then 48, consolidated her hold on the company, allegedly locking out Jim's two children by his first marriage, and triggering a lawsuit charging that Helen had looted the children's trusts for the benefit of herself and her son David. After years of litigation, Helen agreed to settle the case in 1982 for a sizable, undisclosed sum.
By the time she named David publisher of the Union-Tribune this April, Helen Copley had spent almost 28 years at the helm of the newspaper company. She had provided political and editorial support to Pete Wilson as mayor, then United States senator, then governor, only to see him blamed for the decimation of the state's Republican Party because of his backing of the anti-immigrant Proposition 187.
Copley used her newspapers to stimulate the city's explosive growth, pushing for North City residential sprawl, convincing voters to approve encroachment of the Naval Hospital expansion into Balboa Park's Florida Canyon, advocating giving away city-owned land for industrial projects, and promoting the Chargers' ticket-guarantee. Few candidates for local office dared challenge the Union-Tribune's dominance, and when they did, they found themselves dispatched to political oblivion.
And yet, though her editorial defeats were few, Copley as publisher never seemed to find her personal bearings. She rarely spoke in public. Her friendship with financier Richard Silberman in the late 1970s became an embarrassment when a reporter at the Evening Tribune accused the paper of spiking a story about Silberman's conflicts of interest stemming from his ownership of the Bazaar del Mundo. When Silberman began dating a young Union reporter, his relationship with Copley cooled. She retreated to her mansion, known as Fox Hill, overlooking the fairways of the La Jolla Country Club, and was seldom again seen by anyone other than close friends.
A few years after his split with Copley, Silberman married Susan Golding on July 22, 1984. Golding arrived for the wedding at Temple Beth Israel in a red Jaguar; Silberman pulled up in a Lamborghini Spada. It was the city's money marriage of the decade. Everyone knew Silberman as the millionaire wonderboy who, along with fellow San Diego State grad Bob Peterson, made a fortune when they sold the Jack In The Box hamburger chain to Ralston Purina more than a decade earlier.
At the time of the wedding, Democrat Silberman -- a self-proclaimed influence-peddler and confidant of former governor Jerry Brown -- was spending hundreds of thousands of dollars to get his new wife elected to the county board of supervisors. Golding, a Republican, had arrived in San Diego in the late 1970s with her husband, attorney Stanley Prowse.
Though she was the daughter of San Diego State president Brage Golding, she and her husband had modest assets. They were soon divorced, and Golding began her political career after striking up a close friendship with political consultant George Gorton, a key advisor to thenSan Diego mayor Pete Wilson.
With Gorton's assistance, Golding won an appointment to the San Diego City Council in January 1981. Two years later, in February 1983, Golding quit her council job to accept an appointment as a functionary in the administration of Governor George Deukmejian. Her council salary had been $35,000. The new job paid $50,784. She and Silberman were soon considering marriage.
"Susan talked to me on the phone about marrying Dick shortly after she had moved to Sacramento in the spring of 1983," her ex-husband Stanley Prowse recalled in a declaration filed in a child-support case Golding brought against him. "She told me that she thought she loved him, and that they were talking about getting married, but that she was nervous about it, particularly in light of their age difference and the fact that she was building her political career as a Republican while he was a prominent Democrat. I told her that I felt her fears were justified and that she should ask him to settle a substantial sum on her when and if they were married, so that she would feel secure and not dependent on him. She told me she thought my advice was sound. I did not doubt that she had followed it when she and Dick were wed the following year."
Golding went on to win her county-board seat, easily defeating a former Silberman protégée, Democratic lawyer Lynn Schenk. For most of her two terms on the board, Golding and Silberman were inseparable, personally and politically. Wiretaps, recorded during an FBI sting that resulted in Silberman's conviction on felony money-laundering charges, showed that Silberman was frequently in contact with Golding's office about arranging government contacts for Silberman's business friends.
Golding's ex-husband Stanley Prowse complained that Silberman was being overly generous to his two children, Vanessa and Sam. "They have both been showered with material things and have had so little interest in birthday and Christmas gifts we have given them that they have often ignored our invitations to visit and claim them." He added, "As I recall, Christmas of 1986 brought a bush plane tour of Alaska, while last Christmas brought a tour of the Far East, complete with surfing in Bali and bar-hopping in Bangkok -- heady stuff for impressionable teenagers."
Prowse was angered by what he charged were Golding's attempts to change the children's surnames. "Several years after our separation, I discovered that she had enrolled them in school as 'Sam Golding' and 'Vanessa Golding' without saying a word to me on the subject. By the time I found out, it was too late to do anything about it without embroiling them in a painful dispute. The sight of 'Golding' in bold letters on the back of Sam's high school letterman's jacket is painful to me, and for years I have received little or no acknowledgement from the children on Father's Day or my birthday. They do not treat [my wife] Joy or me respectfully. Susan has done her best to wipe the slate clean." Both Sam and Vanessa later went to court to make their name-change legal and permanent.
By the time Silberman was convicted on the money-laundering charges in June 1990, his business empire had been shown to be a massive fraud, based more on local myth of his financial infallibility than his balance sheet. A year later, Golding filed for divorce, and Silberman issued a statement from federal prison saying he had lied to his wife. "Unfortunately, I was not always truthful with her regarding critical and vital aspects of my life, and I know I am responsible for the changes in our relationship."
In November 1992, Golding was elected mayor of San Diego, narrowly beating Peter Navarro, the UC Irvine economics professor who was the bête noir of San Diego's establishment. Golding did not remarry, and, to outward appearances, lived a hermetic social life until leaving the public spotlight last year.
In contrast to Copley and Golding, Maureen O'Connor and Joan Kroc seemed to find post-spousal happiness. Kroc, a buxom blonde who at age 27 had met 53-year-old McDonald's founder Ray Kroc while playing piano at a bar in St. Paul, Minnesota, in 1957. For the next six years, they carried on a secret relationship. Ray Kroc divorced his wife, but Joan refused to divorce her first husband, who had become a McDonald's franchisee, and they didn't see each other at all for another six years. Meeting up with Kroc again at a 1969 McDonald's convention in San Diego, Joan finally ditched her husband and married the feisty billionaire.
After Ray Kroc died in January 1984, leaving Joan not only his fortune, but ownership of the San Diego Padres, she styled herself as a grand philanthropist, backing every cause from nuclear disarmament and world peace to the San Diego Zoo and Midwest flood victims. She tried to donate the Padres to the City of San Diego, a plan thwarted by her fellow Major League Baseball owners, who banned public ownership of teams.
Kroc's personal life, too, was more colorful than Copley's. She commissioned a sprawling house in Fairbanks Ranch and purchased a 300-foot yacht (the Impromptu), a helicopter (the Luvduv), a private Gulfstream jet, and a fleet of gold Cadillac Sevilles to provide transportation. She stopped driving the Cadillacs in October 1997 after she rolled one of the Sevilles on Interstate 5 near Clairemont Drive, suffering what were reported to be minor facial lacerations.
Like Kroc and Golding, former mayor Maureen O'Connor has not remarried. As a physical education teacher at a Catholic school, O'Connor, then 25, met Robert O. Peterson while running for the San Diego City Council in 1971. He was 55. Peterson, founder of the Jack In The Box hamburger chain, provided financial backing to O'Connor's subsequent campaigns and married her in 1977 in a European wedding.
Peterson lavished more than $500,000 on O'Connor's first mayoral race against Roger Hedgecock in the 1983 special election to replace Pete Wilson. During his victorious campaign against her, Hedgecock allies accused O'Connor and Peterson of conflicts of interest arising from Peterson's partial ownership interest in the Grant Hotel. A year later, Hedgecock found himself embroiled in the J. David political contribution scandal, but O'Connor declined to run in the June 1984 regular election, saying neither she nor Peterson were ready for another vitriolic go-around with Hedgecock.
Then, in September 1985, with Hedgecock on trial for political corruption and a likelihood that he would be forced from office, Peterson filed for divorce against O'Connor after eight years of marriage. Union-Tribune columnist Tom Blair reported that "the settlement isn't public, but an O'Connor friend says it's sizable. O'Connor, whose maiden name was restored, according to court documents, reportedly was in New York City when the dissolution was filed." Others claimed that the rift was caused by Peterson's opposition to O'Connor's ambition to run for mayor again.
The couple eventually reconciled, and by the spring of 1986, O'Connor was campaigning to replace Hedgecock, who had departed city hall after his conviction on the corruption charges. Vowing to spend no more than $170,000 on the campaign, she won the election that June. When she filed her first financial disclosure statement as mayor, it revealed an array of holdings from Gustaf Anders restaurant -- owned jointly with Union-Tribune publisher Helen Copley, an O'Connor intimate -- to 20 pieces of property in the county, valued well in excess of $2.5 million.
The couple's assets outside San Diego were not disclosed. "We listed anything that could even remotely be construed as doing business with the city," her attorney, David Bain, told the Los Angeles Times. "But it's safe to say that Maureen and Bob have interests outside San Diego that have nothing at all to do with San Diego." Though Bain didn't mention it, it was common knowledge that Peterson owned much of the Northern California resort town of Mendocino, as well as a hotel in Orange County.
"I don't see how anything that she and her husband hold could cause a significant conflict," Bain added. "Her policy has always been not to vote on anything that even remotely could be seen as a conflict, and she'll continue to follow that guideline. But I don't think there are going to be many cases where she might disqualify herself, and if there are, they'll be minor ones."
In December 1989, downtown-hotel magnate Douglas Manchester accused O'Connor of holding up the construction of the city's bay-front convention center while failing to reveal that she and her husband had a financial interest in the 249-room Grand Hotel, across the street from Disneyland. Oscar Irwin, an attorney for the Port of San Diego, defended the mayor, saying she had disclosed the interest earlier, while serving on the Port Commission. "Why are they crying to the press...unless it has to do with Manchester's vindictiveness?" Irwin told the Los Angeles Times.
"I came in as a maverick," O'Connor was quoted as saying, "and I will go out as a maverick." She served only one term as mayor. Peterson died of leukemia at the age of 78 in April 1994, less than two years after she left office. The former mayor, who is seen around town driving a silver Mercedes Benz, now manages much of her late husband's real estate empire, including the properties in Mendocino. On occasion, she has returned to the San Diego political fray, most notably to oppose the Chargers' ticket-guarantee and to speak out against Sempra Energy. She is said to remain friendly with Joan Kroc and Helen and David Copley, political allies and confidants of years past.
As the last decade of the century dawned, three men emerged to inherit San Diego's wealthy-spouse legacy. Alan Bersin was a corporate lawyer in Los Angeles when he married Lisa Foster in 1991. He had met her while working pro bono at a homeless legal clinic. It was her first marriage, his second. Foster was the daughter of Stanley E. Foster, who himself had married into San Diego's wealthy Ratner family almost 50 years earlier.
San Diego's legendary Ratner dynasty had begun in 1921 when Isaac Ratner arrived in town from New York and established United Cap Works on the east side of downtown. From the Depression through World War II, the factory made Navy uniforms and caps. After the war, Isaac's sons Abe and Nathaniel, along with Abe's son-in-law Stan Foster, switched to making menswear and casual clothing, eventually becoming one of the county's biggest employers.
A flood of cheap imports eventually doomed their clothing factory, but the Ratners, led by Foster, sold off that end of the business and switched to licensing their brand name, Hang Ten. Foster also became one of the county's biggest developers of so-called "maquiladora" sites in the South Bay and along Otay Mesa. He snapped up large tracts of cheap agricultural land near the border and developed them into trucking depots and warehouses supporting the burgeoning "twin plant" movement in Tijuana, where low-wage workers toiled making goods for low-duty import into the U.S. By 1991, when he was 64, Foster boasted to a magazine writer that he owned 17 industrial projects with more than two million square feet.
With Silberman's imprisonment and the death of his one-time partner, liberal Republican Robert Peterson, Foster had become one of the few remaining pillars of the city's left-of-center establishment. He backed stiff handgun controls and gave generously to Planned Parenthood and the Democratic party. Bersin had graduated from Yale Law School in 1974, one class behind Bill Clinton, and, like Clinton, had attended Oxford's Balliol College on a Rhodes scholarship. He spoke of his personal relationship with the Arkansas governor and told the Union-Tribune that Hillary Clinton had introduced him to his first wife.
Newly married Bersin and Lisa Foster arrived in San Diego in the spring of 1992, in time for presidential primary season. He took a job as "visiting professor" at the University of San Diego's law school and became a key operative of San Diegans for Clinton. With Clinton's election, Bersin, who had been in town for less than a year, was named United States Attorney. Attorney General Janet Reno designated him U.S. "border czar," a position he used to advocate tough restrictions on immigrants while championing Otay Mesa development and the maquiladora movement.
As it happened, Bersin, Foster, and their wives had a personal interest along the border. County records showed that in January 1992 they had formed a general partnership called Otay Terminal, which snapped up four industrial parcels worth more than $12 million. One of the sites, subsequently leased to a freight-forwarding service, was located less than a quarter-mile from the frontier.
"It's a partnership in which my wife and I have an interest," Bersin explained in a 1998 interview. "I don't know when we made it, but it's something my father-in-law organized. It's a truck -- Consolidated Freight -- transfer point." He pointed out that the Otay Mesa property was purchased in 1992, "before I was U.S. Attorney." Bersin defended himself against allegations that the border-area property holdings of he and his family represented at least an appearance of conflict of interest by saying, "No, because first of all, it's fully disclosed, and it had no bearing on,you know, the requirement is to disclose it. Frankly, none of the decisions I made as a prosecutor were affected by that." He added, "the notion that my role was driven by a desire to feather my own nest, I think, is a little bit far-fetched."
Still, there were skeptics who pointed to Bersin's role in the development of the so-called International Gateway of the Americas project, a shopping and office complex next to the San Ysidro border crossing. "When the proposed International Gateway of the Americas Project was going nowhere," said a San Diego Union-Tribune editorial praising him in March 1998, "it was Bersin who stepped in and cut through the red tape to get the border development project on track." In a later interview, Bersin downplayed his role, saying he was just trying to get better circulation through the notoriously congested border.
In March 1998, the San Diego Unified School District board voted to name Bersin superintendent of schools. Backed by his father-in-law Foster, the Union-Tribune, and other members of the city's old guard, he launched a controversial overhaul of the district.
Last year, when Frances O'Neill Zimmerman -- an opponent of Bersin's restructuring moves, who was the lone hold-out against hiring him -- was up for re-election, Foster and his business and real estate allies spent almost $1 million in a losing bid to unseat her.
Another high-ranking member of San Diego's educational establishment to come to power here after meeting a wealthy wife-to-be is UCSD chancellor Robert Carr Dynes. A physicist who grew up poor in a small Canadian city, Dynes was a researcher at AT&T Bell Labs in New Jersey from 1968 until late 1990, when he became a UCSD professor. His wife-to-be, Frances Hellman, had worked with Dynes at Bell Labs from 1985 to 1987, when she moved to UCSD, also to become a physics professor.
Dynes was named UCSD chancellor in April 1996. Hellman was seated at the chancellor's inaugural dinner table. In May 1998, the couple was wed in San Francisco, where the marriage on Stinson Beach in Marin County was big news. The father of the bride was Warren Hellman, a multi-millionaire investment banker and venture capitalist with close connections to the University of California. Hellman's company, Hellman and Friedman, claims to have raised more than $4.5 billion in investment capital from investors, including the California Public Employees Retirement System, known as CALPERS. A well-known Bay Area philanthropist and political power broker, Hellman is a close ally of San Francisco mayor Willie Brown. Business Week magazine recently referred to the financier as the Warren Buffett of the West Coast.
News of Dynes's wealthy father-in-law did not make it into the Union-Tribune, however. Nor did word of Dynes's bitter split-up from his first wife Christel, still living in New Jersey. Dynes had sued for divorce in July 1996, shortly after he became chancellor. Christel had responded by claiming that Dynes had "deserted" her "on or about January 1, 1991, ever since which time and for more than 12 months last past, [Dynes] has willfully and continuously deserted [Christel Dynes]."
A final divorce decree was issued in January 1998 after a caustic series of court filings. Dynes agreed to give his ex-wife their house in New Jersey, pay her $6000 a month alimony -- about a third of his UCSD salary -- and split all patent royalties with her 50-50.
As chancellor, Dynes had become a friend of Padres owner and venture capitalist John Moores. Named in 1997 by Mayor Susan Golding to a committee exploring whether taxpayers should subsidize a new ballpark, Dynes wholeheartedly endorsed the idea. He and Moores also joined the board of Leap Wireless, a corporate spin-off of Qualcomm, the cell-phone pioneer closely tied to the university. Moores had kind words for his friend. "I would not expect a physicist to have the interpersonal skills and the energy level this guy does," he told the Union-Tribune in November 1998.
As it turned out, Dynes and Moores had something else in common. In October 1999, Moores and Warren Hellman paid an undisclosed sum to take over Blackbaud, Inc., a South Carolina accounting and business-management software company. As part of the deal, Hellman's son, Mick, became Blackbaud's chairman of the board. In a February 2000 interview, Dynes said he had no knowledge of his in-laws' arrangement, and it would not have mattered if he had. (Moores, it also happens, is a member of the University of California board of regents.)
In January 2000, a reporter's inquiries caused Dynes to amend his financial disclosure statement to disclose his wife's assets, which he had not previously reported, as required by state law. It revealed 16 separate interests, each valued at more than $100,000, the maximum reporting category, including holdings in Bank of America, First Capital Corp, and Avon Products, in addition to the Hellman & Friedman Management Fund.
San Diego's latest wealthy wifeambitious husband relationship came to light after last November's election, when attorney Scott Peters beat Linda Davis for the city's District 1 city-council seat. Peters, a self-styled "environmental attorney" and former deputy county counsel, loaned his campaign more than $200,000. The job pays just $60,715. In an interview published in early November, he told the Union-Tribune that he had to put his own money into the campaign because Davis, his opponent, had been endorsed by the building industry. "That's generally where money comes from in San Diego politics, so we've had to make up for that by kicking in our own funds."
Peters, 41, is married to Lynn Gorguze, who, along with her father, Vince, the former president and chief operating officer of Emerson Electric Company, operate a privately owned conglomerate called Cameron Holdings. It is named for Cameron Indoor Stadium at Duke University, the alma mater of both Lynn Gorguze and Peters.
In February 2000, the St. Louis Business Journal reported that Cameron had gross revenues of $350 million. According to that account, Vince Gorguze, originally of St. Louis, began buying small- and middle-sized industrial businesses in 1978 by purchasing Sinclair & Rush, a plastic-molding venture in St. Louis.
His daughter was a senior partner in a Minneapolis investment firm, First Bank Systems, in 1988 when she first joined her father to help raise capital for his purchase of a million-dollar stake in San Diego's Aldila, Inc., a golf-club maker. By November 1990, according to a report in the San Diego Business Journal, Gorguze, then vice president of corporate development for Aldila, was working on a 30,000-square-foot Tijuana maquiladora for the company.
Today, Cameron's biggest single holding is reported to be PlayPower Inc., the largest manufacturer of commercial playground equipment in the country. The firm grossed $143.8 million in 2000, $27 million more than the year before, the St. Louis Business Journal reported this March. "Through its family of companies," the company website says, "PlayPower can satisfy your entire commercial playground, floating dock and boat or personal water craft (PWC) lift requirements. Our product offering includes traditional play systems (both wood and steel), soft contained play systems, water slide, pool slides, free standing slides and swings, benches, tables, floating docks, boat lifts, PWC lifts...the list goes on and on." The company also owns SpectraTurf of Corona, maker of rubberized surfacing for playgrounds and businesses.
Owning a conglomerate has clearly been lucrative for Lynn and Vince Gorguze. But it has presented a raft of complex legal questions for her husband Scott Peters. Because the city is a likely future customer of PlayPower and its subsidiaries, including Miracle Recreation, Peters recently asked the city attorney's office for an official opinion regarding possible conflicts. After researching the issue, the attorneys concluded that Peters would have to be especially vigilant.
"The City has used Miracle Recreation equipment in some of its facilities, and has acquired products from the company both directly, in the case of replacement parts, and indirectly, through a general contractor, in the case of construction and renovation projects," the attorney wrote. "Miracle Recreation does not install playground equipment, and does not have a general contractor's license, therefore, it does not directly bid on City playground construction renovation projects, and does not have any contractual relationship with the City when it provides materials for such projects.
"The February 20, 2001, Council Docket includes an item seeking to add four Park and Recreation Department projects in Council District 6 to the Fiscal Year 2001 Capital Improvement Program budget. Of the four projects, two are 'tot lot' renovations. Additionally, the City Council docket of February 26, 2001, includes a similar item involving five park projects in Council Districts 2, 6, 7, and 8. Two of the five projects are tot lot renovation projects. The two Council items are for the purpose of approving funding for the projects only, neither item involves the award of any contracts.
"Because these Council decisions to fund park projects are preliminary funding items, with no known connection at this time to Miracle Recreation, you do not have a conflict of interest that would disqualify you from participating in these decisions under the Act or Section 1090.
"Future Council actions related to tot lot renovations may involve different facts, and should be analyzed on a case by case basis. Please feel free to call me if you have any further questions about this matter."
The opinion also pointed out that the city council has adopted a broad conflict-of-interest policy, not enforceable by law, more stringent than the state's conflict code: "No elected official...of the City of San Diego shall engage in any business or transaction or shall have a financial or other personal interest, direct or indirect, which is incompatible with the proper discharge of his official duties or would tend to impair his independence or judgment or action in the performance of such duties."
"Under this policy," the attorney explained, "it is each official's responsibility to determine whether he or she has any interest, financial or not, which is 'incompatible with the proper discharge of official duties'
"If an official determines that he or she cannot be objective about a decision because of a financial or personal interest, the official may choose to abstain from participating in discussions or discussions and votes on a particular project.
"You may wish to consider this policy in determining whether or not to participate in these Council decisions on funding projects, which could potentially use Miracle Recreation equipment, even though a determination has been made that there is no legal conflict of interest. It should be emphasized, however, that this is a policy, not a law, and does not have the force and effect of law."
Peters has vowed to avoid any conflicts of interest scrupulously. As a frequently mentioned candidate for Democrat Howard Wayne's seat in the state assembly, his opponents will be watching every move. The legacy left by San Diego's other weddings of wealth and power suggests that the path to success for the ambitious young politician married to money is fraught with peril.
[Via San Diego Reader]
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