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And the Republican Party wonders why it has a tough time attracting African-American businesspeople to the party of Lincoln & Lott.
Yochi J. Dreazen and Jeff D. Opdyke report in the Wall Street Journal
When Katrina's flood waters began to subside, Socrates Garrett hoped his family-owned construction company would win a government contract to help clear the debris.Instead, Mr. Garrett says, white-owned competitors in his hometown of Jackson, Miss., won a string of contracts in the storm-ravaged areas of Mississippi and Louisiana. He says the Federal Emergency Management Agency, which controls the purse strings for the tens of billions of dollars in federal money earmarked for the effort, told him it had a standing contract with a Florida company. He has registered his firm with the companies awarded major federal contracts but has yet to win any Katrina-related business of his own. Meanwhile, the dozens of vehicles he owns sit idle despite a region-wide shortage of such heavy equipment.
"We're right back to the old network, and we can't get in," he says. "They're just giving the contracts out without a competition. But they won't give a contract to a minority firm. It's like they're turning back the clock.
Mr. Garrett's complaints are being echoed by a growing number of minority business owners across the Gulf Coast who say they're being shut out of the first wave of Katrina-related contracts. They blame longstanding ties between federal and state officials and white-owned companies, as well as Bush administration moves that eased affirmative-action rules for new contracts as long as a state of emergency exists. The critics say they are particularly concerned by provisions of the federal Katrina relief funds that temporarily waive a requirement that federal contractors provide written affirmative action plans and that double the size of the contracts that can be awarded without giving special opportunities to the economically disadvantaged.
There's more to the depressing and predictable story.
Posted by dan at 05:02 PM
It's been a good few months since we've had a good old-fashioned cramdown. Has there been something of a lull of big employers walking away from commitments freely made to employees? Perhaps the benefits consultants were all on vacation in August. Now we're about to get a bunch. After the recent bankruptcy filings of Delta Airlines and Northwest Airlines, we're sure to have some cram-downs.
And now a comparatively healthy service company is getting in on the act. Sears has been rejuvenated under the leadership of brilliant hedge fund manager Eddie Lampert, who merged K-Mart and Sears together to form one big blechy retailer. But why look for synergy when you can simply cut costs by cramming down retirees?
Amy Merrick reports in the Wall Street Journal:
Sears Holdings Corp. has begun to notify its retirees that it will make further cuts to their medical benefits, citing rising health-care costs and competition from retailers that provide little or no medical coverage to retired employees.The moves are the latest in a series of cuts in retiree benefits in recent years. In the past, such cuts helped Sears generate income, thanks to accounting practices that transform reductions in retiree benefits to accounting gains.
As a result, Sears's postretirement benefits, which include both medical and life-insurance benefits, added $50 million to the company's operating income last year, according to its annual report filed with the Securities and Exchange Commission. Its total operating income for the year was $487 million. . . .
The most noticeable change to benefits will be for retirees younger than 65 years old. They will still have access to medical coverage, but Sears will no longer pay anything toward the coverage. About 15% of the 45,000 Sears retirees enrolled in a company medical plan fall into this group, the retailer said. More than half of those employees will become eligible for subsidized coverage once they turn 65, Sears said.
Posted by dan at 04:59 PM
Martha Stewart may be much more telegenic than Donald Trump. But she apparently can't open a series like the Donald.
Brooks Barnes reports in the Wall Street Journal
Despite a heavy promotional push by General Electric Co.'s NBC, "The Apprentice: Martha Stewart" attracted just 3.2 million viewers aged 18 to 49, the group advertisers pay a premium to reach. That's 24% lower than the audience for the program NBC aired in the time slot last fall -- the failed series "Hawaii" -- and 62% less than the first airing last season of the original "Apprentice" starring Donald Trump, according to figures from Nielsen Media Research.
Jeff Zucker, call your agent, or somebody else's.
On the other hand, her daytime tv show is doing pretty good.
Ratings for the daytime series have so far been solid. More than two million people have tuned in per show for its first eight days, making it the most successful syndicated launch since "Dr. Phil" in 2000.
Posted by dan at 04:52 PM
After a week away, I was sifting through old copies of the Wall Street Journal, and came across the funniest line about fiscal policy yet. Courtesy of the well-known comic Tom DeLay.
"[DeLay] suggested that the government has little fat. "After 11 years of Republican majority, we've pared it down pretty good."
Guess he never visits the website of the Bureau of Public Debt.
Total debt today: $7.92 trillion.
Total debt on Sept. 30, 1994: $4.69 trillion.
Posted by dan at 04:43 PM
The first gloomy Holiday shopping season forecast has arrived, from the National Retail Federation. Will this be the year the exhausted American consumer finally keels over?
Posted by dan at 09:25 AM
Who is the biggest nincompoop writing about business and economics on National Review? Most informed folks say it’s Donald Luskin. You know, the Krugman-stalker who loudly called a top on oil in August, and in April, and in October 2004
Generally, I agree with Brad Delong. But Kathryn Jean Lopez makes her bid for greatness today. In a piece about Wal-Mart, she makes it clear that she thinks that everybody working at Wal-Mart has health insurance:
“But, the employer of a million people has been known to provide health insurance to over 90 percent of its workers (the others covered by another family member).”
Has been known by whom? Not by Judge Richard Posner, who wrote on the blog he shares with Nobel Prize winning economist Gary Becker:
Wal-Mart provides health insurance to fewer than half its employees (though, as some critics neglect to note, many of the others are covered by spouses' health insurance or by Medicare), and it charges those employees whom it does cover a significant fraction of the total insurance premiums.
Not even Wal-Mart makes such a claim. Lopez could have simply surfed over to Wal-Mart’s website and learned that the company has 1.2 million associates and that last year it insured 568,000 associates, or about 47.3 percent. That’s substantially less than 90. And if all the others that Wal-Mart wasn’t covering were covered by another family member, as Lopez blithely assumes, without citation or evidence, why would Wal-Mart employees and their dependents be enrolled in government-run insurance programs like Medicaid.
You don’t need a full-time fact-checker to catch and correct an embarrassing error like this. You just need a sentient human being.
So, do the people who “edit” the content at National Review really also believe that all Wal-Mart employees have health insurance? Will they run a correction? Or do they just lack the intelligence, professional pride, or energy to bother to check.
Posted by dan at 04:53 PM
To my dozens (dozen?) of regular readers, I apologize for the recent low volume of posting. I've been in Germany on an eye-opening press trip, on which more later.
In my absence, the fiscal follies have continued. President Bush has ruled out tax cuts to pay for the big cost of recovering from Katrina.
And his Republican allies in Congress have generally agreed with him. The governing principle is that raising taxes on the American people is unjust and economically damaging, no matter how big the deficit or how grave the challenge the nation faces. And you have to admire the GOP crew for sticking to their "no new taxes ever" (or at least until President Bush is out office) message.
Except that they’re not. In fact, more than 16 million Americans—hard-working Americans,I might add—are set to face a tax increase in 2006 thanks to the policies of the Washington crowd. Tom Herman notes in today’s Wall Street Journal:
“The AMT [Alternative Minimum Tax], originally designed to prevent a small number of high-income individuals from avoiding paying taxes, has hit a growing number of middle-income earner because the levy isn’t indexed for inflation. If Congress does nothing, the AMT will hit more than 20 million Americans in 2006, up from about 3.8 million this year.”By definition, having to pay the AMT means you’ve just been hit with a tax increase. And next year, 16.2 million more Americans will pay it. We don’t have to wait until 2010 for the temporary Bush tax cuts to be phased out. For a growing number of taxpayers, the cuts are already disappearing.
Posted by dan at 01:48 PM