Recently in Business and Economics Category

By way of Glenn Reynolds comes this article from Investor's Business Daily showing how the Obama campaign is based upon 5 phony economic claims, all easily debunked.

Obama's claims:

The Bush tax cuts and deregulation caused the recession.

I stopped a second Great Depression.

My policies are working.

A slow recover was inevitable.

Nobody could have done any better.

Let's take a look at two of my favorites, being the first and last claims on the list. First, the first claim:

The Bush tax cuts and deregulation caused the recession.

It's a standard Obama talking point. But it's not true. Bush's tax cuts did not cause the last recession.

In fact, once they were fully in effect in 2003, they sparked stronger growth -- generating more than 8 million new jobs over the next four years, and GDP growth averaging close to 3%.

Those tax cuts didn't explode the deficit, either, as Obama frequently claims. Deficits steadily declined after 2003, until the recession hit.

Most of the deregulation that Obama blames on Bush took place during Clinton administration. If anything, regulation grew during Bush's time in office. Obama needs to retire this phony claim as it's too easy to prove it's false.

In regards to the last claim - Nobody could have done any better - I have only this to say:

I could have done better than you! I have a modicum of understand about how an economy works, how improper and overreaching regulations can hurt businesses large and small, and that punishing success and rewarding sloth and failure get you less of the first and more of the second, neither of which helps the economy. My wife and I have actually run a business, dealt with the headaches such a thing entails, worried about paying the bills and taxes, meeting a payroll, and dealing with an ever increasing litany of more intrusive (and expensive) regulations that affected our business. While you, on the other hand, haven't run so much as a lemonade stand. (But you did manage to piss away $110 million in Annenberg Foundation funds with nothing to show for it.)

And if you need even more ammunition to debunk the claims made by The One, there's this graphic that does a pretty good job of explaining why none of his claims are anywhere near the truth.


'Nuff said.

When I first read this I thought it might be a parody by way of The Onion. But it turns out it was anything but.

The latest bit of wackiness from the watermelon environmentalists in New York are their claims that fracking - the hydraulic fracturing of oil or natural gas bearing rock - will cause an increase in syphilis. And that's not all. Their reasoning? Try this:

They argue that a drilling boom would draw an influx of male workers from other states who would engage in activities of a kind that would spread sexually transmitted diseases.

They also contend that a boom would trigger a housing crunch, adding to homelessness and the health ailments that go along with it.

And that increased truck traffic would not only lead to more road fatalities, but would also -- again, no kidding -- discourage people from getting the outdoor exercise they need to stay fit.

Yeah. Right.

It sounds like these folks are related to the West Coast wackos who have been claiming the decrease in population (and businesses) in California is a good thing because "it gives the municipalities and the state the opportunity to plan and build for future population and business growth." They don't seem to understand that there will be no money available to do those things because most of the people who would supply that money through the taxes they pay no longer work or live there. (And we musn't forget the multi-billions of taxpayer dollars that will be spent building a high speed rail system to nowhere, again with money they won't have, for people who don't want it or need it.)

All of this sounds like it came right out of Atlas Shrugged. (One wag commenting on a WSJ opinion piece about California's accelerating economic decline suggested banning businesses from moving out of state, reminiscent of Directive 10-289. At first I thought it was sarcasm, but it wasn't. How sad.)

So, economic growth and the jobs that go with it are a Bad Thing™? I'm not sure how they came to this conclusion, but obviously some deluded soul has sold them on the idea that anything that helps the economy must automatically be bad because....because...umm...it's just bad!!

(H/T Synthstuff)

Bill Whittle has another great video, this time dealing with "Going out of business". In this case he's not talking about a company or corporation, but...well, I'll let him tell it.


(H/T Instapundit)

Glenn Reynolds has a lengthy post about "brick-and-mortar" retailers versus online shopping. There are quite a few reader e-mail comments and not more than a few links.

One of Glenn's biggest suggestions for the brick-and-mortar shops: "I do feel, though, that brick-and-mortar stores ought to be trying harder to make the shopping experience pleasant. Instead, I often get the feeling that the staff views me as a disturbance to their texting-their-friends time."

I've gotten that same feeling, too.

Around here in the Lakes Region of New Hampshire there are lots of shops that cater more to the seasonal visitors and many of the items they sell probably wouldn't do so well online. Sometimes you've got to be visceral about what you're buying. I find they also tend to bend over backwards to serve their customers.

Unfortunately that effort does not extend to many of the chain stores out here. On more than one occasion I've had problems finding anyone in some of these stores with at least a modicum of knowledge about what they sold. Probably the worst examples can be found at some of the big box stores and electronics retailers.

On more than one occasion I have needed help at one of the big box home improvement stores. I won't name them, but I will tell you they like using signs in Spanish...even in areas where French is the second most spoken language behind English. Trying to find someone who knows anything about what I'm looking for, particularly where I can find it, can be frustrating. That's why I rarely go there and frequent one of the locally owned hardware stores instead.

The same is true of both one now defunct electronics chain, Circuit City, and another chain which shall remain nameless. After Circuit City laid off their more experienced sales staff (supposedly as a cost cutting measure), the remaining staff was too inexperienced and not very knowledgeable about the equipment and accessories they sold. It was no wonder they ended up going under. The other chain is still in business, but they're struggling. Only their online sales operation seems to be doing moderately well. Again, it all comes down to their staff and how they treat their customers.

Is it any wonder online retailers are doing so much better than brick-and-mortar stores?

I just caught a report by ABC's Good Morning America covering the dismal jobs report for June. It was another almost-softball report for Obama, with economics commentator Matthew Dowd stating the American people no longer trust politicians to fix the economy.

The truth, however, is more likely that it is the President they no longer trust.

Throughout our history it has been shown again and again that both Congress and the President have the power to damage the economy, but can usually do little to fix it by any other means than getting out of the way and letting the economy fix itself. Time and again it has been shown that by getting out of the way the economy rights itself, growth returns, and all is right with the world. Then someone in Congress or the President decide that things "aren't quite right" and they start tinkering with one tax, regulation, rule, incentives, subsidies, and law after another, each of them adding burdens that puts more pressure on the economy. In turn the economy slows, falls into recession, and then the Powers-That-Be wonder why this happened, not understanding that they are the ones causing the problems.

This recession, the longest in US history, was fostered by job-killing, finance-twisting, illogical regulations, laws, and "incentives" that short-circuited the usual feedback mechanisms and allowed economic bubbles to be created. Once those bubbles burst, the economy fell and fell fast.

The Powers-That-Be keep ignoring history, keep doing the same thing over and over again, and then wonder why their various 'fixes' for the economy didn't work this time.

It's called insanity.

Another California municipality has collapsed financially, with the city of Stockton filing for bankruptcy under Chapter 9.

This is merely the latest in a series of municipal bankruptcies plaguing the Golden State. Far too many of the municipalities believed the good times would never end and promised things to their citizens and employees based upon that belief. However reality has proved them wrong, the bills have come due, and their coffers are empty.

State finances aren't in any better shape, with a projected $16 billion budget deficit in the offing. Unfortunately, unlike the cities and towns in California, the state cannot declare bankruptcy, meaning the taxpayers (what's left of them) are obligated to pay off the state's deficiencies. But as the state assembly and the governor are learning the hard way, raising taxes any more than they already have will not raise more revenue because the state is already on the wrong side of the Laffer Curve. The last round of tax hikes caused revenues to fall, leaving the state even deeper in debt.

How they believe yet another round of tax hikes will solve their problem makes me wonder if there is anyone sane left in the upper echelons of state government. Unfortunately the answer appears to be 'no'.

You could tell it was the opening weekend of the July Fourth holiday. All one had to do was look at the traffic pouring off of Interstate 93 into the Lakes Region and the full parking lots at the local supermarkets.

I normally make my bi-weekly stop at the local discount warehouse every other Thursday. But due to another commitment I had to put off that trip until yesterday.

That was a mistake.

It was immediately apparent I was going to spend more time there than is usual as the lot was almost three-quarters full. I've never seen the lot with that many cars and trucks in it and I've been shopping there for over 12 years.

Seeing that the gas pumps had only one or two cars fueling up, I decided to fill up the trusty F150 before braving the shopping inside the warehouse. (This discount place also sells gasoline, usually for as much as 10¢ a gallon less than most of the other gas stations in the Lakes Region.)

Once done and making the trip across the parking lot and into the warehouse, I was able to pick up the items I needed pretty quickly. In less than 10 minutes I had gone through my entire shopping list. (When you're buying in bulk it doesn't take much to fill a shopping cart.) However, checking out was a different story.

It is my usual routine to use the self-checkout lanes as they're generally faster than using the regular checkout lanes. That wasn't the case this time. Due to poor planning or poor resource management there were only 2 cashiers working the regular lanes. They should have had all eight of them open. That dearth of human checkers meant the self-checkout lanes were also jammed. And to add insult to injury, many of those using the self-checkout had obviously not done so before as they fumbled around, trying to figure out how to use them. That slowed an already slow-moving process even more. In the lane where I found myself it got worse.

The fellow at the self-checkout terminal had finished running his items through the scanner and was paying for his purchases....with cash. It's one thing if he had his cash wad in some logical order, but he had to pick through to find the bill denominations he needed to feed the terminal. It took a long time. It wasn't until he was almost finished that I realized why it was taking him so long: he was trying to give the machine exact change! Either he didn't know or didn't care that the terminal would give him the correct change if he fed it enough cash. (This wasn't an older gentleman who might not be conversant with the technology, but a fellow easily 20 or 25 years my junior.)

Then his wife ran her items through the scanner and once again he went through his stack of cash, feeding one bill at a time into the terminal. Something that should have taken them all of 5 minutes to do took them 15, which meant the line got even longer than it might have otherwise.

I wasn't the only one having to deal with this as Deb spent a considerably more time at our local supermarket than usual.

First, the parking lot was full, meaning it took time for her to find a parking space.

Second, there were no carts available. She and others had to wait for departing customers to empty their carts before snagging one for themselves and heading into the market. She's never had to do that, either.

I don't know whether this is due to the fact that the Fourth of July is in the middle of the week and the summerfolk are making a long weekend or a full week of the holiday or if this is going to be happening all summer long.

I'm almost hoping for the latter rather than the former because it means the tourists and summerfolk are spending more time and more money here in the Lakes Region, something good for our local economy.

The implosion of Detroit continues, with the city taking more actions to cut its costs even as revenues decline and more people leave the city seeking greener pastures. Their latest action: shutting off and/or removing half the street lights in the city. That ought to help the crime rate in the city...go up.

Detroit, whose 139 square miles contain 60 percent fewer residents than in 1950, will try to nudge them into a smaller living space by eliminating almost half its streetlights.

As it is, 40 percent of the 88,000 streetlights are broken and the city, whose finances are to be overseen by an appointed board, can't afford to fix them. Mayor Dave Bing's plan would create an authority to borrow $160 million to upgrade and reduce the number of streetlights to 46,000. Maintenance would be contracted out, saving the city $10 million a year.

When you have block after block of abandoned commercial buildings and homes, it makes no sense to waste money lighting streets where no one (except squatters) live. Of course many of those buildings and homes wouldn't be abandoned if decades of Progressive leadership hadn't driven the city into these dire straits. The city is a perfect example of the Thatcher Axiom: "The problem with socialism is that eventually you run out of other people's money." That certainly fits Detroit to a 'T'.

Detroit's dwindling income and property-tax revenue have required residents to endure unreliable buses and strained police services throughout the city. Because streetlights are basic to urban life, deciding what areas to illuminate will reshape the city, said Kirk Cheyfitz, co-founder of a project called Detroit143 -- named for the 139 square miles of land, plus water -- that publicizes neighborhood issues.

--snip--

Meantime, [Detroit Chief Operating Officer Chris] Brown said, the city will fix broken streetlights in certain places even as it discontinues such services as street and sidewalk repairs in "distressed" areas -- those with a high degree of blight and little or no commercial activity.

As Glenn Reynolds stated in his link to the story, it's like something right out of Atlas Shrugged or I Will Fear No Evil.

Much as cities in California have made mistakes when it comes to their finances, it appears here on the East Coast the city of New York is about to shoot itself in the foot, but in a different fashion.

While New York also has problems with its public employee unions, it's nowhere near the level seen elsewhere. Instead, the City Council is proposing rules that will help drive the last surviving industry out of the city - the financial industry.

For the life of me I can't figure out how making it too difficult and too expensive to remain in New York City is going to help the city's finances. Is it possible the City Council has been infected with the "California disease"? After all, California's state and local level governments have been doing their best to drive businesses out of business or out of state. They have succeeded. That's why California is in the fiscal mess it's in. And now New York City wants to do the same thing?

Yet in the wake of JP Morgan's massive losses last week and the continuing controversy surrounding the Wall Street bailouts, the New York City Council is debating a measure that would require city banks to publicly disclose their efforts at "socially responsible" banking.

--snip--

Many bankers, as well as Mayor Michael Bloomberg, have voiced their opposition to the new plans. The regulations, they say, would add another burdensome layer to the web of regulations that already exist at the federal and state levels. The Council, however, appears unmoved, and support of key council leaders...give it a fighting chance at making it into law.

If it does, its supporters on the Council will hail it as a major victory, but it will be a loss for the city as a whole. The financial industry is the one industry keeping the city alive, yet New York's blue politicians seem unconcerned about the risks of antagonizing their major cash cow.

This is the same attitude held by many politicians in California and we've seen how well that's worked out for them. The City Council doesn't seem to understand that the banks and other financial institutions will have no problem departing the city for greener pastures. As the post linked above states, Fortune 500 companies have been leaving New York for decades. Wall Street firms will have no problems following them to places with better business climates. And with today's telecommunications infrastructure, those greener pastures can be anywhere, even here in New Hampshire.

As I commented upon earlier this month, people have been dropping HBO and switching over to streaming video because of HBO's support of an increasingly misogynistic Bill Maher and the political hatchet job they did on Sarah Palin.

In the two weeks since that post the number of people doing that has grown. In a Glenn Reynolds post about the failure of the Media Matters driven Rush Limbaugh boycott, Instapundit reader Kirby Angell comments about a bit of anecdotal evidence the "dump HBO" phenomenon is continuing.

"I was at the cable store dropping all of the movie channels, but I told them I specifically wanted to drop HBO because of Bill Maher and objectionable content. Then I found out if I got a new cable modem I could get a faster internet connection. Yesterday the cable guy was out with the new modem and while testing it he said 'lots' of people were dropping cable service and going with streaming only. He said he would drop it at his house but there was one show he would miss and that's the only reason he keeps it. I've never seen Game of Thrones which he would miss, but I love Walking Dead and would still wait until I can stream it at my convenience than pay for cable. Soon the cable companies' only product may be the pipe."

At the moment "the pipe" is the only service we have from our local cable company. We never had the video service (we subscribe to satellite, but don't have any of the movie channels) and dumped our phone service almost a year ago when we realized our home phone was redundant. We haven't subscribed to one of the streaming video services yet, but I figure that's coming. I do use Hulu to catch up on episodes of shows I might have missed.

The WP Parents use a Sony Media Player to stream stuff from Netflix. They'd never go back to HBO. I know a number of my co-workers have also dumped their movie channels in favor of streaming video, with two of them specifically mentioning HBO as their reason for dropping their service.

I've covered the decline of Detroit more than once, covering the various reasons for its precipitous fall from grace.

It's decline continues as the Democrat policymakers continue their experiment to create a socialist utopia. Too bad it's been failing and in such a spectacular fashion that it's impossible to hide. No amount of dissembling and sleight-of-hand can point observers away from the obvious: Detroit is dying and it's the fault of the Progressives who have been running the city for decades.

They have implemented just about every socialist program, regressive 'redistributionist" tax, and punitive business regulation on their wish list upon the city and its residents and the results are clear to see: Detroit has gone from the richest city in the US (per capita) to the second poorest. (Only Cleveland beat them out for that honor.) Detroit can stand as an example of what the rest of the nation will look like if Obama and the rest of the Progressives get their way. The socialist experiment has failed and no amount of window dressing can change that, no matter how hard the MSM tries.

As bad as the real estate bubble and subsequent meltdown was here in the US, the bubble in China is worse and the meltdown will be far more spectacular. Unlike the one in the US, the Chinese meltdown includes entire cities built in anticipation of demands for housing, manufacturing, and consumer spending. It is this last that shows just how badly the Chinese government has overestimated the demand, particularly in light of the highly inflated prices for housing.

One other difference - while shopping malls in the US have been struggling remain open as retailers either fail or decide to move to another location (sometimes to the web), many new malls in China never had the retailers to begin with. One mall, called the South China Mall (also known as the Great Mall of China), was supposed to be the biggest retail mall in the world, with over 1500 shops under one roof. Instead it sits virtually empty, with few operating shops and even fewer customers.

To see how bad it is, an Australian news crew visited one of the new cities. Thousands of apartments sit empty, as do many of the retails shops.



Billions of dollars spent on ghost cities where very few live. This is what happens when the government decides what the demand will be rather than letting the private sector figure it out and build only what they can sell.

Is the UK on the verge of abandoning the EU? It's looking more like a more attractive option as the monetary/finance crisis deepens and threatens to pull the UK irrevocably into a bankrupt and less democratic European superstate.

What options does it have to preclude this out come? Only two variations on a theme, that being withdrawal from the EU. That leave them with two possible options once they've done so: Go it alone or seek alliance elsewhere. Going it alone may seem attractive at first, but it does leave them open the vagaries of the world market with no one else backstopping them. So perhaps they should seek an alliance elsewhere. But with whom?

Well, how about NAFTA? After all, the UK has far more in common with Canada and the US than they do with France, Germany, or Belgium.

Britain does have other choices. To find the country's new role, British leaders should look to North America.

Alone among EEC members, Britain narrowed some of its major trade networks when it joined. It also traded ordinary Britons' right to virtually bureaucracy-free movement, temporary or permanent, between the U.K. and British Commonwealth nations.

--snip--

While much trust was lost between Britain and the rest of the Commonwealth because of this move, strong personal, cultural and economic ties remain and could be revived. Ask the average Briton where he'd feel more at home, Paris or Toronto.

Canada and Australia have well-managed, vibrant economies. Both countries sit on huge deposits of natural resources of ever-increasing value. Britain's top-tier financial sector and still-excellent technical capabilities already play a role in Canada's economy. These ties could be much strengthened.

Britons also feel at home south of the Canadian border. Contrary to an oft-repeated myth, links between Britain and the United States are not reducible to the personal relationships between presidents and prime ministers. The U.S. and the U.K. have always been each other's primary financial partners. A few simple measures could substantially deepen this relationship, especially once Britain no longer needs to adhere to EU rules.

The only thing the UK has in common with the rest of Europe these days is proximity and a centuries long history of armed conflict with a number of countries there. Perhaps it's time for Britain to remember the rest of the Anglosphere and to consider re-aligning itself it with it. I have no doubt it would help both the UK and the other nations of the Anglosphere.

And the UK's trade with the rest of the EU? I have reason to believe that while there would be some fall off in trade, in the end it won't be all that much. And increased trade and relations with the rest of the Anglosphere would certainly help make up any shortfall from the rest of Europe.

Frankly I see little if any downside to the UK withdrawing from the EU and realigning itself with its former colonies and Commonwealth members.

Some of the latest housing news shows that home values are still falling. That's not really a surprise, is it? But prices are rising in 2 cities, Washington DC and Detroit.

Detroit?

Yes, Detroit.

When you think about it it makes sense. Its real estate values plummeted to the point where the median price for a house was less than $7000. (The large number of abandoned homes and buildings in the Motor City helped suck down property values for years.) Many neighborhoods have been abandoned entirely and the city has been tearing down empty homes for some time. The population of Detroit is less than a third of what it was at its peak. In effect, property values hit rock bottom. There's only one way for them to go: up. So is it a surprise that home values are starting to climb? Some folks see an opportunity and are snapping up empty homes for bargain basement prices and fixing them up. Unless the city dies entirely the chances are the value will go up.

We've been hearing about the financial turmoil in the EU, with Greece just this side of total bankruptcy, and Portugal, Italy, Ireland, and Spain no too far behind. There's lot's of finger pointing, with very few pointing the finger at Brussels and he unaccountable EU Parliament.

One of those doing willing to do so is the CEO of Ryan Air, Michael O'Leary. He slams the EU bureaucracy, the politicians, the rent seekers, and those trying their hardest to kill off any innovation that might make things better rather than maintaining the status quo, as bad as it is.


O'Leary tells them some hard truths, truths they'd rather not hear. But then he's helped create more jobs than all of the EUcrats combined.

It is said the truly smart will learn from the harsh lessons of others' failures. I can say that one member of the WP clan is that smart, that being the youngest of the WP sisters. (As she says, she made her own mistakes while growing up that our parents never found out about.)

It would be great if the political class presently ruling the US was as smart as my youngest sister. Unfortunately they are not.

They see the economic meltdown occurring in the Euro-zone, yet refuse to learn the lessons countries like Portugal, Ireland, Italy, Greece, and Spain are teaching us, the primary one being that eventually you will run out of other people's money to fund all the wonderful social programs that have been used to bribe the electorate.

Italy is the latest to teeter on the brink of insolvency, and should it go over the edge it is quite likely it will pull the rest of the Euro-zone with it. Greece's default damaged the European economy yet it has only a fraction of the GDP of Italy. Should Italy default Europe will take an additional $2 trillion hit it cannot afford. Is it any wonder Germany is considering abandoning the Euro and going back to the mark? Can anyone deny that this problem has been driving the British public to demand a referendum about whether or not to remain in the EU? At least those two countries see the problem and realize they'll have to bankrupt themselves in a doomed effort to prop up economic policies from Brussels.

But too many of our own politicians at the state and federal level, regardless of party, seem oblivious to the fact that unless we make some drastic changes in how our federal government taxes and spends we will be headed down the same path. Labor leaders ignore the fact that neither businesses or taxpayers are a bottomless source of funds, shortchanging their own members by making promises no one can keep.

Should the US fail to put its financial/economic house in order, and right quick, it will pull the world economy down with it into a depression unlike any we've seen before.

I saw this by way of Instapundit. It reveals some harsh truths the #OWS folks won't admit to, but something We The 53% understand completely.

We are Wall Street. It's our job to make money. Whether it's a commodity, stock, bond, or some hypothetical piece of fake paper, it doesn't matter. We would trade baseball cards if it were profitable. I didn't hear America complaining when the market was roaring to 14,000 and everyone's 401k doubled every 3 years. Just like gambling, its not a problem until you lose. I've never heard of anyone going to Gamblers Anonymous because they won too much in Vegas.

Well now the market crapped out, & even though it has come back somewhat, the government and the average Joes are still looking for a scapegoat. God knows there has to be one for everything. Well, here we are.

Go ahead and continue to take us down, but you're only going to hurt yourselves. What's going to happen when we can't find jobs on the Street anymore? Guess what: We're going to take yours. We get up at 5am & work until 10pm or later. We're used to not getting up to pee when we have a position. We don't take an hour or more for a lunch break. We don't demand a union. We don't retire at 50 with a pension. We eat what we kill, and when the only thing left to eat is on your dinner plates, we'll eat that. For years teachers and other unionized labor have had us fooled. We were too busy working to notice. Do you really think that we are incapable of teaching 3rd graders and doing landscaping? We're going to take your cushy jobs with tenure and 4 months off a year and whine just like you that we are so-o-o-o underpaid for building the youth of America. Say goodbye to your overtime, and double time and a half. I'll be hitting grounders to the high school baseball team for $5k extra a summer, thank you very much.

So now that we're going to be making $85k a year without upside, Joe Mainstreet is going to have his revenge, right? Wrong! Guess what: we're going to stop buying the new 80k car, we aren't going to leave the 35 percent tip at our business dinners anymore. No more free rides on our backs. We're going to landscape our own back yards, wash our cars with a garden hose in our driveways. Our money was your money. You spent it. When our money dries up, so does yours.

The difference is, you lived off of it, we rejoiced in it. The Obama administration and the Democratic National Committee might get their way and knock us off the top of the pyramid, but it's really going to hurt like hell for them when our fat a**es land directly on the middle class of America and knock them to the bottom.

We aren't dinosaurs. We are smarter and more vicious than that, and we are going to survive. The question is, now that Obama & his administration are making Joe Mainstreet our food supply...will he? and will they?"

So if the OWS folks get their way and kill off Wall Street and the corporations, what they'll get in return is an economic collapse that will make the Great Depression look like a minor market correction in comparison. But what do you expect from economically illiterate and spoiled children who feel entitled to what the rest of us earned?

I've seen this both at Instapundit and on a friend's Facebook page. It's too good to pass up, so I knew I'd have to link it.

While the so-called 99% are protesting for free stuff, we, the 53% who actually pay for that 'free' stuff, are voicing our own opinions about it. One shot from the site:


Yup, I'd say that covers it.

As the foreclosure crisis drags on, it appears banks holding some of the foreclosed properties are taking drastic measures to lighten their burden.

As we've seen in Detroit, foreclosed and abandoned homes have been demolished. In a number of the hardest hit suburbs empty housing developments, some with hundreds of empty never-occupied homes, are being bulldozed to remove the need for the banks or the towns to maintain and police them. (Some of these upscale homes have turned into squatters dens, housing drug dealers and prostitution operations.)

The trend has been spreading, with a number of cities passing legislation to enable them to work with banks to demolish foreclosed properties that are unlikely to ever be occupied before they molder away from neglect. One of the latest to deal with this issue has been Cleveland.

The sight of excavators tearing down vacant buildings has become common in this foreclosure-ravaged city, where the housing crisis hit early and hard. But the story behind the recent wave of demolitions is novel -- and cities around the country are taking notice.

A handful of the nation's largest banks have begun giving away scores of properties that are abandoned or otherwise at risk of languishing indefinitely and further dragging down already depressed neighborhoods.

Four years into the housing crisis, the ongoing expense of upkeep and taxes, along with costly code violations and the price of marketing the properties, has saddled banks with a heavy burden. It often has become cheaper to knock down decaying homes no one wants.

As the linked article states, a number of other states and cities have passed laws allowing the same kind of operations to demolish distressed properties and ease the burden of supporting empty properties.

One area I predict will see such demolitions in the near future is the Las Vegas area. Entire neighborhoods sit empty, with street after street of new homes never sold and never occupied gathering dust and becoming the icon for a modern ghost town.

While not nearly as eerie as the modern ghost cities seen in China, it's still a sad testament to the housing bubble enabled by Congress with their weak oversight of Fannie Mae and Freddie Mac.

I'm beginning to wonder how many times Obama and his advisers will have to hear this message before they come to understand it, if at all: the American Jobs Act won't induce employers to hire new workers.

I've discussed the issue of tax incentives as a goad of hiring a number of times with some of my more liberal friends or acquaintances, few of whom don't seem to understand the reason why businesses hire more workers. They can't seem to grasp the concept that no amount of tax cuts will induce any business owner to hire an employee they don't need. Adding an worker who adds nothing to the bottom line, meaning one who does not create more income for the business than it costs to employ them, makes no sense and causes the business to lose money even with the tax cut incentive.

Message to Obama et al: Businesses hire workers when they can't meet the demand for goods or services with the employees they already have. Period.

So endith the lesson.