U.S. Economic/Financial News

California Unemployment Hits 11.5%

June 19 (EIRNS)—Even before new layoffs of state employees have been finalized, the official unemployment rate in California hit a modern-day record of 11.5%. The May 2009 figures, released this morning, show a continuing erosion of jobs, as the state is facing what its lunatic governor, Arnold Schwarzenegger, has described as financial Armageddon. The official rate in May 2008 was 6.8%. Schwarzenegger and the legislature are currently quibbling over what both sides call a share-the-pain budget, which will likely result in many more job losses in education, prisons and law enforcement, health care, and government services.

Colorado in for 'Brutal' Budget Cuts

June 15 (EIRNS)—The chair of Colorado's legislative Joint Budget Committee told the June 12 Denver Post that the state is in for "brutal" budget cuts in the next fiscal year, which starts July 1. Colorado has already had to cut $1.4 billion out of its budget over the last two fiscal years. The budget shortfalls have been due to the continuing collapse in revenue. "We will be $150 million short of what we budgeted at a minimum," said Moe Keller (D-Wheat Ridge). "It could be double that." The big cuts are for prisons, and colleges and universities.

Auto Industry Could Help Build Nuclear Plants!

June 17 (EIRNS)—On June 4, DTE Energy (incorporating what had been Detroit Edison), based in Michigan, and the Nuclear Energy Institute in Washington, sponsored a regional manufacturing outreach workshop in Detroit. More than 400 local industry representatives participated, along with major nuclear vendors GE, Westinghouse, Areva, etc.

DTE is seeking approval from the Nuclear Regulatory Commission to build a second reactor at its Fermi site, near Monroe. Gerry Anderson, chief operating officer at DTE, said at the workshop, that hundreds of thousands of components will be required, including parts that can be manufactured in Michigan, such as valves, pumps, and seals.

The centerpiece of Lyndon LaRouche's proposal in 2005 for the soon-to-die Midwest auto and machine-tool industries was to convert that manufacturing capacity to produce desperately needed infrastructure, including for transport, water management, and nuclear power plants. In an article in its Dec. 30, 2005 issue, EIR outlined specific nuclear reactor components that could be manufactured in converted auto and machine-tool factories. Now, with the auto industry in bankruptcy, at the same time that nearly two dozen electric utilities have started ordering nuclear power plants, corporate officers are finally bringing the two industries together, to use the skills and facilities that exist and are idle, to help rebuild a nuclear manufacturing industry that has nearly disappeared.

Speaking June 16, at a "The National Summit" in Detroit, DTE CEO Anthony Earley said, "One of the challenges we'll face with the resurgence of nuclear energy is also one of our biggest opportunities. The number of nuclear suppliers has shrunk and global competition is already heating up for the limited material and manpower now available." While utilities will use (so-called) renewables, "windmills and solar panels will never power an auto assembly line or a cold-rolled steel mill," he said. Nationally, he reported, as much as $2 trillion will have to be invested in energy infrastructure, by 2030. The average age of a power plant in Michigan is 48 years. If we don't start building new nuclear plants now, there will not even be enough generating capacity to replace the plants that will be retired over the next decade, Earley warned.