U.S. Economic/Financial News
Bulk Coal Being Moved by Truck to Ohio
The Army Corps of Engineers crews continue to work on repairs on the McAlpine Lock gate in Louisville, Ky., while the 981-mile Ohio River corridor remains, in effect, out of service, the Cincinnati Enquirer reported Aug. 12. Though the Corps officials gave shippers all the time they dared allow, to rush-ship commodities over the June-July period, and to make alternate freight arrangements, there is still mad scrambling to make up for the August two-week closure of the Ohio Mainstem navigation system. But all U.S. transport is so decrepit, there are no alternatives!
For example, the Western states rail system is so congested right now, due to lack of locomotives, cars, lines and all, that Toledo Edison Co. has resorted to bringing in at least 60,000 tons delivered by truck to its generating plant in Oregon, Ohio! A spokesman for FirstEnergy, parent company of Toledo Edison, said that coal stocks are dwindling, and "normal means" of shipment are not working. Coal for the Ohio Bayshore plant of Toledo Edison, which normally comes from Powder Basin, Wyoming, by "rail/boat", that is by train and Great Lakes shipping, now, is coming in by "boat-truck" instead.
Middle-Class Americans in 'Deep Economic Trouble'
Millions upon millions of American families are in deep economic trouble, and Bush has no plan, said New York Times columnist Bob Herbert in an op-ed Aug. 9. "Despite the rosy rhetoric that comes nonstop from the administration, millions upon millions of American families, including many that consider themselves solidly in the middle class, are in deep economic trouble," he said, adding: "The first essential step ... is to recognize and acknowledge the sheer enormity of the problem."
According to Harvard law professor Elizabeth Warren: "This year, more people will end up bankrupt than will suffer a heart attack. More adults will file for bankruptcy than will be diagnosed with cancer. More people will file for bankruptcy than will graduate from college.... Americans will file more petitions for bankruptcy than for divorce."
A Century Foundation debt study showed that "a family with two earners today actually has less discretionary income, after fixed costs like medical insurance and mortgage payments are accounted for, than did a family with only one breadwinner in the 1970s."
Skyrocketing Cost of University Education
The average basic cost of a year's tuition plus room and board at a private four-year U.S. college has risen from $15,098 to $29,119, since 1990, a 93% increase, not including books, computers, and other essential costs, USA Today reported Aug. 10. For four-year public college, a year's tuition, room and board (for students attending schools in their home state), the increase rose 87%, from $5,324 to $9,953. In some states, such as New York, the rate hikes for public community colleges (which typically offer two-year programs) are estimated to have risen 23%.
GM To Lay Off Most Lansing Assembly Workers
General Motors said it will lay off most of its Lansing, Mich. car assembly workers2,200 employeesfor about three weeks, beginning Aug. 23, according to the Lansing State Journal Aug. 11. Plus, the automaker is cutting 300-400 jobs by eliminating one work crew at its Saturn assembly plant in Spring Hill, Tenn., effective Sept. 7. The shutdown and job cuts, blamed on GM's falling U.S. auto sales, will likely trigger layoffs at GM parts suppliers.
Meanwhile, auto supplier Grand Vehicle Works will permanently close its plant in Union City, Ind., in October, eliminating 118 jobs.
Machinist Union Calls for Bankruptcy Trustee at United
The International Association of Machinists, which represents about a third of United Airlines employees, has called the judge in UAL bankruptcy case to appoint a trustee at UAL, USA Today reported Aug. 12. The IAM took this action after United stopped payments to the union pension plan that covered 125,000 active and retired employees.
The bankruptcy law allows for the appointment of a trustee in cases of fraud and mismanagement. The union is alleging gross mismanagement.
The Machinists union is getting backup from the flight attendants' union, whose representative said that the action was appropriate. The attendants' union has posted a notice on their website, calling on all members to vote no-confidence in United's management team. The pilot's union has so far had no comment.
Police Union Protests Pittsburgh Austerity Plan
Several hundred active and retired police officers, including national officers of the Fraternal Order of Police, held a noontime demonstration on Monday, Aug. 9 to denounce the economic austerity plan call "Act 47" which is being imposed by Pittsburgh's mayor and city council, the Pittsburgh Post-Gazette and Tribune, reported Aug. 10. The FOP leaders warned that the Act 47 "recovery" plan for the financially distressed city is nothing more than an attack on organized labor, and would jeopardize public safety. "This is not just a police issue, ... this is a labor issue," declared Michael Havens, Jr., president of the Pittsburgh police union, adding: "It's nothing more than coming in to destroy the union."
Also hit hard are the firefighters who, last month, gathered and turned in 20,000 petition signatures, demanding a change in the Home Rule charter so as to require Pittsburgh to meet national fire-response-times standardssomething which will not happen with the Act 47 slashing of 168 firefighter jobs, and closure of 35 fire stations. The economic plan is cynically called the "recovery plan."
The police union is challenging the austerity plan in court, and the city's fire union has filed a similar lawsuit. The plan calls for $33 million in further spending cuts and $41 million in tax increases to plug the budget gap. It mandates cutbacks in wages, benefits, and workforce levels in the next police contract.
Ohio Home Foreclosure Auctions Skyrocket
Home foreclosure auctions in Ohio jumped 26% last year, due to job losses and banks' predatory lending practices. More and more Ohio families lost their homes in 2003, as county sheriffs' departments across the state put more than 36,425 foreclosed residential properties up for sale at auction, according to the Cincinnati Enquirer Aug. 12. This number represents a 26% increase from the level in 2002and a 57% leap from just two years earlier, according to a study by Policy Matters Ohio. About one in every 117 Ohio households, lost their homes to sheriff sales of foreclosed properties.
More than 57,000 new foreclosure filings were made in Ohio courts during 2003, up 3% from a year earlier, up 31% from 2001and more than double the number in 1998. Ohio's foreclosure rate is the second-highest in the nation, behind Indiana; as of June, the state had lost a total of 232,000 jobs173,00 jobs in manufacturingsince January, 2001.
Five Greater Cincinnati counties were hit by double-digit percentage increases in both foreclosures and sales between 2001 and 2003.
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