Tuesday, May 31, 2011, 10:38 PM - Political developmentsYou paid more in taxes last year than General Electric paid.
They paid nothing.
In 2010, on $5.1 billion profits form the U.S., G.E. paid nothing:
http://www.nytimes.com/2011/03/25/busin ... 25tax.html
Even if that was somewhat skewed by big losses at G.E. Capital, the revelation that one of the nation's largest companies pays nothing (and whose CEO Jeffrey Immelt is Obama's new joblessness guru) has ignited a minor political firestorm.
Did you catch last week's 60 Minutes episode on the overseas flight of American companies to countries with lower tax rates?
That's a good place to start to understand the economic challenges we face.
Should Congress declare tax holidays with reduced tax rates to lure capital back here? And would jobs really come back?
The 60 MInutes piece features an interview with Cisco's John Chambers.
You've got to admire how forthright Chambers is. He doesn't sugar coat it.
Cisco has 40 billion parked overseas.
Wednesday, May 25, 2011, 01:46 AM - Understanding the CA WC systemYou are at dinner, your Silver Oak Cabernet sitting beside your appetizer plate. It's your anniversary, and you and your wife are dressed for the swanky seaside venue.
Diners are ushered to the adjacent table. As a diner takes off her overcoat, one of the coat arms swings toward your table, grazing your wine glass, causing it to tumble and spill all over your wife’s white linen dress.
Steam blows out of your wife's ears. This was the special dress she bought on Rodeo Drive.
Your wife snarls at the adjacent couple, challenging them as rude and careless. You've seen the couple before; probably at the local schools fundraiser, chatting with one of the town gossips.
The couple, their noses in the air, refuse to acknowledge responsibility. Under their breath you hear one of them mutter "bitch". Stepping up the interchange, the husband says it's your fault, you caused it. He notes that you placed the wine glass six inches from the outer right side of your plate.
Your retort is that it was still eight inches from the side of the table.
It's an unhappy meal. Who wants to eat halibut with macadamia nut crust under such hostile circumstances?
You return home. With your wife, you engage in a philosophical excercise.
Was it a causative factor that you chose a wine which comes in stemware which is easier to tip over? A scotch and soda glass would have been unlikely to have tipped.
Was the spill (and the stain on the dress) caused by the restaurant’s placement of tables? By the failure of the maitre’d to ask for coats at the entry?
Are you yourself a contributing cause because you placed it too close to your wife so that it spills in her direction?
And whatever the cause of the spill itself, what about the stain?
Is the stain on the dress also partially caused by the fact the dress was linen, rather than fashioned from Goretex?
Is the extent of the stain damage partly caused by the fact that the dress was not black or maroon rather than white? After all, a darker color would better mask the stain.
And is the extent of the stain damage partially caused by the fact that the restaurant had no red wine removal chemicals on hand?
At the end of the night, steam is still coming from your wife's ears. You're in danger of being sent to the guest bedroom on your anniversary.
"These philosophical distinctions are crap", she screams. "Those jerks...they should pay the total cost of an equivalent new dress", she says as she heads to the computer to print out forms to file in small claims court.
Monday, May 23, 2011, 02:52 AM - Understanding the CA WC systemCosmology is so fascinating.
If the universe (?our universe?) was created with a big bang, will it expand forever? Or like an expanded balloon, will it deflate into a big crunch?
Is our universe closed, or open? Will things disintegrate in a big rip?
None of us know the answers.
But in the workers' comp world, the trend toward a big crunch has ended.
For the first time in five years, aggregate California workers' comp premium has risen.
Just a few years ago, it seemed that the California workers' comp universe would be ever expanding. Premium was over $16 billion in 2004.
With the 2003 and 2004 reforms, and with the post Bear Stearns and post Lehman Brothers economic turmoil, premium volume tanked.
By 2009, premium volume was $6.9 billion.
High unemployment, outsourcing and decreasing claims frequency were major factors in the shift.
Decreasing premium has put pressure on insurer profitability, as overhead to premium ratios soared.
But the period of contraction of the comp universe may be coming to an end. While much ultimately depends on whether the California economy can avoid going into a double dip recession, it appears that there is some
In 2010 premium volume increase by 3.1%, to $7.1 billion, according to data from the National Association of Insurance Commissioners (NAIC).
To see 2010 market share and premium volume stats for California workers' comp insurers, click here:
http://www.insurance.ca.gov/0400-news/0 ... ps2010.pdf
After you have your fill of those figures, you can bend your mind a bit by considering various theories on whether our universe, like California's comp system, is ever expanding or contracting:
http://en.wikipedia.org/wiki/Ultimate_f ... e_universe
Monday, May 16, 2011, 05:50 PM - Political developmentsAmong the state boards and commissions on Governor Brown's chopping block are the Fair Employment and Housing Commission and the Occupational Safety and Health Standards Board, aka the Cal-OSHA Standards Board.
I'm no Cal-OSHA expert, but I checked in with a source with extensive experience in OSHA matters to learn what this would mean.
Here is what I was told:
"It's a good thing for workers and advocacy groups at least. Getting regs through the Cal-OSHA Standards board was a nightmare. Too much compromise required to get things through which often results in weaker than necessary regulations such as ergonomics or heat illness standards. Yes California has a lot of regs that other states don't but they are close to useless because they have to be watered down significantly in order to get the appointees on the standards board to approve."
Elimination of the board would be done through legislation or the budget process, so this is not a sure thing.
But if the Standards Board is eliminated, "stakeholder groups" would advise DOSH staff at the Division of Occupational Safety and Health. My source says that:
"Stakeholder panels aren't great because employers always have more time and money to put into attending those, but when you have career staff at Cal-OSHA who feel comfortable moving things along, things can get done".
Stay tuned as the plans for reorganization of some of the Department of Industrial Relations agencies are debated.
Sunday, May 15, 2011, 08:42 AM - Political developmentsArnold Schwarzenegger, full of bravado, threatened to "blow up boxes" in
Tomorrow, with his budget revise, Governor Brown will outline plans to do just that.
Partly it's a function of the looming chaos in Sacramento, where the way forward out of the budget mess is murky. And perhaps it's also a function of a desire to reinvent portions of the Labor and Workforce Development Agency.
One target for reform is the California Unemployment Insurance Appeals Board, which Brown would seek to terminate. If this was done, it's not clear how unemployment appeals would be processed.
Undoubtedly we'll hear more in coming days on how this would be achieved. There would still be ALJs deciding UI cases. But as with cases at the WCAB, the CUAIB hears appeals from the ALJs and sets precedent that way. There will need to be some mechanism in place for those appeals to be heard unless there is an overall statutory change in procedure.
Under Schwarzenegger, there was various talk of consolidating functions of some of the appeals boards that operate in the Labor and Workforce Development Agency. Whether Brown and Marty Morganstern truly believe this is a political heavy lift that is worthwhile given the relatively small savings isn't clear.
Eliminating the Unemployment Appeals Board could hit political sppedbumps. The board has been a place where politically powerful termed-out legislators landed after their career under the Capitol dome.
Current members include recent Attorney General candidate Alberto Torrico, former State Senator Denise Ducheny, and recent Republican legislators Bonnie Garcia, George Plescia, Roy Ashburn and Dennis Hollingsworth.
Ducheny was quoted in the L.A. Times that she doesn’t see how eliminating the board will save the state money since the panel is mostly federally funded.
The bigger question is what the Brown Administration will do to address the looming problem of financing California's unemployment system. Here is a link to the Legislative Analyst Office report on the massive UI shortfall:
http://www.lao.ca.gov/reports/2010/ssrv ... 102010.pdf
A link to the CUIAB website is here: