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Voting Your Way to Prosperity

The opinions expressed by columnists are their own and do not necessarily represent the views of
"Our people in an overwhelming way supported the re-election of this president and there ought to be a quid pro quo and you ought to exercise leadership on that… Of course, not just that, but why not?"

"After the election of Jimmy Carter, the honorable Coleman Alexander Young, he went to Washington, D.C. He came home with some bacon. That's what you do."

Joann Watson
Detroit City Councilwomen

The first crack in the floodgates opened this week, when Detroit councilwoman Joann Watson demanded a quid pro quo from President Obama in the form of a federal government bailout of the beleaguered city. The problem is that this is just like Greece, which will forever need bailouts until it changes the underlying mentality that has made it a welfare state hanging by a thread only because of past ruins and pristine beaches. Parts of Detroit are in ruin, but have little historical value to a would-be tourist, and I haven't heard much raving about their beaches.

Both share a welfare mentality that has created a populous not prepared to compete in the global economy. The only currency is the vote which citizens there haven't been wise enough to sell to the highest bidder. You see, Councilwoman Watson's implied threat is empty and laughable. "Our people" have always voted overwhelmingly for democrats and probably will for the foreseeable future.

Detroit was the marvel of the world for a long time - the greatest manufacturing city in the world. It was the most productive city in the world. Then complacency and greed set in, as power shifted toward unions in industry which fought tooth and nail with management on how to divvy up the spoils. Whenever this is occurring in the private sector, it's also mirrored in the public sector, too (see how housing booms in America, Spain and Ireland echoed influence in the local level public sector spending to the point of self-destruction).

If Councilwoman Watson feels like the love of city isn't being reciprocated then that love should be given to someone else. If it's simply a business arrangement, then certainly it is dumb to give away your bargaining chip every time when it's all said and done. But Ms. Watson is a die-in-the-wool victim-monger. Her brand of politics motivated her to dismiss a champion boxer who volunteered to teach inner city children the sport, because he happened to live in the suburbs.

Watson felt that was a sellout, and thus, deprived the children of a generous offer and a chance to get fit and learn discipline. This is the real problem for the citizens of Detroit. Maybe it's a coincidence, but I think not since the same script has played out through scores of formerly prosperous cities and towns in America - the shift from balanced government to democrats in complete control. The last republican mayor of Detroit was Louis Miriani from 1957 to 1962.

Detroit peaked in 1964.

Since then the town has been descending into a hell.

> Population 800,000 from 1.7 million in 1960
> 40% street lights do not work
> 47% of citizens functionally illiterate
> #2 in violent crime for midsize to large city in 2012 (FBI)
> Mistress of former Hip Hop mayor still owes city $85,000

Voting is a form of currency, but the notion it should be so powerful that people putting nothing into the pot or doing meaningful things to improve their own lives can be paid off with funds from taxpayers is nuts. There is a growing belief that simply being born in America and voting should take the place of working hard, making sacrifices, and achieving. People taking out of the pot seem to think those that are putting into the pot actually owe them.

Detroit is a disaster, but it's a man-made disaster. There is only one way for that city to dig out of its hole. It would be a long and arduous journey. It would mean accountability. It would mean accepting non-financial help from successful people, even those sell-outs that dare leave the hood and live in the suburbs. Voting is a form of currency, but it's not a license to steal. If voters want rewards then they should first demand more from themselves and secondly understand what true caring is all about.

Jobs Data, Simply … Wow!
Carlos Guillen

The highly awaited government jobs data is here, and the first reaction to the numbers is a clear wow! At the moment, Americans are still struggling with the consequences of the most recent recession, and while there are signs of improvement, the overall picture is still one of difficulty for many out there without work, but today's results are quite a surprise.

According to the latest data from the Department of Labor, the unemployment rate in November clocked in at 7.7%, landing below the Street's consensus estimate of 8.0% and decreasing from the 7.9% posted in the prior month. The household survey showed that those employed declined by 122,000, and those unemployed decreased by 229,000. Discouraging, however, was that those not in the labor force increased by 542,000. In essence, the jobs market shed a good chunk of people, which led to a lower unemployment rate.

Perhaps the more favorable aspect of the employment report was that non-farm payroll employment in November (derived from the establishment survey) increased by more than expected. The report showed that the increase in non-farm payrolls was 146,000 while the Street's consensus called for a gain of 90,000. This was quite a bit of a positive surprise given that this past Wednesday, according to ADP (with a new methodology), 118,000 private sector jobs were gained during November, which landed lower than the Street's estimate calling for a gain of 125,000 jobs. The nonfarm increments were, however, revised lower for September and October to 132,000 (from 148,000) and 138,000 (from 171,000), respectively. We should note that during the last 12 months, there have been 189,000 jobs added per month, which is an improvement from the 174,000 jobs added per month in the prior 12 months. Despite expectations that super-storm Sandy would have generated noise in the data, it appears that there were no such effects, as the Bureau of Labor Statistics claims that Sandy did not substantively impact the national employment and unemployment estimates for November.

Overall, investors' enthusiasm after the employment data is very encouraging, as the Dow Jones Industrial Average is indicating higher by 70 points. However, in light of the current fiscal cliff dilemma, the employment situation is still at risk of making a turn for the worse.


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