Go to Jeff Salisbury LWGate Home Page.From: Spencer48@aol.com
Subject: Re: [CANSLIM] "M"
Date: Tue, 24 Sep 2002 20:38:46 EDT
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Kent et al:
This is perhaps off Canslim topic, but this idiotic bill (IBD editorial
below) most likely will affect the California economy deleteriously,
especially the businesses with "N" in Canslim, but not a lot of free
cash-flow.
Davis should be charged for criminally choking off new businesses (not
to mention established small businesses). This piece is from 9/24/02 IBD
Issues and Insights, and the political climate it signifies is one more
reason in my opinion not to move on out to California.
jans
Issues & Insights, Wednesday, September 25, 2002, California Chill,
INVESTOR'S BUSINESS DAILY
Family Leave: The Golden State has created a new entitlement, and big
labor wants other states to follow. The smart ones will take California's
jobs instead.
Gov. Gray Davis this week signed the nation's first law providing workers
with paid family leave. For the unions, it's time to pop the champagne. For
employers, it's another reason to leave the state.
Nearly all private-sector workers in the state now have the right to leave
for up to six weeks, drawing 55% of their pay, to care for ill parents,
children or domestic partners, or spend bonding time with a newly adopted
child. This benefit is to be funded from workers' paychecks through an added
payroll deduction expected to start at $26 a year on average and ranging up
to $70 for workers earning more than $72,000 a year.
There are ways to deal with family needs short of mandating a new social
insurance scheme backed by a tax increase. A more business-friendly state
might have opted for some mix of tax credits and voluntary action.
California's approach is to give workers what they want and hope employers
don't decamp to more hospitable states.
What really should worry California employers - and, ultimately, workers who
depend on jobs in the state - is the inevitable pressure to pump the program
into something far bigger and more costly. If it's popular, workers will want
more of it and lawmakers will find a way to make employers pay.
The initial California bill called for 12 weeks of paid leave, with employers
shouldering part of the cost. Business lobbyists pared the leave time and got
employers off the hook, for now, but they were helped by political conditions
that may not repeat themselves.
Davis, a Democrat in a surprisingly tight race with political novice Bill
Simon, doesn't want to scare business donors. So the stars were aligned for
some moderation. But if Davis is re-elected, he won't have much reason to
hold back the liberal state legislature.
For organized labor, the California law is just a start. The AFL-CIO and
other unions are pushing for similar laws in nearly 30 states and they want
employers to foot the bills. Smart states, of course, will pass on those laws
and take California's jobs instead.
And don't think California's business-climate change has gone unnoticed. In a
survey of executives released this week by the marketing firm Development
Counsellors International, 57% of them ranked California the worst place in
the country to do business. In 1999, only 25% of them felt this way.
Davis and the legislature have already dimmed the state's once-sunny
reputation. Their paid-leave law will just add to the chill.
In a message dated 9/24/2002 6:06:46 PM Eastern Daylight Time,
kent_norman@yahoo.com writes:
<< If low interest rates alone could save the day, they would have
already. I doubt a business manager would delay a project for a
fraction of a point interest.
I think they are really too scared to commit to new projects due to low
visibility and distracted by having to double check the financial
statements.
Regards
Kent
--- Spencer48@aol.com wrote:
> Kent:
>
> This (shell-shocked investors) is the main reason that IBD
> states, in
> IBD's editorial today, that the Fed should cut interest rates. To
> put it in
> James Carville speak, 'it's no longer the economy stupid, but rather:
> "It's
> the psychology, stupid."
>
> To paraphrase the editorial, IBD says that the even though the
> economy
> is coming around (albeit feebly), it is the psychological pounding
> that
> individual investors have taken since 2000 that will prompt investors
> to
> start investing again once interest rates are cut-and which will also
> boost
> more IPO's, venture capitalizations and start-up businesses.
>
> Personally, I think this is too much to ask, and think that
> business and
> personal tax cuts are more likely to lead to a rejuvenation of both
> the
> economy and the stock market.
>
> jans >>
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