Wednesday, July 13, 2005


Economy shames prophets of doom: "We were told at the beginning of the year that the American economy was in trouble. The boom in house prices was producing a bubble that would burst. The dollar would fall, and the federal budget deficit rise, increasing inflationary pressures and forcing a growth- stifling rise in interest rates. And soaring oil prices would be the final straw that broke the back of the economy. In the event, the housing market remains strong, with sales at record levels. Instead of falling, the dollar has risen, helped along by the sag in the euro as it becomes apparent that the eurozone economic model is on the road to nowhere. The budget deficit has declined, thanks to robust tax receipts and in spite of a battle between President George Bush and Congress to see who can be the most profligate. Inflation has remained tame, and long-term interest rates have not responded significantly to the Federal Reserve's attempts to force them up by raising short-term rates."

CAFTA opponents ignore NAFTA: "Last week's 54-45 U.S. Senate vote in favor of the Central American Free Trade Agreement (CAFTA) was a modest step forward for U.S. taxpayers and consumers.... liberal voices from the past continue to echo through Washington. "CAFTA contains inadequate protections for workers' rights and will only increase the power of corporations to exploit workers," the International Brotherhood of Teamsters website exclaims.... This rhetoric is mild compared to so-called "progressive" opinion outlets that equate CAFTA with corporate-sanctioned murder.... Over ten years ago, before the inception of NAFTA, Canada had a GDP of $617.7 billion. Since then, its GDP has expanded over 65% to $1.023 trillion. In addition, Canada's December 2003 unemployment rate was 11%; in 2004, its unemployment rate had dropped to 7% (a 36% decrease). Mexico's economic numbers since the signing of NAFTA do not reveal a "brutal exploitation" either, but measured progress, and a higher standard of living. In 1994, Mexico had a GDP of $740 billion. Ten years later, Mexico has seen its GDP expand over 35%, to $1.006 trillion today. In addition, its 1993 GDP growth rate was .4%. In 2004, it boasted a 4.1% annualized growth rate. These numbers are hardly indicative of the dangers of free trade. Like Canada and Mexico, the United States has witnessed similar economic prosperity since NAFTA".

Labor unions: "The truth is that unions are essentially parasitic organizations that thrive only by draining and ultimately destroying the companies and industries they control. The essential goal of the unions is to compel the payment of higher wages for the performance of less work and less productive work. Unions are notorious for their hostility to labor saving machinery and to any form of competition among workers, for featherbedding practices, indeed, for "making work" by deliberately and arbitrarily increasing the number of workers required to accomplish a given task and sometimes even by compelling the disassembly or destruction of products already produced. It should be no wonder that the percentage of the labor force controlled by unions tends progressively to decline. Where the unions hold sway, companies cannot compete. Their market share falls and they ultimately go bankrupt. The only way that unions can maintain any given share of the labor force is by finding new victims to replace the ones they have sucked dry".

Fabulous news from Greece: "The government is seriously considering introducing a single, 25 percent income-tax band as part of its broader effort to boost the economy. The rate would be the same for both individual and corporate earnings, and would be introduced on January 1, 2007, applicable to incomes earned in 2006. Should the government go ahead with the reform, which appears likely, it will be announced by Prime Minister Costas Karamanlis in early September at the Thessaloniki International Fair, where premiers traditionally announce the government’s policy for the following year. Under the present system, annual income up to 11,000 euros is tax-exempt, while the portion of the income between 11,000 and 13,000 euros is taxed at 15 percent, between 13,000 and 23,000 at 30 percent and above 23,000 euros at 40 percent. According to sources, introduction of the flat rate will be accompanied by a rise in the tax-exempt portion of the income to 13,000 euros. The government, meanwhile, has already begun decreasing corporate taxes, from 35 percent to 25 percent."


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