Here are a few interesting stories over the past few days that caught my eye. The one bright spot is that Cap-And-Trade is officially dead. The rest show that structural problems continue to mount.

Landlords Squeezed By Small Pool Of Good Tenants

Landlords not so quick to evict in slow economy

Despite the sour economy, evictions in Davidson County [Tennessee] fell by nearly 10 percent in January from a year ago, and they’re on track to fall even further this month.

Landlords know they’ll have trouble finding new tenants if they lose the ones they have, industry observers say, so some of them are more willing to give struggling tenants a break.

“The economy has hit the apartment industry in a lot of different ways,” said Brad Cathers, past president of the Tennessee Apartment Association and president of Lighthouse Property Management Group in Nashville.

“It’s changed the way a lot of people live, who is looking to rent, how many units are rented, and it’s certainly true — some companies are giving a little more latitude to renters who find themselves in trouble.”

The change may have begun in 2008 and intensified in 2009. Davidson County court records show that 7 percent fewer detainer warrants were filed last year than two years earlier. Detainer warrants typically are filed for failure to pay rent, said Ricky Rooker, Davidson County’s circuit court clerk.

The cost of removing someone from a unit, cleaning, painting and maybe even laying new carpet has a lot to do with landlords’ reluctance to evict, Cathers said.

But that’s not the only reason that fewer eviction proceedings are being filed.

“The pool of potential renters is just smaller,” Cathers said. “Young people are moving back in with parents, and older people are moving in with children. And roommates … they are going two to three to a unit today instead of renting the two or three separate apartments they might have occupied before the recession began.”
More units, fewer takers

So the number of units available for rent has reached levels unseen in Nashville since the 1980s, according to the association’s data.

With fewer people lining up to rent, landlords have a powerful incentive to try to work with people who just need a little more time to pay, said Dan Ford, director of property management for Freeman Webb Inc., which operates 35 apartment complexes in the Nashville area and 33 others in Tennessee.

Violent Student Protest at U.C. Berkeley

Berkeley fee protest turns rowdy

A late-night protest against fee hikes at UC Berkeley turned violent early this morning when a crowd of about 200 people lit trash can fires, smashed at least one store’s windows, occupied a university building and clashed with police, officials said.

At around 1:30 a.m., arguments turned tense between the protesters and Berkeley police who were monitoring the gathering, and within 20 minutes some in the crowd lit a large trash can on fire and shoved it toward officers, police said.

That’s when a full-out riot erupted, with officers pushing the crowd back so firefighters could get at the flaming can and protesters flinging bottles and at the police, authorities said.

Members of the crowd lit more cans on fire. The crowds surged forward, police shoved them back with batons, and then the crowd would surge again, officials said.

“The crowd got out of control, and rocks and bottles were thrown,” said Berkeley police spokesman Officer Andrew Frankel.

The crowd was finally quelled by 3:30 a.m., leaving debris and still-flaming trash cans all over Telegraph Avenue near the university’s entrance.

Social unrest begins. Expect to see much more of it.

Jet Engine Maker Pratt & Whitney Battles Union

Pratt & Whitney announces layoffs, appeal of ruling blocking shift of 1,000 jobs from Conn.

Jet engine maker Pratt & Whitney delivered a blow to its unionized work force Tuesday, announcing it will lay off 163 employees and appeal a judge’s decision blocking it from moving 1,000 jobs out of Connecticut.

Just hours after announcing the planned layoffs at its Cheshire and East Hartford facilities, company president David Hess said Pratt & Whitney strongly disagreed with the federal court’s ruling earlier this month and planned to file an appeal.

Hess told employees in a letter that the subsidiary of United Technologies Corp. is reacting to a downturn in the airline industry due to the recession. Closing two engine repair businesses and moving the jobs to Georgia, Japan and Singapore would reduce costs by more than $53 million a year, he said.

“The impact on families and communities is significant and these decisions are never taken lightly,” Hess said. “But unfortunately, I do not have the luxury of considering only the fate of the employees who are directly affected by this decision. I need to think about all 36,000 employees of Pratt & Whitney and the company’s long-term health and competitiveness.”

U.S. District Judge Janet Hall ruled Feb. 5 that Pratt & Whitney failed to make every effort to preserve the jobs in Connecticut as required by its contract with the machinists union.

James Parent, the union’s chief negotiator, said the union will demand that Pratt & Whitney prove that the layoffs, which represent about 20 percent of the jobs at the two facilities, are related to falling volume and are not an attempt to shift jobs in violation of the court ruling.

Unions Win Battle Lose War

I have to side with the unions on this one. They had a clause in their contract “to make every effort to preserve the jobs in Connecticut”. However, the contract expires in December. There is no way on earth that clause will be repeated in the next contract.

If the union had an ounce of common sense, it would strike the clause upfront and ask Pratt & Whitney what it would take to keep the jobs in Connecticut for another three years.

But unions never look ahead. Instead I expect a bitter strike in December with the end result in every job being moved to Georgia or overseas.

Jobless Benefits Phase Out Starting Sunday

Jobless benefits start ending on Sunday

Depending on extended unemployment benefits to see you through the Great Recession?

You’d better not: The Senate failed to push back the Feb. 28 deadline to apply for this safety net. Starting Monday, the jobless will no longer be able to apply for federal unemployment benefits or the COBRA health insurance subsidy.

Federal unemployment benefits kick in after the basic state-funded 26 weeks of coverage expire. During the downturn, Congress has approved up to an additional 73 weeks, which it funds.

These federal benefit weeks are divided into tiers, and the jobless must apply each time they move into a new tier.

Because the Senate did not act, the jobless will now stop getting checks once they run out of their state benefits or current tier of federal benefits.

That could be devastating to the unemployed who were counting on that income. In total, more than one million people could stop getting checks next month, with nearly 5 million running out of benefits by June, according to the National Unemployment Law Project.

Lawmakers repeatedly tried to approve a 30-day extension this week, but each time, Sen. Jim Bunning, R-Ky., prevented the $10 billion measure from passing, saying it needs to be paid for first.

This is not the first time unemployment insurance benefits — which enjoy wide bipartisan support — have fallen prey to politics. Last fall, the House approved adding up to 20 weeks to the federal benefits period. But it took seven weeks for the Senate to send it to the president’s desk, during which time more than 200,000 people stopped receiving checks.

It will be interesting to see how much resolve Bunning has. More than likely Congress will pass something next week. If not then, probably the week after.

Cap-And-Trade Dead
Key senators would nix ‘cap and trade’

Three key senators are writing a new climate bill without a broad “cap-and-trade” approach to reducing carbon pollution, leaving behind what has been the central feature in the debate over climate legislation for years, The Washington Post reported Friday night.

Cap and trade, in which overall pollution reduction targets are met by allowing facilities to buy and sell pollution credits, has become so politically unpopular that its Senate passage is viewed as unlikely.

So Sens. John Kerry, D-Mass., Lindsey Graham, R-S.C., and Joe Lieberman, I-Conn., are planning an alternative to be introduced next month, the Post reported on its Web site. The bill would apply different carbon controls to different sectors of the economy instead of taking a national approach.

According to participants, Graham told environmental leaders in a meeting Wednesday that “cap-and-trade is dead,” the Post said.

The new bill by Kerry, Graham and Lieberman, who have taken lead roles in the climate debate, would apply different approaches to three major emission sources: electric utilities, transportation and industry, the Post said, attributing the details to unidentified people familiar with the process.

Utilities would have to meet an overall emissions cap that would grow stricter over time. A carbon tax could be levied on motor fuel. And industrial facilities would be exempted from an emissions cap for several years, before it would be phased in.

Cap-And-Trade was one of the dumbest ideas ever. Thus, it’s a wonder it did not pass. It could have given the House passed the legislation. Fortunately the Senate refused to go along.

New Jersey pension fund is underfunded by $46 Billion

N.J. pension fund is underfunded by $46B, as gap continues to grow

New Jersey’s pension system is underfunded by nearly $46 billion, a more than 30 percent increase in a year, and as a result the state’s annual bill has grown to $3 billion, according to a new analysis released today by the state Treasury department.

Lawmakers are working on bills that would scale back pension benefits for future hires, but three pension boards passed motions asking the legislature to hold off on any action until they understand the financial impact of the bills. So far, the legislature only has an analysis for the impact of a bill that would require public employees to contribute 1.5 percent of their salaries toward health benefits.

The state’s pension funds cover retirement benefits for about 700,000 current and retired state and local workers, firefighters, police officers, judges and teachers.

“The proposed pension fund legislation wrongly makes police and fire an enemy when we believe we’ve faithfully made our contributions to the system,” said Rob Nixon, director of government affairs for the New Jersey Policemen’s Benevolent Association.

Excuse me but police and firefighter public unions are the enemy. Indeed all public workers on a defined benefit plan are the enemy.

Firefighters Retire To Lock In Benefits

Fearing pension cutbacks Jersey City is losing scores of firefighters eager to retire to protect benefits.

The Jersey City Fire Department has lost 26 members since the start of the year and will lose 20 more March 1 as firefighters rush to retire before the Legislature caps payouts.

“All of a sudden, I’ve got all these people that are retiring,” said Fire Director Armando Roman.
Across the state, municipal and school employees are making a mass exodus, fearful of state legislation that would cap their payouts for unused sick time at $15,000.

The Senate approved the bill, S-4, 36-0 Monday. The bill would only apply to those hired after the bill is signed into law, but it has employees nervous enough to leave before it becomes law.

Once again the solution to this mess is simple: Privatize the fire department and get rid of all these pension woes once and for all, going forward.

Counties Protest Excessive Pay In New Jersey

‘Excessive’ pay, benefits at N.J. Association of Counties are up for discussion

Concerns about “excessive” pay and benefits to the chief officer of the New Jersey Association of Counties, that caused some counties to withhold dues and prompted calls for the director’s resignation, will be tackled at a special executive board session today.

The association’s president, Somerset County Freeholder Peter Palmer, said he hopes to move quickly to resolve issues that have generated criticism of the lobbying group that represents 20 of the state’s 21 counties.

At issue are NJAC Executive Director Celeste Carpiano’s $205,000 salary, which rose from $133,000 since 2003, plus a luxury car she leases, oversight of the group’s nonprofit educational foundation and enrollment of NJAC employees in the state’s pension system.

The Morris County freeholders two weeks ago passed a resolution to withhold the county’s dues of $10,000 pending an independent audit of the agency, and lobbied other counties to join in withholding payment. They want cuts in pay and benefits to the association’s director and staff, and want the lobbying organization streamlined.

Freeholder boards in Sussex and Warren counties joined with Morris to withhold dues, while other counties are pondering decisions. Warren County Freeholder Director Richard Gardner called for Carpiano’s resignation, as did Somerset County Freeholder Director Jack Ciattarelli.

“I believe Celeste Carpiano’s compensation program is indefensible,” said Ciattarelli. “Salary increases she received for the past five to six years should be cause for outrage.”

Counties annually give the association a total of $200,000 in membership dues. Hunterdon County withdrew last year when NJAC declined to release financial information.

Congratulations go to Hunterdon County for having the common sense to opt out of the New Jersey association of counties. The simple solution is for every county to opt out of the association.

Mike “Mish” Shedlock
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