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Despite record profits Caterpillar pushes 6 year pay and pension freeze

By Poop Deck   Follow   Mon, 23 Jul 2012, 7:18pm   7,307 views   134 comments
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http://www.nytimes.com/2012/07/23/business/profitable-caterpillar-pushes-workers-for-steep-cuts.html?pagewanted=all

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1. iwog Follow Befriend (48) 274 threads 12,571 comments 47 male Lafayette, CA Premium

   95   9:36am Fri 27 Jul 2012   Share   Quote   Permalink   Like (1)   Dislike   Protected   Peter P says Wealth disparity is not a bad thing. We are NOT communists. Wealth disparity is a good thing in moderation because it provides incentives to succeed. Wealth disparity in the extreme, like we have now or like existed in 1929 or like France had before the revolution, is a nation destroyer. Obviously we are not communists. Would you say we were communists in 1950 then?

2. Peter P Follow Befriend (4) 117 threads 17,655 comments Premium

   96   9:37am Fri 27 Jul 2012   Share   Quote   Permalink   Like   Dislike   Protected   Construction of one large yacht employs hundreds of people for a few years.

3. iwog Follow Befriend (48) 274 threads 12,571 comments 47 male Lafayette, CA Premium

   97   9:40am Fri 27 Jul 2012   Share   Quote   Permalink   Like   Dislike   Protected   Peter P says Construction of one large yacht employs hundreds of people for a few years. That's true, but most of the money hoarded by the rich does not purchase yachts. It goes into government debt, Dubai, or into commodity speculation. 100% of the money earned by the lower 80% goes into consumption and making jobs. I would guess that billionaires use less than 5% on consumption and the rest goes into hoarding.

4. Peter P Follow Befriend (4) 117 threads 17,655 comments Premium

   98   9:40am Fri 27 Jul 2012   Share   Quote   Permalink   Like   Dislike   Protected   iwog says Peter P says Wealth disparity is not a bad thing. We are NOT communists. Wealth disparity is a good thing in moderation because it provides incentives to succeed. Wealth disparity in the extreme, like we have now or like existed in 1929 or like France had before the revolution, is a nation destroyer. Obviously we are not communists. Would you say we were communists in 1950 then? Lol! We are not even close to France before the revolution. How many people starve to death every day?

5. Peter P Follow Befriend (4) 117 threads 17,655 comments Premium

   99   9:42am Fri 27 Jul 2012   Share   Quote   Permalink   Like   Dislike   Protected   iwog says Peter P says Construction of one large yacht employs hundreds of people for a few years. That's true, but most of the money hoarded by the rich does not purchase yachts. It goes into government debt, Dubai, or into commodity speculation. 100% of the money earned by the lower 80% goes into consumption and making jobs. I would guess that billionaires use less than 5% on consumption and the rest goes into hoarding. So wealth does trickle down. It just does so globally.

6. freak80 Follow Befriend (4) 52 threads 4,416 comments Corning, NY Premium

   100   9:42am Fri 27 Jul 2012   Share   Quote   Permalink   Like   Dislike   Protected   iwog says A billion dollars in hookers? I was joking of course. ;-) I agree there is too much "capital" chasing too little "demand." Supply-side economics isn't going to get us out of the current mess. We're caught in a classic "catch 22." There is massive unemployment because the unemployed can't buy anything that would create their own jobs. It's a structural problem, not a laziness problem. Graduates with engineering degrees can't even find work. No one makes it through an engineering program by being lazy, that's for sure. Far-right trolls will call this "wealth redistribution" but how else are we going to reduce unemployment? Are we going to "print money" and give it to the unemployed?

7. iwog Follow Befriend (48) 274 threads 12,571 comments 47 male Lafayette, CA Premium

   101   9:42am Fri 27 Jul 2012   Share   Quote   Permalink   Like (1)   Dislike   Protected   Peter P says Lol! We are not even close to France before the revolution. How many people dtarve to death every day? You need to ask yourself why we're not even close to pre-revolutionary France. The answer is food stamps, unemployment, Social Security, Medicare, the minimum wage, and other public spending. Everything the Republicans want to eliminate in the name of balancing the budget. We're not there yet, but it's part of the Republican platform to put us there.

8. Peter P Follow Befriend (4) 117 threads 17,655 comments Premium

   102   9:43am Fri 27 Jul 2012   Share   Quote   Permalink   Like   Dislike   Protected   I do think we need a safety net.

9. freak80 Follow Befriend (4) 52 threads 4,416 comments Corning, NY Premium

   103   9:46am Fri 27 Jul 2012   Share   Quote   Permalink   Like   Dislike   Protected   iwog says 100% of the money earned by the lower 80% goes into consumption and making jobs. I would guess that billionaires use less than 5% on consumption and the rest goes into hoarding. Correct. That's why "tax cuts for the rich" doesn't create jobs. Other than slave-labor jobs in China and Vietnam.

10. iwog Follow Befriend (48) 274 threads 12,571 comments 47 male Lafayette, CA Premium

    104   9:47am Fri 27 Jul 2012   Share   Quote   Permalink   Like (2)   Dislike   Protected   Peter P says So wealth does trickle down. It just does so globally. The answer is no. If you won a $10,000 prize somewhere, you'd go spend it. If a billionaire won a $10,000 prize, it would sit in his bank account or a treasury bond forever. Austrian economic theory assumes that rich people move their money around. They have more so they spend more. The reality is that the lower 80% spend almost everything immediately while the top 1% will let their money sit around useless for long periods of time.

11. freak80 Follow Befriend (4) 52 threads 4,416 comments Corning, NY Premium

    105   9:54am Fri 27 Jul 2012   Share   Quote   Permalink   Like   Dislike   Protected   iwog says The reality is that the lower 80% spend almost everything immediately while the top 1% will let their money sit around useless for long periods of time. One key concept here is the distinction between just "money" and the so-called "velocity of money." All the money in the world doesn't matter if it's not changing hands. Like iwog says, the lower 80% use money mainly as a "medium of exchange" (to buy stuff they need) wheras the top uses money as a "store of value."

12. Peter P Follow Befriend (4) 117 threads 17,655 comments Premium

    106   10:07am Fri 27 Jul 2012   Share   Quote   Permalink   Like   Dislike   Protected   Again, having too much newly created money changing hands will turn us into Zimbabwee. It is now the best of all possible world. I don't like it but what can we do?

13. iwog Follow Befriend (48) 274 threads 12,571 comments 47 male Lafayette, CA Premium

    107   10:14am Fri 27 Jul 2012   Share   Quote   Permalink   Like   Dislike   Protected   Peter P says Again, having too much newly created money changing hands will turn us into Zimbabwee. It is now the best of all possible world. I don't like it but what can we do? That's a myth and is not what happens at all. FDR effectively doubled the money supply overnight in 1933 and none of that happened. The problem with Zimbabwe was industry, NOT money supply. Zimbabwe gutted their economy by wrecking farm production and as a result there was practically nothing to buy. In response, the government started printing to survive, however they were competing with the public and prices skyrocketed. In a deflationary depression, like what we're experiencing, new demand will almost immediately create new supply and there will be very little new inflation.

14. Peter P Follow Befriend (4) 117 threads 17,655 comments Premium

    108   10:16am Fri 27 Jul 2012   Share   Quote   Permalink   Like   Dislike   Protected   We may have to agree to disagree.

15. xrpb11a Follow Befriend (4) 2 threads 787 comments

    109   10:50am Fri 27 Jul 2012   Share   Quote   Permalink   Like   Dislike   I'm addressing your comment: Because Americans have lots of savings they would be wiling to dip into if only the right product came along, right? not your 'zero sum' macro argument.... iwog says xrpb11a says If you engineer a product that will make people's lives better, they will buy it, via savings, loans, or cash. You've never played Monopoly have you. Again......it's a zero sum game. If you engineer a product that people buy, they will buy it instead of something else. When you make someone a billionaire, that billion dollars is no longer available to be spent in the general marketplace.

16. xrpb11a Follow Befriend (4) 2 threads 787 comments

    110   10:53am Fri 27 Jul 2012   Share   Quote   Permalink   Like   Dislike   Precisely. Thanks for agreeing. BTW, I was not addressing "government funding". I was addressing "private company R&D funding" tatupu70 says xrpb11a says Rich people create jobs in R&D, where there is no demand, but lots of risk. Demand will be a byproduct of a successful R&D project. Not really. People invest in R&D to develop products to cater to unmet demand. Pure research (fundamental) is usually funded by the government because "rich" people won't.

17. xrpb11a Follow Befriend (4) 2 threads 787 comments

    111   10:57am Fri 27 Jul 2012   Share   Quote   Permalink   Like   Dislike   Yes. http://pragcap.com/the-5-trillion-corporate-cash-hoard tatupu70 says xrpb11a says Rich people will not invest in R&D if their funding is threatened by excessive taxation Huh? I don't get this theory. So, rich people would rather make 0 by not investing as opposed to making 70% of something large (profits from the development)?? How do you figure?

18. xrpb11a Follow Befriend (4) 2 threads 787 comments

    112   11:02am Fri 27 Jul 2012   Share   Quote   Permalink   Like   Dislike   But if you are sitting on the sidelines with 5 trillion, not investing for whatever reason, additional tax writeoffs can push you into putting some of that cash into play...Look at the 100% writeoff for capital equipment purchases .. Obama to Propose Tax Write-Off for Business NY Times ^ | 9/7/10 | Jackie Calmes Posted on Tue Sep 07 2010 10:31:47 GMT-0700 (Pacific Daylight Time) by Nachum WASHINGTON — As part of his emerging program to jolt the economic recovery from its stall, President Obama will call this week for allowing businesses to deduct from their taxes through 2011 the full value of new equipment purchase, from computers to utility generators, to increase demand for goods and create jobs. The upfront deduction would allow businesses of all sizes to keep more money now and would give large corporations, many of which are sitting on cash because of uncertainty about the economy, an incentive to spend and invest. (Excerpt) Read more at nytimes.com ... tatupu70 says The risks of investing in R&D are rewarded with profits, not tax benefits. You invest to make money, not save on your taxes.

19. xrpb11a Follow Befriend (4) 2 threads 787 comments

    113   11:06am Fri 27 Jul 2012   Share   Quote   Permalink   Like   Dislike   most of us, anyway.... Peter P says Wealth disparity is not a bad thing. We are NOT communists.

20. rdm Follow Befriend 4 threads 239 comments

    114   11:25am Fri 27 Jul 2012   Share   Quote   Permalink   Like (1)   Dislike   errc says The union workers I know are the ones that stand on a factory line, watching a machine do all the work, Those jobs both union and non union are pretty scarce in the USA. Most of CAT workers are highly skilled and not easy to replace. Still.... CAT had a huge strike some years back in Illinois centered in Peoria the union was the UAW. CAT won, the union caved. CAT knows how to win concessions, and because of that has no need to go non union. They are , particularly in this economy holding the best hand. Contrary to what many think, being a union company that hires skilled workers does have advantages for the company. Not the least is a pool of skilled workers that are immediately available to the company so one can gear up production or gear down production without concern as to labor, of course it all depends on the terms of the contract. But this is huge in some businesses. Most of the really stupid "featherbedding" in union contracts is long gone, and that's to the good. The reality today is unions, because of the general economic conditions their own stupidity and weakness have given the "companies" the upper hand. Some companies choose to keep their workers happy by being reasonable in their negotiations others such as CAT dont give a shit.

21. tatupu70 Follow Befriend (3) 15 threads 5,643 comments

    115   5:10pm Fri 27 Jul 2012   Share   Quote   Permalink   Like   Dislike   xrpb11a says http://pragcap.com/the-5-trillion-corporate-cash-hoard The facts are right, your explanation is what is wrong. They aren't investing because there is no demand. Noone can afford to buy things so there's no reason to make them.

22. tatupu70 Follow Befriend (3) 15 threads 5,643 comments

    116   5:12pm Fri 27 Jul 2012   Share   Quote   Permalink   Like   Dislike   xrpb11a says BTW, I was not addressing "government funding". I was addressing "private company R&D funding I understand and I was pointing out that companies don't fund pure research. They fund product development.

23. tatupu70 Follow Befriend (3) 15 threads 5,643 comments

    117   5:16pm Fri 27 Jul 2012   Share   Quote   Permalink   Like (1)   Dislike   Ruki says Uh, no. Your views on the matter won't change things because it doesn't involve you. It involved Caterpillar's investors and workers. Uh, yes. As an owner of Caterpillar, if I can convince other owners of Caterpillar then it will. Ruki says Again, another liberal who arrogantly feels he knows what is best for others and even displays more arrogance in assuming he should actually effect said others. Yes, how dare I think that children shouldn't work in sweatshops. Or that we should strive to have a healthy economy where people can work and support a family. Where there is a rule of law. How about you go to Somalia-I hear you can do whatever you want there.

24. tatupu70 Follow Befriend (3) 15 threads 5,643 comments

    118   5:18pm Fri 27 Jul 2012   Share   Quote   Permalink   Like (1)   Dislike   Ruki says Well, you see...a man and a women get together...but some irrational Patlib fools actually think new customers are delivered by storks instead... Once again Shrek misses the boat. A customer must have the means to buy... or else he's not a customer

25. xrpb11a Follow Befriend (4) 2 threads 787 comments

    119   5:29pm Fri 27 Jul 2012   Share   Quote   Permalink   Like   Dislike   There is no demand for products that have not been invented yet. There was no demand for the ipad prior to its development. The demand was created by the product, which was unique. it's called "Research and Development" tatupu70 says xrpb11a says http://pragcap.com/the-5-trillion-corporate-cash-hoard The facts are right, your explanation is what is wrong. They aren't investing because there is no demand. Noone can afford to buy things so there's no reason to make them.

26. xrpb11a Follow Befriend (4) 2 threads 787 comments

    120   5:33pm Fri 27 Jul 2012   Share   Quote   Permalink   Like   Dislike   which was the basis of my post. tatupu70 says xrpb11a says BTW, I was not addressing "government funding". I was addressing "private company R&D funding I understand and I was pointing out that companies don't fund pure research. They fund product development.

27. tatupu70 Follow Befriend (3) 15 threads 5,643 comments

    121   7:52pm Fri 27 Jul 2012   Share   Quote   Permalink   Like   Dislike   xrpb11a says There is no demand for products that have not been invented yet. There was no demand for the ipad prior to its development. The demand was created by the product, which was unique. it's called "Research and Development" Sure there was. All you had to do was ask someone if they would pay $xx for a tablet computer with apps, etc. The demand is there even before the product exists. That's why companies do focus groups-to get a handle on demand.

28. tatupu70 Follow Befriend (3) 15 threads 5,643 comments

    122   7:53pm Fri 27 Jul 2012   Share   Quote   Permalink   Like   Dislike   xrpb11a says which was the basis of my post. Then we agree--companies spend money to develop products to cater to unmet demand. If there is no unmet demand, as now, then companies don't invest. The problem is that there isn't enough unmet demand right now.

29. xrpb11a Follow Befriend (4) 2 threads 787 comments

    123   8:12pm Fri 27 Jul 2012   Share   Quote   Permalink   Like   Dislike   Well, a tiny iota of 'demand' may be generated by the focus groups, which may represent 0.000001% of the target audience. Note this is not necessarily an accurate assessment of what actual demand may be. Actual 'Demand' is generated when development * is around 90% complete and * the concept has been validated * Pre-production advertising is put in place * Commercial production may or may not have been initiated. This is the end of the "R&D" stage, where investor dollars are at most risk. tatupu70 says xrpb11a says There is no demand for products that have not been invented yet. There was no demand for the ipad prior to its development. The demand was created by the product, which was unique. it's called "Research and Development" Sure there was. All you had to do was ask someone if they would pay $xx for a tablet computer with apps, etc. The demand is there even before the product exists. That's why companies do focus groups-to get a handle on demand.

30. xrpb11a Follow Befriend (4) 2 threads 787 comments

    124   8:26pm Fri 27 Jul 2012   Share   Quote   Permalink   Like   Dislike   "Demand" cannot be accurately verified until R&D has deemed the product feasible to manufacture, and pre-production advertising has begun. Therefore, companies do invest in products on the drawing board, having no actual demand, risking capital on an idea which may or may not come to fruition. This negates the bolded section below.... tatupu70 says xrpb11a says which was the basis of my post. Then we agree--companies spend money to develop products to cater to unmet demand. If there is no unmet demand, as now, then companies don't invest. The problem is that there isn't enough unmet demand right now.

31. Bellingham Bill Follow Befriend 30 threads 1,488 comments Bellingham, WA Premium

    125   9:53pm Fri 27 Jul 2012   Share   Quote   Permalink   Like (1)   Dislike   Protected   Peter P says Construction of one large yacht employs hundreds of people for a few years. This is a very silly thing to argue. For one, for the same money these workers could have been employed creating more usable wealth for more people rather than that "one large" personal luxury watercraft. At the end of the day, luxury spending removes wealth from the economy. 10 $20,000 Hyundais is a higher quality of life compared to 1 $200,000 Maserati. Also, what's happening with these big-ticket items is that the labor component is seeing very little of the sales money. For a $200,000 luxury car, the labor might get $20,000 while $100,000 remains with the factory owner. The money just went from one capitalist pocket to the other. People who can't see this basic reality scare me.

32. thomaswong.1986 Follow Befriend 15 threads 2,845 comments

    126   10:05pm Fri 27 Jul 2012   Share   Quote   Permalink   Like   Dislike (1)   Poop Deck says Despite record profits Caterpillar pushes 6 year pay and pension freeze thats one way to avoid future lay offs..

33. freak80 Follow Befriend (4) 52 threads 4,416 comments Corning, NY Premium

    127   10:08pm Fri 27 Jul 2012   Share   Quote   Permalink   Like (1)   Dislike   Protected   Delurking says For one, for the same money these workers could have been employed creating more usable wealth for more people rather than that "one large" personal luxury watercraft. True.

34. tatupu70 Follow Befriend (3) 15 threads 5,643 comments

    128   6:36am Sat 28 Jul 2012   Share   Quote   Permalink   Like   Dislike   xrpb11a says Well, a tiny iota of 'demand' may be generated by the focus groups The focus groups don't generate demand, they just give the company an idea of how much demand already exists. It's like taking a poll. xrpb11a says Therefore, companies do invest in products on the drawing board, having no actual demand, risking capital on an idea which may or may not come to fruition. No--again, the demand is already there. The company is trying to create a product that caters to that demand.

35. xrpb11a Follow Befriend (4) 2 threads 787 comments

    129   3:53pm Sat 28 Jul 2012   Share   Quote   Permalink   Like   Dislike   The focus groups are exposed to the idea of a product. Some of them like the idea so much they want it, budget for it if the product pans out, and become part of the "demand". a "tiny iota" of demand, but nonetheless, demand. tatupu70 says xrpb11a says Well, a tiny iota of 'demand' may be generated by the focus groups The focus groups don't generate demand, they just give the company an idea of how much demand already exists. It's like taking a poll.

36. xrpb11a Follow Befriend (4) 2 threads 787 comments

    130   4:00pm Sat 28 Jul 2012   Share   Quote   Permalink   Like   Dislike   My definition of "demand" is different than yours. "Demand" for me means that there are actual customers that have put down a deposit for something that is in the Pre-production or production stage. They have put their money where their mouth is. I would call your version "Projected Demand". tatupu70 says xrpb11a says Therefore, companies do invest in products on the drawing board, having no actual demand, risking capital on an idea which may or may not come to fruition. No--again, the demand is already there. The company is trying to create a product that caters to that demand.

37. tatupu70 Follow Befriend (3) 15 threads 5,643 comments

    131   4:33pm Sat 28 Jul 2012   Share   Quote   Permalink   Like   Dislike   xrpb11a says The focus groups are exposed to the idea of a product. Some of them like the idea so much they want it, budget for it if the product pans out, and become part of the "demand". a "tiny iota" of demand, but nonetheless, demand. I think you are confused about the definition of demand. xrpb11a says "Demand" for me means that there are actual customers that have put down a deposit for something that is in the Pre-production or production stage. They have put their money where their mouth is. That's not the correct definition of demand. A quick google search yields the following. Obviously exact definitions vary, but none require someone to pay to be considered part of demand. "Definition: Demand is the want or desire to possess a good or service with the necessary goods, services, or financial instruments necessary to make a legal transaction for those goods or services." "The desire to possess a commodity or make use of a service, combined with the ability to purchase it."

38. xrpb11a Follow Befriend (4) 2 threads 787 comments

    132   4:39pm Sat 28 Jul 2012   Share   Quote   Permalink   Like   Dislike   As a business owner, I do not calculate "demand" based on "wants or desires". That is "projected demand" to me. I like my version better than Googles..I'll stick with that. tatupu70 says That's not the correct definition of demand. A quick google search yields the following. Obviously exact definitions vary, but none require someone to pay to be considered part of demand. "Definition: Demand is the want or desire to possess a good or service with the necessary goods, services, or financial instruments necessary to make a legal transaction for those goods or services." "The desire to possess a commodity or make use of a service, combined with the ability to purchase it."

39. tatupu70 Follow Befriend (3) 15 threads 5,643 comments

    133   4:45pm Sat 28 Jul 2012   Share   Quote   Permalink   Like   Dislike   xrpb11a says As a business owner, I do not calculate "demand" based on "wants or desires". That is "projected demand" to me. I like my version better than Googles..I'll stick with that. Obviously, as a business owner you are most concerned with actual sales. And not so much with abstract concepts like demand. Which is completely understandable. But the definitions of demand that I have provided are correct so when we are talking about big picture economic concepts, you need to keep that in mind...

40. xrpb11a Follow Befriend (4) 2 threads 787 comments

    134   4:53pm Sat 28 Jul 2012   Share   Quote   Permalink   Like   Dislike   I understand where you are coming from. In my position i need to separate it into "Actual" or "Projected". tatupu70 says xrpb11a says As a business owner, I do not calculate "demand" based on "wants or desires". That is "projected demand" to me. I like my version better than Googles..I'll stick with that. Obviously, as a business owner you are most concerned with actual sales. And not so much with abstract concepts like demand. Which is completely understandable. But the definitions of demand that I have provided are correct so when we are talking about big picture economic concepts, you need to keep that in mind...

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