Thursday, Feb. 7, 2008

There's good news and there’s bad news

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There's good news and bad news. Which is which depends upon your situation.

The stock market has tumbled, which for many downcast investors means they have lost a bundle. Yet bottom fishers, those who can afford to buy when prices are low and sell when prices have risen, are cheering at their good fortune.

Walk Frederick's streets and elsewhere, and there are for-sale signs on houses in numbers like never before. Foreclosure notices fill columns in newspapers. Some of the most prudent financial institutions are reporting losses in the billions, having invested in home mortgages with terms homeowners can't meet.

One-time prudence vanished as officers of those institutions saw gigantic salary increases based on promises, not fact.

For the first time in four years, the total jobs in the United States has decreased. To be sure, 17,000 is a small number, except the home construction industry has slowed almost to a halt, and retail sales are slowing as well, indicating future problems.

One expert says the 2.8 million manufacturing job loss in recent years, many of which ended up overseas, is not the problem. China's gain is not really our loss. Just be sure and check the lead content in your children's toys.

The dollar traded at its lowest against the euro, the currency used by many major European nations.

But the Swiss are cheering, because its franc has reached a record high, and the Japanese yen is so valuable, you can get low-cost loans there. The U.S. dollar is buying less in overseas trade.

The president, joined by Congress, is about to produce an economic stimulus package to add $150 billion to the economy. Most Americans will get between $600 to $1,200, which we are expected to spend immediately. So big daddy who dug deeply into our pockets through taxation is sending back some of our money. The federal debt is at record high, and so the federal government will just rev up the printing presses to spew out money that has no financial support.

Somehow, all I see is politicians trying to make themselves the good guys and gals, wanting to defer action on the recession we face.

I would be more impressed if our members of Congress, earning $169,300 each per year with a hefty fringe benefit package and an automatic COLA increase, would vote to forego the COLA until the economy became stable.

And I would be more impressed if our state legislators, who have raised our taxes in the special session by $1.3 billion, would vote to cut their $43,500 salary and per diem reimbursement they get for a 90-day session.

As Sen. Bryan Simonaire of Anne Arundel County said, “If we're in a financial crisis and we ask the people of Maryland to sacrifice, our own salaries shouldn't be exempt from the process.“

The same can be said for our city officials, who have voted a $17,000 increase for the next mayor to $90,000 and the $11,500 increase to $25,000 for the next aldermen. In economic times like these, our city officials should feel the pain many of our residents are feeling. Before I became mayor in 1990, the salary had been raised from $45,000 to $50,000 with automatic increases. Feeling strongly that the desire to serve the residents of Frederick should be the consideration, regardless of what the job may pay, I froze my salary at $45,000, foregoing any increase.

We were in the midst of struggling to balance the budget. It may be good news to the politicians to raise their salaries, but it is bad news for the residents who watch their taxes increase and buying power decrease.