Consulting Practice Details

FASTER - BETTER - CHEAPER - SAFER ... will the pressure never cease? It would seem not! After we struggled through Q1 2008 and sank deeper into W's second recession, we next endured Q2 & Q3, and the economic climate became steadily worse. As we proceeded through Q4 2008, the US financial system fell down around our ears. Q4 2008 was the worst quarter of the year! The US economy at the end of last year under Bush 43 contracted at a far faster rate than initially estimated, a US Bureau of Economic Analysis report released February 27, 2009 said. The decline in the country's gross domestic product in the last quarter of 2008 was the worst since the 1982 recession under Reagan, and indicates that the current recession has been even deeper than previously believed. Output fell 6.2% at an annualized rate in the fourth quarter of 2008, revised downward from a previous estimate of a 3.8% decline. Consumer Confidence sank to 38, the lowest level in 41 years.

Good riddance to 2008, but conditions hardly improved in Q1 2009! On March 6, 2009, more bad news was released by the US Labor Department. The nation's unemployment rate rose to 8.1% in February 2009, the highest since 1983, as employers chopped another 651,000 jobs. Both figures were (as usual) worse than analysts expected. And revised figures released March 6 showed even deeper payroll reductions in the prior two months: the economy lost 681,000 jobs in December 2008 and another 655,000 in January 2009. Since W's second recession began in December 2007, the economy through February 2009 had lost an incredible 4.4 million jobs. Then on April 03, 2009, the Labor Department reported the nation's unemployment rate jumped again, to 8.5% in March, the highest since late 1983, as a wide range of employers eliminated a net total of 663,000 jobs. The latest tally of job losses in March was slightly higher than the 654,000 that economists expected. So since W's latest recession began in December 2007, the economy lost THROUGH MARCH 2009 a net total of 5.1 million jobs.

Another 539,000 jobs disappeared from the economy in April, and the unemployment rate jumped to 8.9%, its highest level in a quarter century, the Labor Department reported on May 08, 2009. Yet the deterioration was slightly milder than expected, prompting encouraging talk that President Obama's stimulus plans are working. But the troubles left to us by the outgoing administration run deep and it will take many more months to dig out ways out of this recession.

Nevertheless, a few optimists had been suggesting that the May 8, 2009 Labor Department report of 'only' 539,000 jobs lost in April was a sure sign that the worst was over. The revised figure for April is even better...only 504,000 jobs were actually lost, said the Labor Department on June 5, 2009. More striking is the Labor Department report for jobs lost in May 2009, released June 5, 2009... only 345,000! Yes indeed; a definite improvement!

But the damage done since the recession began in December 2007 is very much still with us, as articulated soberly and comprehensively in a June 5, 2009 article in the New York Times by Peter Goodman & Jack Healy, entitled, 'Hints of Hope Even as Jobless Rate Jumps to 9.4%.'

The July 2, 2009 Labor Department report showed that US employers cut a larger-than-expected 467,000 jobs in June, driving the unemployment rate up slightly to a 26-year high of 9.5%, suggesting that the economy's road to recovery will continue to be bumpy. But then on August 7, 2009, the announcement came that U.S. employers throttled back on layoffs in July, cutting just 247,000 jobs, the fewest in a year, and the unemployment rate dipped to 9.4 percent. It was a better than expected showing that offered a strong signal that the recession may have bottomed out.

On October 2, 2009, the Labor Department said that the jobs lost in August were 207,000, not the higher figure of 216,000 jobs lost reported for August originally. However, the initial figure for September job losses was 263,000, higher than expected. We are all wishing for better job numbers by now, but it's important to remember that as recent as Q1 2009, job losses were averaging 699,00 per month. Still, more than 7.2 million jobs have been eliminated since the recession began 22 months ago in December 2007. The road to full recovery is still long.

Indeed, as we warily begin Q4 2009, every business enterprise faces accelerating change and aggressive competition. High Technology companies may be the most challenged of all! Slowing growth - shorter product life cycles - fewer people - stretched management resources - increased security concerns & international financial risks ... all push both hi-tech vendors and users to the ragged edge.

After eight years (1993 - 2000) of an improving technology environment, the eight years 2001 - 2008 moved the country in the wrong direction. There have existed and still exist multiple business, economic and geopolitical indicators that have been causing high-anxiety in the world of high technology in the United States and elsewhere. We have only just begun to implement policies to recover.

Here in the United States, those eight years (2001-2008) resulted in well over a dozen and a half enervating political and economic factors: (1) unremitting government extravagance and unwarranted tax cuts in the face of the shift from US federal budget surplus to deep deficit, made far worse by the ineffective and clumsy 2008 Wall Street & bank bailouts; (2) the definite long-term trend of a rich-get-richer, poor-get-poorer US income distribution; (3) sluggish net job growth chronically below the requirements of US population increases; (4) a net US disadvantage in globalization, with outsourcing of US jobs; (5) weakened US environmental stewardship, and rapidly deteriorating US infrastructure; (6) the ballooning real and psychic costs of recent and current wars, in lives and treasure, including the IRAQ quagmire (now in its 7th year), along with huge numbers of expensive US-paid mercenaries unaccountable to US military authority, and resurgence of the Taliban in Afghanistan; (7) reduced worldwide and domestic admiration for US leadership, with an astonishing lack of accountability, conflating IRAQ with 9/11, and appalling ignorance of history in understanding or even talking to foreign countries (Syria, Palestine, Iran, North Korea, et al), brokering Bhutto's return to Pakistan, only to see her assassinated; threatening a war with IRAN in the last months of Bush 43's lame duck term; (8) the weaker US dollar, still near a record low vs. the euro; (9) elevated energy, oil & gas prices, with record profits for “big oil” for most of the last eight years; (10) a still-deteriorated domestic tech-laden NASDAQ market vs. 2001; (11) ongoing corporate fraud, including widespread options back-dating and unregulated sub-prime lending; (12) scandals, indictments, criminal investigations and even some convictions in the White House and Congress; (13) double-digit annual rises in the cost of US health care and ongoing increases in the number of US medical & dental uninsured (US has the most expensive health care in the world, yet is 42nd in life expectancy); (14) stunning US federal incompetence (revolving-door cronyism, inept disaster relief, bumbled Medicare drug plan, mishandled offshore oil leases, ignoring global warming, homeland security lapses, incompetent nation building, Osama still on the loose, ordering extraordinary foreign rendition, Abu Ghraib, Haditha, Guantanamo, destroyed CIA tapes, FCC decision loosening media cross-ownership rules, EPA rule to disallow state waivers to reduce pollution emissions, etc.); (15) illegalities in reduced US civil liberties & personal privacy; (16) unrelenting illegal immigration into the US, with no reform in sight; (17) the rise of religious fundamentalism in the US, resulting in the blurring of constitutional separation between church and state; (18) deterioration of the US K-12 education system, especially in math & science, and ominous reductions in college affordability by low & medium income US citizens; all resulting in abridged future global US competitiveness; (19) rapidly falling US home prices and sales during 2005-2008; (20) the rise of secretive, unregulated hedge fund investment partnerships, derivatives, credit default swaps and unregulated sub-prime lenders that create widespread financial disruptions, including the Madoff Ponzi Scheme ignored by Bush 43's SEC; (21) sinking into Bush 43's 2nd recession from October 2007 onward; and (22) unceasing high US trade deficits, despite the weak US dollar, requiring the US to borrow billions of dollars every week from abroad; just to name a few.

We were heartened by the results of the November 7, 2006 US election, in which the American electorate finally responded, repudiating the ruling party in control of the Executive and Legislative branches of the US government for the previous six years. While it will take many years to recover from the damage of those previous six years, we had hoped that further damage between 2006 and 2008 could at least be minimized. The actions from the president since the November 7, 2006 election were, however, not encouraging (e.g. the "surge" of more US troops into the IRAQ quagmire, a record number GI's killed in both IRAQ and Afghanistan in 2007-08 already, unwarranted "confidence" in Gonzales both before and after Gonzales handed in his resignation, unwarranted "confidence" in Wolfowitz before he finally resigned from the World Bank in shame; spurning subpoenas from Congress, commuting convicted criminal Libby's prison term, vetoing Child Health Care, threatening war against Iran, ignoring the latest NIE, etc.).

As a result, as of late 2008, the U.S. found itself in its deepest economic slowdown since the 1930's. Bush 43 bequeathed monumental problems for President Barack Obama to overcome. As a first step, President Obama muscled the $787 billion Stimulus Bill through Congress in mid-February 2009, despite nearly universal Republican opposition, and despite the fact that Republican policies were the very ones that got the economy in trouble in the first place!

And the indications are that another, much larger stimulus bill needs to be implemented, and fast. But will this be impossible with ongoing Republican "do nothing" opposition?