Thursday AM July 31st, 2008
by: Ed Mayberry, July 30, 2008 6:07:05 pm
According to Forbes magazine, Houston is the eighth-most expensive city in the nation to live in. Commuting costs are blamed, with the magazine noting the lack of an extensive or reliable mass-transit system. The article notes that 20.9 percent of Houston's household expenses go toward transportation. The magazine considered transportation costs, as well as food and apartment rental costs.
Houston's Bush Intercontinental Airport is the 16th-busiest airport, according to Airport Council International. Bush handled nearly 43 million passengers in 2007. Dallas-Fort Worth is the seventh-busiest, with nearly 60 million passengers. Topping the list is Atlanta, with almost 90 million passengers. According to the report, 4.8 billion people passed through the world's airports in 2007, which is 6.8 percent more than in 2006. ACI predicts that number will double to more than nine billion passengers by 2025.
The Bush administration has announced details on how it plans to borrow the billions of dollars it will need to cope with the soaring budget deficits. Those plans announced include raising $27 billion by selling a new ten-year note and a new 30-year bond at the regularly scheduled quarterly auctions to be held next week. The government needs to borrow $171 billion during the current July-September quarter, the second-highest quarterly borrowing total on record. The increased borrowing needs reflect the exploding federal budget deficit which is projected to more than double in size this year. It is expected to hit an all-time high of $482 billion in the 2009 budget year.
The Federal Reserve is extending its emergency borrowing program to Wall Street firms and is taking other steps to ease a severe credit crunch that has hobbled the national economy. The Fed announced Wednesday that the program, where investment houses can tap for a quick source of cash, will now be available through January 30th. Originally the program, started on March 17th, was supposed to last until mid-September. The Fed says another program, where investment firms can temporarily swap super-safe treasury securities for more risky investments also will continue through January 30th. And, it also will let commercial banks, in a separate program, be able to bid on cash loans that last longer — for 84 days — besides the 28-day loans now available.
Florida utility regulators powered down an $11.4 million program designed to promote green energy, but whose budget overwhelmingly funded marketing and administrative costs. The program, operated by Florida Power & Light and Austin-based Green Mountain Energy Company, charged willing FPL customers a $9.75 monthly fee in addition to their regular power bills. The parties were supposed to develop an extra 150 kilowatts of solar energy for every 10,000 residential customers who signed on to the Sunshine Energy program. A Public Service Commission report last month said only 24 percent of the money collected from more than 38,000 households paid for actual energy. The rest funded marketing and administration costs to promote the program. The Public Service Commission voted to terminate the program, rather than revise it as FPL recommended.
A study says China's soaring trade deficit cost Americans 2.3 million jobs and $19.4 billion in lost wages between 2001 and 2007. The Economic Policy Institute's study shows California suffered the most losses, with 325,800 fewer jobs. It was followed by Texas at 202,900, New York at 127,000, Illinois at 102,800 and Ohio at 102,700. Virginia lost 39,500 jobs. West Virginia's job losses totaled 7,200, including 900 workers in the wood products manufacturing industry who were displaced last year. The Washington, D.C.,-based think tank blamed the trade imbalance for pushing down wages an average of $8,146. The study is based on data from the Bureau of Labor Statistics, Census Bureau and the United States International Trade Commission.
Texas oilman T. Boone Pickens continues to be a pitch man for wind and natural gas as fuel for U.S. energy Needs. Pickens started his $58 million "Pickens Plan" in Topeka this week. The idea is to use television ads and town hall meetings across the Great Plains to get his word out. He tells anyone who will listen that the U.S. imports 70 percent of its oil today, compared to 24 percent in 1970. He says the annual cost of importing oil is $700 billion. Kansas is in a corridor from the Texas Panhandle to North Dakota that Pickens says could produce 20 percent of the nation's electricity by wind. The cost to achieve it is $1 trillion to build the turbines plus $200 billion for transmission lines. His plan calls for erecting wind turbines in the Midwest to generate electricity, replacing the 22 percent of U.S. power produced from natural gas. The freed-up natural gas then could be used to power vehicles now reliant on gasoline and diesel.
The government says crude oil inventories fell for the second consecutive week. Gasoline stockpiles also declined. The Energy Information Administration, says crude supplies dipped by 100,000 barrels, which is less of a decline than expected. Gasoline inventories dropped 3.5 million barrels, contrary to expectations for an increase. Demand for gasoline was about 2.5 percent below where it was a year earlier. Inventories of distillate fuel, which include diesel and heating oil, rose 2.4 million barrels. That is a bigger-than-expected increase, leading to an uptick of over $4 in oil prices.
The tenth annual Texas sales tax holiday will be August 15th through the 17th as families prepare to send children back to school. Texas Comptroller Susan Combs announced most clothing and shoes priced less than $100, with some exceptions, can be purchased tax free that weekend. Combs estimates shoppers will save about $54 million. Some tax free items will include coats, diapers, hooded shirts and sweat shirts, jeans, suits and underclothes. Taxes must still be paid on wallets, watches, handbags, jewelry and roller blades and skates. Combs says the tax loss is not expected to have a significant impact on Texas sales tax collections. She says Texas sales tax revenue "continues to grow at a healthy pace."
Whirlpool has filed a lawsuit in federal court. It wants to cut the medical benefits of thousands of retired Maytag workers. Whirlpool said it provides benefits to about 3,000 retired Maytag workers, surviving spouses and dependents. Whirlpool bought rival Maytag in 2006 for $1.7 billion and assumed the negotiated union contracts and related benefit plans. Whirlpool closed the Maytag corporate headquarters and a laundry equipment factory causing 1,800 workers to lose their jobs. Whirlpool said in the lawsuit that a contract negotiated between the union and Maytag in 2004 expires Thursday. Whirlpool said it plans to change the retiree medical benefits next January to bring them in line with the plan that more than 10,000 current employees, retirees and dependents have. A spokeswoman said the company will not discuss benefit changes until the workers are first informed. She said letters are going out to the retirees.
Delta Air Lines is going to double its charge for checking a second bag on a domestic flight from $25 to $50. It's part of a set of fee increases to help offset the high cost of fuel. The nation's third-largest carrier says the changes will apply to customers who purchase a ticket starting Thursday for travel on or after August 5th. Customers checking bags on international flights can check a second bag at no charge. The airline will also raise fees for specialty items that require special handling, such as surfboards or ski equipment, on both domestic and international flights. Delta says First Class, BusinesseLite and Medallion customers will still be able to check up to three bags at no charge. Delta currently doesn't charge passengers for checking a first bag on domestic flights, but has said it is studying a decision by several other major carriers to impose that fee.
Meanwhile, United Airlines is asking a federal judge to stop four of its pilots and the Air Line Pilots Association from what the airline says are unlawful job actions. United, a unit of Chicago-based UAL Corporation, said the lawsuit seeks a preliminary injunction against the union and pilots for abusing sick time in an effort to oppose its plan to shrink its fleet and furlough pilots. United says the lawsuit also aims to end intimidation of pilots who pick up extra flying time, saying that amounts to a work slowdown. United says the job actions have resulted in hundreds of flight cancellations. Pete McDonald, United chief administrative officer, says "it is absolutely irresponsible for ALPA to promote unlawful behavior," especially when the industry is fighting high fuel prices.
Not ready to retire just yet? Consider asking your boss if you can work part-time or telecommute. A study released by Hewitt Associates finds 61 percent of U.S. companies have or will develop programs that let workers retire in stages. The programs are intended to hold onto the experience of baby boomers, and ease the difficulty of replacing their skills. The study included 140 mid-size and large-size companies. Two-thirds of companies said offering part-time work year round was the most effective way to keep workers who are near retirement. Another strategy was giving workers access to retirement benefits while still employed. Some companies are even reconsidering their policies that ban rehiring retirees.
Comcast has reported an eight percent increase in second-quarter profits, despite a seasonally slower quarter made tougher by the decelerating economy. While the nation's largest cable operator lost basic video subscribers in the quarter, such losses were in line or better than what analysts had expected. Comcast, the country's second-largest Internet service provider, is taking market share from rival phone companies, which reported much weaker broadband gains. Revenue rose 11 percent. The second quarter is traditionally slower for the company because snowbirds and students disconnect their cable for the summer.