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Dealing with Fake News

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President Trump has come up with a novel idea for dealing with all the Fake News swirling around - tax it. From New York's The Sun:

Newspapers Opposing Trump Begging for Relief on Duties On Newsprint From Canada
If you think President Trump has an antagonistic relationship with the press now, just wait until his administration slaps a new 30% tax on newsprint.

Seriously. That’s the threat America’s newspaper publishers are warning about, with the Commerce Department’s International Trade Administration set to issue a preliminary determination by March 7, 2018 on whether Canada’s export into the United States of “certain uncoated groundwood paper” meets the legal tests to qualify for countervailing duties under the Tariff Act of 1930.

The publisher of Maine’s largest newspaper, the Portland Press Herald, raised an alarm about the issue in her year-end letter to readers. “We are facing a new challenge that threatens our newspapers,” the publisher, Lisa DeSisto, wrote. “The Trump administration is looking to impose a tariff on newsprint from Canada, which would have a disastrous effect on the entire newspaper industry. We purchase all our newsprint from Canada, as Maine mills no longer produce it. It would be near impossible for us to absorb a 30 percent increase in newsprint costs.”

Come on now - the corporate tax rate is way down. And how many newspapers are starting their reporters, typesetters and press operators $15/hour? How many of them are handing out bonuses this year? Methinks we are seeing a bit of crocodile tears - newspapers are generally privately held corporations so we do not really get an insiders look at their finances. Considering what they charge for advertising, I am betting that selling ink is still quite profitable.

If you hire someone to work for your business on a temporary basis, you give them an IRS Form 1099 at the end of their service with you. This is a record of how much they worked and what they were paid. It is then the responsibility of the temporary worker to pay their own withholding, L&I and taxes. This makes it very cheap for the employer as they do not have to deal with workers compensation, payroll taxes, FICA, FUTA, the whole alphabet salad but this is not intended for full-time workers - the rules are very explicit on this.

There is an interesting lawsuit going on now - a lot of the "gig" businesses like Uber and Lyft are treating all of their employees like independent contractors and giving them 1099's at the end of the year. From Yahoo:

What you missed at the GrubHub trial about 1099 independent contractors
In a windowless, 15th-floor courtroom in downtown San Francisco last week, GrubHub was defending its 1099 independent contractor employment model for its delivery drivers.

There's no verdict yet, and there probably won't be for at least another week. This trial, Lawson vs. GrubHub, is looking to determine whether or not plaintiff Raef Lawson, an ex-GrubHub driver, was misclassified as an independent contractor while delivering food for GrubHub.

Those who work as 1099 contractors can be their own bosses, meaning they can set their own schedules, and decide when, where and how much they want to work. Being a 1099 contractor can also be a solid, lucrative side-hustle because you could theoretically work for several companies at once. As noted in this trial, Lawson also delivered food for other gig economy startups, including Postmates. For employers, bringing on 1099 contractors means they can avoid paying taxes, overtime pay, benefits and workers' compensation.

Although Lawson only seeks a small, estimated sum of $586.56, the result of the trial could potentially affect the employment models of companies like Uber, Lyft, Postmates, Caviar, DoorDash and many others. On day one, I noticed a member of Uber's employment counsel team watching closely, taking notes about the trial. That makes sense, given Uber has found itself as the defendant in similar lawsuits that have ultimately been settled before needing to go to trial.

Lawson's lawyer, Shannon Liss-Riordan, has spent a good chunk of time in this trial focusing on the amount of control she perceived GrubHub to have over Lawson during the time he delivered food for them. She's trying to prove that Lawson's employment met the conditions of the Borello test, which looks at circumstances like whether the work performed is part of the company’s regular business, the skill required, payment method and whether the work is done under supervision of a manager. The purpose of the test is to determine whether a worker is a 1099 contractor or a W-2 employee.

That is going to change a lot of these businesses - rides will not be as cheap as they are now. The Borello test is an interesting one - involved cucumber pickers but applicable to any business hiring temporary workers

Larceny in their hearts

An interesting idea for software - from the United States Department of Justice:

Everett Software Salesman Sentenced to Prison for Selling ‘Tax Zapper’ Software to Enable Cheating on State and Federal Taxes
Promoted and Sold Software to Restaurants Resulting in More Than $3.4 Million Tax Loss
An Everett, Washington man who worked for a Canadian company that sells point of sale computer software, was sentenced today in U.S. District Court in Seattle to 18 months in prison and three years of supervised release for his role in a scheme to sell ‘Tax Zapper’ software, announced U.S. Attorney Annette L. Hayes. JOHN YIN, 66, pleaded guilty in December 2016, to wire fraud and conspiracy to defraud the government admitting that he promoted and sold a revenue suppression software that allowed restaurants to underreport their sales and illegally lower their tax bills. The software – sometimes called a “Zapper” program - resulted in a loss amount of more than $3.4 million. At the sentencing hearing U.S. District Judge Richard A. Jones said YIN served as a facilitator for illegal operations. “This was illegal, this was criminal and you had to know you have to pay taxes… but you continued – motivated by greed.”

And they caught one of his customers - from The Seattle Times:

Bellevue restaurant owner pleads guilty to tax theft using software that hid cash
The owner of a Bellevue restaurant pleaded guilty Wednesday to using software that deleted transactions and allowed her to steal an estimated $395,000 in sales taxes.

Yu-Ling Wong, the owner of Taiwanese restaurant Facing East, has agreed to pay $300,000 in restitution to the Department of Revenue. The Everett man who sold Wong the software pleaded guilty in December. and was sentenced to 18 months in prison in April.

This was the first prosecution in the United States for the use of sales suppression software, according to a news release from the office of Washington Attorney General Bob Ferguson, which prosecuted the case.

What tipped them off?

Facing East’s missing taxes were brought to light when auditors looking over the restaurant’s 2010 to 2013 tax returns found that only 7 percent of the restaurant’s sales were in cash — far below normal — that cash tips on some days exceeded the restaurant’s total cash sales, and that bills seemed to be paid minutes after orders were put in the system.

Statistical and probability analysis will point out all sorts of things about a businesses operation that some people would rather leave undiscovered.

Be ready for higher gasoline prices

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From USA Today:

The nation's largest oil refinery shuts down as Hurricane Harvey floods Texas
Flood waters closed oil refineries Wednesday along the Texas Gulf Coast, including the nation's largest, as Hurricane Harvey showed its power to ravage the energy infrastructure and drive up gasoline prices.

Some 15 refineries were going off line from Corpus Christi, Texas, to Port Arthur, Texas, the Energy Department reported. The list included the largest refinery in the U.S., the Saudi-owned Motiva plant in Port Arthur, which began what it called "a controlled shutdown."

Taken together, the closures represent about 25% of U.S. refining capacity, petroleum analyst Patrick DeHaan said.

"It's a chilling effect on the refining industry, which is in a dire state right now," DeHaan said.

Just ahead of the Labor Day holiday weekend, one of the top travel weekends of the year, DeHaan estimated Wednesday that gas prices would increase 15 cents to 25 cents per gallon nationwide as a result of Harvey. Earlier, he had predicted a boost of 5 to 15 cents.

We have two refineries up here so it will be interesting to see what happens to the local prices. They will probably jack them because they can.

Some fun in San Francisco

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Someone just got a bunch of elite panties in a twist - from the San Francisco Chronicle:

Rich SF residents get a shock: Someone bought their street
Thanks to a little-noticed auction sale, a South Bay couple are the proud owners of one of the most exclusive streets in San Francisco — and they’re looking for ways to make their purchase pay.

Tina Lam and Michael Cheng snatched up Presidio Terrace — the block-long, private oval street lined by 35 megamillion-dollar mansions — for $90,000 and change in a city-run auction stemming from an unpaid tax bill. They outlasted several other bidders.

Now they’re looking to cash in — maybe by charging the residents of those mansions to park on their own private street.

Those residents value their privacy — and their exclusivity. Past homeowners have included Sen. Dianne Feinstein and her financier husband, Richard Blum; House Democratic leader Nancy Pelosi; and the late Mayor Joseph Alioto. A guard is stationed round the clock at the stone-gate entrance to the street to keep the curious away.

A bit more about how this happened:

The couple’s purchase appears to be the culmination of a comedy of errors involving a $14-a-year property tax bill that the homeowners association failed to pay for three decades. It’s something that the owners of all 181 private streets in San Francisco are obliged to do.

In a letter to the city last month, Scott Emblidge, the attorney for the Presidio Homeowners Association, said the group had failed to pay up because its tax bill was being mailed to the Kearny Street address used by an accountant who hadn’t worked for the homeowners since the 1980s.

Two years ago, the city’s tax office put the property up for sale in an online auction, seeking to recover $994 in unpaid back taxes, penalties and interest. Cheng and Lam, trawling for real estate opportunities in the city, pounced on the offer — snatching up the parcel with a $90,100 bid, sight unseen.

Since the purchase in April 2015, the couple have been quietly sitting on the property, talking to a number of land-use attorneys to explore their options.

“We were looking to get title insurance so it could be marketable,” Cheng said.

He and his wife see plenty of financial opportunity — especially from the 120 parking spaces on the street that they now control.

Kudos to them - the HOA should have had their ducks in a row on this and they failed spectacularly.

I'll try their products - Brandless

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Sounds like a great idea - from their About page:

Everyone deserves better.
We've created a thoughtful, irresistible selection of the food and household products you reach for every day. Searching far and wide for high-quality materials and healthy ingredients, everything that's Brandless is also bad-stuff-less and goodness‑ful.

Who says better needs to cost more?
BrandTax™ is the hidden costs you pay for a national brand. We've been trained to believe these costs increase quality, but they rarely do. We estimate the average person pays at least 40% more for products of comparable quality as ours. And sometimes up to 370% more for beauty products like face cream. We're here to eliminate BrandTax™ once and for all.

Just What Matters™
At Brandless, we put people first. That means you. We know your values are important and you look for better-for-you products in every aspect of your life. So do we! Around here we focus on “just what matters.” That starts with offering products that match your values, preferences, and at times requirements—where it matters our products are non-GMO, sometimes organic, fair trade, kosher, gluten free, no added sugar and more. It’s different for everyone.

Basically, their products are packaged in plain white boxes with zero branding - makes perfect sense for bulk staples like sugar, corn flakes, soap, etc... Forbes has a nice profile of the founders. I wish them well - like I said, a great idea and I will buy their products.

You have different levels of competency at different stores so this story may be an isolated instance but still...
From Quora:

How do Lowe's and Home Depot differ?
I have a fresh and steamy story to tell you about which is better.

I have a week off of work and I've been bored around the house so I decided to build a fence partitioning my backyard, with one half being a giant garden. This project was going to cost me around $1,500-$2,000 and I was going to get my supplies at the local Home Depot in Puyallup, Wa.

Jacob proceeds to tell his story - it does not end well:

Manager: “I don't care who loaded them for you or who said it was okay. I'm the manager and I say that you can't buy these.”

Me: “Look. I've loaded about $2,000 of stuff onto these pallets and I'm willing to pay the $15 for them. It was a hassle putting all of this stuff on them. What do you expect me to do?”

Manager: “Unload your items and return the pallets to Recieving.”

Me: (after about 10 seconds of staring into this kid’s soul) “You can kiss my fucking ass.”

And I walked out, vowing never to shop at Home Depot ever again.

Right behind Home Depot is a Lowes, which I've never shopped at.

The first thing I see INSTANTLY makes me a lifelong customer there:


And the shopping experience?

So, I park in this amazing spot and ask to see the manager before anything else so I can see if the pallets will be a hassle. She laughs and tells me that she'd be dumb not to GIVE me 3 pallets for all of that stuff and I continue to have an amazing shopping experience. That and what would have cost me $2,000 at Home Depot cost me $1,154.73 at Lowes.

So again, Home Depot can kiss my fucking ass.

Save money, more fun shopping and Lowe's takes care of our Veterans - talk about win/win.

We have both stores in Bellingham - Home Depot has a better selection of tools and hardware but Lowe's has a better selection of everything else and I like the people there.

A breath of fresh air - Oregon

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From gCaptain:

Oregon County Overwhelmingly Rejects Measure to Block LNG Export Terminal
A coastal Oregon county overwhelmingly rejected a ballot measure aimed at blocking a proposed natural gas terminal dealing a blow to what was the latest in a series of efforts to thwart energy projects across the Pacific Northwest.

The measure, had it passed, would have banned transport of fossil fuels not intended for local use through Coos County, located about 200 miles (322 kms) south of Portland.

Around 76 percent of votes were cast against the measure, with 24 percent in favor, according to unofficial results posted on the Coos County government website late Tuesday.

Unfortunately, there is still a lot of Gang Green activity in these parts:

Last year, the Lummi Nation Native American tribe and environmental groups blocked an export terminal in Northwest Washington state that would have moved Montana and Wyoming coal to markets in Asia.

In January, Washington State denied a permit for a coal export terminal in the city of Longview, citing concerns about the financial viability of the project.

In February, bowing to pressure from activists, Seattle’s city council voted to divest approximately $3 billion from Wells Fargo, citing concerns over the bank’s support of the North Dakota Access Pipeline, among other factors.

All of these bad for business, bad for local employment and the environmental "concerns" are ludicrous. This is not anything new - Cherry Point is currently the home of an aluminum plant and a refinery. They were proposing to develop a sea terminal for shipping coal to China and Australia and this was shut down by the environmentalists. The only problem is that back in 1999, the environmentalists received huge concessions from the developers with the understanding that Cherry Point would be permitted to become a multi-use heavy industry site. The PDF document can be found here. The signatories are Pacific International Terminals (the developers), Whatcom County, the State of Washington Departments of Ecology, Department of Fish and Wildlife, the North Cascade Audubon Society, People for Puget Sound, the League of Women Voters, Ocean Advocates, and Washington Environmental Council. All these people signed off on the agreement and now they want to re-write history and take it back.

Further development would have been a goldmine for our County and our State - with just the aluminum plant and the refinery, Cherry Point either directly or indirectly hires 11% of the Whatcom county labor force and they contribute over $200 Million dollars in tax revenues. Let us hope that this can be revisited at a later date - my gut reaction is that the Lummi Indians were not in the original agreement and they weren't offered enough money with this new one. It is all about the Benjamins - want to understand some strange political transaction? Follow the money.

Only in San Francisco

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From Business Insider:

San Francisco is considering a once unthinkable measure to offset the threat of job-killing robots
The tech industry collectively face-palmed when Trump's treasury secretary said earlier this year that the threat of robots taking human jobs was "not even on our radar screen."

There is a growing evidence that robots and artificial intelligence could displace huge swaths of the American workforce in the next couple of decades, much sooner than the "50 to 100 more years away" timeline that Treasury Secretary Steven Mnuchin said he expects.

In San Francisco, where robots already run food deliveries for Yelp's Eat24 and make lattés at a mall coffee kiosk, one politician is working to ensure the city stays ahead of the curve.

Supervisor Jane Kim is exploring a tax on robots as one solution to offset the economic devastation a robot-powered workforce might bring. Companies that use robots to perform tasks previously done by humans would pay the city. Those public funds might be used to help retrain workers who lose their jobs to robots or to finance a basic income initiative.

Geez - talk about nanny-state protectionism. This benefits nobody. How about energizing your business and getting out there and competing in the marketplace. Don't drag everyone down to your moribund level, get out there and win!

Why ESPN is tanking

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A couple of days ago, I noted that sports network ESPN was laying off about 100 of their on-air personalities. Today, Sean Davis at The Federalist lays out the reasons why:

The Real Story Behind ESPN’s Wednesday Massacre
ESPN, the self-proclaimed worldwide leader in sports, became the worldwide leader in sports layoffs on Wednesday morning after news leaked that the cable network was in the process of laying off 100 staffers, most of whom are reported to be on-air talent.

The layoff reports came as no surprise to those who have followed ESPN and its on- and off-air struggles to profitably provide the kind of content that most sports fans want to watch. Shortly after the mass layoff reports were confirmed, the Internet hot takes began. ESPN is failing because of cord-cutting, because it has too much politics, because it has too little politics, because sports fans are racists, you name it.

And the four reasons:

1) ESPN Overpaid for Broadcast Rights
2) Cable Cord-Cutting
3) Declining ESPN Ratings - and, you guessed it:
4) Politics
With all this in mind, it’s not at all surprising that ESPN decided to retreat into the fever swamp of leftist politics to save itself. An obsession with politics didn’t doom ESPN, but it’s going to make it extremely difficult for ESPN to dig itself out.

The industry insider I spoke to said the focus on politics was a symptom, rather than a root cause, of all these current issues. According to this insider, ESPN executives saw the writing on the wall — higher costs, subscriber losses, lower ratings — and decided that it needed a bigger content pie to attract more content consumers. Sports is too small, so why not try for a real mass audience by broadening the network’s focus to include news and politics? If X number of people like sports, and Y number of people like politics, then surely combining sports and politics will lead to a much bigger audience, thereby solving the company’s financial dilemma.

This view, of course, ignores how people consume political news. The diehards who love political news don’t turn on the TV or open the laptop and navigate to sites with zero bias that just play it straight. Why? Because those kinds of political news and commentary providers don’t exist. Because that’s not what political junkies want. Liberals want news from liberals, and conservatives want news from conservatives. The Balkanization of political news and commentary didn’t happen by accident. People in this business know you have to pick a side. That works in political news. It doesn’t work if you have a bipartisan mass media audience.

Instead of expanding its pie by combining two types of mass media content, ESPN ended up communicating to half its audience that it didn’t respect them. How? By committing itself entirely not to political news, but to unceasing left-wing political commentary.

Yup. They did not think this through and alienated half of their audience

More on the Laffer Curve

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I had posted earlier today about President Trump's wonderful tax cuts and gave a side reference to the Laffer Curve. The New York Times has a nice article:

Arthur Laffer’s Theory on Tax Cuts Comes to Life Once More
A white cloth napkin, now displayed in the National Museum of American History, helped change the course of modern economics. On it, the economist Arthur Laffer in 1974 sketched a curve meant to illustrate his theory that cutting taxes would spur enough economic growth to generate new tax revenue.

More than 40 years after those scribblings, President Trump is reviving the so-called Laffer curve as he announces the broad outlines of a tax overhaul on Wednesday. What the first President George Bush once called “voodoo economics” is back, as Mr. Trump’s advisers argue that deep cuts in corporate taxes will ultimately pay for themselves with an explosion of new business and job creation.

The exact contours of the plan remained murky and Mr. Trump will not produce a fully realized proposal on Wednesday. But what the president has called a tax reform plan is looking more like a tax cut plan, showering taxpayers with rate reductions without offsetting the full cost by closing loopholes or raising taxes elsewhere. In the short run, such a plan would add many billions of dollars to the national deficit. Mr. Trump contends that it will be worth it in the long run.

“The tax plan will pay for itself with economic growth,” Steven Mnuchin, the Treasury secretary and main architect of the plan, told reporters this week.

Good - make the cuts deep enough and the economy will boom. Cut regulation, cut taxes and stand back.

From The New York Times:

White House Proposes Slashing Tax Rates for Individuals and Businesses
President Trump on Wednesday proposed sharp reductions in both individual and corporate income tax rates, reducing the number of individual income tax brackets to three — 10 percent, 25 percent and 35 percent — and easing the tax burden on most Americans, including the rich.

The Trump administration would double the standard deduction, essentially eliminating taxes on the first $24,000 of a couple’s earnings. It also called for the elimination of most itemized tax deductions but would leave in place the popular deductions for mortgage interest and charitable contributions. The estate tax and the alternative minimum tax, which Mr. Trump has railed against for years, would be repealed under his plan.

Arthur Laffer - paging Mr. Laffer to the white courtesy phone please...

Keep on the corporate side of life

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A memo from the Puddles Pity Party

The future of Coal

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From Reuters:

United Air removes couple traveling to wedding from plane
An engaged couple were removed from a United Airlines flight to Costa Rica on Saturday, as the airline remained under scrutiny following outrage caused by a video last week of a passenger being forcibly removed from a flight.

A matter of someone sleeping and leaning across their seats - they moved up a few rows to a vacant row of seats. This was in a higher class and they tried to pay for the upgrade but United would not let them. This is no way to run an airline...

United Airlines

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Things just keep getting better and better for them - from Global News Canada:

Emergency crews called to airport after man reportedly stung by scorpion on flight to Calgary
A beautiful two-week vacation in Mexico came to an unexpected — and creepy — end for a Calgary couple.

Richard and Linda Bell were on United Airlines flight 1418 going home from Houston when a feisty, eight-legged creature showed up.

The scorpion fell in Richard’s hair from an overhead bin. Linda said it reminded her of something else entirely.


Richard dropped it on his plate, then picked it up again. That’s when it stung him.

It “felt like a wasp sting,” he said.

Pure chance but still - United is not getting any good publicity these days.

Dave Carroll on United Airlines

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Dave was the unfortunate musician whose guitars were smashed by United Airlines in 2008. When he asked United to repair them, he was told to basically pound sand. He wrote three songs about the incident which went viral (song #1 has over 16 Million views). Here he is talking about the most recent case of United - Flight 3411 and Doctor David Dow:

Interesting development - North Korea

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It seems like President Trump's meeting with China's President Xi is having an effect - from Newsmax:

North Korean Ships Head Home After China Orders Coal Returned
A fleet of North Korean cargo ships is heading home to the port of Nampo, the majority of it fully laden, after China ordered its trading companies to return coal from the isolated country, shipping data shows.

Following repeated missile tests that drew international criticism, China banned all imports of North Korean coal on Feb. 26, cutting off the country's most important export product.

To curb coal traffic between the two countries, China's customs department issued an official order on April 7 telling trading companies to return their North Korean coal cargoes, said three trading sources with direct knowledge of the order.

And it looks like a win/win situation:

To make up for the shortfall from North Korea, China has ramped up imports from the United States in an unexpected boon for U.S. President Donald Trump, who has declared he wants to revive his country's struggling coal sector.

Eikon data shows no U.S. coking coal was exported to China between late 2014 and 2016, but shipments soared to over 400,000 tons by late February .

Brilliant! Talk about the art of the deal...

I bet Governor Moonbeam is feeling pretty proud of himself these days - we are going to raise so much money through high taxes.. Oh. Wait. From the Los Angeles Times:

Aerojet Rocketdyne to cut 1,100 jobs in Sacramento, move some to L.A.
Sacramento will lose 1,100 jobs over the next 18 months as rocket engine maker Aerojet Rocketdyne plans to relocate or cut positions in that facility and move jobs to Alabama, Canoga Park and other locations.

A bit more:

By the end of 2018, defense-related program management, engineering and related support positions in Sacramento will move to Huntsville, Ala., where the company’s defense business unit is based. Huntsville is also the final assembly site for Aerojet Rocketdyne’s new AR1 rocket engine.

They are not completely leaving the state - they have a large facility at Canoga Park near Los Angeles but a lot of other offices are packing up and leaving. Minimize the impact of those new taxes.

End of a local grocery store


As the owner of a local grocery store, news like this is never welcome. From The Bellingham Herald:

Dodson’s has closed. Will there be another neighborhood store in its place?
A longtime grocery store has closed after a potential deal to sell it didn’t come together.

Dodson’s IGA in Nugents Corner had a going-out-of-business sale over the weekend, closing for good on April 2. According to a sign posted on the front door, there was an interested buyer but a sale didn’t materialize. The store is at 3705 Mount Baker Hwy.

“We sincerely regret the inconvenience this means to you. We are still planning on selling the store, restoring a neighborhood grocery store to the community,” according to the sign written by the Dodson family.

The store, which had been in business for about 50 years, ran into financial difficulties because it experienced some internal theft, co-owner Ellen Dodson said last fall.

A gift certificate program was started where customers could pay ahead to help save the business, but it apparently wasn’t enough: A federal tax lien of $47,796 was placed on the business in late February, according to documents filed on Whatcom County government website.

The internal theft was covered in this article at the Herald from December 9, 2016 - an excerpt:

Co-owner Ellen Dodson told the Lynden Tribune last month that two employees were fired earlier this year for internal theft. Dodson, who declined to name the employees, believes the thefts took place over time, but the store’s security cameras only documented a two-week period. Store officials didn’t have enough evidence to press more serious charges than shoplifting, and insurance didn’t cover the losses. She told the Tribune that about $100,000 in cigarette purchases were unaccounted for.

I am very sad (and pissed - employee trust is crucial) but their store had about eight lanes all running a point of sale system. They should have caught this before it became a $100,000 problem. If the owners were not capable of reviewing the data, they should have at least seen that the numbers did not smell quite right and called someone in.

Nugent's Corner is about five miles from the Bellingham city limits - there are two large grocery stores close to them in town and a nice chain of independent grocery stores heading out the Mt. Baker Highway including Crossroads in Maple Falls.

From Reason:

Baltimore Mayor Supported $15 Minimum Wage Until She Learned What It Would Do to City’s Economy
During the 2016 campaign, Catherine Pugh was one of dozens of Democratic politicians calling for the implementation of a $15 per hour minimum wage.

Since being elected mayor of Baltimore in November, though, Pugh has changed her mind about the merits of forcing employers to pay such a high hourly rate. Last week, Pugh announced she would veto a $15 minimum wage bill passed by city council, citing concerns about how it would hurt the city's economy, nonprofits and charities working in the city, and the city government's bottom line.

After doing "some research," Pugh said at a press conference on March 24, "it is not appropriate at this time that I will sign this bill, so I am vetoing this bill."

Pugh said the bill would not be in the best interest of Baltimore's 76,000 unemployed workers and would drive businesses out of the city to the surrounding counties.

Smart move - it makes zero financial sense and only drives up the cost of everything else - goods and services.

Perfect example of overreach by a government agency - from the Miami, Florida NBC affiliate:

Court: Florida Dairy's Skim Milk is Skim Milk, Not Imitation
An all-natural diary fighting to call its skim milk "skim milk" against the wishes of the Florida Department of Agriculture won a victory in federal appeals court.

A three-judge panel on Monday struck down a decision that allowed the state to ban the Ocheesee Creamery from labeling its skim milk as skim milk because it doesn't add vitamins to it. The state wanted the creamery to call it imitation skim milk.

While the state defines skim milk as skim milk with Vitamin A added, the appeals court in Jacksonville said most people think of skim milk as the dictionary defines it: milk with cream removed.

The court said the Panhandle creamery isn't deceiving people when by calling the product skim milk and sent the case back to the district court.

At least sanity prevailed but I hate to think of how much it must have cost the dairy - legal fees plus having to reprint their labels. Dairy website is here: Ocheesee Creamery

Not that I ever used them before but... From the Washington Examiner:

Chelsea Clinton joins Expedia's board of directors
Chelsea Clinton has joined Expedia's board of directors.

A filing with the Securities and Exchange Commission this week shows the travel firm expanded the number of members on its board up from 13 to 14 members and voted for the former first daughter to take the new position.

As MarketWatch notes, Clinton's compensation will be a "standard" $45,000 a year, plus stock grants valued at $250,000 in accordance to the company's proxy statement for its 2016 annual meeting of stockholders.

Clinton she has not been appointed to serve as a member of any committee of the board, the SEC filing stated.

Why? She is smeared with her family's taint and brings nothing to the board - no business savvy, no political pull outside of a few enclaves on the coastal areas. Why did they do this?

From Miso Robotics:

From Tech Crunch:

Meet Flippy, a burger-grilling robot from Miso Robotics and CaliBurger
Flipping burgers is a hot and greasy job. Slips, trips, burns and cuts are common hazards associated with the work. But global demand for burgers is tremendous. Top burger chains racked up more than $75.5 billion in annual sales in 2016. To help keep human cooks out of harm’s way while fulfilling our collective appetite for burgers, Pasadena-based Miso Robotics is rolling out a new “robotic kitchen assistant” called Flippy.

Miso Robotics CEO and co-founder David Zito said, “We focus on using AI and automation to solve the high pain points in restaurants and food prep. That’s the dull, dirty and dangerous work around the grill, the fryer, and other prep work like chopping onions. The idea is to help restaurants improve food quality and safety without requiring a major kitchen redesign.”

Make employees too expensive and cheaper alternatives will always be found.

From the Canadian Broadcasting Company:

Manulife revealed as bank fined $1.15M for violating anti-money laundering reporting rules
The head of Canada's financial crime watchdog agency is second-guessing his decision last year to withhold the name of a bank — which CBC Investigates has identified as Manulife Bank of Canada — fined $1.15 million for not reporting hundreds of transactions it was obligated to report under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act.

And a bit more - protecting the guilty and getting called out for it:

"In exercising my discretion to withhold the name of the bank, I understand that it may not have met public expectations in relation to openness and transparency," FINTRAC director Gérald Cossette told CBC News in a written statement last week.

He's now promising a review of FINTRAC's penalty policies.

CBC News sources confirmed the case involves Manulife Bank and its failure to report 1,174 international electronic money transfers, 45 cash transactions involving at least $10,000 each, as well as one suspicious transaction.

And what caused the investigation:

FINTRAC was first alerted to the problems after auditing the bank's records in 2014 and determining it failed to report a suspicious transaction in 2012 involving Andrew Strempler, who'd run into serious — and high-profile — legal troubles in the U.S.

Originally from Winnipeg, Strempler made headlines that year when he was arrested and imprisoned in the U.S. for running a mail-order pharmacy, contrary to U.S. laws protecting patented drugs.

During the audit, FINTRAC discovered a wide range of other violations at Manulife Bank, including its failure to report 1,174 international wire transfers of $10,000 or more involving other clients, as well as a general lack of anti-money-laundering safeguards and policies.

Somebody got greedy and they got their fingers burned...

Starbucks in the news

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Shot: (Jan. 29, 2017) Starbucks says it will hire 10,000 refugees over the next 5 years in response to Trump's travel ban
Chaser: (February 22, 2017) Starbucks' brand perception has plummeted since it announced plan to hire refugees

I prefer local places for coffee out here or others if I am Bellingham. To buy beans in town or out here.

If Starbucks was serious instead of just looking to Virtue Signal, they should be hiring 10,000 veterans.

A pocket of sanity in a deep blue land

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I love it - we will have to have lunch at the restaurants or something next time we visit. From the Seattle Times:

B.C.’s new Trump tower isn’t getting a polite Canadian welcome
Ready or not, Cascadia — the Trump Organization is planting its flag high atop a tower deep within your borders.

On Tuesday it will formally open the West Coast’s first Trump International Hotel & Tower in Vancouver, B.C., paying little heed to the long-running clamor from unwelcoming natives.

Donald Trump Jr. and his brother Eric will be there to celebrate, although the project’s namesake apparently will be otherwise engaged.

One of the tower’s most outspoken local critics is Vancouver City Council Member Kerry Jang, who says that because of President Donald Trump’s policies and rhetoric, the building “has become the beacon of racism and the tower of intolerance.”

Awww - poor little butt-hurt liberals. A beacon of racism and the tower of intolerance? Give me a break. I am thinking a classic case of projection.

Go and sob in the corner little one while us men and women will be out there creating jobs and rejuvenating the economy.

Just wonderful - first it's the F-35 fighter and now this - from Bloomberg:

Lockheed Hit by U.S. Air Force for More GPS III Satellite Flaws
Botched testing by a Lockheed Martin Corp. subcontractor on a key component for the U.S.’s newest Global Positioning System satellites raises new questions about the No. 1 defense contractor’s supervision of the project, according to a top Air Force official.

The mistake by subcontractor Harris Corp. forced another delay in the delivery of the first of 32 planned GPS III satellites until later this month, according to Major General Roger Teague, the Air Force’s chief of space programs. That will make the $528 million satellite 34 months late, according to service data.

Lockheed has a contract to build the first 10 of the satellites designed to provide a more accurate version of the Global Positioning System used for everything from the military’s targeting of terrorists to turn-by-turn directions for civilians’ smartphones. The program’s latest setback may affect a pending Air Force decision on whether to open the final 22 satellites to competition from Lockheed rivals Boeing Co. and Northrop Grumman Corp.

Just wonderful - the problem:

Last year, the Air Force and contractors discovered that Harris hadn’t conducted tests on the components, including how long they would operate without failing, that should have been completed in 2010.

Now, the Air Force says it found that Harris spent June to October of last year doing follow-up testing on the wrong parts instead of samples of the suspect capacitors installed on the first three satellites. Harris “immediately notified Lockheed and the government” after a post-test inspection, Teague said in his message.

And of course, Harris is going to cover the additional cost - not so fast there:

The Air Force will have to pay to replace the suspect capacitors on the second and third satellites. That’s because the satellites are being developed under cost-reimbursement-type contracts, which require the Pentagon to pay for cost increases, the service said.

Stuff like this is why President Trump was elected. None of these people are held accountable when things go wrong. Shades of Europe's Galileo Clock problem: here and here - not anything you can bring back to the garage.

Fun in California - cap and trade

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Looks like the State of California is in for some interesting legal proceedings - from the Los Angeles Times:

The immediate threat to California's climate-change fight isn't Trump, it's this
With President Trump in the Oval Office, California officials are bracing for the possibility that the new administration will undermine the state’s landmark policies on climate change. But the more immediate threat isn’t coming from Washington; it lies in a lawsuit that has been slowly winding its way through state courts.

The 4-year-old legal challenge pursued by the California Chamber of Commerce and a collection of business interests argues that the cap-and-trade program represents an unconstitutional tax. The system, intended to create a financial incentive to reduce greenhouse gas emissions, requires companies to purchase permits to pollute.

The problem?

The result was cap and trade, which auctioned off its first permits in 2012. Revenue from the auctions, which has ranged from hundreds of millions of dollars to nearly $2 billion a year, is then spent by lawmakers on initiatives intended to further reduce emissions. One of those projects is the $68-billion bullet train from Los Angeles to San Francisco.

All of this activity, state officials argue, falls within the government’s authority to regulate industry.

Opponents disagree, noting that the state is collecting revenue through a program that wasn’t created with a two-thirds vote in both houses of the Legislature, the threshold needed to approve taxes. 

Should be interesting to see the outcome. Doing some simple math, they would need to run the cap and trade scam for 34 years to pay for just the budgeted price of the bullet train. This is especially interesting in that without an inch of track being laid, the initial run is already $3.6 Billion over-budget and seven years behind schedule. No wonder businesses and people are fleeing the state.

Problems with Western Union

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Back in 2014, I opened a UPS/FedEX shipping and receiving business in my small town. I closed it after one year - not enough business to pay for my time.

I also did copies and printing and became an agent for Western Union - sending and receiving money across the world. I researched the company and really came to like them. They were very focused on money laundering and had a lot of auditing procedures in place to detect any 'fishy' operations. They pre-date the telephone system and at one time, had the option to purchase all of the Bell patents which would have given them a monopoly on telecommunications. They declined. Oops!

Now it seems that there is some rot at the core - sad to see. From Forbes:

Western Union Slammed For Aiding Crooks, Agrees To Pay $586 Million
Money transfer giant Western Union has agreed to pay $586 million in connection with its failure to prevent criminals from moving ill-gotten money using its platform, according to federal authorities.

In a statement from the U.S. Department of Justice and Federal Trade Commission on Thursday, authorities describe insufficient or poorly enforced policies that resulted in the funneling of hundreds of millions of dollars in proceeds from illegal gambling, fraud and drug and human trafficking.

Western Union admitted to criminal violations including its willful failure to maintain an effective anti-money laundering program and aiding and abetting wire fraud.

“Western Union owes a responsibility to American consumers to guard against fraud, but instead the company looked the other way, and its system facilitated scammers and rip-offs,” says FTC chairwoman Edith Ramirez.

Authorities say that employees allowed or aided and abetted fraudsters in processing illicit proceeds and that the company knew about it. However, rather than firing them, Western Union allowed the employees to continue working for the company and even paid them bonuses.

More at the site - I do hope that they are able to dig the rot out and prevent it from coming back. WU is a good company and I loved working with them.

Check out Ten Bullets:

A bit of a ruffle at Boeing

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A tweet from Donald Trump has ruffled some feathers at Boeing. From The Seattle Times:

Trump says Boeing contract for Air Force One should be canceled
A single tweet by President Elect Donald Trump declaring that he wants to cancel the contract for replacement of the Air Force One presidential jets has shocked Boeing and cast doubt on what was expected to be a lucrative crowning order for the 747 jumbo jet.

“Boeing is building a brand new 747 Air Force One for future presidents, but costs are out of control, more than $4 billion. Cancel order!” Trump tweeted early Tuesday.

In brief follow-up remarks, Trump told reporters in New York that “The plane is totally out of control. I think it’s ridiculous. I think Boeing is doing a little bit of a number.”

“We want Boeing to make a lot of money but not that much money,” he added.

This is exactly why he will be in office in a few weeks. Government spending is out of control - nobody is being held accountable. Re-negotiate the deals. It is fine for a corporation to make money but this is not a government feeding trough.

Schadenfreude - McDonald's

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Those people petitioning for a universal $15 minimum wage - meet your replacements. From Forbes:

Thanks To 'Fight For $15' Minimum Wage, McDonald's Unveils Job-Replacing Self-Service Kiosks Nationwide
As the labor union-backed Fight for $15 begins yet another nationwide strike on November 29, I have a simple message for the protest organizers and the reporters covering them: I told you so.

It brings me no joy to write these words. The push for a $15 starter wage has negatively impacted the career prospects of employees who were just getting started in the workforce while extinguishing the businesses that employed them. I wish it were not so. But it’s important to document these consequences, lest policymakers elsewhere decide that the $15 movement is worth embracing.

Let’s start with automation. In 2013, when the Fight for $15 was still in its growth stage, I and others warned that union demands for a much higher minimum wage would force businesses with small profit margins to replace full-service employees with costly investments in self-service alternatives. At the time, labor groups accused business owners of crying wolf. It turns out the wolf was real.

Earlier this month, McDonald’s announced the nationwide roll-out of touchscreen self-service kiosks. In a video the company released to showcase the new customer experience, it’s striking to see employees who once would have managed a cash register now reduced to monitoring a customer’s choices at an iPad-style kiosk.

If you want more money, it is your personal responsibility to make yourself more valuable to your employer. Take a class, pick up a skill. It is not that difficult. Schadenfreude?

You can not make this stuff up - from Reuters:

Mexican cement maker ready to help Trump build border wall
A Mexican cement maker is ready to lend its services to U.S. President-elect Donald Trump to build the wall he wants to erect on the southern border of the United States to curb immigration.

"We can't be choosy," Enrique Escalante, Chief Executive Officer of Grupo Cementos de Chihuahua (GCC) said in an interview. "We're an important producer in that area and we have to respect our clients on both sides of the border."

A healthy business environment is good for everyone. The rising tide lifts all boats.

Creating jobs - President Trump

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An interesting demographic

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From the Bellingham Herald:

Move over, booze: 2016 is a milestone year for sales of pot in state
Marijuana sales passed a quiet milestone in Washington state in the first three months of 2016.

For the first time, residents and visitors as a whole spent more on cannabis products than on hard alcohol, based on an analysis of purchase and tax records from two state agencies.

In the first quarter of 2016, people spent $19.1 million more on marijuana than spirits, which includes the cost of the products and its associated taxes. By the second quarter, that gap increased to $52.3 million. Those amounts include taxes levied by the state on those products. Spirits sales do not include wine and beer. Marijuana sales include all cannabis products but not paraphernalia.

Makes a lot of sense - pot is more of a social lubricant than hard spirits. I wonder what the numbers would be if we subtracted restaurant spirit sales. Also, pot sales have not canibilized spirit sales:

Ozgo said spirits retailers have not seen a drop in sales volume since marijuana was legalized.

“In fact, the growth rate is at or equal to the national average over the last couple of years,” in Washington, he said. In other states with legal weed, “really it’s been a non-issue.”

The pot store in our little hamlet is doing a great business - lots of traffic. Good people too.

The Trump Presidency

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Great news from Bill Ford at The Gateway Pundit:

TRUMP EFFECT: Ford Calls Donald Trump – Says Plant Will Not Move to Mexico, Will Remain in Kentucky
Bill Ford, the Chairman of Ford Motors, called Donald Trump tonight and said he will be keeping the Lincoln plant in Kentucky- Not Mexico.

Trump tweeted the news tonight–


I had been a Dodge and Chrysler driver for the last 30 years but when it was time to get a new truck back in 2010, I decided to go with a Ford since they were the only car company that did not take a federal bailout. (here and here). Needless to say, I have been incredibly happy with my decision - when my truck sustained a large front-end collision in 2014, I replaced it with a new version of the same make, model and package. Got almost 50,000 miles on this rig and still a very happy camper. Ford does good stuff.

From FOX News:

New York Times publisher vows to 'rededicate' paper to reporting honestly
The publisher of The New York Times penned a letter to readers Friday promising that the paper would “reflect” on its coverage of this year’s election while rededicating itself to reporting on “America and the world” honestly.

Arthur O. Sulzberger Jr., the paper’s embattled publisher, appealed to Times readers for their continued support.

Well, the New York Times is losing money big-time. Sales are down, subscriptions are tanking. Maybe the leadership feels that they might want to start telling the truth instead of what the denizens of the East and West coast conurbations want to hear. See if that will turn things around.

Now this will be interesting

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From The Christian Science Monitor:

Small Texas company announces massive oil discovery in Alaska
The Dallas-based Caelus Energy Alaska LLC announced on Tuesday a discovery of 6 billion barrels of light oil in Smith Bay off Alaska’s North Slope; 450 miles north of Fairbanks and 300 miles above the Arctic Circle. If estimates are accurate, the recent find could prove to be one of the largest fields ever discovered in Alaska.

The site, located in the shallow waters of Smith Bay, southeast of Barrow – Alaska’s northernmost city – could eventually deliver 200,000 barrels per day of “highly mobile oil” into the trans-Alaska pipeline, according to a statement released by the company.

While noting that such figures do not include analysis by a third-party engineering company, Caelus says it believes that the numbers do indicate the site could be even larger than the Alpine unit of ConocoPhilips, which reached a peak output of 139,000 barrels per day (BPD) in 2007 after beginning production in the year 2000, reported the Alaska Dispatch News.

Very cool - we certainly can use the energy. Makes for a better life for everyone (except the enviros but they are their own special little nut-case). It sounds like really sweet oil too - doesn't need as much refining.

Good news on the union front

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Labor Unions very much had their place in the 1900's - they did a lot to bring us the modern work week. Unfortunately, they have not advanced with the times and are now a dinosaur twitching in its death throes. It doesn't help them that they tend to have a lot of lawlessness and corruption at their core. Case in point this story from The Wall Street Journal:

Texas Janitors Mop the Floor With a Bullying Union
Big unions play hardball, and most of the time it works. Not this week in Texas, however, where a jury awarded $5.3 million in damages to a local cleaning firm targeted by the Service Employees International Union. Although disparagement claims are difficult to prove, the owners of Professional Janitorial Services of Houston showed that SEIU Local 5 had tried to destroy them with a campaign of misinformation about how they treated workers. The firm’s attorney, John Zavitsanos, says that this is the first time a jury has held the SEIU responsible for defaming a business.

In 2005, the SEIU decided to try to break into Houston by pushing “justice for janitors.” It began persuading the biggest janitorial companies in town to accept Local 5 as the representative for their workers. Five firms agreed. The sixth was Professional Janitorial Services.

The union wanted to organize workers through “card check,” which allows it to pressure workers one by one to sign an “authorization for representation.” But PJS insisted on a vote by secret ballot, as is its right.

The union responded with a campaign whose goals (more here and here), according to internal emails entered into evidence, were to “cost PJS money” and “cost PJS accounts.” It accused the company of withholding workers’ pay, forcing them to work off the clock, and firing those involved with the union—none of which was substantiated.

A bit more:

The union sent letters to the building-management companies that contracted with PJS, spreading accusations. It circulated vicious fliers at disruptive demonstrations. One building manager said in a deposition that she fired PJS after protesters stormed her conference rooms while tenants were using them. PJS lost a dozen contracts. 

Just shows how desperate the union is to retain its power - it serves zero function at all except to collect union dues from the workers.

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