The Pothead President

Just how big does the president think this country is, anyway?

Consider this from yesterday:

"I urge Congress to listen to AARP, listen to the AMA, and pass this reform for hundreds of millions of Americans who will benefit from it," Obama told reporters during an unannounced visit to the White House briefing room after the endorsements were announced.

Apparently to him, the country is really big.

But according to the U.S. Population Clock, the country currently has just over 300 million people in it. I guess President Obama could be referring to these "hundreds of millions," which is technically correct, but it sure sounds like he means a whole lot more people than that. You know, five, six, seven hundred million.

Would it be unfair to speculate that he's referring to all those extra Americans who live in the surplus states of the union he said in May of 2008 he had already visited up to that point in the primary campaign? What, fifty-seven, fifty-eight states?

It's big, man, really big.

Or is the president contemplating a future where the rest of the world continues to beat down our door to get our superior healthcare? Has it occurred to him that maybe after they've seen us all standing in line waiting forever for services they won't be so eager to come? Has it occurred to him that with the single payer system his plan intends for us that the number of abortions will skyrocket on the public tab and there won't be as many of us in the future as he thinks? Who's going to pay for all this spending, the Israelis? I don't think any of that has occurred to him at all.

Obama's troubles with geography and numbers go back a long way, and the instances have been the subject of some interest and amusement from the beginning. But the on-going failure to grasp the shape and size of things simply suggests that the president has an impaired sense of reality and its proper proportions.

Anyone who has known a dope smoker can pick out the telltale signs of the disconnect from reality, especially the frequently remarked detached quality of his personality. He seems passionless at the most inopportune times, strangely unmoved by events which deeply affect the normal among us. Off teleprompter, the president is haltingly vacant. He is apathetic to his core.

I say it's because he's a toker.

Liberal Projection Syndrome

ABC News is reporting that President Obama is warning people not to jump to conclusions about the Ft. Hood shooter:

President Obama warned today against "jumping to conclusions" regarding the motive for the shooting and ordered flags to be flown at half staff until Veteran's Day, saying that the "entire nation is grieving."

You mean like you calling a police officer "stupid"?

Just another case of Liberal Projection Syndrome: accusing others of that which thou doest thyself.

Chief Democrat Subverts Democratic Process

Pelosi Breaks Pledge to Put Final Health Care Bill Online for 72 Hours Before Vote

Speaker Nancy Pelosi's office tells THE WEEKLY STANDARD that the speaker will not allow the final language of the health care to be posted online for 72 hours before bringing the bill to a vote on the House floor, despite her September 24 statement that she was "absolutely" committed to doing so.

House members are still negotiating important issues in the bill--whether it will provide taxpayer-funding for abortions, for example. Pelosi is pushing for a Saturday House vote, and a number of big changes will be introduced, likely less than 24 hours before the vote takes place (if in fact it does). The Rules Committee hasn't yet released its resolution, or rule, that must be passed before the bill can move from committee to the floor. The rule will set the terms of debate and determine what amendments are in order.

It seems likely that the rule will allow very few, if any, up-or-down votes on amendments on the House floor. Rather, the rule will include a series of amendments that will all be adopted at once if the rule passes.

On September 24, Speaker Nancy Pelosi told THE WEEKLY STANDARD that she was "absolutely" committed to putting the text of the final House bill online for 72 hours before the House votes:

TWS: Madam Speaker, do you support the measure to put the final House bill online for 72 hours before it's voted on at the very end?

PELOSI: Absolutely. Without question.

But tonight, when asked if Speaker Pelosi will leave the bill online for 72 hours after we see what's in the rule, Pelosi spokesman Brendan Daly replied in an email: "No; [the] pledge was to have manager’s amendment online for 72 hours, and we will do that."

Apparently Pelosi's agreement to leave the "final" bill online "at the very end" of the process wasn't such a straightforward pledge.

Posted by John McCormack on November 5, 2009 06:56 PM

"The Feds Have No Faith in Recovery"

Penetrating analysis here from the chief economist at Delta Global Advisors.

November 5, 2009

The Feds Have No Faith in Recovery

By Michael Pento

The stock market has enjoyed a significant rally since the end of the first quarter. The Bureau of Economic Analysis reported last week that the economy grew at a 3.5% annual rate in the third quarter--a figure they achieved by that claiming inflation was running at only a 0.8% annual rate, despite a sharp drop in the dollar, a spike in commodity prices and record highs for gold.

The cyclical bull market in stocks and positive print on GDP has caused some on Wall Street and in Washington to claim the recession has ended. Despite all the good economic news, an end to fiscal and monetary stimulus is nowhere in sight, precisely because policymakers know the happy news is artificially derived.

A closer look indicates that neither the administration nor the Federal Reserve believes its own recovery rhetoric. They understand that the economy will not prosper without continued life support.

I believe removing such artificial stimulus is needed so the country can immediately begin de-leveraging and to prevent the accumulation of yet more baneful debt. What is truly amazing is how many people on Wall Street are foolish enough to postulate that our problems have been solved. The stock market will not be so easily fooled for much longer.

The Great Depression Part II was narrowly averted last year by slashing interest rates to near zero. The Fed made money virtually free because the record level of indebtedness ($34 trillion) in the economy required such low rates so that borrowers could service their obligations. Otherwise a cataclysmic domino effect of defaults and bankruptcies would have occurred. To avoid that scenario, the public sector assumed some of the private sector's debt and then subsequently took on a significant amount more. The debt of the nation continues to increase at a 4.9% annual rate. All public debt is ultimately the responsibility of the private sector to pay off--either directly or through future taxes. As a result, the economy has never been more precarious than it is today.

In spite of this, the stock market appears to be doing quite well. We've seen a 57% rally off the March lows in the S&P 500. However, if you measure the market against other assets its performance is much less impressive. Since the beginning of 2000 the S&P is down about 50% measured in terms of a basket of currencies other than the falling U.S. dollar. The index is down nearly 80% against the real inflation hedge--gold!

The sad truth is that this recent market rally has been produced on the back of a weakening dollar and the slashing of corporate overhead. Cutting payrolls and research and product development projects are not a prescription for sustainable growth. As I like to say, you can't burn your furniture to keep your house warm forever. Eventually, top-line revenue growth must emerge or Wall Street's game of beat-the-expectations will be short lived.

It's also worth noting that a country cannot devalue itself to prosperity and that a bull market cannot survive an inflationary environment for long. In the short run, nominal gains in the averages can occur since everything priced in dollars tends to increase in value. However, the rally will be truncated unless the Fed provides consumers and corporations with a stable currency.

The ramifications of a crumbling currency are vastly misunderstood. A strong dollar is the cornerstone of a healthy economy. It is essential for balanced growth and healthy investment to occur. On the other hand a weak currency decimates the middle class and the corporate sector's ability to maintain earnings growth. Inflation lies behind all infirm currencies, and it is inflation that destroys the purchasing power of consumers. The diminished value of their wallets leaves them with the ability to buy only non-discretionary items. As a direct result, unemployment rates soar and economic output plunges.

I believe we will suffer from a protracted period of stagflation. Money supply, as measured by M2, has increased 5% Y.O.Y. Meanwhile the output of goods and services is falling. As long as the money supply is chasing a shrinking GDP pie, there will be upward pressure on prices.

Making the situation even worse is the manner in which the money supply is growing. The quality of growth is very low because the increase in supply is coming from commercial bank purchases of Treasury debt, rather from an issuance of credit to the private sector for capital goods creation. Total Loans and Leases at Commercial banks are down 8.2% from last year. Meanwhile, the amount of Treasuries held at all commercial banks is up 20% year-on-year.

That means money supply growth is emanating from government's misallocation and redirection of capital. It isn't being loaned out to build mines and factories; it is instead being loaned out to increase consumption and build even more consumer debt.

If the Treasury and Federal Reserve truly believed the economy and the stock market were on a sustainable recovery path, talk of extending and increasing the home buyer's tax credit would be off the table. The Fed would already be reducing the size of the monetary base. The truth, however, is that no one in government really believes in this recovery. If they did, they would be hiking interest rates and the deficit would be shrinking.

The government's realization of our precarious economic condition means its largess will continue. Near term, that may ease some pain. So did the artificial stimulus that gave rise to the housing boom. In the end, a protracted period of a near-zero interest rates, along with endless economic stimulus, will spawn another bubble and not a genuine recovery.

Michael Pento is chief economist at Delta Global Advisors and a contributor to greenfaucet.com.

My New Car

My New Car

I bought a new BMW-Li and returned to the dealer the next day complaining that I couldn't figure out how the radio worked. The salesman explained that the radio was voice activated. "Watch this," he said. "Nelson!" The radio replied, "Ricky or Willie?"

"Willie!" he continued, and "On The Road Again" came from the speakers.

Then he said, "Ray Charles!" and in an instant "Georgia On My Mind" replaced Willie Nelson.

I drove away happy, and for the next few days, every time I'd say, "Beethoven," I'd get beautiful classical music, and if I said "Beatles" I'd get one of their awesome songs.

Yesterday, a couple ran a red light and nearly creamed my new car, but I swerved in time to avoid them. "Assholes!" I yelled.

Immediately the FRENCH National Anthem began to play, sung by Jane Fonda and Barbara Streisand, backed up by Michael Moore and The Dixie Chicks, with John Kerry on guitar, Al Gore on drums, Dan Rather on harmonica, Nancy Pelosi on tambourine, Harry Reid on spoons, Bill Clinton on sax and Ted Kennedy on scotch.

Damn, I LOVE this car!

(author unknown)

Insurance is for Accidents, Not Oil Changes

Political meddling in healthcare has driven up its costs and reduced choice. It's time to end that, not expand it, as yet another excellent thinker has made plain here.

November 3, 2009

The "Costs" of Medical Care: Part IV

By Thomas Sowell

What is so wrong with the current medical system in the United States that we are being urged to rush headlong into a new government system that we are not even supposed to understand, because this legislation is to be rushed through Congress before even the Senators and Representatives have a chance to read it?

Among the things that people complain about under the present medical care system are the costs, insurance company bureaucrats' denials of reimbursements for some treatments and the free loaders at hospital emergency rooms whose costs have to be paid by others.

Will a government-run medical system make these things better or worse? This very basic question seldom seems to get asked, much less answered.

If the government has some magic way of reducing costs-- rather than shifting them around, including shifting them to the next generation-- they have certainly not revealed that secret. The actual track record of government when it comes to costs-- of anything-- is more alarming than reassuring.

What about insurance companies denying reimbursements for treatments? Does anyone imagine that a government bureaucracy will not do that?

Moreover, the worst that an insurance company can do is refuse to pay for medication or treatment. In some countries with government-run medical systems, the government can prevent you from spending your own money to get the medication or treatment that their bureaucracy has denied you. Your choice is to leave the country or smuggle in what you need.

However appalling such a situation may be, it is perfectly consistent with elites wanting to control your life. As far as those elites are concerned, it would not be "social justice" to allow some people to get medical care that others are denied, just because some people "happen to have money."

But very few people just "happen to have money." Most people have earned money by producing something that other people wanted. But getting what you want by what you have earned, rather than by what elites will deign to allow you to have, is completely incompatible with the vision of an elite-controlled world, which they call "social justice" or other politically attractive phrases. The "uninsured" are another big talking point for government medical insurance. But the incomes of many of the uninsured indicate that many-- if not most-- of them choose to be uninsured. Poor people can get insurance through Medicaid.

Free loading at emergency rooms-- mandated by government-- makes being uninsured a viable option.

Within living memory, most Americans had no medical insurance. Even large medical bills were paid off over a period of months or years, just as we buy big-ticket items like cars or houses.

This is not ideal for everybody or every situation. But if we are ready to rush headlong into government control of our lives every time something is not ideal, then we are not going to remain a free people very long.

Ironically, it is politicians who have already made medical insurance so expensive that many people refuse to buy it. Insurance is designed to cover risk. But politicians have mandated that insurance cover things that are not risks and that neither the buyers nor the sellers of insurance want covered.

In various states, medical insurance must cover the costs of fertility treatments, annual checkups and other things that have nothing to do with risks. What many people most want is to be insured against the risk of having their life's savings wiped out by a catastrophic illness.

But you cannot get insurance just for catastrophic illnesses when politicians keep piling on mandates that drive up the cost of the insurance. These are usually state mandates but the federal government is already promising more mandates on insurance companies-- which means still higher costs and higher premiums.

All this makes a farce of the notion of a "public option" that will simply provide competition to keep private insurance companies honest. What politicians can and will do is continue to drive up the cost of private insurance until it is no longer viable. A "public option" is simply a path toward a "single payer" system, a euphemism for a government monopoly.

War is the Father of Everything

From the very long term perspective, the spending on World War II which supposedly got us out of the Great Depression did nothing of the sort. It erected an enormous edifice which became the foundation for the present trouble, which is masked in the ever declining purchasing power of the dollar, the 1928 version of which is worth eight cents in 2008, the 1910 dollar, four pennies.

Instead of climbing out of that debt foxhole, we're digging it ever deeper, and the viccissitudes of a history of our own making are raining down upon us a torrent that will become a flood, collapsing the unsupported walls around us. The world knows a worthless currency when it sees it.

Heraclitus taught us that war is the father of everything. Consider the chart above. The very American nation was itself born of monies borrowed to finance its War of Independence. Mark the sudden upticks in expenditure as a percentage of gross domestic product which commence with the War of 1812, the War Between the States, World War I, the response to the crash of 1929 and World War II, the Peace Through Strength policy to defeat the Soviet threat begun under the Reagan administration, and the adventures in Afghanistan and Iraq since 2003. We've been paying for all that with the continuing slide of a fiat dollar.

Jesse thinks the day of reckoning fast approaches: "The States racked up some serious debt in keeping the world safe for democracy in the Second World War. On a percentage basis, it has recently spent a significant amount keeping its financial sector safe from productive effort and honest labour. They will raid the Treasury, take their fill, and then compel the government to confiscate the savings of a generation by defaulting on its obligations, its sovereign debt."

So does Sprott Asset Management, here:

In case you failed to catch it in our previous articles this year, we thought we’d state it outright for our readers this month: the United States Government is on a trajectory to default on their obligations. In its current financial condition, it will not be able to fund its forecasted budget deficits and unfunded Social Security and Medicare promises on top of its current debt obligations. This isn’t official yet, and we don’t know when the market will react to it, but there is no longer any doubt about the extent of their trajectory. There simply isn’t enough taxing power, value creation or outside capital willing to support its egregious spending.

The great imperative of our time is to bring spending to a halt, or as Jesse says, to need little, and want less. Willingly or no, little and less await us.

Yet Reason frowns on war's unequal game,

Where wasted nations raise a single name,

And mortgaged states their grandsires' wreaths regret,

From age to age in everlasting debt;

Wreaths which at last the dear-bought right convey

To rust on medals, or on stones decay.

Samuel Johnson

The Baloney in the Bailouts

An excellent summary detailing in plain language what has been wrong with the bailouts of banks and Wall Street, posted today at Jesse's Cafe Americain. Here is the link.

02 NOVEMBER 2009

Ten Things Not to Like About the US Government Policy Actions Known as "The Bailouts"

Malcolm McMichael

1. The Treasury and the Fed rewarded some aggressive risk takers and failing business models at the expense of those who followed sound business practices. Those who followed conservative practices have been penalized twice; first on the way up and again on the way down. Those companies that did fail appear to have been 'targeted' by insiders.

2. Much of the process was done in secret with minimal transparency, debate, or disclosure by people who have obvious conflicts of interest.

3. The stated objectives of freeing up credit for the real economy and stemming foreclosures have not been achieved.

4. Trillions in taxpayer monies were provided with few strings attached and at minimal stipulated rates of return. Furthermore, several of these institutions are using their taxpayer money to lobby against reform and award themselves pre-crisis salaries and record bonuses.

5. Bailout actions were arbitrary, inconsistent, ad hoc, and without any apparent guiding principles of justice.

6. The banking, rating, “insurance," and regulatory systems have not been reformed and the perpetrators of the collapse and their enablers remain in charge, now overseeing the “recovery.”

7. Criminal investigations are minimal; few people are facing indictments or even serious regulatory scrutiny for actions that are highly questionable. Official finds are whitewashes.

8. Regulations, regulatory structures, and other safeguards were implemented, revised or swept aside in chaotic and reckless fashion. [discount window participation and collateral, short selling rules, bank holding companies, mark-to-market]

9. The insider advantages, speculative excess, and extreme leveraging of the perpetrators has been allowed to continue; in fact, allowed to expand. There is a taint of insider trading and corruption that permeates the process.

10. Wall Street is bailed out; Main Street is not. Efforts to subsidize the incomes and balance sheets of failing firms have been massive and were implemented with minimal debate, requirements, or oversight; efforts to shore up taxpayer incomes and balance sheets have been comparatively minimal, subject to extensive debate and tinkering, highly selective, and incomplete.

The New National Symbol

"The First 2.5% of GDP is Fictional"

Good stuff from Mish today on the recent GDP numbers.

He says they are inherently deceptive because they count all spending, including government spending, which is by definition consumptive spending extracted from the productive side of the economy.

He quotes Federal Reserve Chairman Ben Bernanke admitting as much:

"It takes GDP growth of about 2.5 percent to keep the jobless rate constant. But the Fed expects growth of only about 1 percent in the last six months of the year. So that's not enough to bring down the unemployment rate."

About which Mish says:

Inquiring minds might be asking: Why does it take 2.5% growth to keep the jobless rate constant? The answer is the first 2.5%+- of GDP is fictional. When the economy is growing at 2%, it feels like a recession because it probably is, even though no one will admit it.

My Kind of Ditto Head

"A Sham GDP for a Sham Economy"

OCTOBER 29, 2009, 1:18 PM ET

Mean Street: A Sham GDP for a Sham Economy

By Evan Newmark

Americans rejoice! GDP grew by 3.5% in the third quarter and the recession is over.

It’s time to drink champagne, dance in the streets, and have a group hug with Nancy Pelosi and Ben Bernanke. But whatever you do, don’t ask yourself why the recession has ended. The answer might ruin the party.

The recession is over only because Washington decided it should be. With billions in fresh government spending, it was only a matter of time before GDP posted some growth.

It’s too bad all that government spending is borrowed money. Someday, we’ll actually have to pay off this year’s $1.4 trillion deficit.

Go here for the rest of the story at WSJ Blogs.

The Parable of Old Butch the Rooster

From the blog Too Much Liberty:

A Parable

John was in the fertilized egg business. He had several hundred young layers (hens) called 'pullets' and ten roosters to fertilize the eggs. He kept records, and any rooster not performing went into the soup pot and was replaced.

This took a lot of time, so he bought some tiny bells and attached them to his roosters. Each bell had a different tone, so he could tell from a distance which rooster was performing. Now he could sit on the porch and fill out an efficiency report by just listening to the bells.

John's favorite rooster, old Butch, was a very fine specimen, but this morning he noticed old Butch's bell hadn't rung at all! When he went to investigate, he saw the other roosters were busy chasing pullets, bells-a-ringing, but the pullets, hearing the roosters coming, could run for cover.

To John's amazement, old Butch had his bell in his beak, so it couldn't ring. He'd sneak up on a pullet, do his job and walk on to the next one. John was so proud of old Butch, he entered him in the Renfrew County Fair and he became an overnight sensation among the judges. The result was the judges not only awarded old Butch the No Bell Piece Prize but they also awarded him the Pulletsurprise as well.

Clearly old Butch was a politician in the making. Who else but a politician could figure out how to win two of the most highly coveted awards on our planet by being the best at sneaking up on the populace and screwing them when they weren't paying attention?

Vote carefully next year, the bells are not always audible.

Posted by Sean G at 04:27, Saturday, October 17, 2009

"The Banks Must Be Restrained"

Total bank failures year to date reached 106 yesterday, bringing the total cost to the FDIC Deposit Insurance Fund this year to about $25 billion, with only about $100 billion to go, according to the FDIC's own projections.

The FDIC likes to take over banks on Friday afternoons, believing you won't notice it as readily with the weekend intervening before the next regular day of business. They wouldn't want you to panic, you know. So people who watch this stuff carefully like to call the last day of the work week "Bank Failure Friday." Yesterday, I noticed that the 106th bank to fail this year was in Itasca, Illinois, near where I used to live, and it reminded me of these words posted by Mish (who lives in Illinois) in July of 2008:

23. FDIC Chairman Sheila Bair said the FDIC is looking for ways to shore up its depleted deposit fund, including charging higher premiums on riskier brokered deposits.

24. There is roughly $6.84 Trillion in bank deposits. $2.60 Trillion of that is uninsured. There is only $53 billion in FDIC insurance to cover $6.84 Trillion in bank deposits. Indymac will eat up roughly $8 billion of that.

25. Of the $6.84 Trillion in bank deposits, the total cash on hand at banks is a mere $273.7 Billion. Where is the rest of the loot? The answer is in off balance sheet SIVs, imploding commercial real estate deals, Alt-A liar loans, Fannie Mae and Freddie Mac bonds, toggle bonds where debt is amazingly paid back with more debt, and all sorts of other silly (and arguably fraudulent) financial wizardry schemes that have bank and brokerage firms leveraged at 30-1 or more. Those loans cannot be paid back.

What cannot be paid back will be defaulted on. If you did not know it before, you do now. The entire US banking system is insolvent.

Since those words were penned, the FDIC is planning to charge premiums several years forward to banks to the tune of $45 billion, its deposit fund is down to about $10 billion, and its troubled bank list has ballooned to over 400 banks, with nearly 300 in serious trouble. The FDIC expects to need at least another $100 billion for bailouts through 2013. Let's see, $10 billion on hand plus $45 billion charged forward = $55 billion. Only $45 billion short! Hmm. And you think we can afford to federalize health care?!

When you go down to the bank to ask for a loan to buy a house, you typically get leverage of only 5 to 1 (20% down), because nobody's got your back but you. So why does the bank get leverage to the tune of 25 to 1 (4% down)? Because of the taxpayer guarantee, that's why. And "rules" which let them, written by politicians on the take. It's high time we ended all that or this country will surely go bankrupt. Consider Citigroup.

It alone has $800 billion in "assets" off the books, and looks to be in serious trouble: suddenly this week it ended its gasoline credit card program and dramatically hiked interest rates on its other cards. Forget about the FDIC covering Citigroup with forward charged premiums to its member banks if it goes under. There isn't enough money there. The taxpayer will be on the hook. Again. Are you mad as hell yet? Are you going to take it anymore? Vote the bums out.

No wonder Jesse keeps saying, "The banks must be restrained . . . before there can be any sustained recovery."

Hu, Wen, Deng, Obamao

5 RMB each, Joy City, Xidan, Summer 2009

90 Jobs--10,000 Applicants/99.1% Disappointed

The country needs to create roughly 150,000 new jobs per month just to keep up with first time job seekers, but the inventory of already unemployed Americans just continues to grow. Who's going to have the money to buy the washing machines these lucky 90 are going to make? Certainly not the 15+ million Americans who've lost their jobs.

The news from Kentucky:

October 8, 2009

10,000 apply for 90 factory jobs

By Jere Downs

jdowns@courier-journal.com

In the latest sign of weakness in Louisville-area employment, about 10,000 people applied over three days for 90 jobs building washing machines at General Electric for about $27,000 per year and hefty benefits.

The jobs dangle medical, eye care, prescription and dental benefit packages, as well as pension, disability, tuition assistance and more, said GE spokeswoman Kim Freeman. And despite the recession, no union workers have been laid off from Appliance Park since the company negotiated lower wages with workers in 2005.

“There are no jobs out there paying these kinds of wages that also offer these kind of benefits,” said Jerry Carney, president of IUE-CWA Local 761 at Appliance Park.

Just four years ago, the same jobs paid $19 per hour. But that was before Local 761 approved wage cuts for new workers aimed at preventing the closure of Appliance Park.

“People still value these jobs,” Freeman said.

With the Jefferson County unemployment rate at 10.6 percent in August and more than 38,000 unemployed people looking for work, the opportunity for moderate pay and health care was an attractive lure.

“In this recession, there are lot of people who are just about to run out of unemployment benefits,” said Richard Hurd, a labor relations professor at Cornell University. The national average of time unemployment benefits collected now stands at 26 weeks, Indiana University Southeast Professor of Business Uric Dufrene said.

That’s about a third of the maximum that can currently be collected.

Larissa Roos, 38, never worked in a factory, but was one of the thousands who bid on jobs assembling appliances.

Until she was laid off from Bank of America in February, Roos said she made $18 per hour fielding calls, often from irritated merchants, about credit card glitches. Roos took that job just out of high school. But severance payments end this month, and Roos said she is looking everywhere to try to replace the income.

“I need something so I can live day to day. The job market is horrible,” Roos said Thursday, adding the family relies on her husband’s job as a printer to pay the mortgage on their Fern Creek home as well as utility, fuel and other bills.

With 10,000 vying for GE line jobs, “I am sure my application won’t even get looked at,” she added.

The rush of applicants came as no surprise to Carney, who noted that another recent GE advertisement for 13 maintenance workers, who are paid a union skilled trades rate of $23 hourly, drew 700 job seekers.

Carney credited GE’s reputation for union job security and blue chip benefits as a powerful lure.

GE announced the new jobs last week and started accepting applications through a website Monday. Wednesday was the deadline. The jobs are being added to a new second shift early next month to assemble Energy Star washing machines in Building 1 at the historic Louisville complex.

Roughly 80 percent of applicants report factory experience, Freeman said. That is not surprising, given the recession so far has slashed 8,000 manufacturing jobs from the region’s economy, Dufrene said.

“There is an abundance of potential employees with manufacturing-related skills,” Dufrene said.

The rough profile of applicants, most of them former factory workers, suggests many lack sufficient education to apply for more than minimum wage jobs in the current job market.

Half lacked a high school diploma. Just 5 percent of the applicants said they had a bachelor’s degree or higher. and

GE employs roughly 2,100 hourly and 2,000 white collar workers at Appliance Park. Now, about 440 workers labor on the first shift making washing machines in Building 1.

Applicant Shane Hopkins, 48, hopes his factory experience provides an edge.

Until mid-August, he said he maintained presses at a plastics factory. Now, Hopkins said he picks up occasional work as a flooring contractor for a cousin.

He still pays $300 per month to keep health care benefits for himself and his wife, an independent contractor for a Ford Motor Co. parts supplier at the Louisville Assembly Plant. Hopkins anticipates she’ll be out of work next year, when the plant closes for retooling.

A year from now, “her job ain’t going to be there,” Hopkins said. “I am thinking seriously about going to McDonalds, just for the benefits if nothing else.”

Reporter Jere Downs can be reached at (502) 582-4669.