Gold closed at 558.90 dollars an ounce on Friday, up 0.9% from $553.80 at the previous week's close. The dollar closed at 0.8269 euros on Friday, up 0.3% from 0.8241 euros the week before. The euro, then, closed at 1.2094 dollars, compared to 1.2134 at the previous Friday's close. Gold in euros, then, would be 462.13 euros an ounce, up 1.3% from 456.40 the week before. Oil closed at 67.76 dollars a barrel, down 1.1% from $68.48 a barrel the Friday before. Oil in euros would be 56.03 down 0.7% from 56.44 euros a barrel the week before. The gold/oil ratio closed at 8.25 barrels of oil per ounce of gold, up 2.0% from 8.09 at the previous week's end. In the U.S. stock market, the Dow closed at 10,907.21 on Friday, up 2.2% from 10,667.39 the week before. The NASDAQ closed at 2,304.23 for the week, up 1.5% from 2,247.70. The yield on the ten-year U.S. Treasury note ended at 4.51%, up 16 basis points from 4.35 at the close of the previous week.

Gold continued its rise last week and the U.S. stock market rallied on Friday, regaining much of what it lost the previous Friday. Oil eased a bit as well.

Why the stock rally? The corporate shills on television would say it is because the economy is strong. What they mean by that is that corporate profits are good. In their minds that counts for everything. The public is not fooled, however, as a recent American Research Group poll shows:
January 23, 2006

George W. Bush's Overall Job Approval Rating Returns to Record Low As American Turn Less Optimistic About the National Economy

George W. Bush's overall job approval rating has returned to its lowest point in Bush's presidency as Americans again turn less optimistic about the national economy according to the latest survey from the American Research Group. Among all Americans, 36% approve of the way Bush is handling his job as president and 58% disapprove. When it comes to Bush's handling of the economy, 34% approve and 60% disapprove.

Among Americans registered to vote, 37% approve of the way Bush is handling his job as president and 58% disapprove. When it comes to the way Bush is handling the economy, 35% of registered voters approve of the way Bush is handling the economy and 60% disapprove.

A total of 14% of Americans say the national economy is getting better, which is down from 30% in December and 52% say the national economy is getting worse, which is up from 40% in December. When asked about the national economy a year from now, 15% say it will be better, which is down from 28% in December, and 62% say it will be worse, which is up from 39% in December.

The results presented here are based on 1,100 completed telephone interviews conducted among a nationwide random sample of adults 18 years and older. The interviews were completed January19 through 22, 2006. The theoretical margin of error for the total sample is plus or minus 2.6 percentage points, 95% of the time, on questions where opinion is evenly split.

Overall, 36% of Americans say that they approve of the way George W. Bush is handling his job as president, 58% disapprove, and 6% are undecided.
It makes sense, actually, that the more ruthless and predatory the large multinationals become, the better their profits and the higher their stock. Social health be damned. The people responding to the polls, however, are looking at Ford and General Motors and are realizing that they no longer have any economic security.
Ford to cut 30,000 jobs in North America

By Joe Kay
24 January 2006

Ford Motor Company announced plans on Monday to eliminate between 25,000 and 30,000 jobs by 2012. This amounts to more than 20 percent of the company's North American workforce, and nearly 30 percent of its manufacturing jobs, where the bulk of the reductions will take place. The Ford plan is only the latest stage in a major assault by US automakers on the jobs, wages and benefits of their workers, an assault that is having devastating consequences throughout the US, Canada and other countries.

The plan, dubbed the "Way Forward," was outlined in a meeting at the company's headquarters in Dearborn, Michigan. Citing increased competition and a "crowded and fragmented" global auto market, CEO and Chairman Bill Ford announced that the company "will be making painful sacrifices to protect Ford's heritage and secure our future." He pledged that in the future Ford, "will be able to deliver more innovative products, better returns for our shareholders and stability in the communities where we operate."

Return for shareholders and a shift toward profitability in its North American division are the basic aims of the restructuring. Ford has been under pressure from Wall Street to make major cuts in costs over the past year, and has seen its bond rating reduced to junk status. The job cuts were widely expected, particularly after Ford's larger US rival, General Motors, announced plans to cut tens of thousands of jobs late last year. The cuts Ford announced Monday went much further than an outline of the plan that it leaked to the press in December and reflected the company's determination not to undershoot Wall Street demands.

Ford's stock price was up $0.42 on Monday, or more than 5 percent - a consequence of larger-than-expected profit figures for the fourth quarter, as well as a generally favorable reaction on Wall Street to the new job-cutting plan. David Cole, chairman of the Center for Automotive Research, told Dow Jones's MarketWatch news service that the restructuring was an "excellent start" for Ford.

…The plan, which will reduce Ford's North American production capacity by 26 percent, is part of a broader strategy to reduce labor costs. Last year, Ford began eliminating 4,000 salaried workers, and another 5,000 are set to be cut as part of the "Way Forward." This amounts to about 20 percent of the company's white-collar workforce.

In addition to jobs, Ford is targeting health care and pension benefits. Bill Ford said on Monday that "health care and legacy costs are enormous" and that "more progress is needed" in making cuts. With the collaboration of the United Auto Workers union (UAW), Ford has already pushed through health care concessions that are estimated to save the company $850 million annually and $5 billion in long-term liabilities. In his statements Monday, Bill Ford directed his appeal for assistance not only to the union, but also to the government, calling on business and government to work together to find a way of reducing corporate health care and pension costs.

Ford's announcement follows close on the heels of the GM cuts, which include plans for the elimination of 30,000 jobs in North America and the closure or scaling down of nine plants by 2008. The new cuts come only four years after Ford's last major retrenchment. In January 2002, the company announced plans to eliminate 35,000 jobs worldwide and 22,000 in North America. In 2001, the other major US auto company, DaimlerChrysler, initiated plans to eliminate 26,000 jobs.

The attack on automotive jobs is an international phenomenon, and workers in Europe have also been severely affected. Both GM and DaimlerChrysler have cut thousands of workers in their German divisions, and German automaker Volkswagen has followed suit. Globally, automakers have been struggling to deal with overcapacity and increased international competition, and have responded by cutting jobs and shifting operations to countries with cheaper sources of labor.

The cutbacks at the Big Three have cascaded throughout the auto industry and beyond. Ford's major parts supplier, Visteon, and GM's major supplier, Delphi, have both announced major job, wage and benefit cuts in the past year. In his speech on Monday, CEO Ford indicated that his company will continue to escalate pressure on parts and material suppliers to reduce costs. He said that it will seek to reduce overall material costs $6 billion by 2010.

Ford's suppliers will no doubt be forced to follow through with their own job cuts and cost reductions. It is estimated that a single job at an auto factory supports seven jobs in the wider economy, which will produce a devastating impact on those areas where plants are shut down. These are working class communities that have already suffered from the general stagnation and decline of wages over the past several years and the attack on social programs and benefits.

Michigan workers have been hit hard by the 25-year assault on auto jobs in what was once the center of US auto production. The closure of the Wixom plant, as well as the Windsor plant directly across the Canadian border from Detroit, will be yet one more setback. Tens of thousands of jobs are slated to be lost in Michigan and the surrounding states of the Midwest as part of the GM, Visteon and Delphi cuts of the past year.

The closure of the Atlanta Assembly plant adds to the GM cuts in that city, which include 3,000 workers at its plant in nearby Doraville. And the scale-back at Ford's St. Thomas Assembly Plant follows GM's decision to close one of its plants in Ontario and eliminate a shift in another, leading to a total loss of 3,500 jobs in addition to the 1,200 cut by Ford.

In making the new cuts, Ford is responding to the continued atrophy of its share of US auto sales, which have declined steadily over the past decade and are now at an all-time low of 17.4 percent. While Ford was able to post profits in 2005 of $2 billion, this was with a loss of $1.6 billion in North American production. The profits were due in large part to a $2.5 billion net income for Ford's financing arm.

The US auto industry as a whole is in a protracted state of decline, which began at least 25 years ago. Since 1979, the "Big Three" - GM, Ford and Chrysler - have shed an astonishing 600,000 jobs. The companies have become shadows of their former selves. At its peak, GM employed more than 600,000 workers. After its latest cuts, the workforce will only be about 120,000.

There is increasing talk of the possibility that GM may end up in bankruptcy, a tool that would be used to impose a new contract to eliminate job security guarantees and health care and pension benefits. If GM does declare bankruptcy, Ford would likely do the same. The auto giants may employ a similar tactic to what has been used by the major airlines, which have exploited the bankruptcy courts to escape from their so-called "legacy costs," including billions in pension obligations.

The decline of the US auto industry is part of a general decline of American manufacturing. As US companies have come under increasing competition from abroad, those sections of the workforce that had previously been able, through major struggles, to win certain concessions on job security, wages and benefits are now considered to be the chief obstacles to restoring profitability.

The working class has been left entirely defenseless as its past gains have been eliminated. Ford and the rest of the auto industry have relied on the collaboration of the UAW and the Canadian Auto Workers in pushing through the required cost cutting. The trade union bureaucracies in the US and in Canada have collaborated with management in imposing cuts, and have taken no steps to oppose the massive assault on auto jobs. Bill Ford said on Monday that Ford would seek to carry out the cuts "with the full collaboration of our union partners," with a justified confidence that this would be possible.

In response to the announcement of 30,000 job cuts, the UAW issued a statement announcing that the news is "extremely disappointing and devastating" for Ford workers. However, the union did not give any indications that it would seriously oppose the cuts in any way, let alone call a strike to prevent the measures.

The union bureaucracy has pursued a policy of increasingly close collaboration with management over the past quarter century. The unions have sought to channel the anger of US workers behind chauvinist attacks on foreign workers while attempting to keep them tied to the Democratic Party, which has helped oversee the deterioration of living standards. For her part, Democratic Michigan Governor Jennifer Granholm declared her support for Ford's new plan, calling the cuts "tough business decisions" that "will help the company regain its financial footing so it can continue to be an industry leader."
Some might see this and the announcement of $17 billion in losses by United Airlines or General Motors's announcement of $8.6 billion in losses and wonder why stocks are doing as well as they are? What's to wonder? These losses are setting the stage for bankruptcy-court evasion of pension and health commitments. And, with Alito on the U.S. Supreme Court, corporations will be able to do whatever they want. Why wouldn't that be good for their stocks? last week published an account of the behavior or UnumProvident Insurance in denying claims. Looks like a textbook case of corporate psychopathy:
Giant UnumProvident Insider Trading Bringing the House Down Before Claims and Criminal Charges Hit Fan

John Caylor
January 21, 2006

Another American Institution Takes Plunge into Greed Pool

According to confidential sources, UnumProvident the nations largest disability and long term insurer is operating in a state of chaos while executives struggle to cash in their chips. Insider trading by the millions, exactly $144 Million according to the United States Securities and Exchange Commission.

According to theSEC, UnumProvident Director Hugh O. Maclellan appears to be leading the way with stock sales from his personal portfolio and the families religious foundation, the "Maclellan Foundation a prime stockholder".

Insider Magazines in-depth investigation reveals a monster corporation with a "religious front" to hide away Billions siphoned from investors and policyholders. The Maclellan Foundation definitely has hooks into the Bush White House, IRS, federal courts and the U.S. Department of Labor and it may have received millions from U.S. government sponsored faith based initiatives explained in their "how to get taxpayer money Web site" "".

Recent corporate moves suggest the company to be quietly liquidating after raising additional capital from investors. Some investors have filed suit for fraud claiming that the company lied to them about soundness of financial statements and claims payments. After years of fending off thousands of lawsuits for bad faith and reckless disregard of medical facts involving denied claims the company recently agreed to reassess 215,000 claims federal and state regulators claimwere wrongfully denied.

The U.S. department of Labor has fined the company $14 Million and California Insurance Commissioner has added another $8 Million after refusing to sign a multi-state settlement saying the company was a criminal corporation and charged them with knowingly violating the law. See the Commissioners statement about UnumProvident: Click Here for Commissioners Press Release

With mandated reassessment of 215,000 claims valued at approximately $330,000 each, UnumProvident now valued at $57 Billion will not be able to survive a $71Billion dollar run on it. The multi-state settlement agreement reached after an examination by a BostonLaw firm cozy with the company spells out that the claims will be reassessed by a special unit formulated within UnumProvident.

But according to confidential employee sources and claimants who have been through the new loop, business is the same despite the agreement that calls for favorable reinstatement of claimants already on Social Security Disability. But the company had provisions written in the multi-state settlement giving them the option to deny those claims again based upon what it deems as incompetence of Social Security Awards.

According to Linda Nee a former UnumProvident manager and whistle blower, Unumprovident lies to their investors and tells them they pay 98% of all claims when in fact the company is paying only 60% of claims as a rule. Nee who now operates her own disability consulting service for ERISA and other claimants says that UnumProvident is paying those short term claims they must pay for cancer and related disabilities where claimants have a short life span."".

The company's confidential claims manual states that Doctors and medical evidence can be ignored when determining disability under policy provisions and the company's employees will make all such determinations. See UnumProvident's confidential claims manual... click here for manual

The most they'll pay a claim will be for 24 months, that's the extreme even though some contracts call for payments to age 65. So far the company has avoided criminal prosecution and held it a bay, but, according to insider sources prosecutors in Washington, D.C. are in producing a fraud case against the company targeting benefits offset policy provisions.

…The pending felony charges may come from the fact that UnumProvident owns Genex Services a claims management company that uses attorneys and insurance professionals to reduce claims payment and company liability. Genex has become the market leader for reducing claims nationally for many corporate and government agencies.

Several months into the long term disability claims payment process UnumProvident sends a letter informing claimants that they will soon reach the end of a 24 month own occupation period and they must seek social security benefit offsets as required by their policies.

The company routinely sends out "Power Of Attorney Forms" from subsidiary Genex Services to handle the case at no cost to the claimant and tells them they are not required to appear at Social Security hearings and asks the Power of Attorney forms be promptly returned. The claimants are never informed that GENEX Services is a 100% owned subsidiary of UnumProvident and they own the lawyers lock stock and barrel.

Refusal to sign the Power of Attorney Waiver to GENEX has brought about early termination for an untold number of the 215,000 claimants due to be reassessed. Insiders claim the apparent "Fox-N-Henhouse" program led to many denials for disability claims sent over to the Social Security Administration because they say it is deliberate criminal fraud that reduced claims payments by hundreds of millions.

…According to the company's own internal Confidential Claims Manual, has acquired; UmunProvident has approximately 500 new disability claims per month. Doing the math shows that to be approximately 6,000 new claims per year and there are still 215,000 outstanding claims that have been denied according to the company's own records. Insider sources have told us that many of those were legitimate active claims which were terminated early due to raids by employees seeking the company's coveted "Hungry Vulture Awards and bonuses".

The claims figures raise serious doubt if the company has ever paid but very few marginal claims since the inception of the Maclellan "Religious" Foundation in 1945 as an apparent safe haven source to stash billions away fromeyes of the IRS and government regulators.

Oddly enough the Provident part of the now merged UnumProvident Insurance giant came about from family founder Thomas Maclellan who demonstrated faith when he bought half of Provident Life and Accident Companies, Inc. The company was in it's fifth year of operation and lacked leadership and organization, but Thomas applied his administrative skills and calm preserve to manage business affairs in Chattanooga, while his partner, John McMasters, used his vibrant, friendly personality on the road selling new policies.

The teams synergy was beneficial, but it was Provident's consistent pledge to integrity and honesty that ultimately brought the company success. In the late 1800's, an insurance company like Provident who promised to "pay all claims promptly" was extraordinary, especially because Provident followed through on that promise. Today UnumProvident provides disability insurance through several subsidiaries:

  1. Colonial Life & Accident Insurance Company (all states, except New York)
  2. First Unum Life Insurance Company (in New York only)
  3. Provident Life and Accident Insurance Company
  4. Provident Life and Casualty Insurance Company (in New York only)
  5. The Paul Revere Life Insurance Company
  6. Unum Life Insurance Company of America

Faith Shattered

"Bad faith" is the intentional deception, dishonesty, or failure to meet an obligation or duty.

In a CBS 60 Minutes interview broadcast in November 2002 California Insurance Commissioner John Garamendi told CBS's Ed Bradley that UnumProvident, the nations largest disability insurer, appears to be under pressure to increase claims terminations. This kind of thing will lead to problems. It'll lead to fraud by the insurance company against the consumer, against the policy-holder, said Garamendi.

Garamendi elaborated further by saying, "There's been successful lawsuits against UnumProvident in which federal courts by unanimous verdicts have issued punitive damages for this kind of activity. That's another, not a warning sign, that's a clear siren out in the streets saying 'What is going on here.?"

Bradley responded with, "If this company knows that they're going to be hit with these lawsuits and they're going to lose some of them, that there's going to be bad publicity, why would they do this?"

Garamendi: "It's an equation, an economic equation. How many will we lose? How much business will we lose? Versus how much will we gain by denying these claims. So they're doing that economic equation and they're saying, "We'll run the risk of the lawsuits. We'll run the risk of the bad publicity, and probably the departments of insurance are asleep anyway. So let's go!"

The company has since ousted former CEO Harold Chandler who handed out "Hungry Vulture Awards" to employees who terminated the most cliams. New CEO Tom Watjens has tried quelling the brewing stockholder rebellion with this statement on the company's website...
At its heart, UnumProvident is a company of people serving people. We provide more than a benefit check to claimants...we provide a wide range of benefits and services designed to help people during what is often the most trying time of their lives - loss of income due to illness or injury.

We are committed to paying all valid claims. In 2004 alone, we replaced over $4.2 billion in lost income to help support families. To our knowledge, this is more than any other income protection provider in the world.

Our claims paying philosophy is simple, yet direct:

  • Make appropriate decisions by providing a thorough, fair, and objective evaluation of all claims
  • Pay all valid claims in a timely manner with a high level of service
  • Partner with our customers in their efforts to return to work or to independent living

Our claims process -- we call it "The Benefits Center" -- is unique, helping our customers return to work following an injury or illness. We have invested heavily in a highly innovative process that is supported by a significant number of specialty and clinical resources, including our FMLA services, disability reporting/analysis, integrated disability management and more. Within our claims operation,our employees are all working on behalf of the millions of customers who have put their trust in UnumProvident. Through these commitments, we have generated return-to-work results better than industry averages.

UnumProvident is headquartered in Chattanooga, Tennessee, and has offices around the globe with a significant corporate presence in Portland, Maine; Worcester, Massachusetts; and Glendale California. Our subsidiaries include Colonial Life& Accident Insurance Company in South Carolina and Unum Limited in England.

Our focus on helping people return to the fullness of their lives extends beyond our business interests and into the cities and towns where we live, work and play. UnumProvident has long recognized the importance of providing philanthropic support in the communities we call home and encourage our employees to do so, as well. In 2004 we contributed more than $4.5 million to not-for-profit organizations across the United States and United Kingdom through locally made-decisions in our home cities. Through our matching gift program, we matched an additional $896,000 of donations made by North American employees to local organizations and schools. This dedication to helping our communities reach their highest potential is a natural extension of our mission to help our claimants return to the fullness of their lives.

In so many ways, and in all that we do, UnumProvident is working to make a person at a time.
All the elements of classic psychopathy are there. Pretend you are a psychologist and UnumProvident is a person - how could a diagnosis of psychopathy be avoided?

I sat next to a claims adjuster coming back from post-Katrina Louisiana a few months ago. He seemed like a good guy. He said that the thing that made him like his job was giving a check to family that needed it. At some point in the conversation, I asked him how the insurance companies were going to survive what I thought was huge liability after a natural disaster like Katrina. He answered quickly and simply: "by not paying claims."

The psychopath repeats words of compassion and caring, but their actions tell a different story. The psychopath also likes to elicit pity from its victim ("the poor corporation has to pay pensions and health care for all those retirees who dare to live so long"). At least they're predictable. What the rest of society, the non-psychopathic part, must decide is if we are going to let them be in charge. There are more of us than there are of them. It is estimated that psychopaths, people with no conscience, comprise between 4 and 6 percent of the population. But people with consciences have been fooled by neoliberalism into thinking that good will come of psychopathic corporate behavior. In fact, this fascist form of neoliberalism is, like all fascisms, ultimately suicidal.

Here's an excerpt from an interview with Emmanuel Todd regarding the U.S. government's response to Katrina:
"We were able to observe the inadequacy of the technical resources, of the engineers, of the military forces on the scene to confront the crisis. That lifted the veil on an American economy globally perceived as very dynamic, benefiting from a low unemployment rate, credited with a strong GDP growth rate. As opposed to the United States, Europe is supposed to be rather pathetic, clobbered with endemic unemployment and stricken with anemic growth. But what people have not wanted to see is that the dynamism of the United States is essentially a dynamism of consumption."

…"American industry has been bled dry and it's the industrial decline that above all explains the negligence of a nation confronted with a crisis situation: to manage a natural catastrophe, you don't need sophisticated financial techniques, call options that fall due on such and such a date, tax consultants, or lawyers specialized in funds extortion at a global level, but you do need materiel, engineers, and technicians, as well as a feeling of collective solidarity. A natural catastrophe on national territory confronts a country with its deepest identity, with its capacities for technical and social response. Now, if the American population can very well agree to consume together - the rate of household savings being virtually nil - in terms of material production, of long-term prevention and planning, it has proven itself to be disastrous. The storm has shown the limits of a virtual economy that identifies the world as a vast video game."

Is it fair to link the American system's profit-margin orientation - that "neo-liberalism" denounced by European commentators - and the catastrophe that struck New Orleans?

"Management of the catastrophe would have been much better in the United States of old. After the Second World War, the United States assured the production of half the goods produced on the planet. Today, the United States shows itself to be at loose ends, bogged down in a devastated Iraq that it doesn't manage to reconstruct. The Americans took a long time to armor their vehicles, to protect their own troops. They had to import light ammunition. What a difference from the United States of the Second World War that simultaneously crushed the Japanese Army with its fleet of aircraft carriers, organized the Normandy landing, re-equipped the Russian army in light materiel, contributed magisterially to Europe's liberations, and kept the European and German populations liberated from Hitler alive. The Americans knew how to dominate the Nazi storm with a mastery they show themselves incapable of today in just a single one of their regions."
The neoliberal looting of social capital, of industrial capacity in the broad sense, will doom the society of the United States and any other country that adopts neoliberal prescriptions to third-world ineffectiveness.