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Archive for January, 2009

Ceo4aday thanks you for your support. We established a new traffic record this week,  with over 5000 views !

We continue to focus on core topics including commentary on politics, the economy, entrepreneurship and our series of articles detailing our attempt to acquire a new business platform, ” A Journey To Acquire “.

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For Republicans on Capitol Hill, their stand on principle has become  principal, in providing differentiation from their Democrat party counterparts. As any good marketer knows, it is important to differentiate your product in the mind of the consumer, or in this case the electorate, if you expect to gain market share.

The party that lost its way during the Bush era, is attempting to position itself again as the common sense party, by focusing attention on wasteful spending and the expansion of entitlement programs, which are pervasive throughout the economic stimulus package, passed by the House this week.

In returning to its roots, as the party of  fiscal responsibility, Republicans must overcome a widely held belief, that they squandered their opportunity during the Bush administration, to retain and expand their political base. The traditional Republican agenda as the party of  low tax, low spend, became the party of fiscal irresponsibility as budget deficits ballooned, while the Bush Administration focused on the war on terror, to the exclusion of responsible oversight of the economy.

As a result of this failure, a new national security issue has evolved, as the economy has spiraled downward the past several months and millions of Americans have joined the ranks of the unemployed. One can only deduce, that those who would harm the west, as they pursue their narrow and naive objectives, must relish the current economic state of the United States and other western economies in theworld. Though ineffective at striking directly against America on its’ own soil since 2001, the diversion that islamic terrorists have created has threatened our security in ways we never would have imagined.

One can not fault the previous administration for what appeared at times to be a singular focus on the terrorist threat as it evolved to Afganistan and subsequently Iraq. The country was attacked and the Administration responded. However, the Republican party failed in its diligence to protect its base principles and as a result created a need for change.

The Republicans recognize that as the Obama Administration and its allies in the Pelosi and Reid controlled Congress, pander to their “change is needed” constituency with their partisan Democrat agenda, that they are the alternative solutions party, should the stimulus package fail to provide the jolt that this economy needs. 

Republicans  recognize that the party out of power, had best stand on principle, if it ever hopes to again be the principal party.

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President Barack Obama, who has allowed comparisons of himself  to Abraham Lincoln to the point that he and Vice President Biden followed the Lincoln route to the inauguration, has opted to draw even closer parallels to himself and the nation’s sixteenth President by opting for his own civil war.

Not content to fight a war on terror, Obama has elected to create a new battle front by declaring a class war in America, through the formation of a middle class task force, to be lead by Vice President Biden. The President, took to the battlefield this morning, elevating the profile of unions and union leaders by signing new executive orders today requiring union labor on federal contracts reversing Bush administration policies.

In additional support for the unions, Obama declared that it was time to “level the playing field” for the unions and stated that they were part of the solution in strengthening the middle class. With his statements yesterday, regarding Wall Street bonuses as shameful, the Obama administration is rapidly drawing battle lines as it focuses on executive extremes and panders to the labor movement.

The President’s actions this morning , will no doubt be viewed as positive by his political base. By emphasising executive excess, while  pandering to unions, the President is embarking on a perilous path, that will further weaken America’s competitiveness at a time where the global economy is looking to America for economic leadership.

Union’s were a 19th century solution to employer excess whose relevance peaked at the mid point of the 20th century. President Obama and a democrat controlled Congress will resuscitate union activity at the expense of a progressive society that believes individuals should profit from their labors as opposed to their labor serving the collective. 

In Obama’s class war the end game is equalization. Those that earn more, should be willing to sacrifice more to allow those that earn less to benefit equally until such time as the new classless society emerges. The American dream will become the American nightmare as initiative will no longer rewarded.

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In a totally partisan vote, House Democrats passed an economic stimulus bill 244-188 with Republicans unanimously voting against the bill despite President Barack Obama’s outreach to Republicans on the hill and his desire for a bipartisan stimulus plan. During President Obama’s campaign, he spoke frequently about being a different kind of politician and his desire for bipartisan support for his administration.

President Obama may indeed gain support from Republicans in the House and Senate however, whether or not that support is effective in governing,  may well be a function of whom House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid, choose to incorporate in their legislative agenda. Democrats won a resounding victory in the 2008 election ans are determined to govern to the exclusion of the Republican minority in Congress as evidenced by their passage of the stimulus bill. The Democratic leadership perceives the election as a mandate for change and they interpret change as the democratic agenda of the last four decades.

The divisive politics of old, are clearly the rule of the day on Capitol Hill. Barack obama should be aplauded for his efforts in reaching out to the minority party but, if he is unable to control the leadership on the Hill then the promise of his administration will prove to be nothing more than promise.

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Starbucks which became a global iconic brand in less then two decades announced today it was closing an additional 300 stores and laying off nearly 7,000 employees as same store sales declined 9% in fourth quarter year over year (YOY) results.

It should come as no surprise to investors, as consumers in the Age of Austerity, retrench and spend their coffee dollars elsewhere. Eliminating a $5 latte from their daily expenditures is a savings of $1,820. per year. Even with a $2 substitute from McDonald’s, a consumer can still save nearly $1,100. annually. Many American’s have joined consumers around the globe in recognizing that  Starbucks coffee, once considered a staple, is now a luxury.

Whether the company is able to resume the growth that it once had remains to be seen. There was a time in many urban centers just a few short years ago, when a Starbucks appeared to be opening on every urban corner. The company, after this round of closures, will have closed nearly a 1,000 stores since it began repositioning its brand a year ago. The company had previously stated that its global target was 40,000 locations. It should end 2009 at around 42% of that goal or 16,800 units.

McDonald’s meanwhile, stands to benefit from Starbucks cooling as their coffee sales heat up. This week they announced strong earnings as a result of nearly continued increases in same store sales and expect to open nearly 1,000 new stores around the globe as they remain best in class in the quick service restaurant category.

The results of McDonald’s and Starbucks, both iconic brands but, at opposite ends of the target consumer spectrum, are delivering a strong message about the current economy and their ability to adapt and succeed in this environment. As consumers continue to seek value McDonald’s should continue to deliver strong resultswhile Starbucks coffee continues to cool.

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Democrats and Republicans, agree with the White House, that an economic stimulus plan is urgently needed to stem the continued erosion in the American economy and return to the economic tides of growth.

However, in what has become typical of the leadership of Speaker of the House, Nancy Pelosi, the Democrats in the House, have penned their own stimulus bill, to the exclusion of  Republican members of Congress and included numerous spending proposals which will do little to support the stimulus that is so urgently needed today.

The politics of old still reign supreme on the Hill and Nancy Pelosi is the Queen of Capitol Hill. The Democrats won a definitive victory in the recent election. However, the leader of their party President Barack Obama, ran on a platform calling for bipartisanship, which would incorporate Republicans and Democrats working together to hone the best legislation possible to support the nation in this economic crisis.

The Democratic stimulus is filled with traditional spending programs that naturally support their collective agenda. Providing additional funds for the arts and maintaining America’s parks and monuments are all well and good however, one questions the immediacy of these plans and how they relate to stimulate job creation in the economy. 

What strikes me as completely obscene in the appropriations bill is that within this $825 Billion stimulus,  less than $900 million is allocated to small businesses in America.

Politicians on the stump are generally quick to praise entrepreneurs and small business owners as the backbone of the American economy, therefor, one would expect broader support of small businesses and entrepreneurs in an economic stimulus package that is supposedly targeted to create new jobs as well as support existing employment.

Republicans in Congress are proposing sustainable and deeper tax cuts that will benefit all Americans and businesses alike. They do not favor the class war politics of Nancy Pelosi but rather treat each taxpayer equally. I seem to recall a line in the Constitution that refers to equality as well. Perhaps Nancy and her supporters should take a moment and reflect on that.

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There is nothing more unsettling for the economy, than increases in unemployment. As Congress, the White House and pundits across the broad spectrum of the media debate the pros and cons of the latest proposals for an economic stimulus plan, employers across the nation are announcing lay offs at rates that are unprecedented in recent decades. As unemployment increases, consumer confidence decreases.

We agree, that a significant economic stimulus package is needed at this time, to shock our economic system out of  a prolonged and deep recession toward an economic recovery that will place us clearly on the path toward economic expansion.

We believe, that tax cuts including a reduction in corporate taxes, as well as investment incentives, should be integral components of an economic stimulus package. We also propose that there is no better time than today to establish the United States Office of Entrepreneurship to support qualified American entrepreneurs with venture capital to support start ups or business expansion.

The USOE, would be an independent agency, that would become an investor in the entrepreneurial ventures as opposed to a lender.  The Office of Entrepreneurship would provide an alternative resource to America’s entrepreneurs at a time when traditional financial alternatives have failed to provide adequate support to the entrepreneurial community.

Expanding ownership and promoting self emlpoyment will provide a stimulus for the economy, by creating additional jobs and restoring belief in an economic system, that people who are inventive, innovative and have the discipline to focus on their dream can succeed.

Join Ceo4aday in calling on Congress and the White House to support our initiative to create the Unites States Office of Entrepreneurship.

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