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Well-written videos. I have my criticisms (such as the omission of discussion of deregulation, Reagan’s Keynesianism, and the fact that we have “bottom up” without anything in the way at the moment), but it plays to the intelligence of the viewer and such art is so rare, I won’t taint the experience by obsessing with trifles. Clearly the authors lean towards Hayek, but it’s a very good framing of the basics.
Just reflecting on the econnomic situation at present. Alhough supply side economics were pretty much refuted in the first couple of the Reagan years, the current economic crisis should amount to the last stone on the grave of trickle downs, Laffer Curves, etc. We have the lowest taxes on the wealthy in recent history. Deregulation of just about everything. The investing class has more money in its hands than at any time in the last century. The mantra we’ve been given is that if we just show more flexibility and get more money into these hands, they’ll invest the money and generate new jobs, with the whole pie expanding and wealth trickling down and the streets will be paved with gold as equilibrium is attained with a chicken in everyone’s pot on his own dime.
It isn’t happening. The investing class is sitting on its money. It’s investing in machinery to some degree, and international markets. They aren’t hiring.
Of course, all that means is that we should give them even more tax breaks, to give them even more money to stuff into their mattresses, right? It reminds me of an old political cartoon in which the King is with his advisors studying pictures of Humpty Dumpty after his fall, and the King procleims: “Gentlemen. The fact that all of my horses and all of my men can’t put him together again simply means I need more horses and more men!”
Workers tend to bear the brunt of the American economy’s boom and bust cycles. When recessions hit and unemployment rises, workers’ share of the national income — the money people earn through wages and salaries, as opposed to corporate profits and capital gains — tends to decline. And when the economy recovers, workers’ portion of the country’s income rebounds to somewhere around its level prior to the recession.
At least that’s how it went in the 20th century. But since the recession of the early 2000s, we’ve seen the decline without the recovery — even after the recession ended, workers’ portion of national income continued to drop consistently, declining up to and through the recession of the late Bush and early Obama years. Which raises the question: Has the economy changed in a fundamental way that will prevent workers from enjoying the benefits of the current incipient recovery?
But as the article continues, the companies just refuse to hire.
By contrast, the financial industry is doing wonderfully for themselves.
This is a point which is apparently either not accepted or ignored by both Republicans and Democrats in the debate – deficits are eliminated by jobs. Therefor, macroeconomic expansion is fiscally responsible. And cut-backs, even those endorsed by the Democrats, may very well extend the recession, reduce revenues, and maybe even aggravate the deficit – which will of course lead to more proposals for cuts…
But it’s counter-intuitive, at least to American values-based economics.
This Kos post elaborates to some extent.
Meanwhile, even though the Democrats have essentially caved on cutback numbers, it appears we’re headed for a government shut down over Republican riders involving abortion and the EPA. David Kurtz asks, “Is it really about the deficit?“
Got this chart from this Kos blog post. Make of it what you will.
The Atlantic has an interactive map which purports to depict income inequality as it has manifested over the past 30 years in terms of culture and regional economic base. They have Humboldt County as a “service worker center” in which tourism has replaced the extraction economy. Assuming the stats are accurate, it tells quite the story.
Good jobs reports for February, though some economists will point out that it could be making up for a January made sluggish by extreme weather. One month doesn’t make a trend, although on paper we have been crawling out of recession for some months despite record numbers of foreclosures and bankruptcies in 2010 (I’m told 1982 still holds the post-depression record for business bankruptcies as opposed to individual, but I haven’t found anything to confirm it).
Usually this is good news for the President in power, and probably he will be re-elected; especially given the weak line of candidates the Republicans have to offer. But it also takes pressure off of the Republicans who haven’t even mentioned jobs since they took over the House. It’s all about deficits, with their leader saying outright that deficit reduction is a priority even if it means hundreds of thousands of jobs. Boehner is taking credit, with caution just in case the numbers go sour again in a few weeks as they did the first time he took credit for December’s numbers. And it does give the Republicans the opportunity to press on social issues to placate the tea party base, such as the threat to shut down the government if Planned Parenthood is funded in the spending bill.
So I’m wondering where the Republican moderates will stand on their currently proposed spending bill, which will cost the economy anywhere from two hundred to seven hundred thousand jobs - devastating to the recovery. Boehner and Cantor are taking credit. Do they want to win the spending fight? Because if they do win, and we slide back into recession, they’d dead in 2012. If Obama and the Democratic leadership were as cynical as some of the Republicans, they might just call and let the Republicans win as they did with the tax breaks for the rich a couple of months ago, again claiming that the Republicans are holding the country hostage.
They won’t do that though, and the Republican leadership won’t let the anti-abortion crazies shut down the government. Not with this jobs report. That’s my prediction. Instead, they’ll compromise and so will the Democrats. Both will position themselves to take credit or blame, or both, next year. A few liberal reps will vote against it because of the cuts to social programs and because the military budget will remain untouched. A few right wingers will vote against it because it isn’t cutting enough, or because of some nutwing social agenda, and will rail on Fox and talk radio about the culture of corruption in Washington. And we’ll limp our way into a tepid recovery which keeps the white suburban middle class just comfortable enough to continue buying disposable plastic rendered into some quasi-useful form by Chinese and Laotian kids.
On the bright side, the Republicans probably will back off any serious threat to defund the Health Care programs, and we will inch our way closer to the single payer system we ought to have adopted 60 years ago to join the modern industrial world.
At a moment when the disparities between rich and poor are at a post-depression record, this is really going to hurt many families. Of course, Eureka has the highest prices in the country (barring Hawaii I think).
Some economists wanted inflation. Now I think they’re going to get it.
Bankruptcy which will lead to the elimination of 30 percent of its stores nationwide.
This might seem like good news for independent bookstores, and short term it may well be. But with the mass push to buy (or steal) books electronically, publishing and writing may be in trouble as well and they’re losing at least some business from a huge client. Being the “economic reactionary” that I am who spends enough time staring at an electronic screen, bookstores will have at least me as a client for my lifetime. I don’t buy much from Borders, preferring to give my business to stores like North Town and the used stores, but I am concerned about this development.
I suspect that the Bayshore Mall will be losing yet another tenant. Obviously we need to build more malls! It reminds me of the old political cartoon where the King and his advisers are poring over photos of Humpty Dumpty and the King declares: “Gentlemen, the fact that all my horses and all my men can’t put him together simply means that I need more horses and more men!”
If Borders does close down, will North Town be the last new book store in the county? We live in a country which even before the Internet had more gun stores than book stores. Are we entering a brave new era of communication, or are we on are way down?
State deficits are different from federal in that they can’t simply generate money to temporarily offset them. Unlike the nation, the state’s credit rating really is key to economic recovery. On the other hand, deficit problems have never been resolved by cut backs, or for that matter tax increases. Revenues increase when taxable transactions increase, and pulling money from the economy only compounds things and sometimes budget cuts can lead to even bigger deficits.
But apparently, Brown having promised that there won’t be tax increases without voter approval, intends to educate the public with cross-the-board cuts, this time including roads and prisons which conservatives never like to touch. From the Times Standard:
According to the report, Brown’s proposal seeks to eliminate local redevelopment agencies and enterprise zones, cuts social service benefits, closes parks, reduces library hours, restricts Medi-Cal access, houses low-level offenders in county jails and imposes deep cuts to the California State University and University of California systems. Brown’s proposals are grim, in part, because he hopes they will encourage voters to approve tax and fee increases in a special election early this summer, the Bee reported.
It’s a big political gamble on his part, and I think he’s essentially hitching up to the same wagon Obama’s on – hoping that the recovery is real. But eliminating enterprise zones is hardly going to help with recovery.