August 2010
22 posts
Why A Civil Society Extends Unemployment Benefits
I have the questionable distinction of appearing on Larry Kudlow’s CNBC program several times a week, arguing with people whose positions under normal circumstances would get no serious attention, and defending policies I would have thought so clearly and obviously defensible they should need no justification. But we are living through strange times. The economy is so bad that the social fabric is...
Warning: Why Cheaper Money Won't Mean More Jobs
Can the Fed rescue the economy by making money even cheaper than it already is? A debate is being played out in the Fed about whether it should return to so-called “quantitative easing” – buying more mortgage-backed securities, Treasury bills, and other bonds - in order to lower the cost of capital still further. The sad reality is cheaper money won’t work. Individuals aren’t borrowing because...
The Two Stories of This Terrible Economy, Yet...
The public doesn’t understand specific policies but it does understand stories that link them together. The stories give the policies context and meaning, and thereby show where policymakers are taking a nation (and, by implication, where the opposition would take it).
Republicans lack specific policies but they have a story. Obama and the Democrats have lots of specific policies but don’t have a...
Why Boehner's Blaming Bureaucrats
We’re moving ever closer to a double-dip. Of course, as I’ve said before, most Americans never got out of the first one.
In previous postings I’ve suggested ways to reverse course, including a “people’s tax cut” exempting the first $20K of income from payroll taxes and making up the revenue loss with a payroll tax on incomes over $250,000.
Yet Democrats seem frozen in the headlights...
Tax Jujitsu: Why Democrats Should Propose a...
Republicans are calling the Democrat’s proposal to end the Bush tax cuts on the richest 3 percent a “tax increase,” and demagoging that it will hurt the economy and small business. This is baloney, to put it politely. Let me count the ways:
– Bush’s ten-year tax cut was designed to end this year, so it’s not a tax increase.
– Ending it for the rich simply returns them to the...
Corporate Rotten Eggs
There are rotten apples in every industry. Or perhaps I should say rotten eggs.
One especially rotten egg is Jack DeCoster, whose commercial egg agribusiness, which goes under the homey title “Wright County Egg,” headquartered in Galt, Iowa, sends eggs all over the country under many different brands. Those eggs have now laid low thousands of Americans with salmonella poisoning, and...
The Anatomy of Intolerance
Connect the dots:
Many Americans (and politicians who the polls) don’t want a mosque at Manhattan’s Ground Zero.
An increasing percent believe the President is a Muslim.
Most Americans approve of Arizona’s new law allowing police to stop anyone who looks Hispanic and demand proof of citizenship.
Most would deny citizenship to children born in the United States to parents who are here...
Why The Unfolding Disaster in Pakistan Should...
The human tragedy unfolding in Pakistan right now demands our full attention.
Flooding there has already stranded 20 million people, more than 10 percent of the population. A fifth of the nation is underwater. More than 3.5 million children are in imminent danger of contracting cholera and acute diarrhea; millions more are in danger of starving if they don’t get help soon. More than 1,500...
Mitt Romney's Wet-Noodle Economics
Mitt Romney is smart enough not to join Newt Gingrich and Sarah Palin in using the proposed mosque at Ground Zero to to lauch a presidential bid. While Gingrich is busy comparing Muslims to Nazis (“Nazis don’t have the right to put up a sign next to the holocaust museum in Washington”), and Palin is calling on New Yorkers to “refudiate” the plan (she subsequently corrected...
Why Growth is Good
Economic growth is slowing in the United States. It’s also slowing in Japan, France, Britain, Italy, Spain, and Canada. It’s even slowing in China. And it’s likely to be slowing soon in Germany. If governments keep hacking away at their budgets while consumers almost everywhere are becoming more cautious about spending, global demand will shrink to the point where a worldwide dip is inevitable.
...
The Truth About China As #2
It’s official. China is now #2. Its economy (measured in nominal GDP for the second quarter) is now bigger than Japan’s (according to numbers released today from the Japanese government). And at the rate it’s growing, China could be the world’s biggest economy in a little more than a decade (Goldman Sachs says by 2027, PricewaterhouseCoopers says by 2020).
Don’t be misled by these numbers....
Forget a Double Dip. We're Still in One Long Big...
It’s nonsense to think of the economy heading downward again into a double dip when most Americans never emerged from the first dip. We’re still in one long Big Dipper.
More people are out of work today than they were last year, counting everyone too discouraged even to look for work. The number of workers filing new claims for jobless benefits rose last week to highest level since...
America's Biggest Jobs Program -- the U.S....
America’s biggest — and only major — jobs program is the U.S. military.
Over 1,400,000 Americans are now on active duty; another 833,000 are in the reserves, many full time. Another 1,600,000 Americans work in companies that supply the military with everything from weapons to utensils. (I’m not even including all the foreign contractors employing non-US citizens.)
If we...
Confessions of a Class Worrier
The decline of America’s middle class can be charted directly. In the three decades after World War II, the median wage (smack in the middle) grew rapidly, right along with productivity gains. Even as late as 1980, the richest 1 percent of Americans received only about 9 percent of the nation’s total income.
But starting in the 1980s — and increasingly since then — the economy has made the rich...
The Jobs Emergency
Washington’s latest answer to the worst jobs crisis since the Great Depression is $26 billion in aid to state and local governments. This still leaves the states and locales more than $62 billion in the hole this fiscal year. And because every state except Vermont has to balance its budget, the likely result is 600,000 to 700,000 more state and local jobs vanishing over the next 12 months...
Greenspan, Rubin, and Herbert Hoover
Herbert Hoover’s disciples are making noises even as America moves closer towards a double dip recession Fed Chair Alan Greenspan tells the New York Times all the Bush tax cuts should expire as scheduled, even those that benefit the middle class and not the rich. His reason: the nation’s looming deficit requires it. On Sunday, former Treasury Secretary Robert Rubin, appearing on CNN, says...
Why the Views of the Wall Street Journal's Letter...
Thoughtful debate is to be found in places other than Letters to the Editor of the Wall Street Journal where, in Friday’s edition, under the ad hominem heading “Mr. Reich’s View Seems to Be Far From This World,” the editor gathers what the Journal apparently considers insightful responses to my Tuesday column (posted below on August 3 as “The Origins of the Enthusiasm Gap.”) Mr. Don Schoen from...
We're Even Deeper in the Hole
The economy is still in a deep hole, and we’re not climbing out.
Remember, we need 125,000 new jobs per month simply to keep up with the growth of the American population seeking jobs. But according to this morning’s job’s report, private-sector employers added just 71,000 jobs in July. (According to the Bureau of Labor Statistics’ revised report for June, private...
The Rich and the Rest of Us
Forty of America’s richest families or individuals – almost all billionaires – have pledged to donate at least half their fortunes to charity. The total is a whopping $125 billion. Warren Buffett and Bill and Melinda Gates reached out to some 80 members of the Forbes billionaires list, seeking their pledges.
I think it’s admirable that Bill and Melinda Gates and Warren Buffett give so much to...
The Enthusiasm Gap and You
A friend whom I’ll call David raised a ton of money for Democrats in 2008 and now tells me they can go to hell. He’s furious about the no-strings bailout of Wall Street, the absence of a public option in health reform, financial reform that doesn’t cap the size of banks or reinstate the Glass-Steagall wall between investment and commercial banking, and a stimulus that was too...
The Origins of the Enthusiasm Gap
Whatever the outcome of the upcoming midterm elections, the activist phase of the Obama administration has likely come to a close. The President may have a fight on his hands even to hold on to what he’s already achieved because his legislative successes have been large enough to fuel strong opposition but not big enough to strengthen his support. The result could be disastrous for him and...
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Why We Really Shouldn't Keep the Bush Tax Cut for...
The economy is slouching backward because consumers can’t and won’t spend enough to revive it. Congress is about to recess for the summer without doing anything to fill the gap. And it looks like the only issue it will be debating when it returns is who, if anyone, should pay more taxes next year – just the very rich, everyone, or no one? The cuts enacted by George W. Bush will expire in January,...
