Day: January 9, 2009

Globalization

Globalization: Truth Not Spoken

This election cycle there is a lot said and a lot used about free trade and globalization in the campaigns. The region known as the Rust Belt is the area hit the hardest by free trade agreements. This area includes Pennsylvania, Ohio, and any place that has lost manufacturing jobs because of agreements like NAFTA. Each of the candidates has their own little world which they preach from on the benefits of globalization and free trade. The truth is more disastrous that any of them want to admit. And actually, some of them go as far to make each of their proposals sound like the answer to the economic woes of the people.

The Democratic Leadership Council’s economist, Rose has said, “The growth in trade and technology over the past three decades has generated meaningful employment growth for the middle class. As a general rule, middle-class jobs are not disappearing.” Unfortunately not everyone agrees with this analysis. A report by the Economic Policy Institute found the following:

• In 2006, the impact of trade flows increased the inequality of earnings by roughly 7%, with the resulting loss to a representative household (two earners making the median wage and working the average amount of (household) hours each year) reaching more than $2,000. This amount rivals the entire annual federal income tax bill paid by this household.

• Over the next 10-20 years, if some prominent forecasts of the reach of service-sector offshoring hold true, and, if current patterns of trade roughly characterize this offshoring, then globalization could essentially erase all wage gains made since 1979 by workers without a four-year college degree.

An important caveat, however, notes that even as globalization raises national income, it can still reduce the incomes of most workers. Global integration has at least two potential impacts on American wages. First, workers employed in industries directly in competition with low-cost imports from abroad can expect to see immediate job dislocation and/or downward wage pressures. Second, as relative prices change across industries, the return to factors of production, including different kinds of labor inputs, can be expected to change as well.

As the campaigns for the presidency move on, we are constantly bombarded with the benefits of the world economy, in this case globalization. But as with anything when politics is involved facts and figures are used to influence and inspire voters. But there is a basic axiom of economic theory is all too often ignored, or, even actively hidden. For example, Bradford, Greico, and Hufbauer (2005), in what they bill as a comprehensive accounting of the gains and losses attributable to trade liberalization, count only the costs of direct displacement by imports as a debit in the balance sheet of globalization, and do not even acknowledge the possibility of permanent wage losses through a broader labor market. Failing to count the largest cost of globalization is, of course, an excellent way to make the cost/benefit analysis of integration come out well to those favoring the status quo.

If one has a finger in speculation then globalization is a profitable endeavor. But if one is a worker then globalization spells only one thing—unemployment and/or low wages.

No Good News Cometh

The number of people continuing to seek unemployment benefits has risen sharply, according to government data released Thursday, indicating that laid-off workers are having a harder time finding new jobs as the recession enters its second year.

The Labor Department also reported that initial applications for unemployment insurance dropped by 24,000 to a seasonally adjusted 467,000 for the week ending Jan. 3. Wall Street economists expected initial claims to increase, but analysts said the new figure reflects the difficulty the government has in making seasonal adjustments over the holiday period.

The four-week average of initial claims, which smooths out fluctuations but also includes the shortened holiday weeks, fell by 27,000 to 525,750.

The US government loans to the auto industry, conditioned on a massive attack on the wages and jobs of auto workers, are being used as a spearhead for broader attacks on the working class throughout the country. This attack has already begun, with numerous companies recently announcing pay cuts and layoffs for the coming year in response to the deepening economic crisis.

Many of the new pay cuts affect salaried positions. While cuts to the pay packages of top executives are largely designed to lend the impression of “shared sacrifice,” the salaries and pensions of wider layers of managerial and professional personnel—a large component of the US “middle class”—are being significantly reduced.

President-elect Barack Obama warned that without immediate steps by the government to revive the economy, family incomes will drop, the unemployment rate could reach “double digits” and the U.S. risks losing a “generation of potential and promise.”

Obama’s speech, which aides billed as a “major” economic address, is part of a broader pitch to Congress and the American public as he works on selling his $775 billion, two-year economic stimulus plan to pull the U.S. out of a recession. While the excerpts released by his transition office didn’t provide specifics of the plan, advisers said the full speech would expand on previously reported elements.

He also will again call for using the government’s “full arsenal of tools” to unlock credit markets and “a sweeping effort” to stem home foreclosures. Obama also is promising to overhaul financial-markets regulations and crack down on “reckless greed and risk-taking” on Wall Street to restore confidence in markets.

Sometimes I feel that this economic crisis is accomplishing what the conservatives have wanted for years–the death of the middle class.

Will Obama Cut Social Programs?

You bet your butt he will!

Barack Obama took the occasion of his first press appearance in Washington as president-elect to declare his determination to impose policies of budgetary austerity, including the elimination of entire federal programs and cost-cutting in the entitlement programs such as Social Security, Medicare and Medicaid that are of vital importance to tens of millions of elderly and poor people.

The president-elect made the statement on the eve of a speech Thursday in which he will make the case for a proposed stimulus package. It was a clear effort to appease both congressional Republicans and the sizeable faction of fiscal conservatives among the congressional Democrats, reassuring them that while unlimited funds are to be provided to bail out big business, there will be a tight rein on spending for programs that support the needs of working people.

Obama’s remarks on Wednesday shed light on the basic character of his stimulus plan, which is tailored to the demands of the financial and corporate elite and will provide hundreds of billions in additional public funds to prop up corporate profits, while doing little to provide relief for tens of millions of working people facing the deepest slump since the Great Depression.

Obama noted the Congressional Budget Office (CBO) estimate released Wednesday that the federal deficit for the current fiscal year will top $1.2 trillion, without counting any additional spending for the economic stimulus plan that the Obama administration and Congress will enact after his inauguration. “Trillion dollar deficits will be a reality for years to come,” he warned, declaring that containing the deficit and putting the lid on federal spending must become “fundamental principles of government.”

Another 15 Minutes Of Fame

ROFLMAO

The guy will not go away…..have we not suffered enough at the hand of Joe The Plumber?

Just when you thought it was safe to watch the news….heeeeeees baaaaaaaaaaaaaack!

The election of 2008 biggest TOOL.  McCain/Palin living campaign prop has returned.

The Ohio man who became a household name during the presidential campaign says he is heading to Israel as a war correspondent for the conservative Web site pjtv.com.

Samuel J. Wurzelbacher (WUR’-zuhl-bah-kur) says he’ll spend 10 days covering the fighting.

He tells WNWO-TV in Toledo that he wants to let Israel’s “‘Average Joes’ share their story.”

Wurzelbacher gained attention during the final weeks of the campaign when he asked Barack Obama about his tax plan.

He later joined Republican John McCain on the campaign trail. At one stop, he agreed with a McCain supporter who asked if he believed a vote for Obama was a vote for the death of Israel.

But what about his country record deal?  Will we have to wait for it?  I was so looking forward to getting the CD (sarcasm intended).

The Palin Page

The news media didn’t treat her fairly, John McCain’s presidential aides didn’t make smart decisions (particularly when they pushed her to do additional interviews with CBS News’ Katie Couric) and both sexism and a “class issue” may have been behind the scrutiny she got, Alaska Gov. Sarah Palin says in an interview she’s done for an upcoming documentary.

She would still run again if given the chance, though, the 2008 Republican vice presidential nominee says.

John Ziegler, the force behind HowBarackObamaGotElected.com is putting the film together.

I watched some of the stuff and she seems to blame everyone for her treatment in the press.  She has never admitted that she screwed up and that makes her the perfect conservative.

War Comes To Gaza–Day 13

At least three rockets have been fired into northern Israel from Lebanon, raising fears the Israeli offensive against militants in Gaza may spread.

Israel replied with artillery, but called the attack an “isolated event”.

The incident followed Israel’s heaviest bombardment so far on Gaza, with 60 air strikes targeting Hamas facilities.

Efforts have continued to broker a ceasefire, as a senior Israeli official travelled to Cairo to hear details of a plan put forward by Egypt and France.

A Hamas delegation is expected in the Egyptian capital at some stage for parallel “technical” talks, Egyptian diplomats said.

Meanwhile, Israel has begun a three-hour pause in fighting to allow humanitarian aid into Gaza.

The first of what is promised to be a daily ceasefire – on Wednesday – allowed aid agencies into the territory for the first time in days.

The International Committee of the Red Cross accused Israel of failing in its international obligations after its staff were met with “shocking” scenes.

One medical team found 12 bodies in a shelled house, and alongside them four very young children, too weak to stand, waiting by their dead mothers, the ICRC said.

About 700 Palestinian and 11 Israeli lives are said to have been lost since the offensive began.