Tag: Recession

On State Capitalism

College of Political Knowledge

My readers know that I spend an inordinate amount of time trying to explain and make complex theories more palatable to the average working stiff…..and I hope that I succeed in some small way so that we all can make more informed decisions in our political thinking……

State Capitalism?  Now there is a subject that would make a person’s eyes bleed or the head explode….we can either look at it as some secret code word for socialism (not necessarily so) or we could talk about the government programs…….it conjurers up some many images for people….but what is it really?  State capitalism, that is.  I am sure that most people already have a preconceived idea of what socialism is and that is the subject for yet another post….

State capitalism simply put is….the idea of combining state funded projects and state regulation of the market with private ownership and profit taking…..if you think about it it sounds a lot like what we have now only on a limited basis…..

Now with that under our belt….state capitalism can impose regulations on labor and generate a bunch of it, especially when capitalists are reluctant to invest  (sound familiar?)…….it can encompass private financial gain with an overview of the needs of the country as a whole….(still sounding familiar?)…..In really bad economic times…it can motivate and stimulate local investment when other markets look more inviting to the private investors…..(once again, familiar?)…..

Let’s be real……state capitalism can be a far more effective way of dealing with a bad recession or depression than traditional liberal capitalism……

And yes, we can associate state capitalism most often with some form of dictatorship….however in dire economic times it may just be the best way to fight a recession or a deep depression….you want an example?  Then look no further than Germany after WW1…here we are talking about economics and not the political theory that we all detest……because of direct government spending in infrastructure and industry….Germany was the first country out of the Great Depression…..

You may not like the idea….but think about it hard….how else will we pull ourselves out of the economic funk we live in today?  Sorry to pee on their parade….but spending cuts and tax breaks will NOT bring the US out of this making of our demise……and is it not government’s purpose to insure the country has a strong economy?

The Land Of Hungry Children

You have heard of the Land Down Under or the Land of the Free or possibly the Land that Time Forgot…..but there is another that is NOT reported so much by the mainstream media….poverty and hunger in the US….with all the crap that the economic collapse has given us there is one that is NOT acceptable, at least in my way of thinking……child poverty!

Black listed news was compiled an excellent list of horrible consequences……

#1 Child homelessness in the United States is now 33 percent higher than it was back in 2007.

#2 According to the National Center on Family Homelessness, 1.6 millionAmerican children “were living on the street, in homeless shelters or motels, or doubled up with other families last year”.

#3 The percentage of children living in poverty in the United States increased from 16.9 percent in 2006 to nearly 22 percent in 2010.  In the UK and in France the child poverty rate is well under 10 percent.

#4 A higher percentage of American children is living in poverty today than was living in poverty back in 1975.

#5 The number of children living in poverty in the U.S. has risen for four years in a row.

#6 There are 10 different U.S. states where at least one out of every four babies is born to a family living in poverty.

#7 Since 2007, the number of children living in poverty in the state of California has increased by 30 percent.

#8 According to the National Center for Children in Poverty, 36.4% of all children that live in Philadelphia are living in poverty, 40.1% of all children that live in Atlanta are living in poverty, 52.6% of all children that live in Cleveland are living in poverty and 53.6% of all children that live in Detroit are living in poverty.

#9 In the United States today, more than 35 percent of all African-American children are living in poverty and more than 33 percent of all Hispanic children are living in poverty.

#10 There are seven million children in the United States today that are not covered by health insurance at all.

#11 Today, one out of every seven Americans is on food stamps and one out of every four American children is on food stamps.

#12 It is being projected that approximately 50 percent of all U.S. children will be on food stamps at some point in their lives before they reach the age of 18.

#13 In 2010, 42 percent of all single mothers in the United States were on food stamps.

#14 There are 314 counties in the United States where at least 30% of the children are facing food insecurity.

#15 In Washington D.C., the “child food insecurity rate” is 32.3%.

#16More than 20 million U.S. children rely on school meal programs to keep from going hungry.

These show the extent of how bad the recession is on the kids….yes, it is bad for everybody (with the exception of Wall Street) but how bad does it have to get to force our politicians to face this problem?  I thought children were our future, if so the future is pretty damn bleak!

We have an election coming up soon……now would be a good time to show your distaste for the policies coming out of Washington……

It’s The Economy, Right?

I was watching CNBC the other day and the anchor got all bubbly because the market went up over 100 points and the GDP figures were in and it expanded by 2.5%, which is pretty good since the last two quarters sucked bad…..

The US’ total economic output shot up 2.5% from July through September, after two dismal quarters of rising just 0.4% and 1.3%, according to a new GDP report released today. Consumers amped up their spending on both durable goods and services, and business investments soared 16.3%—indicating that we may not be in for a second recession after all.

The numbers were also boosted by federal government spending, though drops in state government spending dampened that effect. And there’s some more moderately positive news: New jobless claims fell 2,000 this week, after dropping 7,000 last week. But that still leaves claims at 402,000—economists think claims must fall below 400,000 for job growth to outpace job losses.

All the pundits are jerking off at the news….but there is still no jobs!  There are still millions of Americans that are unemployed!  Then for whom is all this good news?  Apparently, investors and by investors I mean hedge funds and by hedge funds I mean the same thieves that help tank the economy in the first place……those figures will be seasonal adjusted……which means in the final analysis….it will NOT be as good as they want it to be….

Let’s review……..0.1% of the population controls 34% of the country’s wealth, and owned as much much money as the bottom 42%.  Corporate profits are up by 62%, and the earnings of the top percentage almost doubled, while the average raise for workers only rose about 9%.  The Prez and the Congress gave massive tax cuts and even the Supreme Court got involved in politics………(pause here to re-read)……Wait!  That was the crash of 1929, not 2008!  And just like 1929 the economic crisis spread worldwide…..

My point here that all this has happened before and for the same reasons, well almost the same reasons, The Prez was Coolidge in1926….and the Supreme Court got involved in the process by ruling the minimum wage law was unconstitutional (they were controlled by business kinda like today and the ruling in the “People United” thing)…..why allow the same things to occur over and over and do nothing to change the vicious cycle?

And just like the crisis in 1929….Tax cuts and deficit debate will do NOTHING to repair the failing economy…..Bold new ideas must be found and I do not see that possible with a Congress owned by special interests….and yes…that could mean a bit of socialism….

I suggest if you truly want change then find another path….they are there…you just have to want it!

Small Busisness To The Rescue

I hope that people are listening………I am sorry to be redundant but……..

Just how many times have you heard the crap from the GOP and from the president?  Small business creates all the jobs in this economy…..I have tried to help the people realize what a pile of bovine fecal matter the politicians are handing you….they are force feeding you erroneous information….and now it is not just me that is telling the voter what crap it is but Bloomberg’s Business Week…….

While extolling small business “might be a good way for politicians to win elections,” Bloomberg Businessweek notes that “the notion that small business is the force behind prosperity is not true.”

“Most small employers are restaurateurs, skilled professionals or craftsmen (doctors, plumbers), professional and general service providers (clergy, travel agents, beauticians), and independent retailers. These aren’t sectors of the economy where product costs drop a lot as the firm grows, so most of these companies are going to remain small.”

Read the article closely……..learn what is meant by small business….to the politicians they want you to believe that an oil company that employs a 1000 workers with $7 million in income is somehow a small business….not so!

The Little Engine That Could

Today is one of my days of Zen, but I feel that I must for go those days because of the events in the past week demands that I stay on topic…….hopefully I can return to my whimsical posts on the weekends that have very little to do with the politic doings of the week…….bear with me for I am a sick puppy…….

We have heard both sides of the jobs debate calling the engine of the recovery will be small businesses….that any taxes will harm the recovery and kill those small businesses……and we cannot have that….now can we?  And then there was Obama’s new proposal to give tax cuts to small businesses that hire new employees…….

When you hear Obama or his opponents, the Repubs, mention the small businesses….what do you think of?  (pause here for a moment or two for thought)………I would bet that you think of that Mom and Pop grocery store on the corner of Main and 5th…..or maybe it is that cute little bakery in the walking mall……or how about that liquor store on the way home that you get relief from the day’s hassles…..am I close?

All in all you would be close but unfortunately….NO CIGAR!  Yes Mom and Pop would be a small business….but then according to the SBA so would a cigarette maker that employs 1000 people……I know…..huh?

The SBA Act also states: “…a small business concern is one that is independently owned and operated and which is not dominant in its field of operation.” Size standards vary by classification. The average standards, by occurrence in the SBA table, are 500 employees or $7 million a year in sales. A very general rule-of-thumb is the size of most manufacturers and wholesalers is determined by the number of employees while the size of the remaining businesses are determined by yearly receipts.

So you see about 90% or more of the companies in this country can be considered small business, as per the SBA definition……so when the Repubs talk about helping small business they are really talking about the larger companies…..you see….they are lying!  And when Obama talks about the tax cuts and incentives to get small business to create jobs…..he is talking about larger companies…..for they both know that a true small business doing its part even in this recession…..what they need is to help the larger companies enhance their profits with the hope that if they do that that they will hire a few people……

In closing…..it is a play on words…..it is a scam!  They are only helping those that can help them.  Mom and Pop are just the hook to get you to side with the larger companies…….it helps them sound like they are on your side…..but that is a lie!  It is ALL a lie and the sooner you realize that, the sooner we can start doing something about all the BS from Washington…..

Another Economic Hit Approaches

My thinking was that the ratings would be lowered……and this post was going to be about that…..but the bastards best me to it…….oh well….onward and upward.

I wish that I had better news…..I hate being that guy that seems to always delivers the crappy stuff….but I do what I must to help people see what is coming…….

The economy is in the toilet….so it cannot get any worse, right?  Wrong again!  It will soon get a lot worse and this time it will be again on the backs of the unemployed……Washington is doping the spending cut two step and there is an economic storm approaching….NO!  This time it is not he debt or the debt ceiling……..but rather the stopping of the unemployment benefits……I know…I know……I can suck the fun out of the party…..but forewarned is fore armed…….

This from Yahoo News…….

At the start of 2012, the extended unemployment benefits approved by Congress in December 2010, which cover a maximum of 99 weeks per person, will expire. Though the benefits are hardly lavish–a little more than $300 a week for most recipients–their total impact on the economy is huge, because so many Americans are currently taking advantage of them. Moody’s Analytics estimates that when the benefits expire, $37 billion will be taken out of the economy, the New York Times reports. That’s enough to exert a significant slowing effect–at a time when the recovery is already a long way from robust.

Government benefits that go to poorer Americans, like unemployment insurance, tend to boost consumer spending more than other kinds of stimulus, because people living paycheck to paycheck have little choice but to spend the money, rather than saving it. So the disappearance of jobless benefits will take money out of circulation when economic growth is seeking to gain some traction.

Indeed, economists say that the withdrawal of jobless benefits will create a major ripple effect on growth as a whole. Consumer spending accounts for around 60-70 percent of U.S. economic activity, economists say. But with so many Americans having lost wealth in the housing bust, spending has been tepid for a while, preventing the recovery from gaining any momentum. Now, the end of the extended benefits will likely soon put a further crimp in spending.

Oh crap!  It cannot get much worse, huh?  Nope!  And how will our cowards in Washington handle this new crisis?  I know that at times I can be a bummer and I see boogey men behind every bank account….but so far I have been pretty accurate in my concerns….

And then there is Cantor, the House majority leader who said to Jim Kramer…..

CANTOR: Jim, the most important thing we can do for somebody who’s unemployed is to see if we can get them a job. I mean, that’s what needs to be the focus. For too long in Washington now we’ve been worried about pumping up the stimulus moneys and pumping up unemployment benefits and to a certain extent you have states for which you can get unemployment for almost two years and I think those people on unemployment benefits would rather have a job. So that’s where our focus needs to be.

So if you are unemployed you will most likely be one the chess pieces in a debate in the House and if all goes like it did with the debt debate…..YOU ARE SCREWED!

Would You Like A Double Dip?

I wish my question was about a visit to Ben and Jerry’s…..but unfortunately it is not but rather a crashing economy…….the debt deal has been made and it will involve tax cuts, spending cuts, balance budget and NO revenue…….and I am old enough to ask….where have I heard all this before?

But what do the people think about all the wheelin’ and dealin’?

A new USA Today/Gallup poll finds 39% of Americans approve of the debt ceiling agreement that President Obama signed into law this week with 46% opposing it.

Key finding: Only 33% of independent voters approved of the deal, while 50% disapproved.

First Read: “But if you want evidence that conservative opinion leaders (Limbaugh, Red State, DeMint) might have more sway over Republicans and conservatives than liberal opinion leaders (Krugman, Daily Kos, Bernie Sanders) have over Democrats and liberals, check out these numbers. According to the poll, 64% of Republicans and 64% of conservatives opposed the deal. By comparison, 58% of Democrats and 51% of liberals supported it. Bottom line, at least per this poll: More Democrats and liberals sided with Obama. than with the liberal opinion elite.”

But let us get back to where I have heard all this BS before?

In 1937 the Roosevelt administration attempted to balance the federal budget by curtailing public works and cutting relief employment programs, while the Federal Reserve limited credit and reduced the money supply to prevent a resurgence of inflation. These actions weakened the economy, which already suffered from a lack of business confidence, and a severe recession ensued after the stock market plunged steeply on 7 September 1937. Over the following nine months, manufacturing employment fell by almost a quarter, industrial output by a third, the stock market by half, and profits by over three-quarters. By June, as the economy began to revive, 4,000,000 workers had become jobless. A major reason for the upturn in business activity was a greater willingness to use budget deficits for economic stimulus……….Geez all that sounds darn familiar, huh?  By all means Google this and see if I lie…please…do not take my word for it!

Everybody has claimed victory in the new debt deal…….the truth is these twats are just repeating the mistake made in 1937…..and that was a disaster…..and guess what?  This will be also!  The use of budget deficits is a proven solution for a recession……regardless of what Tea baggers want you to believe……….recent activity or the lack thereof, on Wall Street shows the reader that all is NOT well with the American economy…..and to keep playing moronic, childish little games will do NOTHING to help the country…it will NOT create demand and without demand….we have NOTHING!

A Double dip?  This from the Economist magazine…..

WALL STREET is betting on a double-dip recession.

All financial-market signs now point to a return to economic contraction. The S&P 500 has dropped 9% in two weeks. American government borrowing costs are plummeting, which could conceivably be construed as a result of increased confidence in America’s finances in the wake of the debt-ceiling deal, except for three things: 1) the deal didn’t fundamentally improve America’s finances, 2) equities are tanking, and 3) so are inflation expectations. Yesterday afternoon, yields on inflation-protected Treasuries signaled a 5-year expected inflation rate of about 2.08%. That has since fallen to about 1.86%. The yield on 3-month debt is back to 0.0%, the yield on the 30-year Treasury is 3.79%, and 10-year yields are back to levels observed last August, which prompted the Fed to engage in QE2. Commodities are dropping like rocks.

If Washington continues down this road…that would be the road that that darn pesky can is on…….we have nothing to look forward to but More Economic Misery……..don’t you just love this crap?

But wait, sports fans….there is more observations….this one from Newser……..

Economists say we could be headed for a second recession—and if they’re right, it’s poised to be even more devastating than the first, writes Catherine Rampell in the New York Times. That’s because the starting point for the second dip would be our current weak economy, and this time, policymakers have little room to fix things. Consumers don’t have much fat to cut, either—they did that already—meaning families would have to “cut from the bone.” Other signs round two would be a doozy: Consumer spending hasn’t grown; industrial production is down 8% compared to December 2007; and while the civilian working-age population has grown about 3% since 2007, there are 5% fewer jobs for it. Interest rates can’t go lower than their current zero, and Washington lacks the financial and political means for another stimulus. Finally, “and perhaps most worrisome,” is the fact that the economy is smaller now than it was at the beginning of the recession.

This country is in deep trouble……as long as we allow idiots to run the country and shape economic policy….the deeper the recession will get and the harder it will be to pull out of it…..

Shame On The “Rat Pack”

By now I am sure that most rational individuals have heard the bad news about the US losing its “AAA” rating……we have been degraded to “AA+”….But how and what caused this…I mean after all we did have a debt ceiling increase….so why the pee pee spanking by S&P?

If you really want to know then read their statement…..read it for yourselves!

The political brinksmanship of recent months highlights what we see as America’s governance and policymaking becoming less stable, less effective, and less predictable than what we previously believed. The statutory debt ceiling and the threat of default have become political bargaining chips in the debate over fiscal policy. Despite this year’s wide-ranging debate, in our view, the differences between political parties have proven to be extraordinarily difficult to bridge, and, as we see it, the resulting agreement fell well short of the comprehensive fiscal consolidation program that some proponents had envisaged until quite recently. Republicans and Democrats have only been able to agree to relatively modest savings on discretionary spending while delegating to the Select Committee decisions on more comprehensive measures. It appears that for now, new revenues have dropped down on the menu of policy options. In addition, the plan envisions only minor policy changes on Medicare and little change in other entitlements, the containment of which we and most other independent observers regard as key to long-term fiscal sustainability.

There is more……..

United States of America Long-Term Rating Lowered To ‘AA+’ Due To Political Risks, Rising Debt Burden; Outlook Negative* We have lowered our long-term sovereign credit rating on the United States of America to ‘AA+’ from ‘AAA’ and affirmed the ‘A-1+’ short-term rating.
* We have also removed both the short- and long-term ratings from CreditWatch negative.
* The downgrade reflects our opinion that the fiscal consolidation plan that Congress and the Administration recently agreed to falls short of what, in our view, would be necessary to stabilize the government’s medium-term debt dynamics.
* More broadly, the downgrade reflects our view that the effectiveness, stability, and predictability of American policymaking and political institutions have weakened at a time of ongoing fiscal and economic challenges to a degree more than we envisioned when we assigned a negative outlook to the rating on April 18, 2011.
* Since then, we have changed our view of the difficulties in bridging the gulf between the political parties over fiscal policy, which makes us pessimistic about the capacity of Congress and the Administration to be able to leverage their agreement this week into a broader fiscal consolidation plan that stabilizes the government’s debt dynamics any time soon.
* The outlook on the long-term rating is negative. We could lower the long-term rating to ‘AA’ within the next two years if we see that less reduction in spending than agreed to, higher interest rates, or new fiscal pressures during the period result in a higher general government debt trajectory than we currently assume in our base case.

Please read it again……..it is worth understanding completely before I continue….(pause here for reflection)………

Now that you understand the thinking behind the degradation……let me explain the title of this post…..the “Rat Pack” I am referring to is not the one that we all enjoyed with Frank, Dino, Sammy, et al…..NO I am talking about the bizarre collection of GOP candidates and what they think about the downgrade…..would you like to hear their thoughts?  (I do not see them as thoughts but rather ass rumblings)…..

  • Newt Gingrich: “The Obama disaster continues. Highest food stamp level and lowest credit rating in history in the same 24 hours.”
  • Jon Huntsman: “Out-of-control spending and a lack of leadership in Washington have resulted in President Obama presiding over the first downgrade of the United States credit rating in our history. We need new leadership in Washington committed to fiscal responsibility, a balanced budget, and job-friendly policies to get America working again.”
  • Mitt Romney: “America’s creditworthiness just became the latest casualty in President Obama’s failed record of leadership on the economy. Today, President Obama promised that ‘things will get better.’ But it has become increasingly clear that the only way things will get better is with new leadership in the White House.”
  • Rick Santorum: “Folks, an AA rating should be so far in our rear-view mirror that no mathematical error should affect it. Tonight, I’m saddened for the millions out of work, but I’m hopeful that I will replace Barack Obama as president and get this country and its economy moving again.”

These are the people that want to run this country….and between all of them I have heard NO substantive economic plan…..only that everything is Obama’s fault…….and people will vote for this pack of morons and cowards….well NOT ME!

NO one will take responsibility for this but yet they want the rest of us to man up and take responsibility for our actions….these cowards are killing this country….I am talking about both parties and those ‘baggers that think they speak for us real people…….and yet fingers are pointing as I write……

Now my question is….will YOU, the voter, remember what this pack of cowards have done to the country you love?  I am hoping you will but I will NOT hold my breath…….There is a new slogan….”It’s The Country, Stupid”!

People! Wake The Hell Up!

The deal is done!  Tuesday the Senate made it official and voted for the pathetic debt deal and immediately the Congress ran to the exits and on to the airport so they could go home and put on the latex gloves and knee pads and meet with their donors……the temp on Tuesday in Washington was 96 and it will be 87 on Wednesday….if that does not prove that the people are large sources of hot air, then nothing will…….

But I digress……..Did you know in their rush for the exits and the failure to do something about the FAA bill will cost the country about a billion dollars in noncollectable revenue?  Just thought you would like to see just how these people are screwing the country……..but wait!  There is more!

After the deal vote Senate minority leader said….”Americans do not believe that raising job killing taxes is best for the country….” (a paraphrase)…..but according to the Economic Policy Institute, a non-partisan think tank that deals with facts and figures….the deal is a job killing bill in itself…..

According to the EPI analysis the debt ceiling act will, in the long run, cost about 1.8 million jobs and will increase the debt by $241 billion…..but do not take my word for it….read the analysis for yourself…….http://t.co/9n2GZID………

Or another analysis from the EPI…….http://bit.ly/qoxWDk

I ask my readers to please read both analyses and then pass on these stories to others and maybe we can get somewhere when the losers return from their donor-a-thons in September.

What are you paying these people for?  Apparently, they have NO inclination to help you or your family, then why keep putting your trust in their crap?  It is time for us, the people, to take back our country from the windbags we have elected….I am all for giving Alfred E. Newman a shot….he could do no worse!

Are Things As Bad As They Seem?

The partisanship…..the extremism……lack of respect…….the out right lies…….the misinformation (and yes, it is different from lies)…….and it all comes down to the American voter….YOU voted for morons and now you are paying the price for that vote…..I know, what could be so bad we might get lower taxes and balanced budget and spending controls….what could be so bad?

Glad you asked!  While you were bobbing and weaving through the political shit slinging….the middle class suffers…….while you were thumping your chest about “Obamacare” or Planned Parenthood or NPR…..while you were being lead down a alternative road, which by the way, has NO place to go…it is a DEAD END!……the working class is being attacked and systematically being wipe out…..Where’s my proof of what I say?

Sorry to say, next year it may all get worse……(but that is another post….coming soon)…….

BLN.com writer Micheal Synder has a really good look at this situation……..

#1 Only 58 percent of Americans have a job right now.

#2 Only 56 percent of Americans are currently covered by employer-provided health insurance.

#3 The median yearly wage in the United States is $26,261.

#4 The average American household is carrying $75,600 in debt.

#5Only the top 5 percent of U.S. households have earned enough additional income to match the rise in housing costs since 1975.

#6 At this point, American families are approximately 7.7 trillion dollars poorer than they were back in early 2007.

#7 The poorest 50% of all Americans now own just 2.5% of all the wealth in the United States.

#8 According to one study, approximately 21 percent of all children in the United States were living below the poverty line in 2010.

#9 Today, there are more than 44 million Americans on food stamps, and nearly half of them are children.

#10According to Newsweek, close to 20 percent of all American men between the ages of 25 and 54 do not have a job at the moment.

Not one of those points shows that the Middle Class will ever recovery….this whole situation is making a two class system….”haves and have nots”  (sorry, but it is a good term)……..

In closing, something to think about…….under Pelosi the House introduced 200+ bills..,..under the leadership of Boehner it has issued 12….even if they work the asses off the Reps….the best it could do is about 50….remind me again what we pay these guys and gals to do!