Saturday September 4, 2010, 7:51 am
THIS promises to be the worst Labor Day in the memory of most Americans. Organized labor is down to about 7 percent of the private work force. Members of non-organized labor — most of the rest of us — are unemployed, underemployed or underwater. The Labor Department reported on Friday that just 67,000 new private-sector jobs were created in August, while at least 125,000 are needed to keep up with the growth of the potential work force.

The national economy isn’t escaping the gravitational pull of the Great Recession. None of the standard booster rockets are working: near-zero short-term interest rates from the Fed, almost record-low borrowing costs in the bond market, a giant stimulus package and tax credits for small businesses that hire the long-term unemployed have all failed to do enough.

That’s because the real problem has to do with the structure of the economy, not the business cycle. No booster rocket can work unless consumers are able, at some point, to keep the economy moving on their own. But consumers no longer have the purchasing power to buy the goods and services they produce as workers; for some time now, their means haven’t kept up with what the growing economy could and should have been able to provide them.

This crisis began decades ago when a new wave of technology — things like satellite communications, container ships, computers and eventually the Internet — made it cheaper for American employers to use low-wage labor abroad or labor-replacing software here at home than to continue paying the typical worker a middle-class wage. Even though the American economy kept growing, hourly wages flattened. The median male worker earns less today, adjusted for inflation, than he did 30 years ago.

But for years American families kept spending as if their incomes were keeping pace with overall economic growth. And their spending fueled continued growth. How did families manage this trick? First, women streamed into the paid work force. By the late 1990s, more than 60 percent of mothers with young children worked outside the home (in 1966, only 24 percent did).

Second, everyone put in more hours. What families didn’t receive in wage increases they made up for in work increases. By the mid-2000s, the typical male worker was putting in roughly 100 hours more each year than two decades before, and the typical female worker about 200 hours more.

When American families couldn’t squeeze any more income out of these two coping mechanisms, they embarked on a third: going ever deeper into debt. This seemed painless — as long as home prices were soaring. From 2002 to 2007, American households extracted $2.3 trillion from their homes.

Eventually, of course, the debt bubble burst — and with it, the last coping mechanism. Now we’re left to deal with the underlying problem that we’ve avoided for decades. Even if nearly everyone was employed, the vast middle class still wouldn’t have enough money to buy what the economy is capable of producing.

Where have all the economic gains gone? Mostly to the top. The economists Emmanuel Saez and Thomas Piketty examined tax returns from 1913 to 2008. They discovered an interesting pattern. In the late 1970s, the richest 1 percent of American families took in about 9 percent of the nation’s total income; by 2007, the top 1 percent took in 23.5 percent of total income.

It’s no coincidence that the last time income was this concentrated was in 1928. I do not mean to suggest that such astonishing consolidations of income at the top directly cause sharp economic declines. The connection is more subtle.

The rich spend a much smaller proportion of their incomes than the rest of us. So when they get a disproportionate share of total income, the economy is robbed of the demand it needs to keep growing and creating jobs.

What’s more, the rich don’t necessarily invest their earnings and savings in the American economy; they send them anywhere around the globe where they’ll summon the highest returns — sometimes that’s here, but often it’s the Cayman Islands, China or elsewhere. The rich also put their money into assets most likely to attract other big investors (commodities, stocks, dot-coms or real estate), which can become wildly inflated as a result.

Op-Ed Contributor
How to End the Great RecessionBy ROBERT B. REICH
Published: September 2, 2010
Recommend
Twitter

E-Mail

Send To Phone
Print


Reprints

Share
Close
LinkedinDiggMixxMySpaceYahoo! BuzzPermalink. Berkeley, Calif.

Enlarge This Image

Alain Pilon
THIS promises to be the worst Labor Day in the memory of most Americans. Organized labor is down to about 7 percent of the private work force. Members of non-organized labor — most of the rest of us — are unemployed, underemployed or underwater. The Labor Department reported on Friday that just 67,000 new private-sector jobs were created in August, while at least 125,000 are needed to keep up with the growth of the potential work force.

The national economy isn’t escaping the gravitational pull of the Great Recession. None of the standard booster rockets are working: near-zero short-term interest rates from the Fed, almost record-low borrowing costs in the bond market, a giant stimulus package and tax credits for small businesses that hire the long-term unemployed have all failed to do enough.

That’s because the real problem has to do with the structure of the economy, not the business cycle. No booster rocket can work unless consumers are able, at some point, to keep the economy moving on their own. But consumers no longer have the purchasing power to buy the goods and services they produce as workers; for some time now, their means haven’t kept up with what the growing economy could and should have been able to provide them.

This crisis began decades ago when a new wave of technology — things like satellite communications, container ships, computers and eventually the Internet — made it cheaper for American employers to use low-wage labor abroad or labor-replacing software here at home than to continue paying the typical worker a middle-class wage. Even though the American economy kept growing, hourly wages flattened. The median male worker earns less today, adjusted for inflation, than he did 30 years ago.

But for years American families kept spending as if their incomes were keeping pace with overall economic growth. And their spending fueled continued growth. How did families manage this trick? First, women streamed into the paid work force. By the late 1990s, more than 60 percent of mothers with young children worked outside the home (in 1966, only 24 percent did).

Second, everyone put in more hours. What families didn’t receive in wage increases they made up for in work increases. By the mid-2000s, the typical male worker was putting in roughly 100 hours more each year than two decades before, and the typical female worker about 200 hours more.

When American families couldn’t squeeze any more income out of these two coping mechanisms, they embarked on a third: going ever deeper into debt. This seemed painless — as long as home prices were soaring. From 2002 to 2007, American households extracted $2.3 trillion from their homes.

Eventually, of course, the debt bubble burst — and with it, the last coping mechanism. Now we’re left to deal with the underlying problem that we’ve avoided for decades. Even if nearly everyone was employed, the vast middle class still wouldn’t have enough money to buy what the economy is capable of producing.

Where have all the economic gains gone? Mostly to the top. The economists Emmanuel Saez and Thomas Piketty examined tax returns from 1913 to 2008. They discovered an interesting pattern. In the late 1970s, the richest 1 percent of American families took in about 9 percent of the nation’s total income; by 2007, the top 1 percent took in 23.5 percent of total income.

It’s no coincidence that the last time income was this concentrated was in 1928. I do not mean to suggest that such astonishing consolidations of income at the top directly cause sharp economic declines. The connection is more subtle.

The rich spend a much smaller proportion of their incomes than the rest of us. So when they get a disproportionate share of total income, the economy is robbed of the demand it needs to keep growing and creating jobs.

What’s more, the rich don’t necessarily invest their earnings and savings in the American economy; they send them anywhere around the globe where they’ll summon the highest returns — sometimes that’s here, but often it’s the Cayman Islands, China or elsewhere. The rich also put their money into assets most likely to attract other big investors (commodities, stocks, dot-coms or real estate), which can become wildly inflated as a result.

Meanwhile, as the economy grows, the vast majority in the middle naturally want to live better. Their consequent spending fuels continued growth and creates enough jobs for almost everyone, at least for a time. But because this situation can’t be sustained, at some point — 1929 and 2008 offer ready examples — the bill comes due.

This time around, policymakers had knowledge their counterparts didn’t have in 1929; they knew they could avoid immediate financial calamity by flooding the economy with money. But, paradoxically, averting another Great Depression-like calamity removed political pressure for more fundamental reform. We’re left instead with a long and seemingly endless Great Jobs Recession.

THE Great Depression and its aftermath demonstrate that there is only one way back to full recovery: through more widely shared prosperity. In the 1930s, the American economy was completely restructured. New Deal measures — Social Security, a 40-hour work week with time-and-a-half overtime, unemployment insurance, the right to form unions and bargain collectively, the minimum wage — leveled the playing field.

In the decades after World War II, legislation like the G.I. Bill, a vast expansion of public higher education and civil rights and voting rights laws further reduced economic inequality. Much of this was paid for with a 70 percent to 90 percent marginal income tax on the highest incomes. And as America’s middle class shared more of the economy’s gains, it was able to buy more of the goods and services the economy could provide. The result: rapid growth and more jobs.

By contrast, little has been done since 2008 to widen the circle of prosperity. Health-care reform is an important step forward but it’s not nearly enough.

What else could be done to raise wages and thereby spur the economy? We might consider, for example, extending the earned income tax credit all the way up through the middle class, and paying for it with a tax on carbon. Or exempting the first $20,000 of income from payroll taxes and paying for it with a payroll tax on incomes over $250,000.

In the longer term, Americans must be better prepared to succeed in the global, high-tech economy. Early childhood education should be more widely available, paid for by a small 0.5 percent fee on all financial transactions. Public universities should be free; in return, graduates would then be required to pay back 10 percent of their first 10 years of full-time income.

Another step: workers who lose their jobs and have to settle for positions that pay less could qualify for “earnings insurance” that would pay half the salary difference for two years; such a program would probably prove less expensive than extended unemployment benefits.

These measures would not enlarge the budget deficit because they would be paid for. In fact, such moves would help reduce the long-term deficits by getting more Americans back to work and the economy growing again.

Policies that generate more widely shared prosperity lead to stronger and more sustainable economic growth — and that’s good for everyone. The rich are better off with a smaller percentage of a fast-growing economy than a larger share of an economy that’s barely moving. That’s the Labor Day lesson we learned decades ago; until we remember it again, we’ll be stuck in the Great Recession.
*************************************
Robert B. Reich, a secretary of labor in the Clinton administration, is a professor of public policy at the University of California, Berkeley, and the author of the forthcoming “Aftershock: The Next Economy and America’s Future.”

Saturday September 4, 2010, 9:44 am
It could possibly be workable. The rich would never go along with it though.

Saturday September 4, 2010, 10:39 am
Some great ideas here but you know that many will not want their tax dollars going to someone else's education or to pay the difference in pay for someone else's new job. So all that government money will go to war instead.

Saturday September 4, 2010, 10:43 am
On Economy, Democrats Face a Lack of Unity

The monthly jobs report on Friday, while better than economists had expected, did nothing to improve the deteriorating political climate for Democrats a little more than eight weeks before Election Day.

President Obama, after a week consumed by foreign policy issues, will begin focusing publicly on the economy next week and on Wednesday plans to propose modest additional tax breaks, temporary and aimed at small business to promote hiring. But it is not clear that he has the votes or the time in Congress to pass them, with Republicans eager to deny Democrats any victories and endangered Democrats eager to get home within three to four weeks to campaign.

Democrats’ sense of vulnerability has increased since Congress broke for August, after a month of reports tracking weakness in both the economy and their polls. One result is that they now split more deeply than ever on the issue that in recent elections had been a rallying cry: ending the Bush tax cuts for the wealthiest 2 percent of taxpayers. Democratic leaders are imploring Mr. Obama to come off the sidelines and lead the fight.

On the campaign trail, many Democrats are going their own ways as they face the prospect that persistently high unemployment could cost them control of the House and perhaps the Senate. Many are embracing the stimulus package enacted soon after Mr. Obama took office; others run away from it. Some distance themselves from Mr. Obama and his economic team; most blame Republicans.

Democrats’ campaign message mostly is a Babel of individual voices. With the national winds blowing ever stronger against the party in power, threatened Democrats are tailoring their message to their particular district or state — with party leaders’ encouragement.

Representative Tom Perriello, an underdog for re-election in Virginia, campaigned this week in a county where he pointed to new water lines and broadband service as the benefits of the stimulus, which helped attract Microsoft to invest in the tobacco region. But he also has called for Mr. Obama’s Treasury secretary, Timothy F. Geithner, to go.

“If it’s Perriello versus Hurt, I’ll win,” Mr. Perriello said, referring to his Republican challenger, State Senator Robert Hurt. “If it’s a referendum on the president, it’s a tougher race.”

Mr. Perriello could not immediately answer when asked what the national Democratic message is. “I suppose the pause there may be telling,” he said.

“But if there is one theme,” he added, echoing a metaphor Mr. Obama likes to use, “it’s that the other side drove the economy into the ditch and they haven’t changed their driving habits at all. And we’ve worked really hard to get us out of the ditch.”

In Arizona, Representative Gabrielle Giffords emphasizes her work for tougher border controls and support for the stimulus money that saved the jobs of local teachers and public-safety workers. Like many Democrats, her campaign depicts her Republican opponent, Jesse Kelly, as an extremist conservative for his views on Medicare, taxes and other issues.

“We’re running our own race,” said Rodd McLeod, the campaign manager for Ms. Giffords.

Representative Walt Minnick, Democrat of Idaho, boasts at home that he opposed the stimulus package and Mr. Obama’s health care overhaul. His campaign manager, John Foster, said Mr. Minnick never expected an easy race: “Obama was unpopular in Idaho in 2008, so we’ve never known anything else.”

Mr. Obama spoke Thursday with the House speaker, Nancy Pelosi, and the Senate majority leader, Harry Reid, to coordinate on proposals Democrats can unite around quickly. Yet Mr. Obama and Mr. Reid have not been able to overcome Republican opposition to a package of tax cuts and lending assistance for small businesses that Mr. Obama proposed early this year.

Among the ideas favored within the administration are tax incentives for clean energy jobs and credits for employers who increase their work forces. The president and his team have ruled out a broad-based payroll tax holiday to promote hiring, officials say.

But they are still considering whether to propose making permanent a tax credit for businesses’ research and development; for three decades the costly credit has been repeatedly renewed rather than made permanent so the revenue loss does not show up in deficit projections.

Democrats say the list of stimulus ideas is mostly tax cuts because spending proposals would have no chance of Republican support. Yet Republicans have opposed Democrats’ tax cutting ideas as well, so some Democrats argue that the new ideas could further demoralize party liberals, who want new spending for job-creating public works.

Administration and Congressional Democrats are considering proposing perhaps $35 billion in additional tax breaks for small businesses.

That sum is roughly the amount that would be saved in 2011 if the Bush income tax rates for upper-income people — couples with more than $250,000 in taxable income and individuals with more than $200,000 — revert to the higher, pre-2001 levels next year, as the tax laws require.

Democrats say such a package would let them counter Republicans’ argument that successful small businesses would be hurt by letting the top Bush tax rates expire. And, Democrats add, their alternative tax cuts would be ones that economists consider more likely to lift the economy.

What is really needed, they say, is for Mr. Obama to get more engaged in the fight to end the tax cuts for the wealthy. Yet the combination of a weakened economy and weaker candidates has scrambled the strategy planning.

Before August, Democrats generally were united in opposing any extension for the top rates and looked forward to a pre-election battle with Republicans. The chief debate has been over whether to make the middle-class tax rates permanent or to extend them for a year given the revenue loss of about $3 trillion over a decade.

Now Democrats are weighing whether they may have to accept a one-year extension of the tax rates for the wealthy. More Democratic lawmakers now fear attacks from Republicans, who argue that no one should pay higher taxes, certainly not before the economy recovers fully.

Democrats assume that Senate Republicans will block any extension that does not include the top rates. In that event, Democrats are ready with their attack lines.

As Representative Chris Van Hollen of Maryland, the chairman of the House Democrats’ campaign committee, put it, “They’re holding tax relief for 98 percent of the American people hostage to permanent tax cuts for the top 2 percent.”

Saturday September 4, 2010, 11:26 am
“They’re holding tax relief for 98 percent of the American people hostage to permanent tax cuts for the top 2 percent.” And that's exactly why NO RepubliCON should win an election!
This "recession" is like a flash-back of the Seventies for southern IL.. what few jobs are available are low-paying & no benefits. Illinois has been barely breathing for so long sometimes I wish they'd just pull the plug..

Saturday September 4, 2010, 12:25 pm
Most money and power is controlled by monopolies; oil, gas, diamonds, professional sports, money supply, coal, nuclear, engineered foods, chemicals, etc.. This monopoly structure of power does not allow for democracy, or at the very least, twists it into a corporate controlled faux version of it.

Add to this that large corporations now control most of the mass media, most elections, Congress, The White House, and Senate, and we have a sad situation where the average person has very little say in the matter. Add to this the propoganda effect that these huge corporations, such as the Koch brothers, use to pretty much bamboozle most people into voting for their version of 'reality', and it makes things even worse for the average worker.

The way through? Get rid of corporate control of elections, media, Congress, White House, and we may have a chance... at getting our country back..

Read; Confessions Of An Economic Hit Man, if you do not believe the above.

Saturday September 4, 2010, 12:42 pm

The buzz is that the neo-cons are purposely not hiring so that there will be more unemployed at election time.

Saturday September 4, 2010, 12:45 pm
Green Road A. I have read that book, for any who have not it is an eye opener, and makes one even more aware of the need to redouble our efforts to stomp out all corporate influence in Washington DC. An excellent comment, thank you for posting.

Saturday September 4, 2010, 12:52 pm
"The buzz is that the neo-cons are purposely not hiring so that there will be more unemployed at election time."

Oh boy, another ultra-liberal conspiracy theory. When at a loss for facts, make somethinhg up.

Saturday September 4, 2010, 1:03 pm
DEPRESSION, FOLKS, DEPRESSION. THERE ARE MORE UNEMPLOYED THAN IN 1933. ADIOS MIDDLE CLASS.

Saturday September 4, 2010, 1:23 pm
Yep I have been saying the same thing..we are in a major depression. I make minimum wage and am condisered to be in the poverty class. Although I am considered to be in the poverty class, I am not eligible to recieve food stamps or any assistance because I make "too much money"!!!!!!!!!!!!!!!!! How is someone supposed to survive like this?? I guess I will continue to live in poverty in this awful depression..recession is so off key!! I think they used recession to describe this instead of depression because they didnt want to scare anyone. Oops..too late.

Saturday September 4, 2010, 1:37 pm
Hmmm, I see so many quandries in trying to solve this. We have always been a nation of consumers, needing more of this, and better that (which is not bad in and of itself). Unfortunately in a economic depression the very things that are needed to stimulate our consumer based economy, spending, spending and more spending is next to impossible as so many are out of work or grossly underpaid. Large corporations are also blackmailing employees to work overtime with no overtime pay... or they'll find someone who will. The "free market" defined by huge corporations and multinationals no longer works for the middle class.
We need to pressure Congress to quit playing politics and come up with workable ideas to get people back to work. (I guess I'm still living in Fantasy Land where I think politicians bought and paid for by large corporations actually care) Being "represented" (not) by McCain and Kyl, I should know better.

Saturday September 4, 2010, 1:43 pm
Reaganomics has accomplished many of its goals. Unions are much weaker than they were 30 years ago. Taxes for the richest are much lower. Free trade agreements have allowed Multi-national corporations to move wherever labor is cheapest and standards are lowest and of course the deregulation that Republicans love so much has given Wall Street free reign to screw the people that actually work for a living.

Saturday September 4, 2010, 1:52 pm
"Free trade agreements have allowed Multi-national corporations to move wherever labor is cheapest and standards are lowest"

Eight months after he called for action on a string of stalled free-trade deals, President Obama is battling fierce opposition from his own party and concerns over a rising trade deficit in a rush to meet his own self-imposed November deadline for finishing a major accord with South Korea.

But the failure of the Obama administration to advance any major trade deals has many of his allies on the issue - including many top Republicans - questioning where Mr. Obama can deliver on his promises.

"I've never heard a president make the arguments for trade agreements as eloquently as President Obama did in January and not say at the end of that statement: 'I will send this agreement to you and expect you to pass it, and want to work with you to pass it,'" said Rep. David Dreier, a California Republican and an outspoken proponent of trade deals. "I don't quite get it."

"Everybody is moving forward except for us right now," said Christopher Wenk, senior director of international policy at the U.S. Chamber of Commerce, noting that South Korea, for one, is preparing a free-trade deal with the European Union.

Trade has been a particularly contentious issue for Mr. Obama's political base. Labor unions are virulently opposed to free-trade deals, which they contend threaten American jobs.

Nervous Democrats are wary of any divisive issues heading into a difficult midterm election.

The president's "fast-track" authority to negotiate trade deals expired in President George W. Bush's second term, and there is no visible sign that Mr. Obama will push the Democratic House and Senate majorities to renew fast-track authority.

Mr. Obama, in his State of the Union address in January, asked for bipartisan cooperation from Congress to approve pending trade pacts with South Korea, Colombia and Panama, while he announced a goal to double U.S. exports in five years. Mr. Obama used a June meeting with South Korean President Lee Myung-bak to say he wants sticking points to be hammered out by November, when he visits Seoul for the next Group of 20 summit.

Mr. Obama, who as a presidential candidate opposed the South Korea agreement as it was written, said in Toronto that he hopes to submit the final pact to Congress for approval within a few months after the Seoul meeting.

"It is the right thing to do for our country. It is the right thing to do for the Koreans. It will strengthen our commercial ties," he said on June 26.

Proponents say news that the U.S. trade deficit in June ballooned to nearly $50 billion, its largest level since October 2008, should inject a sense of urgency into the debate. But the ever-thorny issue of trade has put the president in the precarious position of butting heads with key allies.

The three agreements, all negotiated under Mr. Bush, have languished for years in the face of stiff resistance from labor unions and various U.S. industries that argue that the terms as written give an advantage to their foreign competitors.

In the case of South Korea, U.S. auto manufacturers say that the June 2007 agreement - under which the two countries would eliminate tariffs on 95 percent of consumer and industrial goods within three years - does not address Seoul's strict vehicle standards that inhibit U.S. imports and jeopardize U.S. jobs by eliminating import duties on Korean pickup trucks, for example.

The administration suggests publicly that negotiations over South Korea are on track. A spokeswoman for U.S. Trade Representative Ron Kirk said, "The president's announcement gives us the timeline and focus we need to get this agreement done and ready to submit to Congress."

Asked whether there were any specific signs of progress in resolving outstanding issues, spokeswoman Carol Guthrie said the government has, since late June, "been engaging more closely than ever with Congress and with stakeholders in preparation for discussions with Korean counterparts in the coming months."

But critics of the agreement aren't optimistic that sticking points can be resolved in time for the November summit.

"I would be surprised if they're able to come through with a major breakthrough on autos" by then, said Jeff Vogt, the AFL-CIO's global economic specialist. Even if those issues were worked out, the union still has major concerns with other aspects of the agreement relating to investments and services, he added.

Business groups - which were pleasantly surprised by Mr. Obama's November deadline for a South Korea deal - warn that the U.S. government must act quickly. They note that South Korea's trade agreement with the European Union, tentatively set to be signed this fall, has caused American meat and dairy exports to South Korea to plunge.

The Chamber of Commerce's Mr. Wenk said efforts by some in the United States to renegotiate pieces of the South Korea deal could open the floodgates for other industries seeking better terms and lead some South Korea industry groups to demand changes as well.

According to a November study by the Chamber of Commerce, the U.S. stands to lose $35 billion in exports to the world and as many as 345,000 jobs if it fails to implement the agreement with South Korea. Canada, which recently ratified a trade pact with Colombia, is in negotiations with South Korea, as is Australia.

As a result of his public push, Mr. Obama now has "a little bit of credibility on the line," said Daniel J. Ikenson, a trade policy analyst at the Cato Institute.

"There's just no way that there's any momentum or any effort to get this Korea deal passed in Congress before November," he said. "I think Obama wants to go to Korea and say, 'Look, we've made some progress.' "

In addition to autos, South Korea's restrictions on U.S. beef is another point of contention. More than 100 House Democrats, in a July letter to Mr. Obama, asked for a meeting on the South Korea agreement. Though not part of the deal, the country's partial ban on U.S. beef imports dating back to an outbreak of mad cow disease in 2003 has several lawmakers calling for the South Korean government to ease its ban before moving ahead on the deal.

"I don't know why I should schedule a hearing" on the free-trade agreement if the disparity continues, Senate Finance Committee Chairman Max Baucus, Montana Democrat, told Mr. Kirk at an oversight hearing earlier this month.

The National Cattlemen's Beef Association, however, argues that South Korea could be the biggest bilateral trade-opening agreement the U.S. industry has ever seen. Gregg Doud, the trade group's economist, said the impact of eliminating Seoul's 40 percent tariff could create a $1 billion beef market for U.S. producers - the world's biggest single export market.

Free-trade advocates say the deals signed by the Bush administration with Colombia in November 2006 and with Panama in June 2007 should be more of a sure thing, considering the U.S. already imposes no tariffs on 95 percent of imports from those countries. In July, Mr. Obama said he would like to submit the Colombia and Panama agreements to Congress "as soon as possible."

But unions and top congressional Democrats are staunchly opposed to the Colombia agreement on the grounds that the country doesn't do enough to prevent violence against labor leaders. Mr. Vogt said 30 union members have been killed so far this year.

Supporters of the trade agreement swiftly reject those concerns as outdated, saying critics do not give the Colombian government enough credit for improvements in safety over the past few decades. Mr. Ikenson called the argument a red herring, saying "it's just a conversation-killer."

Indeed, Mr. Dreier said postponing consideration of those two agreements until after South Korea was a "real slap in the face of our strongest allies in this hemisphere."

Analysts say Mr. Obama's best hope for getting the deals approved by Congress is probably for Republicans to pick up seats in November.

.

Saturday September 4, 2010, 2:21 pm
It may also help to vote for the Green Party.. BOth of the other two are more or less bought and sold, by corporations.. Just take a look at who contributes to them..

We need taxpayer funded elections, equal media air time for all candidates, and no corporate money or influence peddling.. That would turn our system right side up, but it will take some brave PATRIOTS to do this...

Saturday September 4, 2010, 2:33 pm
noted.

Saturday September 4, 2010, 2:47 pm
Noted - tell it like it is Linda G! I needed this laugh, and I'm laughing because you speak the truth. The government bailed out the "too big to fail", but must ponder on extending unemployment benefits. It let's you know where their loyalty lies and it ain't with us.

Lack of common sense and caring are the mode for the day. I see openings in the FDA since they're too short handed to perform due diligence QC on food providers. HIRE and train the unemployed, it's not rocket science. I'm quite sure their are other opportunities to train and hire if we look hard enough.

Saturday September 4, 2010, 2:48 pm
Yes indeed, a vote for the Green Party..

Saturday September 4, 2010, 2:52 pm
You're right Pamela, train and hire the unemployed. And while we're at it, bring our jobs back home from overseas.

Saturday September 4, 2010, 3:00 pm
Send a Green Star to Green Road A.
Sending a Green Star is a simple way to say "Thank you"
You cannot currently send a star to Green Road because you have done so within the last week.

Paul, it took me a few days, but I've finally figured it out: you have a convert mentality, and these long posts you make are cut and pasted from whatever sites you frequent. Thanks. I'll just scroll past them from now on.

I agree with Corinne and Bobbie: it's a depression. Just because people still run to Walmart and spend their paychecks every Friday does not mean they actually have money to spend. It's horrifying; it's like the last hurrah for the conspicuous consumer. And if it all finally crashes down on them, they just won't understand why or what happened...

Saturday September 4, 2010, 3:01 pm
Whooa, looks like it's gonna be a little bit of a rough ride.

Saturday September 4, 2010, 3:11 pm
Katherine T. - "Kindness is the language which the deaf can hear and the blind can see." - Mark Twain

Saturday September 4, 2010, 3:11 pm
Good word here today. I just don't think McCain could have done ANY Better.

Saturday September 4, 2010, 3:32 pm
Oh my, people are beginning to actually use the "D" word. And why not, this is a Depression, caused by the ruling class of republicans, the corporate giants doing as they please with out regulation, and strict guidelines. This is not a recession, this is a Depression, and the paltry sums that are some how helping some to survive, not much else but to survive have become an issue of contention for cutting the budget? Fat Cat Republicans need to live a few months of the life of real Americans, no chauffeured limousines, no $5,000. suits, no steaks at "special" restaurants, no maids, or secretaries, just real life. Wash your own dishes, do your laundry - just like the real folks in America. That shock might make them realize that what they think and what is are two very different things.

Saturday September 4, 2010, 3:36 pm
Why are the wealthiest politicians democrats? Why are dems the party of wealth and elitism?
Top 10 wealthiest members of the house and senate (7 are dems)
Jane Harman (D-Calif)
2 Darrell Issa (R-Calif)
3 John Kerry (D-Mass)
4 Vernon Buchanan (R-Fla)
5 Herb Kohl (D-Wis)
6 Edward M. Kennedy (D-Mass)
7 Jay Rockefeller (D-WVa)
8 Robin Hayes (R-NC)
9 Dianne Feinstein (D-Calif)
10 Frank R. Lautenberg (D-NJ)

Most expensive places to live in the US: Cape Cod, Beverley Hills: 90% democrat.

Billionaire Democrat: Warren Buffet.
Billionaire: George Sorros.
Sergey Brin, Democrat, Billionaire.
Larry Page, Democrat, Billionaire
Charles Koch, Democrat, Billionaire
Kirk Kerkorian, Democrat, Billionaire
Abigail Johnson, Democrat, Billionaire
Ballmer, Steven, Democrat, Billionaire
(there are many more billionaire dems, but i dont have room to list them)

Why are democrats the party of the rich and elite?

Saturday September 4, 2010, 4:41 pm
Thanks very much for sharing this interesting article. x

Saturday September 4, 2010, 4:45 pm
In addition to reinstating a fair tax rate on the very wealthy, we could cut a couple hundred billion or more from the Pentagon budget (and of course stop the wars) and create jobs in infrastructure repair, education, health care, renewable energy and conservation measures,etc. Of course not likely to happen.

I agree sf Paul, that Dems are also elites that work for their corporate masters, but it has been the Repubs mainly pounding the drum for tax cuts for the wealthy (trickle down) and deregulation for the last 30 years or more. Also, i have no idea what Charles Koch (of the Koch brothers) is registered as, but this right-wing think-tank funder, Teaparty funder, corporate-zealot is about as much a Democrat as Rush Limbaugh.

Saturday September 4, 2010, 5:08 pm
FIRST YOU HAVE TO END THE GREAT DEPRESSION. THEN RESESSION

Saturday September 4, 2010, 6:54 pm
Green Road you express my sentiments.

Saturday September 4, 2010, 7:54 pm
Thanks Kit for these posts and discussion.

I point out that 'in the old days' all recessions/depressions were called 'depressions'. Since then economists have developed definitions which distinguish between the two, so that a 'recession' is a shorter less damaging form of economic downturn.

It follows, therefore, that there is a psychological benefit to calling an economic downturn a 'recession'--'great' or otherwise.

What is fundamental to this economic downturn is that:

1 it is worldwide but uneven. e.g. Many nations such as China and Australia, did not experience a 'recession', though many of the people who lived in those countries felt as if they had--especially when they looked at their stock portfolios;

2 it was debt induced;

3 it might well take years from which to recover.

The people who govern us need to decide what to do about this debt. It needs to be written off, paid off, but not ignored.

The posts above give some ideas about how to achieve those goals. Until the powers that be decide something about these debts, lenders might take a lot on convincing to lend, either to each other or somebody else, and those without loans might keep pleading for more help, thereby perpetuating the merry-go-round of money chasing its tail.

I should hate to be the US government trying to decide what to do with Fannie Mae and Freddie Mac; I should hate it even more to be the Federal Reserve System with a cash rate of about 0 per cent.

In the meantime, as usual, the vulnerable and powerless are bearing more than their share of the burden.

Saturday September 4, 2010, 9:40 pm
Thanks Mary that was well stated. Nice to see you back Bryan.

Does it really matter what party allegiance a person has if they vote against the best needs of the people? If a billionaire democrat supports, shutting down the Bush tax cuts, continued unemployment support for those dumped on the job(-lack-of) market, supports the veterans, Social Security, and Medicare/Medicaid then good on them. We are living in an Orwellian nightmare created by republicans for republicans and the Corporations that own and operate this country.

Why is it that republicans have a thorn up their arse about healing the problems of this country and meeting the needs of the people. Oh yeah - that's socialism, homelessness - that's good ole capitalism at it's triumphant best.

Sunday September 5, 2010, 2:07 am
Kit

I think that your post is a hot one, and that there are likely to be more comments.

Sunday September 5, 2010, 9:20 am
Excellent article, Kit! It pretty much applies to Canada as well.

There are a few small things you can do to make it easier and to initiate some changes. Stay away from big chain stores such as Walmart. Only shop there when it is absolutely necessary. Support local businesses. Visit the farmer's market (it's cheaper and the products are fresher), Go to a small repair shop to have small appliances fixed instead of throwing them out. Quit buying junk you don't need. Barter. Open your own small business.

On a larger scale, tell your government officials to bring outsourced jobs back home. Put a temporary freeze on immigration. There are few jobs available and very little money. We don't need more people when we are not self-sufficient and cannot, or will not, help our own citizens first.

Sunday September 5, 2010, 9:24 am
Excellent points Sherri.

Sunday September 5, 2010, 2:02 pm
Thank you very much for sharing this interesting article x

Sunday September 5, 2010, 5:44 pm
Hope that I get this on the right thread. It's been very sad for me to read the comments of people who have lost so much in this horrible economic time that this country has experienced and continues to experience. Despite what political differences we might have, we do have the finest work force in the world. Just give our people a chance to do an honest day's work. I do hope that we can all work together to overcome those forces that have brought such suffering upon our people. Certainly not the best of Labor Days but wishing you all a Happy Labor Day and better ones to come.

Tuesday September 7, 2010, 8:00 am
A CNN/Opinion Research Corporation survey released Tuesday indicates that 46 percent of Americans say that Republicans in Congress would do a better job dealing with the economy, with 43 percent saying that Congressional Democrats would do a better job

Wednesday September 8, 2010, 4:02 pm
Thanks again Kit.

How do you folks view the new stimulus package?

Wednesday September 8, 2010, 4:18 pm
Mary, I think that any one would have to agree that our infrastructure is decayed and in need of complete modernizing. Temporary jobs? Perhaps for some, but once the economy is moving again more jobs will begin to open. So do I support Obama's plan; yes, at least he has a plan.

Thursday September 9, 2010, 12:05 am
So much with the plans to bring back the economy and make it heathy. Those at the top don't want to make concessions. Especially in the already messed up housing situation. Firstly, the American people have to feel good. They also need money to spend and if it isn't there for whatever reason, the economy will be stagnant. But the rules are stacked against the people. The opposite of bailing out Wall St. , the Banks, and Insurance companies and mortgage companies would have been to allow those people to live in the homes that they lost in the mortgage crisis. That would be a logical position, but that's politics, not reason that this is not done. This would solve one problem and will solve the "feel bad" problem and energize those that were thrown out in these forclosures. After all these houses are rotting and unkept. The tragedy is preposterous and generally these houses are sold at a lower price under the present situation, anyway! The reality is fewer homes are refinanced and the foreclosures continue.

The jobs naturally have been lost through outsourcing, but as mentioned you need to put the money back into the hands of the people, not the banks. The puny amount of 50 billion dollars slated for improving our infrastructue seems nothing more than a band-aid and a PR campaign for President Obama's drouping approval rating. There has to be real positive change and the return of money, in the form of interest back to the American people. That is the Banks that were helped with the TARP funds have to be repaid soon, back to the American people. After all it was their tax contributions that saved the banks. Instead the Banks have the control over the average working stiff's money! It is as if the President and the Senate decided to provide all these Federal funds and "praying" that the banks will finance the smaller businesses. Prayer's don't help when the money is transfered to the devil! But there are no regulations or rules of conduct to tell the banks what to do. So the politicians (only some of them), are running on faith and all the things that can bring back the economy can't happen. It would make sense if Congress toughened up, but I fear it is too late with all the cronyism going on!

The problem according to the Republicans is the deficit! They talk about tax cuts and generally no one likes to pay a lot of tax. But remember the tax cuts in the past 8 years of the Bush administration liberated the wealthy. While Glass-Steagall at the end of Clintons term was removed, the Bush administration as well as the Democrats, both parties in concert with big business would be unshackled with the freedom to make the "free market" sing for them. That it did, and the bubbles in every form imaginable continued it's unsteady course. I really thing those who are at the top of the pyramid, whether a part of Wall St. or whomever it concerns, will want to change anything and bring back a healthy America. The reason is, and should be simply clear. A recession favors the wealthy. Ravaging the middle class actually helped them, but as a whole stagnated America as well as the rest of the world. The reality is, President Obama is only "talking the talk" that can bring back employment, but if anyone thinks allowing the rich to get richer by allowing further tax cuts for rich, you have to be crazy or insane! They are hanging on to every cent they can. They will do the same and not invest back into the American working middle class. Outsourcing would be thier goal and any devastated economy is nothing more than to make is easier for them to exploit the labor sources. While the labor force in the United States has been reduced to beggar status, corporations have the upper hand. I believe only a very strong progressive Congress can change that and that is not a reality, especially now! The new trend now is to elect ex-CEO's who oursourced labor because they will run government, schools or whatever as a business.

Obama has to get tougher, but without a majority and 2/3rds of Congress, he doesn't have much of a chance. The Republicans and Blue Dogs will do everything to hurt his reforms. Americans are in a fight for solidarity. Those who have maintained their middle class status are all too comfortable in their lives have to realize this is something that will affect their futures as well as their children in adverse ways, if the wealthy get their way! We are one step away from slavery!