Category Archives: The Economy

Another great editorial from Paul Krugman.  I really can’t believe the American Electorate is going to vote for the Republicans.

My thoughts on this later this weekend.  For now, I’ll defer to Krugman.

Barring a huge upset, Republicans will take control of at least one house of Congress next week. How worried should we be by that prospect?

Not very, say some pundits. After all, the last time Republicans controlled Congress while a Democrat lived in the White House was the period from the beginning of 1995 to the end of 2000. And people remember that era as a good time, a time of rapid job creation and responsible budgets. Can we hope for a similar experience now?

No, we can’t. This is going to be terrible. In fact, future historians will probably look back at the 2010 election as a catastrophe for America, one that condemned the nation to years of political chaos and economic weakness.

More:   Divided We Fail – NYTimes.com.

Interesting article….

ON HIS FIRST DAY back from summer vacation, President Obama appeared in a sweltering Rose Garden to talk about the economy. The latest numbers were disheartening—growth slow, consumer spending weak, housing sales down, unemployment near 10 percent. Obama reported that he’d just met with his economic team. He pointed out that his administration had already taken “a series of measures” to boost the economy, and that his aides were “hard at work” looking for more. He offered no specific proposals, and after five minutes he went back inside, taking no questions from the sweating reporters.

One natural query would have been: Mr. President, how did you lose control of the economic message? Only months earlier, the administration had announced a push to remind the public of the positive impact of the stimulus. But the “Recovery Summer” campaign—press releases, big road signs, presidential and vice-presidential events—barely registered, and the “ground zero mosque” controversy dominated the summer’s silly season instead.

And now, with the Democrats’ poll numbers falling in tandem with the economic indicators, the best Obama could offer were a few modest proposals. At a moment when his party was facing a possibly catastrophic drubbing, the president appeared on the defensive, his economic leadership anemic. How had Obama lost his groove?

More:  How Obama Lost the Narrative | Mother Jones.

This is extremely scary….

One out of every 34 Americans who earned wages in 2008 earned absolutely nothing — not one cent — in 2009.

The stunning figure was released earlier this month by the Social Security Administration, but apparently went unreported until it appeared today on Tax.com in a column by Pulitzer Prize-winning tax reporter David Cay Johnston.

It’s not just every 34th earner whose financial situation has been upended by the financial crisis. Average wages, median wages, and total wages have all declined — except at the very top, where they leaped dramatically, increasing five-fold.

Johnston writes that while the number of Americans earning more than $50 million fell from 131 in 2008 to 74 in 2009, those that remained at the top increased their income from an average of $91.2 million in 2008 to almost $519 million.

The wealth is astounding, says Johnston. “That’s nearly $10 million in weekly pay!… These 74 people made as much as the 19 million lowest-paid people in America, who constitute one in every eight workers.”

Johston sees the depressing figures as a result of government tax policies maintained by politicians with an eye on re-election, not good government:

MORE:  New Figures Detail Depth Of Unemployment Misery, Lower Earnings For All But Super Wealthy (VIDEO).

Another excellent article from former Secretary of Labor Robert Reich:

It’s a perfect storm. And I’m not talking about the impending dangers facing Democrats. I’m talking about the dangers facing our democracy.

First, income in America is now more concentrated in fewer hands than it’s been in 80 years. Almost a quarter of total income generated in the United States is going to the top 1 percent of Americans.

The top one-tenth of one percent of Americans now earn as much as the bottom 120 million of us.

Who are these people? With the exception of a few entrepreneurs like Bill Gates, they’re top executives of big corporations and Wall Street, hedge-fund managers, and private equity managers. They include the Koch brothers, whose wealth increased by billions last year, and who are now funding tea party candidates across the nation.

Which gets us to the second part of the perfect storm. A relatively few Americans are buying our democracy as never before. And they’re doing it completely in secret.

Hundreds of millions of dollars are pouring into advertisements for and against candidates  — without a trace of where the dollars are coming from. They’re laundered through a handful of groups. Fred Malek, whom you may remember as deputy director of Richard Nixon’s notorious Committee to Reelect the President (dubbed Creep in the Watergate scandal), is running one of them. Republican operative Karl Rove runs another. The U.S. Chamber of Commerce, a third.

MORE:   Robert Reich (The Perfect Storm).

I doubt we’ll see much about this in the main stream media….

The US deficit shrank nine percent last fiscal year but still topped one trillion dollars, the government said Friday in a report seized on by Democrats’ rivals weeks ahead of mid-term elections.

For the 2010 fiscal year that ended on September 30, the government had a budget shortfall of 1.294 trillion dollars, down 122 billion dollars from the previous year’s record-setting high.

Revenue rose and spending fell amid recovery from recession and as President Barack Obama’s Democratic administration wound down some of the emergency measures taken to restore growth.

The final figures “underscored the administration’s commitment” to cutting the massive government deficit, Treasury Secretary TimothyGeithner said in a statement.

“By carefully managing the emergency initiatives to stop the financial panic and by accelerating our exit from those investments, we have significantly lowered the cost to taxpayers, bringing the costs of the financial rescue down by more than 240 billion dollars this year.”

via Democrats shrank US spending, deficit in last fiscal year, figures show | Raw Story.