Political Economy category archive

Clay Bennett:

The streets are about to get more populated, thanks to the rampant wingnuttery in Raleigh.

The state unemployment compensation has been “overhauled,” hauled right over the backs of the unemployed:

The state legislature’s unemployment system overhaul, which both raised taxes on employers and cut the length and amount of benefits, makes the state ineligible to receive federal unemployment funds intended for those unemployed longer than 26 weeks. Federal law cuts off aid to states that don’t maintain their current benefit system.

The U.S. Department of Labor estimates 170,000 people in North Carolina could ultimately lose extended federal benefits for which they otherwise would have qualified.

North Carolina’s unemployment rate in April was 8.9 percent, the fifth-highest in the U.S. In Mecklenburg County, with an 8.5 percent unemployment rate, the state said 42,575 people were unemployed in April. That figure doesn’t include people who’ve stopped looking for work.

Still not good.

Applications for jobless benefits increased 10,000 to 354,000 in the week ended May 25, Labor Department figures showed today in Washington. Economists called for 340,000 claims, according to the median forecast in a Bloomberg survey.

(snip)

The four-week moving average of claims, a less-volatile measure, climbed to 347,250 from 340,500.

The number of people continuing to collect jobless benefits rose by 63,000 to 2.99 million in the week ended May 18. The continuing claims figure does not include the number of workers receiving extended benefits under federal programs.

Those who’ve used up their traditional benefits and are now collecting emergency and extended payments decreased by about 50,000 to 1.73 million in the week ended May 11.

Heidi Moore distrusts the numbers.

She suspects that reports of recovery are overblown and that the “housing recovery” isn’t so much a “recovery” as the next stage of foreclosure frenzy.

The housing recovery, for instance, seems to be just another stage of the foreclosure crisis. Note that the areas where house prices have risen the most – Arizona, Las Vegas and California – are all areas that were hurt most deeply by the housing crash. So pry between the boards of the housing recovery and the termites start crawling out. Here, you’ll find some old villains of the last housing bubble, crawling on the same properties. There are the house-flippers and the financial institutions, the foreclosure players that regenerate whenever there is a boom.

In this case, they may be creating the boom themselves. House-flipping in California has reached levels not seen since 2005, according to the Wall Street Journal. This rise in price is, by all accounts, artificial. Housing, like all products, responds to the laws of supply and demand. When supply decreases – when there are fewer homes on the market – then prices will rise. This is what is happening now.

And I’m still waiting for sequestrian dressage to start affecting the numbers, because it will.

In The Guardian, Mattea Kramer and Jo Comerford look back from ten years later.

It ain’t a pretty sight.

The streets are so much darker now since money for streetlights is rarely available to municipal governments. The national parks began closing down years ago. Some are already being subdivided and sold to the highest bidder. Reports on bridges crumbling or even collapsing are commonplace. The air in city after city hangs brown and heavy (and rates of childhood asthma and other lung diseases have shot up), because funding that would allow the enforcement of clean air standards by the Environmental Protection Agency is a distant memory. Public education has been cut to the bone, making good schools a luxury, and, according to the Department of Education, two of every five students won’t graduate from high school.

It’s 2023 – this is America a decade years after the federal budget cuts known as sequestration. They went on for a decade, making no exception for effective programs that were already underfunded, like job training and infrastructure repairs. It wasn’t supposed to be this way.

Der Spiegel points out that, come summer, the effects of Sequestration will start to have noticeable effects and looks at the absurdity of the whole darn thing. A nugget:

The absurdity of the cuts angers the people they affect. The US can undoubtedly see how Southern Europe is driving itself into the ground with its belt-tightening measures and how unemployment there is skyrocketing. But, here, the country is pulling its own plug. “Austerity, including sequestration, is the economic version of medieval leeching,” wrote Jared Bernstein, former chief economic adviser to Vice President Joseph Biden, in the New York Times in early May. People in the Middle Ages believed a sick person needed to lose supposedly bad blood in order to regain health.

That, of course, was nonsense.

More sense about nonsense at the link.

A little better:

Jobless claims decreased by 23,000 to 340,000 in the week ended May 18, Labor Department figures showed today in Washington.

(snip)

Economists’ estimates in the Bloomberg survey ranged from 338,000 to 360,000. The Labor Department revised the previous week’s figure to 363,000 from an initially reported 360,000.

The four-week moving average, a less volatile measure than the weekly figures, dropped to 339,500 last week from 340,000.

Not very good.

Jobless claims jumped by 32,000 to 360,000 in the week ended May 11, exceeding all forecasts in a Bloomberg survey of economists and the most since the end of March, Labor Department figures showed today in Washington. A Labor Department spokesman said no state provided information explaining the surge in applications which was the biggest since the aftermath of superstorm Sandy in November.

(snip)

The four-week moving average, a less volatile measure than the weekly figures, rose to 339,250 last week from 338,000.

Donald Kaul points out, one more time, that the past is not even past, in a particularly depressing context:

Further reading has convinced me that the instance wasn’t isolated. Virtually everything about the economic catastrophe of the 1930s has a precise parallel in today’s major political dilemmas.

Conservative leaders, then as now, were absolutely clueless as to what regular people were going through. There’s a reason they call what we’ve just experienced the “Great Recession” and the 1930s economy the “Great Depression.” The Depression was much more devastating, with 13-15 million people unemployed, leaving as many as 34 million men, women, and children with no income at all.

Their safety net was often a garbage heap in which they foraged for food, or worse, begged for it. Yet President Herbert Hoover actually said: “Nobody is actually starving. The hobos, for example, are better fed than they have ever been.”

And when it was suggested that the Du Pont family’s corporation sponsor a Sunday afternoon program during the Depression, a member of the clan rejected the idea on grounds that “at three o’clock on Sunday afternoons, everybody is playing polo.”

Does that sound like Mitt Romney talking to his country club friends or what?

Read the rest.

Via The Progressive Populist.

The evidence is that Reagonics sounds nice, but doesn’t work.

Tim Donovan wonders why, despite the evidence Republicans are considered to be responsible fiscals, despite the evidence of Reaganomics in practice.

A snippet; read the rest.

While those who adhere to supply-side principles might point to a brief period of economic growth during the Reagan administration as proof of the success of their policy prescriptions, or perhaps instead argue that their economic agenda has never been fully implemented, neither of these arguments can stand up to careful scrutiny. The economic results of neoliberal policies have been consistently devastating, and their failures immediately apparent. Examples abound: the Argentine currency collapse from ’99-’02; the East Asia Crisis of ’97; the “Shock Therapy” technique in post-Soviet Russia; the Bolivian Water Crisis of 2000; the collapse of the Mexican Peso in ’94; the Subprime Mortgage Collapse of ’09 … The list goes on and on. Supply-side ideologues refuse to accept this most basic reality: Their principles are fundamentally flawed and do not work. To continue to base our economic policy, our regulatory policy and our financial policy on their misguided assumptions makes about as much sense as adopting the governing principles of the CCCP [Soviet Union}.

Afterthought:

Reagonics sounds nice because every successful con has a smooth line of patter.

Again, no mention of those who are “furloughed” for the sequestrian dressage.

Applications for unemployment insurance payments decreased by 4,000 to 323,000 in the week ended May 4, the least since January 2008, Labor Department figures showed today.

(snip)

The four-week moving average of claims, a less-volatile measure, dropped to 336,750, the lowest level since November 2007. The worst recession since the Great Depression began the following month and ended in June 2009.

The number of people continuing to collect jobless benefits fell by 27,000 to 3.01 million in the week ended April 27. The continuing claims figure does not include the number of workers receiving extended benefits under federal programs.

Applications for unemployment insurance payments fell 18,000 to 324,000 in the week ended April 27, the fewest since January 2008, Labor Department figures showed today in Washington. Economists forecast 345,000 claims, according to the median estimate in a Bloomberg survey. A Labor Department official said there was nothing unusual in the data.

(snip)

Estimates for first-time claims ranged from 335,000 to 365,000 in the Bloomberg survey of 48 economists. The Labor Department revised the previous week’s figure up to 342,000, from an initially reported 339,000.

As near as I can tell, workers doing the sequestrian dressage, who are “furloughed” without pay for a day or two a pay period, are not considered unemployed.

Just screwed.

At MarketWatch, Paul B. Farrell discusses the difference between a “market economy” and a “market society” and gloomily concludes that we are moving towards the latter:

What is certain: Capitalism is eliminating moral values, as Nobel economist Milton Friedman and capitalism’s philosopher Ayn Rand had been preaching to the generation. As (Harvard Professor Michael–ed.) Sandel puts it: “Each party to a deal decides for him- or herself what value to place on the things being exchanged. This nonjudgmental stance toward values lies at the heart of market reasoning, and explains much of its appeal.”

But unfortunately, market capitalism “has exacted a heavy price … drained public discourse of moral and civic energy.”

The good professor is a great teacher, with only one glaring flaw in his logic: he’s too idealistic, too quixotic. You don’t have to be a fatalist to know that without a total economic collapse, market capitalists — including 1,426 billionaires, Wall Street bankers, hedgers, lobbyists and every other special interest getting rich off the new market society — will never voluntarily surrender their control over the American political system.

(Link fixed.)

A little better, but still in the same ballpark:

Applications for jobless benefits decreased by 16,000 to 339,000 in the week ended April 20, the lowest since March 9, according to Labor Department data released today in Washington. Economists projected 350,000 claims, according to the median estimate in a Bloomberg survey. A Labor Department spokesman said the claims data typically bounce around this time of year.

(snip)

The four-week moving average of claims, a less-volatile measure, fell to 357,500 from 362,000.

The number of people continuing to collect jobless benefits fell by 93,000 to 3 million in the week ended April 13, the lowest since May 2008. The continuing claims figure does not include the number of workers receiving extended benefits under federal programs.

Via Bartcop.

Things are working out nicely in Greece.

Right-wing thugs have been spreading fear and terror in Greece for months. The worse the financial crisis gets and the harsher the budget cuts imposed by European creditors are, the worse the terror gets on the streets. Foreigners have been attacked, homosexuals chased and leftists assaulted. Some were beaten to death. There are parts of Athens in which refugees and minorities no longer dare to go out alone at night, and streets that are echoingly empty. Foreign merchants have had to close their doors, while journalists and politicians who criticize these developments receive threats or beatings.

Ta Nea, a leading Greek daily, has described conditions here as similar to those of Weimar Germany. Vassiliki Georgiadou, a political science professor in Athens, likewise calls it “an atmosphere like in the 1930s in Germany against the Jews and their businesses.”

Reg Henry jumps himself to some conclusions. A snippet:

I will jump to further conclusions, now that I have the hang of it. Hate is an infection, one that has reached epidemic proportions in American society and the world. A lot of people think the remedy to hate is more hate, if it is focused on their favorite enemy. Trouble is, hate once loosed is not so easily contained.

It is a tall jump to the next conclusion, but I’m up for it: Those who just hate and those others who act on their hate in murderous ways are swimming in the same swamp. And, yes, some of those who jumped immediately to prejudiced conclusions about the Boston Marathon bombing don’t realize that their selective disdain for humanity helps maintain, even if only a little, the habitat where killers flourish.

Jump to the link for the rest.

About the same.

Applications (INJCJC) for jobless insurance payments increased by 4,000 to 352,000 in the week ended April 13, in line with the median forecast of economists surveyed by Bloomberg. There was nothing unusual in last week’s data and two states, California and Kentucky, were estimated, a Labor Department official said.

(snip)

The four-week moving average, a less volatile measure than the weekly figures, rose to 361,250 last week from 358,500.

The origins:

Via Driftglass.

Phil Terrana has a theory about why Congress obligated the postal service to pay up its pension fund for 75 years into the future: it’s all about the privatization con, another attempt to sell off the public’s assets for the personal gain of a few masters of the universe.

This comes to more than $55 billion in payments for a company adjusting to a significant loss of revenue. The Postal Service was actually still showing a profit until just a few years ago, despite these payments, but these are pretty big chunks of revenue to be giving up each year, and they are beginning to take a toll.

People keep asking why Congress doesn’t put a stop to this, or postpone it or reduce it to a more manageable figure.

The reason is that the people who put this into law don’t want the Postal Service to survive. They want to break the back of the Postal Service so that the only answer will be privatization, and some big investors with a lot of money will get their hands on a business that goes into every home and business in America.