Political Economy category archive

Clarence Page wonders on this apparent contradiction: States who number among those receiving the highest amounts of government benefits have populaces who tend to be most vocally opposed to government benefits.

He suggests that it is a question of framing: To wit, my hard-earned asset is your undeserved entitlement.

Here’s a bit. Click to read the rest.

I was informed of this in a gigabyte of emails that I received last summer after writing about a study by Cornell’s Suzanne Mettler. She found that substantial percentages of people receiving benefits from such programs as Social Security (44 percent), unemployment insurance (43 percent) and Medicare (40 percent) told researchers that they have not received a “government benefit.”

Irritated readers responded with personal arguments that basically went like this:

“How dare you refer to (Social Security/Medicare/unemployment/home mortgage income tax deduction/etc., etc.) as a ‘benefit.’ I worked hard for (fill in the blank) years to earn my (Social Security/Medicare/unemployment/home mortgage income tax deduction/ etc., etc.), you (fill in the invective.)”

Believe me, I get it. The dispute here is between what I mean when I say “benefit” and what some people hear. In the years since Ronald Reagan won blue-collar votes by denouncing “welfare queens” and the like, many voters have come to associate the word “benefits” with handouts to “deadbeats” and “losers” and “cheats.”

Despite the best efforts of Republicans in Congress, we may have a trend:

Applications (INJCJC) for unemployment insurance payments decreased 13,000 in the week ended Feb. 11 to 348,000, less than the lowest forecast of economists surveyed by Bloomberg News and the fewest since March 2008, Labor Department figures showed today. The median survey estimate projected an increase to 365,000.

(snip)

The number of people continuing to collect jobless benefits dropped by 100,000 in the week ended Feb. 4 to 3.43 million, the fewest since August 2008. The continuing claims figure does not include the number of workers receiving extended benefits under federal programs.

At Psychology Today, Peter Corning points out that there was much more to Adam Smith’s beliefs than an unfeeling reverence for acquisitiveness and for letting Goldman fill his sacks in any way he can.

More important, many of Smith’s modern acolytes seem unaware of his cautionary warnings, especially in his earlier work, The Theory of Moral Sentiments, where (as a Stoic and a Christian) he stressed the fact that everything in a free market depends on a moral foundation of trust, honest dealing and, as he himself put it, “justice”. (He defined justice as not doing “injury” to others.) “There can be no proper motive for hurting our neighbor.” Smith was even a proponent of the Golden Rule and invoked the “invisible hand” simile in his earlier work to characterize our sense of charity toward those in need.

I forgot to check whether the FDIC was dining out on the town yesterday evening.

It was. Two more blanked banks:

SCB Bank, Shelbyville, Indiana

Charter National Bank and Trust, Hoffman Estates, Illinois

If this keeps up, we might just maybe have a trend:

Applications for jobless benefits decreased 15,000 in the week ended Feb. 4 to 358,000, Labor Department figures showed today. Economists forecast 370,000 claims, according to the median estimate in a Bloomberg News survey. The four-week moving average, a less-volatile measure of claims, declined to 366,250, the lowest since April 26, 2008.

(snip)

The number of people continuing to collect jobless benefits rose by 64,000 in the week ended Jan. 28 to 3.52 million. 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 increased by about 18,650 to 3.5 million in the week ended Jan. 21.

Reaching for the skies:

The tallest skyscraper in the southern United States is going up for public auction after its owners missed mortgage payments.

The 1,023-foot Bank of America Plaza in Atlanta is scheduled to be auctioned Tuesday on the steps of the Fulton County Courthouse.

The picture would be complete if it were owned by Bank of America, but it isn’t. It’s owned by some Los Angeles outfit that bought it at just the wrong time.

Creamy foreclosure goodness for everyone:

Throughout affluent communities in the Bay Area, million-dollar-and-up homes are increasingly being lost to foreclosure, or sold as a last resort for far less than their mortgages.

More than 1,500 Bay Area homes with mortgages of $1 million or more were scheduled for auction last year, more than double the number in 2008, according to ForeclosureRadar, a foreclosure tracking service.

“The fact is, upper-end folks are starting to feel the crunch,” said Barbara Safran, president of the Contra Costa County Association of Realtors.

Click for a larger image.

Via BartBlog.

Asia Times reports on Apple’s off-shoring.

After addressing the notion that there are two economies, a “financial” economy (companies such as Goldman Sachs, which make money by playing with money) and a “real” economy (companies that make money by making stuff), they look at Apple and other tech companies:

A nugget:

It is estimated that 8 million US manufacturing jobs were eliminated between June 1979 and December 2009. One report describes the grim process of deindustrialization:

Long before the banking collapse of 2008, such important US industries as machine tools, consumer electronics, auto parts, appliances, furniture, telecommunications equipment, and many others that had once dominated the global marketplace suffered their own economic collapse. Manufacturing employment dropped to 11.7 million in October 2009, a loss of 5.5 million or 32% of all manufacturing jobs since October 2000. The last time fewer than 12 million people worked in the manufacturing sector was in 1941. In October 2009, more people were officially unemployed (15.7 million) than were working in manufacturing.

This decimation of the manufacturing sector, which involved the elimination a massive number of well-paying manufacturing jobs, played a central role in the stagnation of income, wages, and purchasing power in the United States. In the three decades prior to the crash of 2008, Robert Reich notes, the wages of the typical American hardly increased, and actually dropped in the 2000s.

One result is that the number of persons who can afford the stuff that the “real” economy produces is decreasing apace.

Follow the link for the rest.

Slightly better:

Applications for unemployment insurance payments dropped by 12,000 to 367,000 in the week ended Jan. 28, Labor Department figures showed today in Washington. The median forecast of 46 economists in a Bloomberg News survey projected 371,000.

(snip)

The four-week moving average for jobless claims, a less volatile measure than the weekly figures, fell to 375,750 last week from 377,750. It was the second-lowest average since 2008, after a 374,000 reading in the last week of December.

Foreclosures continue to work their magic.

About 302,000 new homes were sold last year. That’s less than the 323,000 sold in 2010, making last year’s sales the worst on records dating back to 1963. And it coincides with a report last week that said 2011 was the weakest year for single-family home construction on record.

(snip)

A key reason for the dismal 2011 sales is that builders must compete with foreclosures and short sales—when lenders accept less for a house than what is owed on the mortgage.

Still holding under 400k.

Applications (INJCJC) for unemployment insurance payments climbed by 21,000 to 377,000 in the week ended Jan. 21, up from an almost four-year low in the prior period, Labor Department figures showed today in Washington. The median forecast of 47 economists in a Bloomberg News survey projected 370,000.

(snip)

The four-week moving average, a less volatile measure than the weekly figures, fell to 377,500 last week from 380,000.

Click for a larger image.

Via Some Guy with a Website.

Daniel Ruth pens a brilliant, acerbic obituary for Rick Perry’s candidacy.

Here’s a bit.

There is a hitch to running for president. Candidates have the pressing obligation to demonstrate a modicum of awareness at least marginally above a sack of anchovies. The tea party crowd dominating the GOP certainly doesn’t mind if a candidate is more bonkers than Edgar Allen Poe. But they do draw line (sic) at being so obvious about it.

Perry didn’t run a presidential campaign. He ran as the poster child for civics illiteracy in America, and by the time he quit the race Thursday he had made the George W. Bush years look like the Age of Enlightenment. This was too much even for the voters of South Carolina.

Read the whole thing, not just for the bits about Perry, but for what it says about the clown car that the nominating process has become.

How regulations are killing the Mafia:

This is almost starting to look like a trend:

(Unemployment–ed.) Claims plunged by 50,000 to 352,000 in the week ended Jan. 14, the lowest level since April 2008, Labor Department figures showed today in Washington. The median forecast of 41 economists in a Bloomberg News survey projected 384,000. A Labor Department spokesman said the decrease reflected volatility seen during this time of year. The four-week average, which smoothes out fluctuations, decreased to 379,000 last week from 382,500.