Political Economy category archive

Via Glomarization.

Paul Krugman on the phony balance of “on-one-hand-on-the-other-hand” (emphasis added):

Some have asked if there aren’t conservative sites I read regularly. Well, no. I will read anything I’ve been informed about that’s either interesting or revealing; but I don’t know of any economics or politics sites on that side that regularly provide analysis or information I need to take seriously. I know we’re supposed to pretend that both sides always have a point; but the truth is that most of the time they don’t. The parties are not equally irresponsible; Rachel Maddow isn’t Glenn Beck; and a conservative blog, almost by definition, is a blog written by someone who chooses not to notice that asymmetry. And life is short …

Via Bob Cesca.

At least one industry is doing okay.

Liquor company Brown-Forman Corp. posted a 30 percent increase in its third-quarter profit on Tuesday, beating Wall Street estimates on the strength of robust international sales and a sales spike for its Jack Daniel’s and el Jimador brands.

Its shares jumped 7 percent in morning trading.

Via BartCop.

Slight cause for hope from the monthly February figures:

The U.S. jobless rate unexpectedly fell to 8.9 percent, the lowest in almost two years, and employers added 192,000 jobs in a sign of growing confidence in the recovery.

The increase in payrolls partly reflected a return to more seasonable weather and followed a 63,000 gain in January, Labor Department figures showed today in Washington. The median estimate in a Bloomberg News survey of economists was for an addition of 196,000 jobs last month.

Meanwhile, in the world of No Mountebank Too High No Lie Too Big, Republicans claim credit, even as they blackmail the polity with layoffs.

Just down the road a piece in Suffolk:

Residential property, which accounts for about 75 per cent of the city’s overall assessed value, led the losses with a decline of about 3 percent. Commercial real estate, about 19 percent of city property value, shrank by a lesser amount. The exact figure was not immediately available. Farm land accounts for about 4.2 percent of the city’s tax base.

Overall, taxable property shrank in value from $9.04 billion to $8.84 billion. It’s the third consecutive year assessments have declined.

I believe that, on Wall Street, this is known as creating value–or some such mumbo jumbo for making the rich richer and the poor poorer.

The short-term weekly figures getting a little better. (Link fixed.)

Applications for unemployment benefits decreased by 20,000 to 368,000 in the week ended Feb. 26, Labor Department figures showed today. Economists forecast claims would climb to 395,000, according to the median estimate in a Bloomberg News survey. The total number of people receiving unemployment insurance fell to the lowest level since October 2008.

Among the reasons for increased optimism about the labor market in coming months has been a recent drop in initial claims, Federal Reserve Chairman Ben S. Bernanke told lawmakers this week. Companies added 200,000 jobs in February, while unemployment rose to 9.1 percent, economists project a Labor Department report to show tomorrow.

(snip)

The four-week moving average, a less volatile measure, dropped to 388,500, the lowest since the week ended July 12, 2008, from 401,250 last week. It was also the first time the monthly average has been below 400,000 since July 2008.

The number of people continuing to collect jobless benefits unexpectedly decreased by 59,000 in the week ended Feb. 19 to 3.77 million.

Writing at the Guardian, Anya Schiffrin considers why business news fails to inform. One possible reason: focusing on the small picture:

Business and economics journalism is not that different from other forms of journalism. Reporters and editors mostly cover events that have already happened, not write about what could happen. They also have a tendency to rely on official and business sources, rather than on person-on-the-street interviews. This is partly because most of the people who read business news are from the worlds of money and business. Historically (the first business news sheets date to the 16th century), they relied on the business press for information that will help their investments. Sadly, this means that press reports about business and economics are often not much help to the ordinary reader trying to understand these subjects.

Remember all those happy-looking retirees in those bathtubs on the telly vision?

They are working actors, probably getting paid minimum scale:

America’s retirement system is said to be a three-legged stool made up of private savings, pension plans, and Social Security. But each leg of the stool is wobbly, while a fourth unacknowledged leg — asset accumulation from home equity — has also taken a huge hit. Absent drastic changes in retirement policy, more elderly Americans will be poor, and many more will be working, often in low-wage jobs, because they can’t afford to retire.

Read the whole thing, especially the part about why the move to 401k’s turned out to be a scam and a fraud has failed the holders of 401k-based retirement plans.

From John Cole:

A unionized public employee, a teabagger, and a CEO are sitting at a table. In the middle of the table is a plate with a dozen cookies on it. The CEO reaches across and takes 11 cookies, then looks at the teabagger and says “Watch out for that union guy—he wants a piece of your cookie!”

This is the type of entitlemennt spending that needs re-examined.

Two years after the San Antonio’s first deployment, which included a weeks-long stop in Bahrain for emergency engine repairs, the ship has yet to return to sea. And in recent months new details that paint an even grimmer picture of the ship’s early years have emerged, including the near- collision in the Suez Canal, which The Virginian-Pilot has not previously reported.

In October, after spending more than $40 million on repairs, the Navy announced that the San Antonio wouldn’t be ready to deploy in the spring with the rest of its amphibious group, and another ship was named to take its place.

While the service has insisted with each setback that the San Antonio eventually will live up to its promises, there has been little to report in the way of progress, because each time crews have come close to fixing one major defect, more have cropped up. Many defects have extended to later ships in the class, though to lesser degrees.

The price tag for taxpayers has been enormous. Delivered several hundred million dollars over budget, the San Antonio has cost nearly $2 billion.

Lots of details at the link,

Keeping home prices within reach (of the moneyed minority):

A total of 831,574 homes that sold in 2010 had received notices of default, auction or repossession, the Irvine, California-based data seller said today in a statement. Properties in distress accounted for almost 26 percent of all home sales last year, down from 29 percent in 2009.

A “bloated supply of foreclosures and weak demand from homebuyers” are depressing the market, James J. Saccacio, RealtyTrac’s chief executive officer, said in the statement. Residential real-estate prices dropped 4.1 percent in the fourth quarter from a year a earlier, according to the S&P/Case-Shiller index of home values in 20 cities.

Back under 400k. Probably just a blip until the government shuts down:

Applications for jobless benefits decreased by 22,000 to 391,000 in the week ended Feb. 19, Labor Department figures showed today. Economists forecast claims would drop to 405,000, according to the median estimate in a Bloomberg News survey. Claims have fallen in three of the past four weeks, pushing down the monthly average to the lowest level since July 2008.

You can look at this chart to see what is trickling down:

More charts at Mother Jones.

Via Michael Tomasky.

Shaun Mullen finds some interesting statistics. Follow the link to see what conclusions they lead him to.

Consider that only five states do not have collective bargaining for teachers. Those states’ rankings on ACT/SAT scores are:

South Carolina — 50th
North Carolina — 49th
Georgia — 48th
Texas 47th
Virginia — 44th

Got that? Meanwhile, the states with the highest ACT/SAT rankings all allow collective bargaining:

Iowa — 1st
Minnesota and Wisconsin — 2nd
Kansas — 4th
Nebraska — 5th

Statistics can lie, but these are unambiguous. States that allow teachers to bargain produce better students, and by inference better teachers.

. . . are nil.

Dean Baker, writing at the Guardian, points out that many of those who today crusade against the growing deficit are the same folks who championed the policies of that led to the housing crash, which in turn led to . . . the growing deficit.

A nugget:

When the country actually did face a real economic disaster, these people were nowhere in sight. They were diverting attention to other issues and dismissing those of us who tried to warn of the real danger.

Now that we are experiencing an economic disaster – 25 million people unemployed or underemployed, millions of people facing the loss of their homes, more than 10 million underwater with their mortgages – as a direct result of their incompetence, these same people are telling us again about the urgent need to cut social security and Medicare. The deficit hawks somehow think that their case is more compelling because of the damage done by their incompetence.

It should not work this way. In most lines of work, incompetence is not a credential; it should not be one in designing economic policy either.

In Wisconsin, Republicans reveal their long-tern goals: Rolling the clock back to reinvigorate the meaning of “slave” in the phrase “wage slave.”

Dick Polman explains the rightwing’s union-busting tactics. A nugget (emphasis added):

The new Republican governor’s bold bid to strip public employee unions of their collective-bargaining rights is not just a parochial skirmish about finding money to close the budget deficit. It’s about exploiting that state deficit for political gain, using it as an excuse to declare war, and perhaps eviscerate, the last healthy sector of the labor movement – a strategy nurtured these past four decades by national conservative strategists and their well-heeled backstage business donors.

(snip)

But conservatives smell a greater golden opportunity in all that red ink. They’ve previously ridiculed Rahm Emanuel’s ’08 quip about how “you never want a serious crisis to go to waste,” but now they’ve adopted it – by launching a radical attack on the core principle of collective bargaining. If successful, in Wisconsin and elsewhere, they might achieve their aim of turning back the clock to the era, circa 1929, when all workers were at the mercy of their employers.

I am not a big fan of individual unions, but for a long time I was in a union job, a member of TCU local 1506, and I held my union card (and paid my dues) for two decades–as long as I was with the railroad–after leaving the union job for management.

By and large, unions have done far more good than bad. They have certainly done far more good for average Americans than has Goldman-Sachs.

Anyone who thinks otherwise needs to read up on the Triangle Shirtwaist Factory; Harlan County, Kentucky; and the Pullman Strike.

It wasn’t the workers who were packing lead; it was the bosses.

My first father-in-law, one of the finest and fairest men I have ever known, could tell stories of being shot at for his activities on behalf his fellow railroad union members not so long ago.

Dennis G. lines up a fascinating collection of maps through time at Balloon Juice to illustrate trends in labor-management relations–efforts by the plutocracy to keep wages low–as moderated by the states through time. He starts with slavery, moves though convict-labor, and reaches the contempororary era.

I commend it to your attention as context for the Republican attack on workers.

Here’s his bit on the double-talk (emphasis added):

This system of boldly stealing the labor of convicts lasted into the 1930s (and versions of it still can be found in almost every State of the Union). It was FDR and the new Democrats of the New Deal who passed a series of laws that made the theft of labor more difficult and help workers to organize and collectively bargain for a fair and living wage. It work. A great middle class in America was created and for almost fifty years prosperity was shared.

The effort to push back against labor rights started almost immediately. By 1947 this movement was able to pass the Taft Hartley Act and open the door to new restrictions to the rights of workers. By the Reagan era in the 1980s, the movement to steal labor was repackaged and resold to the most gullible and cynical among us. Since then it has picked up a lot of steam. Laws to restrict the rights of workers have been given the very Orwellian name, “Right to Work” laws—as in in you have the right to work, but not the right to come together and ask for a fair deal. In a “Right to Work” State, a worker is on his or her own. The State will always fight against you. You are on your own sucker and you just have to deal with it. In a “Right to Unionize State” you have back-up, regardless of whether or not you work in a Union shop.blockquote>

February 21, 2011 | Posted by: Frank | Posted in: Political Economy | Bookmark this post