Political Economy category archive

Eistein (possibly apocryphal):

Insanity: doing the same thing over and over again and expecting different results.

Republicans (from the transcript):

Unfortunately, those are the ideas we keep hearing from our friends in the other party. This week, the Republican leader in the House of Representatives offered his plan to create jobs. It’s a plan that’s surprisingly short, and sadly familiar.

First, he would repeal health insurance reform, which would take away tax credits from millions of small business owners, and take us back to the days when insurance companies had free rein to drop coverage and jack up premiums. Second, he would say no to new investments in clean energy, after his party already voted against the clean energy tax credits and loans that are creating thousands of new jobs and hundreds of new businesses. And third, even though his party voted against tax cuts for middle-class families, he would permanently keep in place the tax cuts for the very wealthiest Americans – the same tax cuts that have added hundreds of billions to our debt.

These are not new ideas. They are the same policies that led us into this recession. They will not create jobs, they will kill them. They will not reduce our deficit, they will add $1 trillion to our deficit. They will take us backward at a time when we need to keep America moving forward.

Q. E. D.

It’s only two minutes long:

Via the ACLU.

A while ago, I demonstrated that there is an assumption which dare not speak its name underlying Republican Economic Theory (follow the link for the demonstration):

That the wealthy are inherently virtuous simply because they are wealthy. Therefore, kowtowing to the wealthy is inherently virtuous policy.

From this touching faith in the beneficence of the rich comes the Laffable Curve and voodoo economics, as well as the castration of the regulatory structure–those strategies which have worked so well to send the United States economy into a tailspin, dragging the rest of the world behind it.

The corollary which dare not speak its name is that the poor are inherently not virtuous, that they are poor because they either deserve or want to be, and therefore must be punished.

This accounts not only for the Republican Party’s opposition to unemployment payments (since obviously all those unemployed folks laid themselves off), but also for its slavering and slavish desire to cut taxes for the rich.

Excerpt:

And I have to say, after years of championing policies that turned a record surplus into a massive deficit, the same people who didn’t have any problem spending hundreds of billions of dollars on tax breaks for the wealthiest Americans are now saying we shouldn’t offer relief to middle-class Americans like Jim or Leslie or Denise, who really need help.

Republican Economic Theory does not work and play well with facts. Follow the link and read the whole thing. From the Neiman Watchdog:

Because it can have an effect on political stability, income inequality is one of the economic indicators tracked worldwide by the Central Intelligence Agency. Its current
World Factbook puts the United States just inside the most unequal third among 184 nations, between Uruguay and Cameroon. Immediately below the USA and Cameroon in the rankings – that is more equal — are Ivory Coast, Iran, Nigeria, Guyana, Nicaragua, and Cambodia.

(snip)

. . . California professor, G. William Domhoff of Santa Cruz, looks at the increasing concentration of wealth rather than income. By 2007, he reported, only 20 percent of the people owned 85 percent of the wealth in the United States. When he looked at pure financial wealth (leaving out the value of your home), the top 20 percent had a 93 percent share, leaving only seven percent for the rest of us.

One more time, Truman was right.

According to Republicans, jobs are out there:

Initial jobless claims dropped by 29,000 to 429,000 in the week ended July 10, the fewest since August 2008, Labor Department figures showed today in Washington. The government anticipates an increase in temporary factory layoffs in early July that did not occur this year, leading to the decrease in applications, a Labor Department spokesman said.

“The key story here is the extreme uncertainty over the near-term path of claims as a result of the annual retooling shutdowns, which throw the seasonal adjustments into chaos,” Ian Shepherdson, chief U.S. economist at High Frequency Economics LLC in Valhalla, New York, said before the report. Shepherdson projected claims would drop to 420,000.

Reality (via Zandar):

TPM explains Republicanism. A nugget:

South Carolina Lt. Gov. Andre Bauer compared the unemployed to stray animals back in January, saying that unemployment insurance is a lot like helping out strays. One is “facilitating the problem if you give an animal or a person ample food supply,” he said. “They will reproduce, especially ones that don’t think too much further than that. And so what you’ve got to do is you’ve got to curtail that type of behavior. They don’t know any better.” Though he later backtracked, saying this probably “wasn’t the best metaphor,” he has since said that “flat-out lazy” people “would rather sit home and do nothing than do these jobs.”

Shaun Mullen explains.

Wingnut myth: Charitable giving will pick up the slack.

Real life:

“I know everyone is saying it, but it’s true,” Genieve Shelter Director Val Livingston said. “In my 13 years here, I’ve never seen it this bad. It’s always been a few thousand here, a few thousand there, but just last week we lost $9,000 in grant money that we received last year and were depending on for this year and won’t get. It’s just getting worse.”

Now, the 49-year-old stonemason has no money coming in, no promising job leads and no idea what to do next.

“I’ve explored every avenue of employment that I can, to no avail,” said the New Castle resident, who has resorted to church food closets in recent weeks to get by. “I just make call after call after call.”

For Dziegielewski and thousands of other Delawareans, the temporary salvation of extended unemployment benefits has run dry, giving way to an existence of fear, despair and bitterness that the nation’s so-called economic recovery seems to be passing them by.

In other news, I heard some Republican hack quoted on the news regarding jobs and deficits. Apparently, everything that happened before January 21, 2009, has gone down some Republican memory hole.

One more time, this is the Republican Economic Theory. If Republicans get back in power, they will just do it all over again once more.

Via Balloon Juice.

Via TPM.

John Cole on Paul Krugman.

Zandar summarizes the nay-sayers:

In other words, we can’t afford stimulus because it’ll hurt the bond traders.

My Daddy told me how, during the Depression, he and lots of other persons learned how to make tomato juice in restaurants by pouring catsup into a glass of water.

Fortunately, he grew up on Pine View Farm, so his family always had food.

Steven D at the Booman Tribune recalls some facts, leading up to some lessons from history. Here’s a excerpt from the “lessons” portion towards the end of his post:

Roosevelt created demand by creating jobs. He strengthened unions and labor. He gave us the first programs to provide a social safety net in this country so the elderly, the unemployed and the disabled didn’t die because they were too poor to afford food and shelter. Did everything he did turn out perfect? Of course not. But in the long run, the New Deal radically changed America for the better.

You can’t say that about the policies promoted by republicans and conservative Democrats over the last 30 years. Those polices led to corruption, fraud, and an economic implosion on a massive scale unknown since the Great Depression. They have also set Americans against fellow Americans and put a heavy anchor on our ability as a nation to compete and succeed in the world.

The entire post is worth the 10 minutes it takes to read.

Not just in San Jose (emphasis added):

The Great Recession continues to cast a deep shadow over Silicon Valley’s economy, with new figures released by the Santa Clara County assessor’s office today revealing the disturbing disappearance of thousands of businesses during the last year.

The report also confirmed a historic plunge in overall property values, with Santa Clara County’s assessment roll for 2010-11 dropping about 2.4 percent, from $303.8 billion to $296.47 billion. Not counting a massive decline after Proposition 13 went into effect in 1978, this year’s reduction is the largest since 1933 — in the early days of the Great Depression.

Creeping upwards once more:

Initial jobless claims increased by 13,000 to 472,000 in the week ended June 26, Labor Department figures showed today in Washington. The number of people receiving unemployment insurance rose, while those getting emergency benefits dropped after Congress failed to act on extending the legislation.

Republicans and Blue Dogs appear to have a two-pronged strategy to remedy this:

• Cut back on unemployment benefits so fewer persons swell the number of recipients, and
• Throw more people out of work.

Bingo. Unemployment problem solved.

Naomi Klein explains it all:

At this weekend’s summit the Canadian prime minister, Stephen Harper, convinced his fellow leaders that it simply wouldn’t be fair to punish those banks that behaved well and did not create the crisis (despite the fact that Canada’s highly protected banks are consistently profitable and could easily absorb a tax). Yet, somehow, these leaders had no such concerns about fairness when they decided to punish blameless individuals for a crisis created by derivative traders and absentee regulators.

Deficit hawks: Wolves in sheep’s clothing.

The general assumption is that reducing the deficit should be a top national objective, and that Social Security should be considered a major source of deficit relief. That much is simple enough. But little else about the campaign against deficits is so simple.

Two issues must be sharply separated. The first is the fiscal policy question of how long increased deficits can be prudently tolerated in the interests of stimulating the economy. The second issue, Social Security, is different – though one wouldn’t know it from listening to most deficit hawks.

Government budget deficits are a serious problem, but Social Security is not a serious part of it. To say otherwise is to engage in mythmaking, and the deficit hawks are doing a lot of that. Those who warn that Social Security’s revenues will fall short of outlays in the 2040s are really pointing to a need for small adjustments, not a problem with the program’s solvency.

Addendum:

Via Michael Tomasky at the Guardian (whose article is worth a glance), try this out to see where real savings lie. Hint: Not in reducing old folks to penury.

Via Marc.

Be sure to start with episode one, linked in beginning of the post.

From the Guardian. Read the whole thing:

For decades, one of the main tools in the arsenal of those seeking to prevent actions to reduce emissions has been to declare the that the science is too uncertain to justify anything. To that end, folks like Fred Singer, Art Robinson, the Cato Institute and the ‘Friends’ of Science have periodically organised letters and petitions to indicate (or imply) that ‘very important scientists’ disagree with Kyoto, or the Earth Summit or Copenhagen or the IPCC (Intergovernmental Panel on Climate Change–ed.) etc. These are clearly attempts at ‘arguments from authority’, and like most such attempts, are fallacious and, indeed, misleading.

They are misleading because as anyone with any familiarity with the field knows, the basic consensus is almost universally accepted. That is, the planet is warming, that human activities are contributing to the greenhouse gases in the atmosphere (chiefly, but not exclusively CO2), that these changes are playing a big role in the current warming, and thus, further increases in the levels of GHGs (green-house gases–ed.) in the atmosphere are very likely to cause further warming which could have serious impacts.