"The latest job numbers are out -- and they're not good."
That's a phrase we've heard a lot lately -- and will likely continue to hear for the foreseeable future. According to the Bureau of Labor Statistics, while the unemployment rate remained unchanged at 9.5 percent, the economy actually lost another 131,000 jobs in July. The only reason the unemployment rate didn't go up was because so many people had quit looking and dropped out of the workforce. Tens of thousands of people throwing in the towel is definitely not good news. More "not good news": the number of Americans unemployed for 26 weeks or more is now over 6.5 million.
Clearly, we're not in the middle of a normal recovery. Wall Street may have its casino up and running again, but Main Street shows no signs of bouncing back anytime soon. From foreclosures to unemployment to household debt to bankruptcies, the American middle class is under assault -- and America is in danger of becoming a Third World nation.
I detail all the ways this is happening -- and the reasons why -- in my upcoming book, Third World America. Just as important, I also talk about the steps we can all take to help stop the slide. As soon as I finished writing the book, I knew I wanted to keep telling the stories of the middle class families whose lives have been turned upside down by the economic crisis -- and to provide interactive tools that would allow people to get involved.
That's why HuffPost is launching a "Third World America" section to bear witness to what is happening to the American middle class in small towns and big cities all across the country. And we will, every day, focus on the solutions that are making a difference in the lives of ordinary Americans.
And we want you to be a big part of this section. If you or someone you know has been struggling with unemployment, foreclosure, bankruptcy, or credit card debt, we want to hear about it. Visit our interactive map, share your story, and leave your mark.
Though it is far from what dominates the debate in Washington, every day brings fresh evidence of the new reality that America is entering. And it's not just about dismal unemployment figures and gloomy foreclosure numbers. As the New York Times reported last week, Hawaii has gone beyond laying off teachers and has begun laying off students -- closing its public schools on 17 Fridays during the last school year. In the Atlanta suburb of Clayton County, the entire bus system was shut down. Colorado Springs turned off a third of its 24,000 streetlights. The Philadelphia Inquirer reports that Camden, New Jersey is soon to permanently shutter its entire library system. And last month the Wall Street Journal reported on the trend of cash-strapped states and counties giving up on the idea of maintaining paved roads, allowing them instead to turn back into gravel. And those localities that can't even afford to put gravel down are just letting the roads, as the Journal put it, "return to nature." A seminar at Purdue University on this trend was entitled "Back to the Stone Age."
Though the particulars of our country's transformation are painfully real to the rest of the country, Washington and Wall Street remain blind to our trajectory toward Third World status.
Witness the joint appearance on Fareed Zakaria's CNN show by former Treasury Secretaries Paul O'Neill and Robert Rubin. According to both of them, we don't need a second stimulus. "We are moving forward at a pretty gradual pace," said O'Neill, "but I don't think things are terrible." Is "not terrible" the new definition of success? And I don't doubt that things are not terrible for O'Neill -- in fact, I bet the roads leading to most of his houses are still paved.
As for Rubin, he "wouldn't do a major second stimulus, because I think...we run a risk that it could be counterproductive in creating a lot of additional uncertainty and undermining confidence."
Uncertainty? I guess that's true in the sense that the nearly 15 million people without a job are currently quite certain they don't have one; if a new stimulus bill were passed, there will at least be some welcome uncertainty as to whether they would be one of the lucky ones getting hired.
In Rubin's mind, what would create more "certainty" is -- drumroll, please -- deficit reduction. "I would try over the next six months to put in place a very serious beginning of deficit reduction that would take effect at some specified time in the future," he said. "I think that could do a lot for confidence."
As Duncan Black writes:
"Can someone get me some of the Very Serious Person crack rock so I can understand the very sophisticated economic model such that all that matters is 'confidence' and that confidence could be undermined by fiscal stimulus?"
To learn more, visit the Third World America section.
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Gaston Caperton: Finding the Will: Can Superman Make Education a National Priority?
The US financial crisis it isn't over. It will only over when significant portions of US paper wealth is destroyed and US accept their poverty and work hard -- as hard as people in the third world countries-- creating wealth that really counts to rebuild their country.
So many Americans are hurting so very badly and their devastation is getting little attention from the media or Washington. It's a very sad story no one seems to want to address.
We must bring high quality jobs back to the U.S. with changes in the tax code and peer pressure. I'd like to see all American companies place their customer service call centers for calls from U.S. customers here in the U.S.
My hardship story is far less compelling than many other people's suffering. My contribution is trying to find ways to bring some happiness to them.
I'm finishing up Happiness In Hard Times - How To Be Happy When Times Are Tough And Help Others To Be Happy Too - see: http://HappinessHabit.com and http://HappinessInHardTimes.com - I mention this in hope that it might help you help others.
Many thanks again for all you do!
http://www.relylocal.com/blog/innovation-perspiration/
The tighter the money gets the fewer choices the consumer has.
If people would start putting the blame squarely where it belongs, and start loudly calling out the names of the obstructionists, instead of trying to pretend that President Obama has not tried his best to do all he can under this democratic system of ours (which happens not to be a dictatorship); if the pressure were to be put on the people who were and are ACTIVELY working against Americans (for political reasons, no less), then things would be different. The help the President and Congress has tried to extend to the people would have gotten through to them.
So instead of LYING about President Obama, what he's tried to do and what he's been able to do, start mobilizing the people to call out the Republicans for BLATANTLY working against this country. Maybe then we can avoid becoming a Third World Country, because that is DEFINITELY where we are headed under Republican influence -- whether they're in the minority or the majority.
At some point even those with a passion for this nation's continued survival, just give up and settle in to enjoy the historic pageant of an Empire in its immutable collapse. The gathering momentum of the process is ultimately propelled by our overwhelming and profound, willful collective ignorance, Each ideology now at work is strictly designed to assign blame elsewhere. Nobody believes there is a solution beyond some painful revolution, so why not just watch Jeopardy and Wheel of Fortune. We can elect an inspiring campaigner president but we inevitably learn he has neither the will or any real power to change much of anything.
•Extension of medicare coverage--eventually to all age groups.
•Tax Social security income for high wage earners.
•Social security eligibility increased 3 years-adjusted for demographics.
•Extraneous military bases need to be shut down.
•Weapons contracts need to be curtailed
•Stop Corporate farm subsidies
•Expire the Bush tax cuts for the rich
•Increase taxes on the top 3% wage earners.
•Corporations must pay their fair share of taxes--which they have evaded over the past 20 years.
•The homeland security department is ridiculous, wasteful and should be shut down
•Wasteful redundancies in intelligence agencies need to eliminated as they create both unnecessary expense and dangerous inefficiencies.
•Medicaid part-d needs to be available only to low income seniors
•medicaid and medicare should be combined into one program.
•Medicare claims forms and medical records need to be modernized and standardized, to stop driving doctors crazy and creating needless expenses.
•Stop the federal funding of overpriced "degree mills" that do not provide much in the way of real job opportunities.
•Fannie and Freddie Mac should be barred from having paid lobbyists--as should any corporation overseen by government agencies as this creates too much conflict of interest. They should remain independent, regulated entities and they be required to underwrite loans properly (i.e. documenting affordability) via proper agency regulatory oversight. Trusts in receipt of defaulted loans should have the right to make mortgage originators buy-back these loans if an audit reveals faulty underwriting procedures.
Rubin, O'Neill and teir crowd are a disgrace to the discipline of economics. Their single-handed, myopic focus on one (admittedly significant, but still just one) factor in determining monetary and fiscal policy is a direct assault upon the central precepts of the discipline, in which students are advised to consider all of the possible factors with an open mind.
The righties I mean...
demand is created by people with the means to purchase something to consume .. are we not losing that ability? is there something going on here that would suit others purposes by destroying the very fabric of our economy?
It seems like if this were actually the case you would be capable of correctly spelling demeanor
But your facts seem wrong or incomplete. If someone with a net worth ( you know, stocks, bank accounts, house value)of $680,000 or more were in the top 10%, it would include a substantial portion of both coasts, if only due to higher wages and house prices. Similarly, what type of "government employee" can retire at 50 at $60,000 per year? Not a Federal worker. perhaps certain cops/firemen in the NYC or LA metro areas, but even though they can retire after 20, WHEN they can start receiving their pension varies considerably. But given your post, is it that you're just jealous? When you retire, won't you have anything to retire on? why? And if you are and will be fine financially, why does what your hypothetical worker recieves bother you so much?
1.) The US should use its oil resources to benefit itself, not corrupt oil companies--to fund a transition to renewables, to fund national assets and extended unemployment benefits with retraining targeted to new job opportunities and to pay down the deficit. Gov't contractors can run existing rigs on US lands with all exploratory drilling ceased (too risky).
2.) Tax policy can support well paid US jobs (without changing existing rates--with tax breaks to employers who employ and pay well.) Close all loopholes and only reward job providers and job creators with tax breaks. Additional tax revenues should fund extended unemployment benefits that allow for re-training unemployed workers to create a highly skilled and globally competitive workforce. Currently most companies do not pay their fair share (16% average). Outsourcers should pay the fullrate at the point-of-sale.
3.) 0% Fed Funds used not just for banks but also to offset negative equity for underwater homeowners. Banks in receipt of 0% interest Fed monies should purchase the negative equity portion of underwater loans from lienholders and reset this part of the loan to 0%. This will create a savings that offsets negative equity.
4.) Job creators should have access to 0% interest loans. An amount equal to 1/3 of payroll increases (US jobs; US citizens) should be availabe to sound businesses in the form of 0% interest loans---to stimulate hiring and job growth
5.) Convert to a 35 hour week to reduce unemployment.
There are clearly not enough well paid jobs as evidenced by high unemployment.
I really agree with you on the whole visa thing. I saw this at a university I worked for--foreign students get undergrad degrees with no debt, sometimes masters degrees also, and then they come to our colleges and take well paid jobs on visas. It is unconscionable that this country is issuing visas to legal immigrants during a period of high unemployment. It is unacceptable.
I was thinking the retraining should involve aptitude and ability assessments. Medical tech jobs, nursing, teachers, completing a grad or undergrad degree, research, advanced computer skills, green technology, a CDL license to drive a truck, engineering skills--a lot of people were employed by the financial services industries and there is a dirth of people who can operate computer-run industrial functions, read blue prints etc. The US needs to get better at providing skills training and credentials to its workforce. What better time to do this than when your living expenses are covered by extended unemployment benefits?
OH SNAP!
Tell me Congress isn't robbing Peter to pay Paul! Tell me why the working class always pays for big businesses' and banks' mistakes but will not have any left over to feed, shelter or support ourselves with federal money? Federal...as in OUR TAX money!
Ergo...robbing Peter to pay Paul.
We either have to start making products here and be willing to pay for higher priced goods made in American, or continue to have cheap goods made in other countries and by default have no jobs or money to buy them…
The third alternative (which is where it looks like we are going) is to make the goods here and maintain the lower prices by reducing wages to competitive world markets, effectively eliminating the middle class…
Demand and competition will hold down product prices, triggering a better profit allocation between CEO, shareholder and worker. Providing a living wage (currently estimated at $18/hr plus benefits) is vital to supporting demand and a functional economy.
There is no way a reasonably sentient person can avoid the terrible mess our country is in, and to disparage those poor folks in Atlanta last week, waiting for rent vouchers, is just shameless. It seems there are a few still out there whose personal ox has not yet been gored..
I hope this forum brings some insight.
I was the first person, ever, in my working -class to middle class family to get a University degree..that alone is supposed to 'guarantee' you several thousand more a year than your less-educated peers...what a crock..
After reading this article I noticed that the poor/ working class are barely considered any more...because that's us!
Welcome to the new reality..
The middle class, such as it is, needs to start fighting back..you were sold a bill of goods, and now you blame everyone but yourselves for the economic collapse inherent in all capitalistic bubbles..
educate yourselves , start voting for those with practical solutions, and most of all, don't be afraid to get your hands dirty... expect your children to pay for their own education..
If this ain't Depression 2, don't know what is..
I agree with you we need to focus on the recovery of our Middle Class, and not on the recovery of big banks and corporations.
Why wouldn't it be fair to have our government simply seize these MNCs, Too Big to Fail Banks, at zero compensation, and downsize them to local concerns owned by the workers and staff as co-owners in cooperative enterprises, and give each and every person in the USA a home with solar/wind power generators and make all of us instant co-shares in our new realdeal commonwealth with each home free-owned and debt-free from day one, all homes linked on the national grid generating income for every American and getting us all working together again?
End lobbying right on Capitol Hill. End derivatives play on stockmarkets, and zero-rate the current piles of worthless paper debts now at $620 Trillion plus that underpins the whole Casino gamesmanship on Wall Street. Let's put Main Street America First again. ))
"In Russia, following the collapse of the USSR, wealth has become spectacularly concentrated; inequality there is dramatically higher than in any country in the West.
…as there are few regulations to protect the environment or to provide safety for workers. This not only leads to pollution and human exploitation, but also generates extraordinary profits for a few companies (the politically well-connected, especially; a popular pun in Russia equates privatization with the "grabbing of state assets"). Economists have also pointed out that Russia has been slow to implement income taxes that would help to redistribute wealth.”
Source:
"The Mathematics of Inequality” by Mark Buchanan
The Australian Financial Review. September 2002. (Originally in the New Statesman) http://www.austms.org.au/Jobs/Library4.html