As I begin to write this, CNN.com has a big red banner across their home page. It reads: "Breaking News: AP: President Bush's top economic adviser says economic growth may be negative for the current quarter."
No sh*t, Sherlock.
And now George Bush is on TV, talking about how the government anticipated this downturn and got on it early.
Breaking news, George: Out here in the real world, it looks like you're seven years too late. People's economic growth has been negative since you and your crony capitalist crowd rode into power with the help of legions of Florida-bound lawyers aboard Enron planes and a Supreme Court decision so tortured it makes waterboarding look legal.
Out here, the only thing the government got on early is the control lever for of the Smoke, Excuse and Promise Machine. The economy may be sputtering, but the Smoke, Excuse Promise Machine is going full-tilt.
For years now, Bush and his buddies have been spoon-feeding the stenographers in the mainstream media a meme.
"The economy is strong."
And for the most part the mainstream stenographers have turned around and fed the meme to a country where working men and women could see it was crap.
Their wages were stagnant -- and still are. Their healthcare coverage costs were going up -- and still are. Gasoline went from $1.50 to $3 a gallon -- and is still going up. College tuition is still going up, too
Good manufacturing jobs have disappeared. When Obama talks about companies unbolting machinery and shipping it to China, that's not hyperbole. That's real life out here.
Instead of one good job, many working people have two crappy jobs now. And many of George W/ Bush's followers think that's just fine.
"I am so proud to be from the state of Minnesota," said Representative Michele Bachmann (R-MN) recently. "We're the workingest state in the country, and the reason why we are, we have more people that are working longer hours, we have people that are working two jobs."
She was speaking in support of a proposal to stimulate the economy by Representtive. Eric Cantor (R-VA), the Chief Deputy Republican Whip in the House. Cantor's legislation was called the "Middle Class Job Protection Act." It suggests helping the middle class by reducing the corporate tax rate by 28 percent.
Bush and his flunkies -- including vast legions of well-off, vapid mainstream media types and pundits -- have spent two presidential terms fiddling while the American middle class burned.
They've tweaked the economy as if it were a tired V-8 in the old man's four-door Impala. In spite of all their ministrations, in spite of their tax breaks and rate cuts and borrowing money from China for rebates to stimulate more empty and frivolous consumer spending, in spite of every other form of bullshit they try, it's sputtering and dieseling.
It's not running right. It won't ever run right -- until somebody strips it down and rebuild it from the bottom up.
That somebody won't be the inept, rich, privileged-from-birth George W. Bush and his set. And it for damned sure doesn't look like a job for flyboy John McCain either.
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Best. Post. On Huffington. Ever.
But a few years late.
Hundreds of billions of dollars spent on Bush's war.
(translation: middle class tax dollars {both current and future} transferred to no-bid contracts - Cheney's buddies and hunting targets.)
The economy is great!.
(translation: see above.)
Cut taxes on business and the rich to stimulate investment.
(translation: Neiman-Marcus has had 7 years of growth, C.E.O. pay is at an all time high in realation to average employee)
The only solution is to tilt the teeter-totter in the other direction. Time to cut taxes on the bottom half of the population to zero. Instant economic stimulus. Increase taxes on those who benefit the most. This lie about cutting taxes on the rich to stimulate investment and create jobs for the rest of us has got to stop.
I predicted during the "land grab" of the 21st century that this was nothing more than "let them eat cake" ploy by the old money to keep middle class American staring at the "shiny stuff". By lowering the interests rates and letting anybody that wants one afford a ridiculous variable it did 2 things. Played right into the stupidity of 2 dimensional short sighted "250 dollar a week millionaire". Thus ignoring the 2nd election and allowing the rich under "W"'s umbrella another 4 years to evaluate and just wait.
Now that foreclosures are up and banks need fast cash. Those with "the money" just pick and choose the assets they want for 30 cents on the dollar. Meanwhile "drunk American" is just now sobering up to reality wondering wtf just happened.
ANYBODY with peripheral vision saw this coming. It's easy to witness a human frothing at the mouth whenever gluttony and greed takes hold. AMERICAN YOU were frothing like a mother f*****.
So now what do you do? I agree with Peter. "Tear it down and rebuild". On several levels that is.
First of all learn discipline. Without that. Forget it. Nothing will help.
Two. Figure out what you truly need and get rid of the rest. Most people bought and have too much shit. Clean house so you can "see".
Three. stay local. feed your community. You do no good shopping at the WalMarts of the world not interested in putting back into the community with fair paying jobs and the model for the "new slavery". Americans will serve you. Just be fair. a 99 cent hamburger is shit, don't expect anything good to come of that level of garbage.
Fourth. Stop voting for people you can"t relate nor are in their club. You are NOT a member. Will NEVER be a member. So if you think they are "looking out"? Open your eyes. They just checked out with record CEO pay and have no answers to your dilemma.
i watch cnbc [and bloomberg] almost daily, devoting more hours to it than i care to admit. and for many months the shills have been suggesting to their viewers that they see some light at the end of the tunnel. yet whenever i stare into the depths of that tunnel, i can see no end in sight.
only six months ago - even though i was generally aware of the pending economic conditions and quite concerned about them - as a modest but dedicated investor [out of necessity], i still felt that i could safely navigate my way through this situation and that things would, at some reasonable point in the not-too-distant-future, begin to recover, as they have managed to do so many times in the past.
but i am no longer confident that they will.
this country is in debt up to its eyeballs. economic opportunities for the vast majority of its citizens [the working poor and most of the middle class] have been thoroughly trashed. the unemployed and the unemployable have no hope at all, and no resources either. costs everywhere, for everything, continue to rise dramatically while the value of our dollar continues its descent to disturbing new lows. and there is no viable, sustainable social safety net or affordable healthcare available.
all of this is bad enough. but one of my biggest fears is that when whatever recovery does begin to materialize, it will by-and-large simply bypass the united states. because corporate america and the wealthy will find 'more opportunity' for reinvestment, and the promise of 'better returns' for their investments, elsewhere in the global economy.
i don't see how we can even hope to maintain our current and/or recent standards of living - with typical housing costs of $250 - $500k; and when new automobiles run $30 - $50k or more; and gasoline sells for $4 - $5/gallon - when most of what few jobs remain pay only $10 - $15/hour and increasingly offer no benefits.
this country and its people appear destined to suffer a steep, deep decline, from which there may be only limited recovery in the foreseeable future. just observe and seriously consider the overwhelming number of disturbing economic events currently swirling around us. how can anyone fail to see that we are - each of us; all of us - at this very moment, in mid-flush, and heading right down the drain?
Mr. Smith, philip, excellent observations, it was only months ago, they were telling us everything was great(yeah, for them).
Sorry to say that your post is not an observed guess but the solid truth. Before most people noticed they opened their eyes to see they were already heading into the abyss. One good thing: there's still time to scream.
I have a naive question?
Is there a correlation between the cost of the WAR and our in-the-ditch economy???>?
Yes, absolutely. The economy would have tanked anyway but the war accelerated the nosedive.
Actually it did accelerate the nosedive - and just as importantly, it makes it even more difficult for us to pull out of that same nosedive.
One of the things that began to pull 'us' out of the last major Depression (1929 - mid 1930s) was a Government with the capital and debt capital to put Americans back to work rebuilding infrastructure and such. The money put into the workers' hands was then spent (wisely) on local produce, local businesses, local investments. This money spent locally had the multiplying effect of stimulating the local economies several times over the value of the initial investment.
Now - the debt level carried by our Government is too high to float the economy in any meaningful and sustained way, and what little 'reserve' we might have had is being pissed away on a dead-end occupation of Iraq. Meantime - lets give the rich bastards more tax cuts!
Remind me again why Impeachment of this Administration remains off the table?
And wqhat paid for the building of the infrastructure and provide jobs to middle america: marginal tax rates as high as 88%!
When the government needs money, you go where the money is - you tax the rich.
It will be us, the people, who rebuild this economy, by standing up for ourselves and unifying for fair and balanced treatment. In a way, We are already doing that by walking away from deceptive mortgage deals from companies that have no interest in the human condition on the ground. We will live, and our families will thrive...and more people will simply walk away from deceptive unfair and unbalanced financial practices. And there are other things we can do. We aren't unreasonable, but enough is enough.
The thing libs keep igoring, the IMPORTANT point, is that we do not have nationalized gay marriage forced on every one of us.
i wonder if george w. could tell us how much a loaf of bread and a gallon of milk costs?? i say no.
George eats caviar and drinks champagne. No milk and bread for him
4 more years
4more years
4 more years ---- what hoot
at least 30 years to recover from 8 years of this idoit.
no oversight and cost plus no bid contracts
Can we also stop outspending the rest of the world combined on the military? Please? And start upgrading our infrastructure? Build better levies around New Orleans instead of more bases in Iraq? Alieviate highway and airport overcrowding and dependence on foreign oil with a real national, high speed, electrified passenger rail network? Please?
But we wouldn't get to have an empire then! Where's the fun in that?
Great Article!! Yes, Yes and Yes. What we need to do is to dismantle this administrations dark works first and then reduce senators salaries to minimum wage.
I started talking about this thirty years ago. All it took was a look down the road, a little further out than the next quarter. I even put up my own economic commentary website a few years ago. It has finally begun to sink in, not my work, a fart in a whirlwind, but the facts now, have unfolded. The Milton Freidman school of economics, Supply Side, trotted out by Reagan, set this country and its economy on the path to ruin. Corporations have used that school of thought to justify anti-labor, tax and trade policy that was doomed to fail. But hey, your drunk teenager has to wreck the car before you can justify taking away the keys. Without that proof, he will cry, pout and stamp his feet. The state of the economy has been a matter of declining parenting by those who knew better.
Now we have a very rocky road to recovery. Wages must go up to provide a market for the products that business wants to sell, because we are tapped out. We have an unsustainable dependency on exploitation of third world labor. Our corporations have been sacked by opportunists whose only objective was hyping a dead end of cost cutting to achieve increased profits. The Bush administration has run up the national debt just like his Republican predecessor, but this time, the public is in a far worse position to pay it down. You can't raise taxes because everyone is pinned to wall already.
The economic policy of the last thirty years has been nothing short of a death march for America. It has been so reckless, thoughtless and savaging, I have come to view the actions of the right wing as treasonous.
Tariffs must be selectively applied to protect and rebuild American wages and markets. Free trade, and its euphemism, fair trade, must be reworked for the benefit of the people rather than for businesses that disregard the health of the country. But most important, politically, the public must realize the illness is coming from deep inside the RNC.
Important thoughts Herrington! The next administration MUST repeal the tax-breaks to the wealthy and as you say, "tariffs must be applied" to give our manufacturing any hope of survival. To avoid even worse pain later, we will need to act strongly and rapidly!
Free trade isn't and fair trade is a socialist pipe dream to turn third-world peoples into communes to satisfy an agenda.
Tariffs are a joke, have been since Smoot-Hawley -- which only unleashed a 34 country war against America. Not that this time, GM can even build a car at a profit anyway. Anyways, protectionism against those dastardly LCD and plama TVs from Asia ... will that protect the American manufacturers? Oh, wait ...
Don't blame the right wing too much. Plenty of guilt to go around. How about Woodrow Wilson signing the Fed into life? And later admitting, "I have betrayed my country." He didn't say as much about his mentor Col. House going to Great Britain to arrange the secret treaty to get the U.S. into World War One. Read William Jennings Bryan's memoirs on that one (and the text is in Vol. 2 -- which he did not know about before the fact. Tsk.
Who gave Truman the keys to the Korean War?
And when JFK was inaugurated, early on, he reckoned America was spending too much on the military. And initiated early release from active military for many people. Only to flip to calling up the reserves and National Guard and extending the current enlistments 'indefinitely'. I was there.
Low Fed rates from 1920 were by agreement to assist propping up the British pound. That easy credit crept into the stock market and irrational exuberance did the rest. Same story as this decade, really. Same result. When you repeat the same mistake, is it stupidity or an agenda?
"You work three jobs? ¦ Uniquely American, isn"t it? I mean, that is fantastic that you"re doing that." " George W Bush to a divorced mother of three, Omaha, Nebraska, Feb. 4, 2005
When does she get to spend time with her kids? Who is taking care of them? And the Republicans still have the nerve to say it's the gays who are threatening American families. But I guess it COULD be the gays who are responsible for her being divorced in the first place, since they are the number one threat to traditional marriages, right Newt? Right McCain? Right Giuliani? Right Craig? Right all-you-other-men-who-cheated-on-your-wives (-sometimes-with-other-men)???? Right?
Amazing.
Isn't it amazing how he take a S**T circumstance like that and spins it into something to almost aspire to?
The Democrat Party needs to vote to make the tax cuts permanent. The stimulus package is just a start. The real need is to keep more money in the working person's pocket, and we can achieve that by making the tax cuts permanent. Let's quit the partisan bickering and get on the same page, so the average American can get on his feet again.
I don't really see how the tax rate in 2010 is going to stimulate the economy in Q2 2008.
Ok, then who pays off the $30,000 per person in the US debt? How is that done?
How about this. You Republicans pay the debt off out of your own pockets. No subsidies, no writes offs, no offsets. Pay it off. Then you can peddle your tax-cut snake-oil again.
All your policies have done is make the economy poorer and our security weaker by running everything up on a credit card for our kids to pay off. You stole candy from babies and sent them the bill.
Lesson one of macro economics. Tax cuts do not, repeat, do not stimulate the economy. Taxes are collected and spent at the same rate, or faster, than wages. They are economy neutral except that they are more often spent on forward looking investments, re: education. They do not alter the money supply.
You may cut taxes until the government no longer functions at all and it will not help. Increasing wages is what helps. Innovation and productivity increases create more wealth. When that wealth is shared, the economy benefits. When that wealth is not shared with the workers, the economy does not benefit. See Division of Labor. Concentration of production on one product or service increases the efficiency of that production. That efficiency produces more product for less effort, the definition of economic growth. If the benefit of that efficiency does not go to the consumer, who is by they way the worker, the growth is lost to the economy, hoarded in increasing amounts in fallow investments like stocks and real estate.
Herrington, Thank you for saying this. Please repeat it regularly.
Just thoughtI I would throw you a question to further your good commentary.
You mentioned the overall economic neutrality of tax cuts here, with an observation that they do not alter the money supply.
Elsewhere you mention the manipulation of the "money-supply" as one of the tools of those responsible for the unfolding economic-financial imbroglio.
The money supply.
They actual QUANTITY of money available on any given day or point in time.
My question: Who should manage the nation's money supply, and on what basis in economic principle should it be managed?
Like, tied to the growth in real productivity, or the growth in the work force, or the growth in some other economic factor?
Its one of those things where everyone seems to know what's wrong with the money supply management, but the philosophy of financial capitalism seems to be to leave it to the FED, in our case, to support the invisible hand of the free market.
Is there such a thing as an appropriate monetary policy that manages the money supply in a way that maximizes economic health vis-a-vis inflation and unemployment?
And, are there other appropriate economic policy initiatives that again should be applied to the actual use of the money supply to also further our overall economic well-being?
Or, should money just be expanded and allowed to go to ITS own most productive use - more money?
Just thought I'd ask.
Thanks.
Part two:
So reliance on the Fed to manage the health of the economy in a global market is patently obsolete. As you suggest, more economic policy tools need to be available. Monetarism will no longer get the job done. That"s basis in economic principle.
As to who should wield these tools, I think a body responsible to the public, with transparency and accountability would be nice. As to the particulars of factors to consider, I like productivity growth and population growth, but find that monetarism is too limited a tool. Tariffs, tax law, and direct government investment are needed to resurrect our economy, unless or until there is a global body trusted enough to manage global money supply in a global economy in which all resources, manpower and governments are exactly equal.
Thanks, that was fun.
Part one:
Sorry for lateness, you make some very interesting suggestions joebhed. First let me share a quip from a fellow poster here joebagadonuts. The "invisible hand is now giving us the invisible finger".
Increasing the money supply necessarily reduces its value, impacting the working poor the most as wages have lagged inflation for about thirty years now, due to practices in calculation of the CPI. Simply adding more money is no solution, because the problem is becoming more a matter of who has it, or more appropriately who directs its use, it than how much of it there is.
Manipulating the size of the money supply is of value only to nudge on inflation and deflation, often euphemized as "cooling" or "stimulating" the economy. We have undergone an unforeseen, by most, dual path in our economy that has seen deflation in many consumer products side by side with inflation in critical goods like oil, housing, food and medical care. So we have been cooling and overheating simultaneously. The cooling part, although seemingly offset by lower consumer prices nevertheless resulted in effects identical to depression, lost jobs and soft wages. This effect simply never registered with Washington, and the Fed is equipped to deal with only one at a time, inflation or deflation.
The common view of inflation is that prices are going up. This may be true for certain items due to actual supply and demand issues, but the real problem of inflation if the value of the money going down. It's a very clever method of embezzling from everyone.
There is no anchor to the value of money and no anchor to the economy. It all floats about; pushed around by the whims of oligarchs.
That "invisible hand" of the free market is their invisible hand, shielded by the obsfucation of politicians on the take, think tanks, banks, and of course, the FED. It's the invisible hand that pushes down the true free marketeers, the regular guys, and new alternatives while helping up the nepotists and the connected.
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Posted March 7, 2008 | 03:15 PM (EST)