American Idiots: How Washington is destroying the economy
By Allan Sloan, senior editor-at-large August 18, 2011: 5:00 AM ET
What's ailing us? It's not just unemployment. It's not just Europe's debt woes. And, no, it's not Wall Street this time. It's the takeover of the economic debate by fanatics who are up to no good. Fix that -- and maybe you fix the economy.
FORTUNE -- What the hell is going on?
Standard & Poor's, the bond-rating agency, downgrades the U.S., and the world trembles. The markets here go nuts on the first trading day after the downgrade, losing $1 trillion in value. European Union finance chiefs are playing Whack-A-Mole with members' debt problems (see the story by my colleague Shawn Tully). And England … England was literally burning.
Only three short years ago we were all terrified when our financial system was on the brink of disaster after Lehman Brothers went broke in September of 2008. Those scary times seemed to have disappeared in the spring of 2009. But now those fears are back -- and things are even scarier, the stock market's "green" days notwithstanding.
Our current mess is different from the Lehman-related horror because it stems primarily from politics, not economics. …
Kawakami: Nevertheless, don’t get too depressed. The elites are finally starting to understand when mainstream magazine Foreign Affairs, July-August, which I subscribe to now, has an article by Michael Spence is Distinguished Visiting Fellow at the Council on Foreign Relations and the author of The Next Convergence: The Future of Economic Growth in a Multispeed World. He received the Nobel Prize in Economics in 2001. http://www.foreignaffairs.com/search/Spence
By Michael Spence
Jobs growth was slow in May, renewing pessimism about the U.S. economy. Spence, a Nobel Prize-winning economist writes that economic growth and employment in the United States have started to diverge, increasing income inequality and reducing jobs for less-educated workers. July/August 2011
Politics have been the main emphasis by the corporate press and media as the problem for the economic mess we are in. Thanks to Elaine for sending me this Fortune/CNN article. Much of it makes sense in our current environment, but we must not neglect the real problem facing us, something for understandable reasons are deemphasized by the Corporate Press and Media.
The very idea of maximizing profits by Wall Street is a symptom that affects our whole society, especially the top 3 percent who have put substantial amounts of their excess income into the stock and bond markets which with exceptions such as now, have been a winning game.
How is this done? Dylan Ratigan, http://dylanratigan.com whose book on Greed is to be published within the next six months or so explains it more simply as corporate extraction of money from the bottom 99% of Americans either due to low wages, layoffs, and sending jobs overseas to maximize their profits.
Yes, corporations provided jobs during this time of maximum profits at the time Americans are suffering and scared about their future. Even those workers on Wall Street are suffering due to expected large layoffs because of lower profit expectation in corporate mergers and bond and stock trading profits. One highly respected technical analyst said that the Financial Industry will soon be in a recession for the next 20 years.
The Bush Republicans and now the so-called patriotic Tea Party wants to accelerate this extraction of income from the middleclass and upper middleclass and devastating the lower middleclass by taking away all the government help they still need to keep them above water.
To make matters even worse, the Republican House Leader, Cantor (R-VA) wants to increase all the money they are getting to fix up earthquake and hurricane damage to his district by lowering benefits for the rest of us!
Many of us who once made $5,000 to $10,000 in their early working years have a distorted gut feeling about the money they make now. Factoring in inflation, close to 80-90% of Americans have the same salaries they had in 1973! Cheap goods from China and elsewhere and two parents or more in a working family has made it possible to survive.
No more. The Republicans and Corporations want to take it all to boost their profits. To keep away dissident lower income Republicans, they now charge a substantial amount of admission fees to attend their meetings with “voters.” I cannot help to think that this is really stupid! What Republican senior will vote for them unless they are wealthy?
However, most of us should not be complacent. Remember what happened to President Franklin D. Roosevelt in the 1936 elections! A record number of House Democrats lost the election, even higher than in 2010. Of course a lowering of government jobs led us back to the Great Depression in 1937.
Many of the elite and rich House Republicans know about this, but they don’t care about the rest of us so they are pushing to increase the age when Medicare will be available or eliminated altogether as well as Social Security where they want to eliminate the inflation basis for increasing the stipend. The more affluent Americans need to give up some of their privileges in the Tax Structure and allow those making over $250,000 to contribute more to Medicare and Social Security because they live substantially longer while Americans with less income are starting to die at a young age because they eat junk food which is the cheapest and calorie loaded. Eating vegetable and fruits is much more expensive now because of Wall Street Commodity Trading which was supposed to be eliminated by the Dodd-Frank Financial Bills. By stopping essentially all appointments by Republican senators, Obama does not have the staffing along with the threat by House Republicans not to fund provisions in the bill.
Yes, the House and Senate filled with Democrats will help our plight much more than a Democratic President such as Obama. But we have no choice. We would be fools to changes horses now and increase the Probability of Republicans controlling the House, Senate, and the Presidency. Vote, vote, and vote and ask all your friends and family members to vote Democratic by explaining what is at stake!
Obama is getting less money from corporations which will be hard to make up. It accounted for half of his money in 2008. So it is up to all who can afford to give a small or larger amount to get involved. This year I have emphasized giving money to the Democratic Congressional Campaign Committee at www.dccc.org.
It is hard to believe but the Republican House spent almost all their time passing laws to make it almost impossible for the middleclass and working poor to get abortions by cutting off funding of Planned Parenthood. Nothing on getting more Americans to get unemployment insurance that is due to expire at the end of this year and no funding for infrastructure jobs which is badly needed even more since the tornados and hurricane flooding.
The Republican headed states were even worse where they have or still trying to eliminate Federal Workers Unions which provide the main funding for the Democratic Party for elections.
Looks good for Democrats? Look at what happened above in the election of 1936. Don Peck, a features editor at The Atlantic Magazine, www.theatlantic.com wrote an article about what happens to people when they are undergoing hard times. They actually get more conservative! They don’t want to help others because they feel that anything given away would have an effect on them! His book Pinched: How the Great Recession Has Narrowed Our Futures and What We Can Do About it.
I have the book, but have not read it yet, but I have heard him talk on www.booktv.org for an hour. He talked at the upscale bookstore in Northwest Washington, DC so very few of the White haired audience had any economic difficulties. It is the same among those associated with the University of Oregon, but it has seriously affected those in Eugene and Lane County where unemployment is 11 percent.
Violence goes up during bad economic times. For the first time, robberies are occurring with guns very visible and family killings are increasing, something I very rarely heard about until more recently.
In Los Angeles, where they studied the effect of a poor economy on violence found it always increases with a particular increase in White majority violence against people of color.
It is now extremely important for all of us to get their friends and relations to vote in the 2012 elections and to provide them with stuff they can read to get over their fears. Fear is used by the Republicans by using scary music in the political ads and by constant repetition of the same phrase which the robotic Republicans can do well, but unfortunately not the Democrats. Fear has worked extremely well. So Republicans usually win in bad times and electing them makes things worse for a large majority of Americans.
Obama’s even handed approach makes me very angry. He got from his mother who was an anthropologist. Clinton’s so-called economic miracle resulted by reducing all constraints, especially regulations, on corporations which led to criminal abuse of the Housing Markets and accelerated the sending of jobs overseas.
We all should start to question whether Free Trade is in our interest as Americans. It has been proven not to be. Who do you want to run our country? Sometimes voting for what is perceived by us to be in our interest turns out not to be in our economic interests. A poor economy hits all of us eventually.
Jim Kawakami, August 30, 2011, http://jimboguy.blogspot.com