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Tue Dec 4, 2012, 04:55 PM

How Wall Street Hollowed Out Industrial America



How Wall Street Hollowed Out Industrial America

Forget the fiscal cliff. America's real problem is a Wall Street that has eaten up industrial America and threatens to consume the rest of us.

By Steve Fraser | Mon Dec. 3, 2012 11:03 AM PST
Mother Jones

EXCERPT...

In the 1980s, when Jack Welch, soon to be known as "Neutron Jack" for his ruthlessness, became CEO of General Electric, he set out to raise the company's stock price by gutting the workforce. It only took him six years, but imagine what it was like in Schenectady, New York, which lost 22,000 jobs; Louisville, Kentucky, where 13,000 fewer people made appliances; Evendale, Ohio, where 12,000 no longer made lights and light fixtures; Pittsfield, Massachusetts, where 8,000 plastics makers lost their jobs; and Erie, Pennsylvania, where 6,000 locomotive workers got green slips.

Life as it had been lived in GE's or other one-company towns ground to a halt. Two travelling observers, Dale Maharidge and Michael Williamson, making their way through the wasteland of middle America in 1984 spoke of "medieval cities of rusting iron" and a largely invisible landscape filling up with an army of transients, moving from place to place at any hint of work. They were camped out under bridges, riding freight cars, living in makeshift tents in fetid swamps, often armed, trusting no one, selling their blood, eating out of dumpsters.

Nor was the calamity limited to the northern Rust Belt. The South and Southwest did not prove immune from this wasting disease either. Empty textile mills, often originally runaways from the North, dotted the Carolinas, Georgia, and elsewhere. Half the jobs lost due to plant closings or relocations occurred in the Sunbelt.

In 2008, in the sunbelt town of Colorado Springs, Colorado, one-third of the city's street lights were extinguished, police helicopters were sold, watering and fertilizing in the parks was eliminated from the budget, and surrounding suburbs closed down the public bus system. During the recent Great Recession one-industry towns like Dalton , Georgia ("the carpet capital of the world"), or Blakely, Georgia ("the peanut capital of the world"), or Elkhart, Indiana ("the RV capital of the world") were closing libraries, firing police chiefs, and taking other desperate measures to survive.

And no one can forget Detroit. Once, it had been a world-class city, the country's fourth largest, full of architectural gems. In the 1950s, Detroit had a population with the highest median income and highest rate of home ownership in urban America. Now, the "motor city" haunts the national imagination as a ghost town . Home to two million a quarter-century ago, its decrepit hulk is now "home" to 900,000. Between 2000 and 2010 alone, the population hemorrhaged by 25%, nearly a quarter of a million people, almost as many as live in post-Katrina New Orleans. There and in other core industrial centers like Baltimore, "death zones" have emerged where whole neighborhoods verge on medical collapse.

CONTINUED...

http://www.motherjones.com/politics/2012/12/how-wall-street-hollowed-out-industrial-america?page=1

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Arrow 22 replies Author Time Post
Reply How Wall Street Hollowed Out Industrial America (Original post)
Octafish Dec 2012 OP
Democracyinkind Dec 2012 #1
Octafish Dec 2012 #4
SalviaBlue Dec 2012 #2
Octafish Dec 2012 #5
SalviaBlue Dec 2012 #7
Ikonoklast Dec 2012 #9
SalviaBlue Dec 2012 #15
HughBeaumont Dec 2012 #17
Octafish Dec 2012 #20
msongs Dec 2012 #3
Octafish Dec 2012 #6
leftstreet Dec 2012 #10
raouldukelives Dec 2012 #16
banned from Kos Dec 2012 #8
Octafish Dec 2012 #12
banned from Kos Dec 2012 #13
leftstreet Dec 2012 #14
Octafish Dec 2012 #19
Prometheus Bound Dec 2012 #22
PufPuf23 Dec 2012 #11
libdem4life Dec 2012 #18
LongTomH Dec 2012 #21

Response to Octafish (Original post)

Tue Dec 4, 2012, 04:59 PM

1. It's the Unions, stupid!


Gee, I wish people would get that. I sincerely believe that they sacrificed industrial America intentionally in order to stiffle social progress.

Off to read... Thanks to Mother Jones for capturing my attention - as always. They're always thankful for donations.

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Response to Democracyinkind (Reply #1)

Tue Dec 4, 2012, 06:05 PM

4. UAW stands out for me.

And Henry Ford, who paid $5 a day when that was enough to support a family, pay a mortgage and purchase the automobiles they made.

Plus, FDR, of course.

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Response to Octafish (Original post)

Tue Dec 4, 2012, 05:07 PM

2. Kick to view later. Thanks.

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Response to SalviaBlue (Reply #2)

Tue Dec 4, 2012, 06:13 PM

5. You are most welcome. Did you see what HughBeaumont had to say about Neutron Jack?

The great DUer in '07 observed:

And GEe . . . who was the corrupt, pro-outsourcing, pro-Bewsh bastard who RAN GE during that time?
Neutron Jack Welch, that's who!


http://en.wikipedia.org/wiki/Jack_Welch

This shitbag bastard fucker raised the bar in neo-Robber Baron ruthlessness, slashing employee numbers by the thousands while rewarding fellow executives with massive bonuses and stock options. He has not an ounce of compassion for the middle and working classes, has publicly stated that he is not concerned with the discrepancy between the salaries of top-paid CEOs and those of average workers, opposes SEC reforms regulating executive pay, is an opponent of the Sarbanes/Oxley act, and started the massive outsourcing of GE's R&D to foreign nations such as India. Many CEOs of the 80s and 90s, with an ally in the staunchly pro-corporate Reagan and Bewsh 41 admins, began to adopt Welch's agenda of rottenness.

Not only that, he was a philanderer (affair with his current wife while still married) and was in the control room of NBC during the 2000 election, DEMANDING their newscasters call the election for Bewsh.

http://makethemaccountable.com/coverup/Part_04.htm

To Welch, although George W. Bush might not be a genius, his policies would encourage those who were geniuses to be even more innovative and productive. Fewer government regulations and lower corporate taxes would create technological advancement, thereby benefiting society more than all of the do-gooder social programs combined ever could. The country would be run for the benefit of the “A” people who achieved great things, not the “C” people who merely existed. In such a laissez faire environment, the powerful would be unshackled to become even more powerful, and no corporation in the world was more powerful than General Electric.

By contrast, Welch viewed Al Gore as the candidate of the parasites. Gore voters were not the generators of wealth; they were the consumers of taxes. Welch privately described the typical Gore voter as “someone who needs all these goddamned social programs because she’s too goddamned dumb to keep her legs crossed and too goddamned lazy to get an abortion.”

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x2534065

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Response to Octafish (Reply #5)

Thu Dec 6, 2012, 05:10 PM

7. We really need to stop these greedy parasites.

As usual, they project, i.e.: "Welch viewed Al Gore as the candidate of the parasites."

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Response to SalviaBlue (Reply #7)

Thu Dec 6, 2012, 05:32 PM

9. GE Is the largest single weapons platform and systems manufacturer on this planet.

GE sucks at the teat of Teh Eebil Gubbamint for its sustenance.

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Response to Ikonoklast (Reply #9)

Fri Dec 7, 2012, 11:54 AM

15. The REAL welfare queen.

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Response to Octafish (Reply #5)

Fri Dec 7, 2012, 01:06 PM

17. This pig ruined America more than anyone can imagine.

CNBC parades this decrepit troll once every two weeks as some kind of paragon of progress. While heroic to the MBA class, any worker who buys this creep's books, attends his business school and looks on him as some kind of sage might as well be taking a shotgun to their feet.

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Response to HughBeaumont (Reply #17)

Fri Dec 7, 2012, 02:36 PM

20. Here's who gave the trough away...



Reaganomics Revealed

EXCERPT...

Reagan’s story at GE is, to a startling degree, the story of labor relations executive Lemuel Boulware. When Boulware hired Ronald Reagan he was a conventional, patriotic, anti-communist liberal Democrat. He was not thought to be particularly well-informed or articulate. Under Boulware’s guidance, Reagan sparred with GE’s unionized employees and received what he termed his “post-graduate education in political science” from 1954 to 1962. He became thoroughly familiar with basic economics, and came to share Boulware’s strong conviction that business performs an essential public service. He also thought about a wide range of other public policy matters stretching even to the core concept of what was to become the Strategic Defense Initiative.

SOURCE: The American Enterprise Institute

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Response to Octafish (Original post)

Tue Dec 4, 2012, 05:20 PM

3. it's the prostitute presidents and congresses that advocate and enable corporations nt

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Response to msongs (Reply #3)

Tue Dec 4, 2012, 07:02 PM

6. I agree 100-percent, msongs.

There's big money to be made.

"You can play ball and good things can happen to you get a big pot of gold at the end of the Wall Street rainbow or you can do your job be aggressive and face personal ruin...We really need to rethink how we govern and how regulate." -- Neil Barofsky

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Response to msongs (Reply #3)

Thu Dec 6, 2012, 05:42 PM

10. +1

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Response to msongs (Reply #3)

Fri Dec 7, 2012, 12:30 PM

16. And the investors who demand profit and look the other way when abuses are commited for them nt

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Response to Octafish (Original post)

Thu Dec 6, 2012, 05:15 PM

8. OK, I like the article but HATE the headline.

 

"Wall Street" is not mentioned in the part you quote.


What you are rightly complaining about is the bloody lust for profit. That is not restricted to Wall Street.

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Response to banned from Kos (Reply #8)

Thu Dec 6, 2012, 09:31 PM

12. What's not to like? It's the truth. Wall Street screwed America.

David Stockman said seven-eighths of all the wealth in history was created in the last 30 years.

The beneficiaries of the lax tax and pro-corporate fiscal policies are the one percent or so who control the big banks and own the most stocks.

Only the ownership class holds the means to build a just society, yet they refuse to invest in people.

War, however, does quite well.

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Response to Octafish (Reply #12)

Thu Dec 6, 2012, 09:42 PM

13. OK, let us define "Wall Street".

 

To me, Wall Street is the investment bank community on Wall and Water Street - in New York City.


It APPEARS to me you think that Wall Street is any corporation that profits - like John Deere in Iowa. John Deere is NOT Wall Street to me! They are Main Street despite their size.

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Response to banned from Kos (Reply #13)

Thu Dec 6, 2012, 09:48 PM

14. John Deere (Deere & Co): DE on the NYSE

That's hardly 'main street'

If you read the article it's about the gazillions siphoned out of the wealth generated by industrial labor and right into the hands, via the capitalists, of the financial 'wizards' on Wall Street

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Response to banned from Kos (Reply #13)

Fri Dec 7, 2012, 02:31 PM

19. To me, ''Wall Street'' is who owns America.

BECAUSE they are the ones who rule America.



Money is power, right?

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Response to banned from Kos (Reply #8)

Fri Dec 7, 2012, 04:07 PM

22. The headline is a good one if you read the article.

In the final section he brings it all together and identifies the root causes of the problem.

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Response to Octafish (Original post)

Thu Dec 6, 2012, 06:16 PM

11. Sad. kr

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Response to Octafish (Original post)

Fri Dec 7, 2012, 01:51 PM

18. And speaking of Vultures...another "Wall" as in WalMart has gutted the rural, small business

local economy, and money formerly recirculated locally, creating Ghost Towns. The profits are now sent up the Walton ladder, to contine their business plan...provide cheap Chinese goods and take advantage of local labor at Food Stamp-eligible wages and let the taxpayer feed them and provide health care. The "cheap prices", especially in small areas with no other choice, aren't as cheap as the quality, etc.

The relevance? The youth and a majority of the local work force from the rural/small towns were forced to go to the cities to get manufacturing jobs, such as GE. This influx boosted the labor pool, which usually depresses the wages.

And with the rural agricultural economy, same situation...forced to sell small farms, agribusiness sets up, and guess who becomes The Local Grocery Store with more "rollback" prices...WalMart.

Three sectors ... manufacturing/industrial, service/retail, and agriculture ... fabulously wealthy "Robber Barons" and under-compensated workers. At least WalMart employees are demanding union representation which will hopefully piggyback on the national chain's name, but I'm not holding my breath. The minimum wage job pool seems to remain strong.



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Response to Octafish (Original post)

Fri Dec 7, 2012, 03:48 PM

21. K&R for an excellent analysis of our decline over the decades

A lot of what's contained in this article has been posted to DU before; but, Fraser has done a masterful job of pulling it all together.

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