Member since: Fri Oct 29, 2004, 12:18 AM
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Member since: Fri Oct 29, 2004, 12:18 AM
Number of posts: 70,042
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Why this Economy Feels Even Lousier than the Lousy GDP Print: Your Slice of the Economic Pie is Shrinking
by Wolf Richter • April 29, 2016
But the numbers are hushed up.
The meme that 14 million jobs have been created since the Great Recession is constantly held up as proof that the labor market has healed, or has practically healed, even if there are a few soft spots left over – such as the pandemic lousiness of the jobs that have been created.
In official circles, the sound of folks patting themselves on the back is deafening. But for many working-age Americans, who have to compete with each other in the labor market, reality is tough.
Turns out, the US population, currently at 323.2 million, has grown by 16.5 million people since the Great Recession. Which is exactly why the unemployment problem has become so intractable: job growth has been less than population growth!
While slow economic growth might look OK-ish on paper overall, but in a country with significant population growth, it’s toxic on a per-capita level – and that per-capita level isn’t theoretical. It’s what people actually experience.
That scenario just played out with the Advance Estimate for first-quarter GDP, released on Thursday. Economic growth compared to the prior quarter was a miserably small 0.5% annualized, which means if the rest of the year is like this, total economic growth for the year will be 0.5%.
These numbers are adjusted for a version of inflation. One tiny understatement of inflation, purposefully or by statistical accident, would drive this “real” economic growth into the negative, meaning economic shrinkage. That’s bad enough.
But on a per-capita basis it’s even worse. ........................(more)
Posted by marmar | Fri Apr 29, 2016, 11:42 AM (3 replies)
New York University’s graduate students union voted to approve a “Boycott, Divest, and Sanctions” resolution regarding the state of Israel, the Graduate Student Organizing Committee announced Friday morning.
The resolution passed with 66.5 percent in favor, with “over 600 members” voting, GSOC said.
It called for the NYU union and the United Auto Workers, GSOC’s parent, to divest from Israeli companies and stop doing business with them, and also for NYU “to close its program in Tel Aviv University, which continues to violate the NYU Non-Discrimination policy.”
It also included a personal pledge not to work with Israeli academic institutions. .................(more)
Posted by marmar | Fri Apr 29, 2016, 11:34 AM (3 replies)
What Good Are Hedge Funds?
Hedge funds make big returns by manipulating markets in ways that are illegal for small investors. Remind us: Why are they permitted?
April 25, 2016
In the pilot episode of the Showtime drama Billions, a CNBC host grills Bobby Axelrod (Damian Lewis), founder of the hedge fund Axe Capital, at a public forum. “How do you respond to the criticism that hedge funds are the scavengers of the financial sector, and that a select few have undue influence on the markets?”
“We’re not scavengers,” Axelrod replies. “We’re white blood cells scrubbing out bad companies, earning for our investors, preventing bubbles. A hedge fund like mine is a market regulator.”
This claim invites an important debate: Do hedge funds represent an asset to the larger economy, or a menace? Do they really help make markets more efficient and transparent, or do they just exploit opportunities at the expense of other investors?
There are roughly 11,000 such funds—investment vehicles that control a mix of client dollars and borrowed money, with a corporate structure that exempts them from most investment-company regulations. We know that hedge funds have made a small subset of financial titans fabulously wealthy. The top hedge fund executives make a billion dollars a year or more. Hillary Clinton and Bernie Sanders are fond of saying on the campaign trail that the top 25 hedge fund managers earn more than all of America’s kindergarten teachers combined. But does this orgy of wealth create value, or merely extract value, at the expense of workers, companies, and other investors? ..............(more)
Posted by marmar | Fri Apr 29, 2016, 11:05 AM (12 replies)
Who says crime doesn't pay?
Tuesday, April 26, 2016 | Posted by Jim Hightower
Wow, $5 billion! That's the stunning amount that Goldman Sachs has agreed to pay to settle federal criminal charges over its shameful financial scams that helped wreck America's economy in 2008. That's a lot of gold, even for Goldman.
Yet, the Wall Street powerhouse says it's "pleased" to swallow this sour slug of medicine. Is that because its executives are contrite? Oh, come on – banksters don't do contrite. Rather, they are pleased with the settlement because, thanks to backroom dealing with friendly prosecutors, it's riddled with special loopholes that could eliminate nearly $2 billion from the publicized "punishment."
For example, the deal calls for the felonious bank to put a quarter-billion dollars into a affordable housing program, but generous federal negotiators put incentives and credits in the fine print that will let Goldman escape with paying out less than a third of that. Also, about $2.5 billion of the settlement is to be paid to consumers hurt by the financial crisis. But the deal lets the bank deduct almost a billion of this payout from its corporate tax – meaning you and I will subsidize Goldman's payment. As a bank reform advocate puts it, the problem with these settlements "is that they are carefully crafted more to conceal than to reveal to the American public what really happened here." ......................(more)
Posted by marmar | Fri Apr 29, 2016, 10:46 AM (2 replies)
(The Intercept) When the Taliban overran Kunduz last September after a monthlong siege, the northern Afghan city became the first to fall to the insurgency since the war began in 2001. A week earlier, many Kunduz residents had left town to observe Eid al-Adha, the sacrificial feast honoring Abraham’s act of submission to God. The heavy fighting sent the remaining Kunduzis fleeing as dead bodies littered the streets.
On Friday, October 2, the city lay quiet, with just one building lit up against the dark sky. Most other international organizations had evacuated when the fighting began, but the Kunduz Trauma Center run by Médecins Sans Frontières remained open throughout the battle for the city. It was one of the few buildings with a generator. Throughout the week, violence seemed to lap against the walls of the hospital without ever engulfing it. All around the 35,620-square-meter compound, the site of an old cotton factory, fighting ebbed and flowed. Doctors and nurses marked the intensity of battle by the freshly wounded who arrived at the gate. According to MSF, the hospital treated 376 emergency patients between September 28, when the city fell, and October 2.
The last week had seen much bloodshed, but Friday was uncharacteristically calm: no fighting nearby, no gunshots, no explosions. “I remember seeing a child flying a kite,” recalled Dr. Kathleen Thomas, “and thought to myself, today is a calm day.” That evening, while more than 100 MSF employees and caretakers slept in a basement below the hospital, several staff members remained awake, preparing for what the night might bring. There were 105 patients in the hospital, including three or four Afghan government soldiers and about 20 Taliban fighters, two of whom appeared to be of high rank. Hospital staff stepped outside to take in the bracing autumn air, something they’d lately refrained from doing for fear of stray bullets. The night sky was open and clear.
Some 7,000 feet above, an AC-130 gunship was preparing to fire. At 2:08 a.m., on October 3, a missile began its descent, gliding through a cloudless sky.
From the beginning, the U.S. military struggled to keep its story straight. Officials initially denied that U.S. forces had attacked the MSF hospital at all, saying that the building might have sustained collateral damage from an adjacent airstrike. Gen. John F. Campbell, the top American commander in Afghanistan, stated that U.S. forces were taking fire when the airstrike was called in. On October 4, Ash Carter, the secretary of defense, admitted that “there was American air action in that area” and that “there was definitely destruction in those structures and the hospital.” The narrative shifted the next day when Gen. Campbell said Afghan forces had come under fire and called in the airstrike. ....................(more)
Posted by marmar | Fri Apr 29, 2016, 10:04 AM (3 replies)
from The Nation:
Prisons Are Using Military-Grade Tear Gas to Punish People
A burgeoning arms industry brings the war home.
By Daniel Moattar
In Bahrain, it took an asthmatic man’s life. Bahrain bought it from South Korea, where it’s been used on dissidents for decades. In Egypt, it choked 37 men to death in the back of a police truck. Egypt got it from the USA. It’s tear gas, and it’s becoming a staple of life in American prisons.
Tear gas is mostly known in the United States as a “crowd control weapon” for dispersing unwanted demonstrators. Beloved of US SWAT teams and riot cops, ubiquitous in police arsenals, it played a key role in suppressing civilians during the protests of the Arab Spring. From Ferguson in 2014 to Rio de Janeiro this year, it’s become notorious for its risks and health effects: miscarriages, lung damage, blunt-force trauma, asphyxiation. So why are we using it on captives?
“They started out by using MK9, which is a form of pepper spray. They put a fogger attachment on it, to pipe it into the cell. Then they used a mixture of OC and CS. Then they fired beanbag rounds into the locked cell with a shotgun. Then they upped it to Sting-Ball grenades. They threw two grenades into the cell—a cell that’s approximately 80 square feet. They did all of this back to back to back, without stopping. And then they go in and they use physical force, and they put him in a restraint chair for eight hours.”
That’s how Mountain State Justice staff attorney Aaron Moss describes one inmate’s experience—which he saw on video—at West Virginia’s maximum-security Mount Olive Correctional Complex. Internal documents from Mount Olive, reviewed by The Nation, confirm that its head warden has declared “martial law” in parts of the facility, superseding standard use-of-force regulations by decree. His declaration authorized the use of “less-lethal” weapons, including grenade launchers, at staff discretion.
The War Resisters League, through a letter-writing campaign run in its prison newsletter, obtained testimony from 18 states on the use of tear gas and pepper spray against inmates—in men’s and women’s prisons, maximum- and medium- security facilities, across the country. For unrestrained use of force on restrained inmates, Mount Olive might be the most well-documented example. .......................(more)
Posted by marmar | Fri Apr 29, 2016, 09:59 AM (3 replies)
from In These Times:
The book is about how the Democratic Party turned its back on working people and now pursues policies that actually increase inequality. What are the policies or ideological commitments in the Democratic Party that make you think this?
The first piece of evidence is what’s happened since the financial crisis. This is the great story of our time. Inequality has actually gotten worse since then, which is a remarkable thing. This is under a Democratic president who we were assured (or warned) was the most liberal or radical president we would ever see. Yet inequality has gotten worse, and the gains since the financial crisis, since the recovery began, have gone entirely to the top 10 percent of the income distribution.
This is not only because of those evil Republicans, but because Obama played it the way he wanted to. Even when he had a majority in both houses of Congress and could choose whoever he wanted to be in his administration, he consistently made policies that favored the top 10 percent over everybody else. He helped out Wall Street in an enormous way when they were entirely at his mercy.
He could have done anything he wanted with them, in the way that Franklin Roosevelt did in the ‘30s. But he chose not to.
A lot of progressives that I talk to are pretty familiar with the idea that the Democratic Party is no longer protecting the interests of workers, but it’s pretty common for us to blame it on mainly the power of money in politics. But you start the book in chapter one by arguing there’s actually something much deeper going on. Can you say something about that?
Money in politics is a big part of the story, but social class goes deeper than that. The Democrats have basically made their commitment already before money and politics became such a big deal. It worked out well for them because of money in politics. So when they chose essentially the top 10 percent of the income distribution as their most important constituents, that is the story of money.
It wasn’t apparent at the time in the ‘70s and ‘80s when they made that choice. But over the years, it has become clear that that was a smart choice in terms of their ability to raise money. Organized labor, of course, is no slouch in terms of money. They have a lot of clout in dollar terms. However, they contribute and contribute to the Democrats and they almost never get their way—they don’t get, say, the Employee Free Choice Act, or Bill Clinton passes NAFTA. They do have a lot of money, but their money doesn’t count.
All of this happened because of the civil war within the Democratic Party. They fought with each other all the time in the ‘70s and the ‘80s. One side hadn’t completely captured the party until Bill Clinton came along in the ‘90s. That was a moment of victory for them. ................(more)
Posted by marmar | Fri Apr 29, 2016, 09:46 AM (140 replies)
(Bloomberg) Opposite the headquarters of Puerto Rico’s power company, Nelson Jimenez is selling lottery tickets. He’s not fooled by the shiny facade across the street, with its glass-and-metal curves.
The island is “broke” and business is bad, Jimenez says, gesturing at his thick wad of unsold tickets -- testimony to a public feeling down on its luck. Then he looks over to the utility building: “They made a lot of money, and there were lots of bonds. But not anymore.”
Of course, Puerto Rico still has bonds -- about $70 billion outstanding. What it’s short of is cash to repay them with. The indebted Caribbean island, home to 3.5 million U.S. citizens, has juggled dwindling resources from one hand to another for months now, to keep creditors at bay. The crisis is set to tip into a new phase this weekend when $422 million of payments are due and, as things stand, unlikely to be made in full -- threatening the biggest default yet.
Cue a flurry of activity in New York, where hedge funds are consulting their lawyers, and in Washington, where lawmakers are wrangling over a rescue package. Congress failed to come up with one by this weekend’s deadline, when the island’s Government Development Bank, which lends money to the local authorities that run schools and other services, is the potential defaulter. Some of its bonds trade at just 20 cents on the dollar, amid last-ditch talks to defer payments.
The next key date is July 1 when $2 billion falls due, including so-called general obligation bonds that have the highest level of guarantees. Missing those payments would deepen the worst crisis to hit the $3.7 trillion U.S. municipal market. ............(more)
Posted by marmar | Fri Apr 29, 2016, 09:30 AM (5 replies)
Published on Apr 28, 2016
Amy Goodman of Democracy Now! tells us about Trump-land and how the media is ruining this election.
Posted by marmar | Fri Apr 29, 2016, 03:22 AM (10 replies)
Sobering and scary, but also hopeful:
Published on Mar 19, 2016
Humanity is on the verge of its darkest hour or its greatest moment.
The consequences of the technological revolution are about to hit hard: unemployment will spike as new technologies replace labor in the manufacturing, service, and professional sectors of an economy that is already struggling. The end of work as we know it will hit at the worst moment imaginable: as capitalism fosters permanent stagnation, when the labor market is in decrepit shape, with declining wages, expanding poverty, and scorching inequality. Only the dramatic democratization of our economy can address the existential challenges we now face. Yet, the US political process is so dominated by billionaires and corporate special interests, by corruption and monopoly, that it stymies not just democracy but progress.
The great challenge of these times is to ensure that the tremendous benefits of technological progress are employed to serve the whole of humanity, rather than to enrich the wealthy few. Robert W. McChesney and John Nichols, authors of People Get Ready: The Fight Against a Jobless Economy and a Citizenless Democracy, argue that the United States needs a new economy in which revolutionary technologies are applied to effectively address environmental and social problems and used to rejuvenate and extend democratic institutions. Based on intense reporting, rich historical analysis, and deep understanding of the technological and social changes that are unfolding, they propose a bold strategy for democratizing our digital destiny before it's too late and unleashing the real power of the Internet, and of humanity.
Posted by marmar | Fri Apr 29, 2016, 03:13 AM (5 replies)