Shall We Call it a Depression Now?- ROBERT REICH

[Ichingcarpenter]

FRIDAY, DECEMBER 05, 2008
Shall We Call it a Depression Now?

Today's employment report, showing that employers cut 533,000 jobs in November, 320,000 in October, and 403,000 in September -- for a total of over 1.2 million over the last three months -- begs the question of whether the meltdown we're experiencing should be called a Depression.

We are falling off a cliff. To put these numbers into some perspective, the November losses alone are the worst in 34 years. A significant percentage of Americans are now jobless or underemployed -- far higher than the official rate of 6.7 percent. Simply in order to keep up with population growth, employment needs to increase by 125,000 jobs per month.

Note also that the length of the typical workweek dropped to 33.5 hours. That's the shortest number of hours since the Department of Labor began keeping records on hours worked, back in 1964. A significant number of people are working part-time who'd rather be working full time. Coupled with those who are too discouraged even to look for work, I'd estimate that the percentage of Americans who need work right now is approaching 11 percent of the workforce. And that percent is likely to raise.

When FDR took office in 1933, one out of four American workers was jobless. We're not there yet, but we're trending in that direction.

http://robertreich.blogspot.com/2008/12/shall-we-call-it-depression-now.html



Notice they lied about when the Recession started but I have to agree with Reich
its a Depression and not a Recession anymore.

[leftstreet]

1. Wow, service businesses accounted for two-thirds of the cuts!

snip

Service businesses accounted for two-thirds of the job cuts in November, meaning that the weakness in labor markets has shifted from the goods-producing sector of the economy to the far larger services sector.

[Ichingcarpenter]

2. When the recession officially started last year it wasn't 1/5 as bad as now

They were trying to hide it from the upcoming election.

[tom_paine]

Bad news. Domestic Nontradable Services was the ONLY sector of the economy growing these last years

Now, even Pizza Delivry Boy has too many applicants for the dwindling numbers of jobs.

Bushler asccomplished his mission. America is a Third-World nation now.

[JDPriestly]

21. Thanks to the Patriot Act, there isn't much freedom left for "them" to hate us for.

And thanks to Republican economic policy, there isn't much wealth left for "them" to hate us for either.

Does this mean nobody is going to hate us any more? Maybe that was Bush's goal-- make us into a country no one would hate.

[Frustratedlady]

3. So much for the college grads finding a decent job, although...

they may replace higher paid employees.

Perhaps the safest occupation is embalming, since we all have to go that route at some point. You never run out of customers.

[pscot]

10. Who can afford a funeral?

I'm definitely putting it off until the economy improves.

[sarcasmo]

4. The D word won't be used until Obama is sworn in.

[judasdisney]

22. January 21, 2009: "The OBAMA Great Depression"

[ddeclue]

5. Robert needs to look in the mirror for the origins of our current crisis..

not that he's responsible for Wall Street's dirty dealing but..

If we still had good jobs in this country then people wouldn't need adjustable rate mortgages, balloon loans, nothing down loans, etc. in order to buy a home because they could save up a proper down payment.

The problems with our economy are:

1) Free trade agreements instead of FAIR trade agreements which eviscerate all the gains of the original progressive era over the gilded era robber barons: ending slave labor, prison labor, child labor, a minimum wage, collective bargaining, health and safety regulations, consumer regulations, environmental regulations, labor laws to protect against over work and exploitation.

2) A lack of regulation and oversight which has allow Wall Street and corporate CEO's to pervert their book keeping processes and game the system to insure their own bonuses rather than the long term viability of their companies.

3) A failure to prevent mergers which have created these companies which are "too big to fail" and which destroy capitalist competition through monopoly power and which make the merged companies too powerful to regulate and which leave consumers and workers no options and no bargaining power.

4) A dangerous dependence on foreign oil which is bankrupting our country and destroying the environment.

5) A failed corporatist health care policy which leaves 47 million without healthcare access and overburdens employers. Single payer government run health care as they have in the rest of the industrialized world would eliminate this burden from the companies and employees alike and would cost less and provide better service by cutting out the profit motive middleman.

6) A falled education policy which leaves far too many Americans without viable job skills or job opportunities. We should have lifetime free education for all Americans to get a oollege education or learn a new job skill - not merely when we become unemployed but rather while we are still working so we will be prepared to switch over when our next job fails.

7) A failed foreign policy which is bankrupting the country by using military force instead of diplomacy. Iraq costs $10 billion per month - at this rate we could bail out the big 3 automakers in 10 weeks worth of war expenses.

8) A failure to provide a living wage which traps people in poverty without any hope of a better job, a house of their own or medical care.

Doug D.

[BrklynLiberal]

6. and outsourcing jobs, as well as manufacturing businesses.

Wal-Mart is no small player in this collapse.I read that Walmart, if looked at like it was a country, would be the second largest importer of goods from China in the world. Walmart imports something like 90% of its goods from China...cheap labor, cheap goods, forcing companies in US that used to make these goods here to either go out of business or outsource the manufacturing.

Walmart, all alone, has destroyed thousands, if not millions of businesses, some large, and some just Mom and Pop stores in small towns.

In an attempt to maximize the bottom line, Walmart and companies with the same bottomline obsession have thrown out the baby with the bathwater, so to speak.

While their private bottom lines may have been getting better, the overall economy and trade balance of the entire country was being slowly choked to death.


http://www.associatedcontent.com/article/1177293/how_shopping_at_walmart_destroyed_your.htm

How Shopping at Walmart Destroyed Your Job
Walmart is the world's largest publicly-traded corporation. They sell more things and employ more people than anyone else in the world. And when they move into town, people go out of business.

Most of us don't work for the kinds of Main Street, mom-and-pop style operations we expect to see Walmart displace. But its effects are felt far outside of the local area. Since 2004, Kraft Foods has shut down 39 plants and fired more than 13,000 workers, in response to pressures placed on them by Walmart. Walmart sells more of everything than anyone else, and they have the power to make demands that nobody else can make -- on the United States economy, and on the entire world.
<snip>

[ddeclue]

7. I covered that under fair trade instead of free trade.

If we had FAIR trade there would be few jobs outsourced. Outsourcing is just an end run around American laws.

[TahitiNut]

9. Without question, PUBLIC spending has failed to serve the PUBLIC in virtually every respect.

All federal interactions are with corporations. The working class is screwed. The war on the working class is about 2/3 complete.

[Bonobo]

8. We make almost nothing, so what did we expect to happen? nt

[geckosfeet]

11. Notice they lied !!??!!

Bwaahahahahahahahahahaha!

He he he woo hoo hoo,,, oooh hooo hoo hoo,, that's funny.

[RoyGBiv]

12. Robert, Robert, Robert ...

Have you forgotten so much?

Perhaps I'm picking ... well, no, I know I'm picking, but this is a former Secretary of Labor for pity's sake.

The current U6 rate, which is what he's talking about when he writes "I'd estimate that the percentage of Americans who need work right now ..." is 12.5%

The BLS publishes this statistic themselves. It's available online. Sheesh.

http://www.bls.gov/news.release/empsit.t12.htm

And, no, it's not a depression yet. We can call it that if we like, and it certainly looks to be headed there, but it's not there yet.

[geckosfeet]

13. Been in recession for over a year and it was just publicly acknowledged this week -

his point is well taken that if the bUSh administration says we are on the road to hell that we have been there and beyond for quite some time.

[Ichingcarpenter]

14. Bush announced it today but 4 days ago they admitted since Dec.2007

In a news wire.


I don't know why no one calls them out on that! Just another lie
and the media didn't call him out on that when he spoke.

[RoyGBiv]

15. Announced ...

Yes, it was "announced" by the Bush administration, whereas people who actually know something (that would not be Bush) have been saying this for some time. I'm really not concerned with what Bush announces and trust that Obama will be more forthcoming with valid information, at least to the point of addressing problems when he needs to as opposed to when he is forced to do so.

The problem here is one of definitions and of analyzing data that frankly takes time to analyze properly. When one economic indicator hits a trigger mark, this does not immediately mean we're in a depression or a recession. Similarly, when that indicator hits a different, more positive mark doesn't mean we're in a recovery. (And this, btw, is really the only reason I care at the moment about what we call things. When recovery starts happening, we run the risk of pulling back on recovery efforts far too soon and making matters worse, as happened in the 30's.)

As I said, we can call it a depression if we like, but doing so makes the definition of "recession" and "depression" irrelevant. And, what we call it does nothing to address the underlying problems.

OnEdit: And my point with mentioning the U6 measurement is that one doesn't need to "estimate" it, and it's surprising to me he'd put it that way. (I'm actually of the opinion he looked at October's number and called it his estimate, but I have no proof of that.) He's low-balling it, in fact, which is the kind of problem we'll run into as we attempt to measure the effects of Obama's recovery attempts.

[Hydra]

16. We've been in a depression for 2 years now

The company I work at is down 51% so far this year. We were down nearly 25% last year. That means our income base has contracted by 2/3 over the last 2 years.

And we're still doing better than most of the companies around the country.

[RoyGBiv]

17. I'm sorry to hear that ...

What's down? Profits, revenue, sales, stock price?

[Hydra]

18. Customer numbers

We got lucky last year due to last minute high numbers during Christmas and insane snow(Ski Area), but this year I think we're cooked. Luckily our corporate office understands...I hope.

[RoyGBiv]

19. Yikes ...

That's a bad number to be off by that much.

Profits being off one can deal with. Revenue and/or sales can be managed. When customers in general simply aren't there, you've got serious problems.

I gather you're in an industry with a revenue stream that originates with tourism or something close to that.

Again, I'm sorry to hear that and will try to think good thoughts.

[Hydra]

20. It's ok

Our Budgets run until next June, so we're funded until then...but what happens after that is anyone's guess. I have less to worry about than most here on this board, even if I've been underpaid consistently for the last 5 years where I am. I'm still working, and my department is critical to operations, so I doubt we'll get the axe. I expect to see some very nervous higher-ups in the next few weeks as Christmas approaches.