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Zero by Leo Reynolds on flickr
The US economy managed to create virtually zero jobs during August, leaving the unemployment rate at 9.1 percent. And revised estimates lowered the number of jobs created in July. With the GOP Congress and the Obama White House still paralyzed by mindless deficit hysteria and unwilling to fund any credible effort to create jobs, the economy is stalled. From The Financial Times :
The unemployment rate remained steady at 9.1 per cent, with 14m American unemployed. Economists had hoped for a 68,000 boost to non-farm payrolls, which was already modest growth from the previous month.
This is the worst non-farm payrolls report since August 2010.
Private sector payrolls added just 17,000 jobs, well below the 95,000 estimate and the manufacturing sector lost 3,000. In the public sector, where budget are being cut, 17,000 jobs were lost last month despite the return of 22,000 workers following a partial government shutdown in Minnesota.
This is exactly what reputable economists have been warning about. With the housing market still declining, consumers still struggling to recover from losing $8 trillion in wealth from the housing bubble crash, and exports hampered in struggling economies oversees, only government can fill the void. But our leaderless government is paralyzed by a preoccupation with deficits, when only deficits are keeping the economy from going under. It is the same in Europe, where incompetent central bankers continue to demand national economies shrink deficit spending in pursuit of fantasy confidence fairies. Krugman sighs:
Too bad there weren’t any prominent economists warning that the obsession with short-term deficits was a terrible mistake, that austerity would undermine hopes of recovery. Oh, wait.
The awful thing is that those of us who warned about all this — based not on some unorthodox doctrine, but on basic textbook macroeconomics — weren’t so much argued down as just ignored. Somehow, those with actual power were convinced that fiscal austerity wasn’t just an option but the only option, and that anyone arguing with that — even people like me and Joe Stiglitz, who had a few easy-to-understand credentials — were just not part of the serious discussion.
Beyond the fraud-riddled banking system and the incompetent Federal Reserve and banking regulators who failed to do their jobs, we know exactly whom to blame for the stalled economy. Deficit hysterics, strangle the government zealots and those dedicated to making Obama a one term President have done everything they could to prevent the federal government from using its spending and monetary powers to boost the economy and create jobs. They’ve been aided and abetted by an incompetent political team at the White House, led by the President’s own debt-focused rhetoric with his Party’s leadership foolishly following. None of them deserves reelection.
“Pivot” is the most misused term in the nation’s capital, where it’s confused with spinning.
There is no shortage of ways to put people to work. doing worthwhile things. There’s no shortage of work that needs to be done, and we have millions of willing and able workers to do the jobs. They need only for Congress to appropriate the money.
With the government’s real borrowing rates effectively at zero, there hasn’t been a better time for the country to invest in its own people, its infrastructure, its future. We are not an impoverished nation; we have enormous wealth, but it’s concentrated and sitting idle, because people with little vision and those with ill will are strangling the economy.
Failure to act when so many are suffering is criminal neglect, but the wrong people are going to jail.
More:
Dean Baker has the details, Zero Job Growth in August . . .
David Dayen, Fitting: Economy Added Exactly Zero Jobs in August
New York Times, Job Growth at Halt in August; Worst Showing in 11 Months
80 Comments
Failure to lead by proposing known solutions that work is political malpractice. I mean, poor Herbert Hoover had no look-back Great Depression to counter-policy against. Barack Obama at least has Hoover’s example, and FDR’s 1937 example — and he followed them both.
It’s sad, and tragic, and wrong.
Send the scam artist back to Chicago.
One way ticket to the Hague. War criminal for letting Bush / Cheny off the hook.
This is the plan, and it is the embodiment Obama’s pivot to jobs. It is no unintended consequence.
Obama is a placeholder and a D spoiler for the next R administration. He will be well rewarded for his efforts to enable the next great round of asset stripping of the US.
We need a painful recession to avoid an even more painful depression.
Bring the economy down to a more sustainable 12 trillion GDP target and you will see sustainable growth.
One would have thought that electing Democrats in 2008 would have shifted the bulk of that pain onto the banks and other plutocrats; instead they rescued them at the expense of everyone else.
2010 was a foretaste of the revenge that voters will enact in 2012.
It is also intentional.
Barack Hoover Obama cannot reasonably plead ignorance. He is deliberately crashing the economy to crush labor and eliminate the safety net in order to further enrich the rich. We must hold him accountable for presiding over the most corrupt government in our history.
Not to mention his own disgraceful participation in committing war crimes and protecting the previous administration from prosecutions for war crimes.
Well, the prevalent theory of economics before the New Deal during a financial crash was liquidate, liquidate, liquidate, which translates roughly to “we had to destroy the economy in order to save it.”
At some point in time, and I sure hope it is soon, the people are going to have to question loyality to the Country. Whatever is spinning out from Washington and the Bankstas has nothing to do with preserving this Nation.
Keep your eyes on the big, untaxed money the 1%ers spirited out of the country and is sitting offshore. They still want to repatriate it with no tax, no penalties and no strings. I don’t trust the current crop of embeds to do anything but grease the skids for the money to return in time for a big US asset fire.
But you know the failure won’t be blamed on the austerity, it will be blamed on those meddling Liberals calling them out on it.
And in yet another cave in, Obama surrenders on ozone standards. Better run your potty schedule by BONER, Mitchie and all the lobbyists ahead of time there. They might get upset if you have to pee when it’s an inconvenient time for them.
No one seems to be able to face the possibility that we may never be able to return to the high growth economy of the past. Stimulus spending by the government would create short term jobs and help rebuild infrastructure but our economy is based on consumption.
Increasing consumption requires increasing wages and easy credit. Wages have been flat for the last 30yrs so credit was used to maintain consumption, home equity was used to service that debt until the housing bubble burst.
Economists on both sides seem to think that their ideas, stimulus or debt
reduction will return the economy to growth without explaining where the money for consumption demand will come from.
Wages are stagnant or falling housing equity is gone and credit is difficult to get so where will this money come from?
Hmmm….should I listen to the Nobel Prize winner or the wayoutwest troll….? Sorry, gotta go with Krugman on this.
We have to start making stuff again.
In the case of Germany in the early 1930, the fallout of austerity was blamed on…big spending liberals and not enough austerity.
Marge, insted of attacking the messenger maybe you should answer my question.I know it’s easier to label people who don’t accept groupthink. I have yet to hear Krugman address this issue although his idea about a war with Aliens might work.
BTW i believe i was the first to use the term Vichicrat and i see you have picked it up.
Yep. Not to mention Jewish people. Scary shit.
Nope. The entire FDL community knows it was me who started using that. It evolved independently out of a desire to meld Kelly’s term “Vichy Dems” into one word.
Please see the blog by Prof. Bill Mitchell for another opinion on Nobel Prize winner Krugman’s understanding of economics at
http://bilbo.economicoutlook.net/blog/?m=20110711
pshakkottai
Oh yeah: And since it’s your claim, I invite you to prove it. I will accept a link to my original Vichycrat comment at FDL and a link to the first time you used it on FDL. Anything else is just unsupported bullshit.
Stop pimping Bill Mitchell. I’ve looked at your previous comments and that’s all you ever do. And it always goes back to the same blog link. Not credible.
Let’s not get emotional Marge i only said i thought i was first to use the term.
The real important question is about the future of the economy and you don’t seem to have any answers to that question. I think Krugman has some good ideas but i haven’t seen him or anyone else address my question.
I don’t know much about you but calling me a troll is a hoot. I guess you are just another Me Generation Liberal who can’t answer simple questions and responds with personal attacks.
While i support many liberal ideas i’ve been a Socialist since ’68 and my distrust of Liberals has been reaffirmed by people like you many times over the years.
I scanned the article you linked but didn’t see any answers to my questions. How do you grow the economy when people don’t have and may never have the extra income to drive consumption?
We can make all the “stuff” you want but if people can’t afford the “stuff” what good does it do?
die gOOgle hat gesprochen …
Margaret February 24th, 2011 at 8:40 pm – Vichycrat
wayoutwest March 31st, 2011 at 11:55 am – Vichicrat
mzchief, i believe i used the term Vivhicrat before March on one of Rusty1776 posts but they have been disappeared by the Gatekeepers.
Since we spell the term differently i will say that we both coined the term independently.
Considering we started using “Vichy Dem” at unrulymob in 2008…um yeah, you evolved it even earlier than mzchief found on der google.
I was driving by and saw your comment about where the money would come from. Well, for one the federal government can never, I mean never, run out of money. It comes from electronic key strokes. Sereiously. and two, if the government spends that money on something, oh say anything, it increases aggregate demand and employs people. This is no problem except for your own understanding. It is as simple as it sounds. What we have is a political crisis at root – - no will to fix it. So pass it along to your economists, many of whom are suffering from cognitive dissonance also known as corruption.
Actually, I think Bill Mitchell, Warren Mosler, Randall Wray, et al are a knowledgeable group of economists of the MMT variety. They have a running gun battle with Prof Krugman. I read a few of the MMT challenges and I think they are winning.But then I am not an economist. (at the moment Krugman even agrees with the MMT or maybe I should say it the other way around. )
I presume you are kidding?
IMO Krugman is right when he says he was ignored, as were the other school of progressive thought, the MMT economists. ON that they fully agree with each other.
Bluedot, your statement about the gov printing money is true but that eventually causes inflation which reduces buying power and then we are back to the same problem.
I think that a consumer economy is unsustainable but if you want one you need to increase wages to drive demand while you destroy the planet.
The government needs to hire them for infrastructure projects, a new power grid, rails for trains.
WPA. This is too much socialism for rigid thinking neoliberal ideologs who must prove that the government cant do anything, and it only gets in the way of the freedom of the market.
On the bright side, maybe these monkeys will crash the system world wide and discredit their ideas completely. We can issue new currency and destroy their wealth.
Marx said more please.. burn it down:
No, the debt is bought back later through increases in tax revenues because the people are working again and private enterprise has been made possible because demand has been created when the workers spend their checks.
http://davidharvey.org/2011/07/the-vote-to-end-capitalism/
Here’s how I see it. The right and I include the Dems. in that political definition these days believe that creating or finding employment is an “individual” not a societal problem. They also it follows believe that each “individual” is also responsible for losing their job or the failure of their small business etc. They reject the idea that society and especially those benefiting hugely from this economic tsunami are in any way responsible for these people’s problems. This is why there has been no attempt to prosecute what many of us see as fraud and thievery among the bankster class. The powers to be believe these folks are “smart savvy business people” as Obama said about Lloyd Blankfien ( Goldman Sachs CEO.) Not the criminals many of us view them as. Its also why the Gov’t and the pols as a class have allowed these same people to continue to run things into the ground.
My search was constrained to the FDL database with the terms selected as shown.
Frogs, i think we have gotten OT here. I’m not talking about monetary policy i am trying to address worker wages and their relation to consumerism. The Gov can print all the money it wants but it doesn’t give it directly to workers and it shouldn’t, workers earn their wages and create wealth.
Unless workers share that wealth in the form of high wages they can not grow the economy.
Um, you argued this same point months ago and again substituted “I believe” for any links or proofs:
Is this some kind of pissing contest Mzchief? It’s not that important to me so why the interest?
I was asking questions about economy which i think is more important.
Meanwhile, the horrifying evil of socialism has caused Norway’s unemployment to skyrocket to a nightmarish 3.4%. It’s a good thing we don’t have any of that damn Godless Marxist crap here in America, who knows where we’d be.
That’s easy. You employ and pay them a reasonable wage with benefits.
The private sector isn’t going to do it, so the public sector has to step in.
Demand for goods and services will increase when 14-30 million people have money to spend.
The private sector will have to start hiring to meet that demand.
This is not rocket science.
When will FDL say, “enough is enough, it doesn’t matter who runs against him, we can not afford any more Obama”? We ALL have a choice at election time, mine is to vote out EVERY Incumbent.
“without explaining where the money for consumption demand will come from.”
Dude this is the whole point that Krugman and other learned economists have been making OVER AND OVER AGAIN. Without federal deficit spending there is not enough demand to warrant spending by businesses, despite the low costs of borrowing and labor.
The money is there. But it’s been redistributed over the last 30+ years during which the economy has grown (overall). So we see the rich and the corporations have enormous profits and the middle class’ income has been flat. The rich are holding on to their money, they are not injecting it back into the economy where it can be productive. If the middle class had more they would be spending for sure. Like bluedot said, it’s a political crisis. In other words, to answer your question of where will the money come from, it’s necessary to look at the question of where did the money go to.
http://www.bgladd.com/CaveManPlan.jpg
Vote of “No Confidence.” Wish we had that formally.
Er, you brought it up, wayoutwest.
This is the thing that has been bothering me for about thirty years now. Capitalism is obviously a flawed system, and the proof of it is UNEMPLOYMENT. Unemployment means that everything society needs is done. There is no need to put those people to work. The capitalist free marketeers like to say that any needs will be met by the free hand, but look around. Does anyone really think that all of societies needs are being met? It isn’t working. People sit idle, while unsolved problems fester.
Meanwhile the Wall Street guys are all investing in China — CHINA!! Why? Because they have a planned economic model that allows them to respond to disruptions. They bought up copper and other commodities during the crash when it was cheap. Now they are building high-speed rail, and solar energy plants according to their 12 year plan. America, meanwhile, waits for the invisible hand to solve all the problems, like an addicted gambler convinced that the next roll of the dice will see them back on top again.
Put the damned dice down, America! If we are going to get out of this situation, we need to take purposive action. That means collective planning, which means government action, not a lucky roll by the invisible hand.
I have watched and listened with dismay over the past few weeks as the GOP Prez candidates have trampled each other in me-too one-upsmanship with respect to misappropriating the “We-Must-Broaden-The-Tax-Base” riff.
For them it’s a dog whistle meaning Lets Tax The Lower Strata Even MORE, Because They Mostly “Don’t Pay Any Taxes Now” (i.e., the FIT straw man diversion).
All while eliminating corporate taxes and reducing or eliminating capital grains taxes.
Y’know, “sharing the burdens…”
Listening to your conservative crap is a pain in the kester.
growth is created by investent but capital is on the sidelines. Investors are in Gold and low risk financial vehicles.
Consumption follow paycheck. If it is immoral to use tax money to hire, then it is as immoral to give tax money to capitalist TBTF banks and Auto industry.
My personal views are I can live with the unfairness of capitalism until they take everything and leave us nothing. That path is very risky, and they are determined. They have armies and technology to keep us down.
In a small way I agree with wayoutwest, but for different reasons. We are never going to employ large numbers of people in manufacturing, even if we begin making stuff, again. Last year I retired as a SCADA programmer. In my trade, I met large numbers of PLC programmers–they are the folks that write the programs that make the factory tools (robots for a layman’s term) operate. One “robot” replaces dozens of jobs, and those jobs will NEVER return. Those jobs paid a “living wage” for out fathers but they will not exist for our children. There are very few manufacturing (assembly) jobs available for the average person. The skills required are those learned by people with “above average” IQ’s, which leaves the “average” people flipping burgers and selling stuff to those that have the ability. This is a sad, but true fact. The U.S., where “everyone can be a success” is a thing of the past. I have no idea how to deal with the problem.
I don’t believe that was the reason. I believe Obama hasn’t prosecuted because he’s doing some of the same things that would make him able to be prosecuted once he leaves office.
Take away a living wage then it has to be provided from the production of the robots. Transfer payments.
This is ridiculous. Stop it. Hey Margaret, is this what this website all about? I don’t think so. People like you trying to prove they’re so smart and/or creative. I don’t care who came up with “Vichycrat.” You must be a really needy person.
But Obama is not cutting the deficit at all, all the cuts will come in 2014 or later. The budget deal that took place in April actually ended up increasing the deficit and once again if you read the details there are NO SHORT TERM CUTS. All cuts are long term, that is why so many tea partiers objected to it.
CBO showed that most cuts will come in 2014, every reasonable individual out there know it. I sometimes can not believe the fact that people keep saying that GOP wants to cut everything right now when that is not the case at all, their biggest demand was to fix SS and M&M by making fixes over the next 20-30 years.
This is exactly why the left has no credibility at all when it comes to debt, you guys are totally opposed to cutting anything…………..even 4 years from now, even tough every economists (even Krugman) admit that we are not on a sustainable path.
I wonder if it’s occurred to anyone that we are living a fraudulent Depression enforced upon the majority of the population? Is it possible that the hostile top one tenth of one percent created a false economic depression as we’ve witnessed the tripling of their incomes and wealth plus more massive tax cuts and perks for them? Massive deprivation for the majority and obscene wealth for the few.
Economic Class warfare has been violently waged upon the majority.
The golden nugget of truth
No improvement since the recent book salon, eh vegas? Too bad blaming the GSE’s is just another shiny distraction. Can’t wait for Obama’s Kabuki anti-labor jobs speech this week.
The United States in comparison to the industrialized world has the largest income gap between rich and poor and by far the most unequal distribution of household income. An accident or deliberate? Economic warfare has been systematically waged upon the majority of United States since Ronald Reagan. We are living in an oppressive tiered class system that is delineated with subcategories of gender and race. We squabble over the table scraps thrown to us as the one percent feast upon our labor. They’ve psychologically waged divisions of race, gender, and class in order to conquer and divide us from our earned wealth and cooperation within to rebel.
This Depression wasn’t an accident in time, it was planned. Subjugation an Oppression are deliberate actions.
False. Bill Mitchell has all you need to dispel that notion on his blog. Suffice to say that inflation will not happen so long as labor and capacity are available. Presently they are underemployed. We are nowhere near capacity and if we get close, then it is an easy matter to put on the brakes. But not to worry, as we are a long way from that.
Warren Mosler has a speech written for Obama to give on his web site. It has a solution to fix the unemployment problem. But I know neither Obama nor some here will buy into it. Just saying, there is a way out of this. It’s called spending money. If you don’t like Mosler’s we can pick one we like.
http://www.businessinsider.com/who-pays-no-taxesand-why-theyre-no-pot-of-gold-2011-8
We can beat this depression. We know how. But congress and the president will not help. And the conservatives are happy to destroy us. It is indeed depresssing. But there is a small chance that some conservative business man (not a TEA) will realize that his profits, even in the stock market, are not good enough and he will help drive some spending to get us out of this. What a shit ass hope,eh?
The debate is about cuts vs. revenue. The whole austerity crap is cover to protect the minimal corporate taxes paid (average 6%), and the lowest tax rates on the wealthy in modern history. Implement fair taxation across the board and their is no debt problem. Austerity hysterics is a smoke screen created by the rich bastards who want a free ride. Average tax rate PAID by US corporations is 6%, lower than nearly every industrialized country.
You mention the FIX for SS ? SS has a 2.6 trillion surplus, the problem is the SS loaned the money to GWB, who promptly gave it to millionaires and defense contractors. The SS trust fund should have bought German bonds, the trust fund would have been repaid. The most successful government program, the only one with a surplus, doesn’t need fixing, it needs to be repaid. That is the crux of the issue. Do the deadbeats who took the 2.6 trillion in loans from the SS Trust Fund want to pay it back ? Hell no, they want to attack the Trust Fund itself as “insolvent.”
Get your facts straight if you want to troll on a site where people know and use actual facts.
The debate is about cuts vs. revenue. The whole austerity crap is cover to protect the minimal corporate taxes paid (average 6%), and the lowest tax rates on the wealthy in modern history. Implement fair taxation across the board and their is no debt problem. Austerity hysterics is a smoke screen created by the rich bastards who want a free ride. Average tax rate PAID by US corporations is 6%, lower than nearly every industrialized country.
You mention the FIX for SS ? SS has a 2.6 trillion surplus, the problem is the SS loaned the money to GWB, who promptly gave it to millionaires and defense contractors. The SS trust fund should have bought German bonds, the trust fund would have been repaid. The most successful government program, the only one with a surplus, doesn’t need fixing, it needs to be repaid. That is the crux of the issue. Do the deadbeats who took the 2.6 trillion in loans from the SS Trust Fund want to pay it back ? Hell no, they want to attack the Trust Fund itself as “insolvent.”
Get your facts straight if you want to troll on a site where people know and use actual facts.
Right, capitalism only really works in a country with vast natural resources with a small population. That’s how America used to be. Capitalism relies on growth at all times. But the planet cannot sustain the kind of “growth” we’re throwing at it. The American economy should be based on “sustainability.” The growth idea no longer works. If the economy was based on sustainability, we’d be creating green jobs, investing in renewable energy, taxing carbon emmissions, investing in education. Capitalism is dead and gone. The rich have recognized this, and have adopted Socialism for themselves and try to perpetrate capitalism on the rest of us. We need a command economy, government plans that run years into the future. Remember Kennedy putting a man on the moon ? Well, the Apollo project created the need for miniaturization and low power requirements for electroncs. Guess what we got out of Apollo research ? The semiconductor industry, Intel, Microsoft, etc. An industry where we still lead the world, 50 years later. That’s what government planning does for a country. Look at Germany, a socialist country with central planning. High standard of living, high wages, advanced products exporting to the world. Sweden ? The most socialist country in Europe, currently growing at over five percent a year. Democratic socialism is the answer, just look around. Social Darwinism, aka capitalism is dead and gone, doesn’t work long term, only in certain ideal conditions.
There is truth to this. If we were a compassionate country, with leaders who would give a shit, we would be looking at how to fully employ a country that doesn’t make enough “stuff” to warrant employing all the people who want it. Right now our thought leaders, with the exception of Krugman and a few others, are hoping for another bubble, to go back to the borrow and spend party of the last thirty years. So, either we a., bring back the jobs that were outsourced to cheap countries (too late for that but maybe we can stop more job bleeding, and/or b. dump the technology that eliminated the rest of the manual jobs (probably not a good idea), or c. look at how Sweden does it and see if any of that hellish socialism can work here, or d. something I haven’t thought of. My vote is for c. Chances of that happening? Slim, unless things get really bad.
What else would a $$$$ Billion candidate do ?
Your are correct that this type of stimulus does work in the short term but it is temporary as we are seeing today. The real problem is not the unemployed, although they might disagree with me. The rest of the working population do not and may never have the excess wealth to drive growth.
Since wages have been flat for the last 40yrs consumers used the equity from their homes and credit to continue to consume. That equity is gone, something like 7 trillion worth, and credit is tight so how do you grow the economy when the majority of working people are just hanging on?
The Gov can stimulate the economy but it can not be the economy.
This is not rocket science, i’ve done that, it’s basic economics.
Amen, all of this hysteria about Social Security is a bunch of propaganda created by right wingers who have always wanted to destroy it, who think FDR was a communist. What KilgourTrout says is the truth, our government is destroying it by stealing from it so it will go belly up. The deadbeats in this society are at the top. But Sea Urchin is also right, the Republican plan is less severe than Obama’s. At least it doesn’t take the bread out of people’s mouths who are living on Social Security in the present. Not that I am for any further damage to this benefit, that we paid for, it’s not a handout.
But where to cut is the question, Sea Urchin. Cutting war and security expenditures, 70-75% of the deficit is the way to go. Not people’s survival network. The attacks on Social Security and Medicare are despicable. In an industrialized society you need safety nets. Market fluctuations will periodically ruin people, and after 50 you can’t get a job, even if you were able to work, which some are not. What are people supposed to do, die in the gutter? Yes, that is the plan, but how shameful is that? We’d rather spend money killing people in Stone Age countries than take care of our own. One day that may be you, realize. You never think it will be, but it most likely will be given our economic meltdown.
I think i have an example that may help explain why i think our consumer economy may never recover.
Probably the most obvious example of excess consumption in the US is the massive amount of rental storage units which probably outnumber Starbucks. This is where Amerikans store all of their excess stuff-consumption. A few years ago these units were popping up everywhere and were very profitable and created jobs in construction, steel, concrete and land sales. At a rental rate of between $25 and $50 a month times the thousands and maybe millions of these units this represents a huge chunk of excess consumption not counting the unused contents of the units.
Recently i was talking with my Greengrocer who has 26 storage units behind his store. Two years ago most of his units were rented with normal turnover. Today 23 of his units are either empty or the rent hasn’t been payed in many months.
Putting the unemployed back to work will create more demand for basic needs but it will not drive the excess consumption that our buy and discard consume for the sake of consumption economy requires.
Yes, this is a good take on the situation, thanks. A lot of ruling class thinking is driven by this philosophy, poster child, Dick Cheney. They fail to see the irrationality of this when it is accompanied by welfare for corporations, so in their minds this only applies to us, where they are concerned, it’s Ok to take public money to rescue failing corporations or ruling class individuals. It’s their right. They are a different, special class of being. Which is why I say we are the Fourth Reich now. We have all the aspects of that particular plague upon humanity. A ruling class convinced it is above the law, completely nihilistic, inhumane, and hell bent on a path of destruction, that seems to us trolls, insane. It is insane.
Yes! Germany is pursuing fusion technology, re recent issue of The Economist magazine. How can they do that and have their workers remain prosperous? Democratic socialism, that’s how. Smart economic planning that had Germany focus not on growth but sustainability, high tech manufacturing, lots of practical education, and social benefits. No war helps a lot too. Imagine what we could do with the trillions upon trillions spent on war over the last 50 years. Now we are an empire, not a republic or even a democracy. We are ruled by an oligarchy of frat boys following the ideology of a Hitler against us and the rest of the world, doomed to failure, but meanwhile we suffer and cause suffering.
The solution is to mandate living wages and restart the CCC and WPA to pick up the rest of the unemployed. Average people will have an opportunity to get dignity, prupose and meaning out of life again. Leave the factories to the robots. Most would rather work in the sunshine than in a prison-like factory. Tax the rich to pay for it all.
Yes it’s no accident. Capitalism has failed and the solution to that problem by our ruling class was to create one bubble after the other, to try to extort the remaining wealth in our society and put it in their pockets, so they can survive the transition to what comes next. What comes next is an endless depression, caused by this wealth robbery and hoarding. As Marx predicted, the end is a vast proletariat that will overthrow their oppressors. Meanwhile the ruling class had to design our our defeat by taking over the government, destroying public education and sending manufacturing abroad, so we can’t fight back and have to endure the full brunt of the failure of capitalism and our economy, an economy that collapsed some time ago, the rest is all illusion and further wealth siphoning. Not to mention propaganda, the best in the world, to convince us that this is all either not happening, or that it’s OK, it’s inevitable we just have to accept it.
Krugman would agree with you that income inequality is a serious, long-term threat to the economy, but that was not what he was addressing when he wrote about the need for more stimulus spending. You can’t expect him to address every issue in every column. Likewise, what to do about long-term trends and short-term crisis require different sets of responses.
Simply Google “Krugman income inequality” and you will see that Krugman has written about this problem. So has liberal economist Joseph Stiglitz. A couple of times before on this site I’ve linked his column in Vanity Fair that warns about its perils:
http://www.vanityfair.com/society/features/2011/05/top-one-percent-201105
The Great Divergence in income distribution that Krugman has written about coincides with the weakening of labor unions. As the labor unions declined, they lost political influence. Hence, there was largely bipartisan support for policies that favored the rich: globalization that sent jobs to other countries and changes in effective taxation that overwhelmingly benefited the rich. Also, the deregulation of the financial sector has legalized white collar theft on a large scale. Krugman has been in the lead in pointing the finger at political policies for making the difference between growing income inequality in the USA compared to other developed countries.
There can be no solution without increasing people’s awareness of the causes of the problems and changing the way they think about politics. Krugman has been trying to do that, but far fewer people read him than watch Fox News. I don’t think there is a solution. There may be a revolution at some point decades from now, but by that time things will have gotten much worse.
I’m not trying to prove how smart I am, but I did study (though it was not my major) the economics and political structures of Latin America in college. I’ve been saying for over 20 years that the goal of the Republican party is to emulate the most disfunctional of those countries. The goal is to protect the positions of the rich, even though it impoverishes the country as a whole and leaves the wealthy less wealthy than they would be with a smaller potion of a larger pie. The point is NOT to increase wealth, but to entrench power. Politicians are warped creatures who are obsessed with power. What I’ve learned since is that, as wealth and, therefore, power has shifted away from the unions and middle-class, how willing the Democratic politicians are to enable the Republican agenda.
I don’t think you are a troll. I am a liberal and I hope that you don’t despise me.
“i think our consumer economy may never recover.”
You may be right.
You are correct that Krugman and others pay lip service to wage inequality but they don’t seem to have any plan to reverse that reality.
Even if we could correct that major flaw and return to growth through consumption is that the ideal goal for our future? Should we strive to return to a consumer economy that is destroying the planet and is unsustainable.
I have been caught up, like everyone else, in debating the nuts and bolts of our economy while the real question is do we want to perpetuate a system that is killing us just so we can have more stuff than our neighbor.
I don’t despise you Non, and from your writing i think you may be more of a Radical than a Liberal. Thanks for not accepting the troll label some have tried to hang on me for not eating the cheese along with their whine.
It’s interesting that this thread has lasted for four days and evolved form a discussion of how to save our Capitalist consumer economy to a discussion of do we really want to save this system.
There are some who think that if we do this or that we can make this system work for everyone just like some think we can fix the Dem party by voting for better politicians.
It seems that the Commie-Socalists, like me, may be getting through all the noise generated by the debate and offer a view of a system that has failed and can not be repaired but must be replaced.
I believe everyone here wants to see full well payed employment but can we finally admit that consumerism, waste and distruction of the planet is not the path to follow.
I don’t know if you’ve won any converts to socialism, but many here would likely agree that what Republicans label “socialism” is really any function of government that serves the common good instead of a special interest. By so doing, they may be convincing many people who don’t know what socialism is that it must be a good thing.
Liberals and libertarians share many common concerns. Where we diverge is that libertarians take a simplistic, dogmatic view that the free market is a panacea and government is an anathema. Liberals take the view that there are desirable outcomes that can best be achieved through government. As long as government is serving the common good, then serving such outcomes is a legitimate role for government. However, we also recognize that–just as the free market has its limitations–so does government. Both cooperation and competition have their places.