Friday, November 26, 2010

Compromise on Social Security and Medicare? Hell No.

Compromise on Social Security and Medicare? Why My Center-Left Friends are Wrong

By Dean Baker
TPMCafe Cafe (Talking Points Memo)

"...In recent days several center-left blogger/columnists have suggested that progressives should be happy to cut a deal now on Social Security and other issues related to the budget. The argument is that the cuts being put forward by the commissions are not that onerous, they don't involve privatization, and we could be facing much worse in the future."

"While politics always requires compromise, this position misreads the economic and political landscape in four important ways..."

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Majority of 2010 Voters Support Spending For Infrastructure to Create Jobs

Zogby Interactive: Poll of 2010 Voters Finds Majorities Still Support Spending For Infrastructure to Create Jobs

On Other Issues, Voters More Likely to Favor GOP Positions

UTICA, New York - "Fifty-six percent of people who voted in the mid-term election favor federal spending on infrastructure projects that create jobs, but they are also more likely to side with the Republican position on other key decisions the next Congress may face, according to the latest Zogby Interactive poll.

The poll of 2,185 voters was conducted from Nov. 3-5, 2010."

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Midnight grocery runs capture economic desperation

Midnight grocery runs capture economic desperation | Tulsa World

Tulsa World / Associated Press, 10/10/2010

FREDERICKSBURG, Va. - Once a month, just after midnight, the beeping checkout scanners at a Walmart just off Interstate 95 come alive in a chorus of financial desperation.

Here and at grocery stores across the country, the chimes come just after food stamps and other monthly government benefits drop into the accounts of shoppers who have been rationing things like milk, ground beef and toilet paper and can finally stock up again.

Shoppers mill around the store after 11 p.m., killing time until their accounts are replenished. When midnight strikes, they rush for the checkout counter....

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Wednesday, November 24, 2010

Letting Unemployment benefits expire could slow recovery

Failure to pass unemployment insurance extension could cost billions, reports say


"...Letting the nation's unemployment benefits expire could drain billions from the economy and cost millions of jobs, according to two reports out this week. On Thursday, House Republicans voted to deny an unemployment benefits extension, unhappy with the method planned to fund it.

Ending federal extensions would drain the economy of $80 billion of purchasing power, according to a report by the U.S. Congress Joint Economic Committee. Every dollar spent on benefits increases the gross domestic product by $1.60, the report said.

'Workers receiving unemployment insurance payments are typically cash-strapped and will spend their benefits quickly,' the report said. They spend about $6.5 billion a month on the local economy to buy essentials such as food, clothing and utilities.

'A failure to extend the unemployment insurance program could hamper the fragile recovery,' the report said. It predicts that consumer spending will fall by $50 billion over the next year if benefits are not extended, and that economic growth will be reduced by 0.4 percentage points by February 2011."

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Tuesday, November 16, 2010

First Friday Vigil for Jobs in New York City

“First Fridays — Vigil for Jobs” – New York City

Local community groups, labor unions, civil rights organizations, and unemployed activists concerned about the high unemployment rate plan to hold a vigil and media briefing in front of Sen. Charles Schumer’s office at 757 Third Avenue (between 47th and 48th Streets) on the First Friday of each month from 12:30 to 1:30 PM.

Our first two vigils will be on Friday, December 3, and Friday, January 7.

Our goal is to call attention to the unemployment crisis, and the need for urgent federal action to reduce unemployment, including a national federal jobs program similar to the WPA. During the last serious economic depression in the 1930’s, President Roosevelt put millions to work doing useful jobs that made a lasting contribution to our country — roads, bridges, schools, libraries, housing, theater, painting, road guides, parks, and much more.

For more information, and to endorse the NYC vigil, click here

This effort is part of a national call for local First Friday actions sponsored by the National Jobs for All Coalition. In December, vigils will be held during "Jobs and Human Rights Action Week" in at least 8 cities on December 3 and December 10.

For more information on national actions and organizing a vigil in your community, contact Logan Martinez at loganmartinez2u [at] or (937) 275-7259

Cross-posted from:

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Thursday, November 11, 2010

US Lagging in Green Jobs

US Lagging in Green Jobs | The Energy Collective:

November 10, 2010 by David Levy

"...A recent Clean Tech Jobs Outlook Report estimated that in 2009 there were more than 3 million jobs in the renewable energy field globally. The report indicates, however, that the US is falling further behind in this field; the bulk of these jobs are now in China and Brazil.

"The CleanEdge report points to several trends that suggest that, while the world is moving toward a green economy, the United States may be lagging. Solar panel production is expanding in Mexico where some U.S. companies have outsourced manufacturing for the lower wages. In the automobile and other sectors, Mexico has been a very attractive destination for outsourcing because its proximity to the U.S. enables logistical integration of supply chains, and because of the NAFTA free trade area."

"About 70 percent of hardware and technology used in U.S. clean-energy installations are constructed overseas, according to the report. “Essentially, clean-tech manufacturing has run up against the same economic realities as countless industries that came before, from clothing to computer chips to cell phones: it’s very hard for the U.S. to compete with overseas labor costs, particularly in the developing world.” For example, BP Solar closed its Frederick, Maryland, PV plant in March 2010 and moved most of the 320 jobs abroad. This is also a sign of the surprisingly rapid maturation of the industry, as solar panels rapidly become low-value added commodities..."

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Deficit Commission Co-Chairs Ignore Economic Reality

Cross-posted from

Dean Baker: Deficit Commission Co-Chairs Ignore Economic Reality

Statement on Deficit Commission Proposals

WASHINGTON - November 10 - Dean Baker, Co-Director of the Center for Economic and Policy Research (CEPR) released the following statement on the proposals offered by Erskine Bowles and Alan Simpson, co-chairs of the President's deficit commission:

"Senator Alan Simpson and Erskine Bowles appeared to have largely ignored economic reality in developing the proposals they presented to the public today.

"The country is suffering from 9.6 percent unemployment with more than 25 million people unemployed, underemployed or who have given up looking for work altogether. Tens of millions of people are underwater in their mortgage and millions face the prospect of losing their home to foreclosure.

"This situation is not the result of government deficits, contrary to what Mr. Bowles seemed to suggest at the co-chairs’ press conference today. The downturn was caused by the bursting of an $8 trillion housing bubble. This bubble was the basis of the construction and consumption demand that drove the economic expansion through 2007.

"The large government deficits are the only factor sustaining demand following the loss of this bubble wealth. If today’s deficit were smaller, we would not be helping our children; we would just be putting their parents out of work. Simpson and Bowles somehow think they have covered this concern by delaying their cuts until fiscal year 2012, 11 months from now. Virtually all projections show the unemployment rate will still be over 9.0 percent at the point when the Simpson-Bowles cuts begin to slow the economy further. This leaves the economy like a plane with one engine already out and Simpson Bowles prepared to knock out the other engine as well.

"The failure to understand current deficits contributes to a misunderstanding of the debt burden. For example, Simpson and Bowles raised fears of an exploding debt reaching 90 percent of GDP by the end of the decade. There is no reason that the Fed can’t just buy this debt (as it is largely doing) and hold it indefinitely If need be, the Fed can use other tools at its disposal to ensure that this expansion of the monetary base does not lead to inflation.

"This creates no interest burden for the country, since the Fed refunds its interest earnings to the Treasury every year. Last year the Fed refunded almost $80 billion in interest to the Treasury, nearly 40 percent of the country’s net interest burden.

"This means that the country really has no near-term or even mid-term deficit problem, just paranoia being spread by many of the same people who led the economy into its current disastrous situation.

"Over the longer term, the country is projected to face a deficit problem but this is almost entirely attributable to the projection that private sector health care costs grow at an explosive rate. This projected growth rate of health care costs would eventually lead to serious budget problems in addition to leading to enormous problems for the private sector. However, the underlying problem is the broken health care system, not public sector health care programs. For some reason, though, Simpson-Bowles never directly addresses these of the health care system.

"Simpson and Bowles apparently never considered a Wall Street financial speculation tax (FST) as a tool for generating revenue. This is an obvious policy-tool that even the IMF is now advocating, in recognition of the enormous amount of waste and rents in the financial sector. Through an FST, it is possible to raise large amounts of revenue, easily more than $100 billion a year, with very little impact to real economic activity. The refusal to consider this source of revenue is striking since at least one member of the commission has been a vocal advocate of financial speculation taxes. It is also worth noting that Mr. Bowles is a director of Morgan Stanley, one of the Wall Street banks that would be seriously impacted by such a tax.

"Finally, it is striking that the Co-Chairs felt the need to address Social Security, even though it was not part of their mandate. The commission’s mandate was to deal with the country’s fiscal problems. Since Social Security is legally prohibited from ever spending more than it has collected in taxes, it cannot under the law contribute to the deficit. Their proposal would cut benefits for tens of millions of middle class workers who are overwhelmingly dependent on Social Security for their retirement income. It would also raise the retirement age for lower income workers who have seen little increase in life expectancy.

"While there are some positive items in the report (it would limit the mortgage interest rate deduction get rid of the deduction for cafeteria benefit plans), it suffers from the fact that the co-directors never reflected on their basic economic assumptions. It is hard to avoid the conclusion that this exercise was a waste of time and that we should go back to having Congress determine our budgets through the normal process rather than secret commissions."
The Center for Economic and Policy Research (CEPR) was established in 1999 to promote democratic debate on the most important economic and social issues that affect people's lives. In order for citizens to effectively exercise their voices in a democracy, they should be informed about the problems and choices that they face. CEPR is committed to presenting issues in an accurate and understandable manner, so that the public is better prepared to choose among the various policy options.

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Tuesday, November 9, 2010

"The Ghost of Full Employment" (9/29 American Prospect)

The Ghost of Full Employment
by Jefferson Cowie
American Prospect, September 29, 2010

In the 1970s, Americans also faced a global recession and double-digit unemployment -- but back then politicians had the courage to think big.

Hubert Humphrey, 1974 (AP Photo)

"..After nearly two years of bad economic news, which topped off three decades of economic insecurity, perhaps it's understandable that we've grown indifferent to labor-market pains. We shrug at long-term double-digit unemployment. We greet the news of record-breaking poverty with a national yawn. We've come to believe that unconscionable levels of inequality are something natural to the social order.

The government's direct response to the jobs and poverty crisis has been simple indifference. Wedded to the idea that propping up the market will naturally lead to job growth, officials have responded with "solutions" drawn only from the narrow menu of economic fundamentalism -- tax cuts and stimulus. Now that gross domestic product is positive, the unemployment problem is mostly considered "structural" -- a skills mismatch -- and thus beyond our capacity to solve.

Yet not that long ago, in the midst of another long-term economic meltdown, politicians dared to think beyond the idea that growth alone would solve all problems. National leaders, including mainstream politicians in both parties, went so far as to propose a federally mandated and legally enforceable right to a job for every American.

That's right -- the federal guarantee of a job.

Read rest of article

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Thursday, November 4, 2010

"Stayin' Alive: The 1970s and the Last Days of the Working Class"

INTERVIEW: Labor's love lost - News Articles - Rochester City Newspaper:

Jefferson Cowie traces the roots of blue-collar conservatism

By Ron Netsky
October 13, 2010

"...In his new book, 'Stayin' Alive: The 1970s and the Last Days of the Working Class,' Cowie weaves popular culture into the narrative of labor history.

The book traces the way some traditionally Democratic workers gravitated to the Republican Party as the left embraced minorities, feminists, and countercultural youth in the 1970's.

As the country braces for another election in which many workers appear poised to once again vote against what would seem to be their best interests, the reverberations of the 1970's continue to be felt.

The book also deals with the more liberal outlook on labor in the 1970's that made it possible for Congress to pass the Humphrey-Hawkins Full Employment Act in 1978. The bill, sponsored by then Senator Hubert Humphrey and Representative Augustus Hawkins (whose district included the turbulent Watts area in Los Angeles), called for the right to a job."

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Serial misinformer continues reign of error regarding benefits of stimulus

Serial health care misinformer McCaughey now misleading about stimulus | Media Matters for America:

"...Betsy McCaughey -- best known for repeatedly misleading about health care reform -- made numerous false or misleading claims in order to attack the effectiveness of the stimulus bill."

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Sustainable Bonds Hope to Help Fix the Planet

Sustainable Bonds Hope to Help Fix the Planet -

SINGAPORE — Financial experts may debate how much it would cost to shift the world to a low carbon economy, but they agree on one thing: the amount would be phenomenal. The International Energy Agency in Paris, for example, has estimated that it would take $46 trillion in additional clean-technology investments over the next 40 years to halve carbon emissions by 2050.

...Today, funds mobilized to address climate change are primarily coming from the private sector. While there is also some public investment, there remains a clear gap between what is needed to deal with climate change and what is available. How to close that gap has become a subject of intense debate.

For Ben Caldecott, head of the British and European Union policy department at Climate Change Capital, a London-based environmental investment manager, the answer is clear. “The only pool of capital deep enough to finance our low carbon transition is that held by institutional investors and players in the debt capital markets,” Mr. Caldecott said. “New green bonds are a way of accessing this pool of money.”
But, he cautioned: “Investors want to see a liquid market in long-dated asset-backed bonds that are investment grade and those criteria have yet to be met for green bonds. The market will buy these new debt products, but for this to happen at scale we need to create a liquid market first. It’s a bit of a chicken-and-egg story.”

Sean Kidney, chairman and co-founder of the Climate Bonds Initiative — an international network that advocates raising money through the bond market for climate protection projects — argues that “themed” bonds have long been a way to raise large sums of money for specific purposes.

For example, “the U.S. civil war was financed with war bonds,” Mr. Kidney told delegates at a carbon conference in Singapore last week. “Although these war bonds were targeted at retail investors, most of the money raised came from institutional investors.”

The retail investors’ campaign served to engage the population, creating political pressures that drew in the institutions, Mr. Kidney said, suggesting that themed climate change bonds could be used in a similar way to mobilize retail and institutional investors on the issue.

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Obama Economic Team Passes Out the Kool-Aid | BanksterUSA

Obama Economic Team Passes Out the Kool-Aid | BanksterUSA:

Submitted by Mary Bottari on November 3, 2010

"It’s the day before a hotly-contested national election, where it appeared the rabble was well positioned to deliver a colossal spanking to the elites who have too-long ignored their plight, so what does Team Obama do?

They have a press conference to talk about their eagerness to complete the Korea Free Trade Agreement negotiated by President Bush. 'The president has long said we want to try and address the outstanding issues regarding the Free Trade Agreement in order to bring it forward for approval,' said Mike Froman, Obama’s deputy national security advisor for international economic affairs. “[W]e're going to put every effort into achieving ... an acceptable agreement, a satisfactory agreement, by the time the president comes to Seoul,' he told a news conference on Monday.

Are these people nuts?"

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Where is today's FDR or Bevan?

Where is today's FDR or Bevan?
The Obama administration's healthcare act is a landmark of social reform, yet no Democrat seems willing to champion it

Nicholaus Mills
The Guardian

October 3, 2010

Franklin Delano Roosevelt's campaign address at Madison Square Garden, New York, 31 October 1936. Video: YouTube

In February 1945, with the 5 July implementation of Great Britain's new National Health Services Act still months away, Aneurin Bevan, Labour's minister of health, wasted no time challenging the opposition. Bevan believed that doctors and dentists receiving a salary equivalent to $1,200 a year plus $3 per patient for participating in the National Health Service were being fairly rewarded for their services. He wasn't about to shed tears on their behalf; nor was he willing let his Conservative opponents undermine Labour's achievement. Responding to the Conservative party's RA Butler, who declared the health programme a "great danger", Bevan insisted that the diehard opponents of National Health had "poisoned" parliamentary debate and, in the wake of their defeat, were engaged in a "squalid political conspiracy..."

"...Never have today's Democrats had more need for someone with the backbone of an Aneurin Bevan. The good news is that if Democrats don't want to look to England and its post-second world war battle for national healthcare, they always have the example of President Franklin Roosevelt. Faced with criticism from a Scrooge-like Republican party during the Depression, FDR was as outspoken as Bevan on what a governing party should do during hard times.  
Speaking before an overflow crowd at Madison Square Garden on the eve of the 1936 election, Roosevelt reminded his listeners that he had kept faith with those who first elected him. For anyone who doubted the political ground on which his administration stood, Roosevelt had an answer that left no room for ambiguity:

"Your government is still on the same side of the street with the Good Samaritan and not with those who pass by on the other side."

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