Today the Dow Jones Industrial Average rose above 14,270 – completely erasing its 54 percent loss between 2007 and 2009.
The stock market is basically back to where it was in 2000, while corporate earnings have doubled since then.
Yet the real median wage is now 8 percent below what it was in 2000, and unemployment remains sky-high.
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Why is the stock market doing so well, while most Americans are doing so poorly? Four reasons: ( Continue… )
What should the President do now?
Push to repeal the sequester (a reconciliation bill in the Senate would allow repeal with 51 votes, thereby putting pressure on House Republicans), and replace it with a “Build America’s Future” Act that would close tax loopholes used by the wealthy, end corporate welfare, impose a small (1/10 of 1%) tax on financial transactions, and reduce the size of the military.
Half the revenues would be used for deficit reduction, the other half for investments in our future through education (from early-childhood through affordable higher ed), infrastructure, and basic R&D.
Also included in that bill — in order to make sure our future isn’t jeopardized by another meltdown of Wall Street — would be a resurrection of Glass-Steagall and a limit on the size of the biggest banks. ( Continue… )
With the sequester now beginning, I find myself thinking about Robert F. Kennedy — and 46 years ago when I was an intern in his Senate office.
But RFK was upbeat. He was also busy and intense — drafting legislation, lining up votes, speaking to the poor, inspiring the young. I was awed by his energy and optimism, and his overriding passion for social justice and the public good. (Within a few months he’d declare his intention to run for president. Within a year he’d be dead.)
The nation is once again polarized, but I don’t hear our politicians talking about social justice or the public good. They’re talking instead about the budget deficit and sequestration.
At bottom, though, the issue is still social justice. ( Continue… )
The White House apparently believes the best way to strengthen its hand in the upcoming “sequester” showdown with Republicans is to tell Americans how awful the spending cuts will be, and blame Republicans for them.
It won’t work. These tactical messages are getting in the way of the larger truth, which the President must hammer home: The Republicans’ austerity economics and trickle-down economics are dangerous, bald-faced lies.
Yes, the pending spending cuts will hurt. But even if some Americans begin to feel the pain when the cuts go into effect Friday, most won’t feel it for weeks or months, if ever.
Half are cuts in the military, which will have a huge impact on jobs (the military is America’s only major jobs program), but the cuts will be felt mainly in states with large numbers of military contractors, and then only as those contractors shed employees. ( Continue… )
Can we just put aside ideology for one minute and agree that businesses hire more workers if they have more customers, and fire workers if they have fewer customers?
There are two big categories of customer: One is comprised of individual consumers. The other is government.
We tend to think of the government as a direct employer — of teachers, fire fighters, civil servants.
But government is also a major customer of the private sector. It buys school supplies, pharmaceuticals, military equipment, computers. It hires private companies to build roads and bridges, dredge ports, manage data.
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One out of every five Americans works for a company whose customer is the government. ( Continue… )
I was born in 1946, just when the boomer wave began. Bill Clinton was born that year, too. So was George W. Bush, as was Laura Bush. And Ken Starr (remember him?) And then, the next year, Hillary Rodham was born. And soon Newt Gingrich (known as “Newty” as a boy). And Cher (Every time I begin feeling old I remind myself she’s not that much younger.)
Why did so many of us begin coming into the world in 1946? Demographers have given this question a great deal of attention.
My father, for example, was in World War II — as were the fathers of many other early boomers. Ed Reich came home from the war, as did they. My mother was waiting for him, as were their mothers.
When it comes down to it, demographics is not all that complicated.
Fast-forward. Most of us early boomers had planned to retire around now. Those born a few years later had planned to retire in a few years. ( Continue… )
Raising the minimum wage from $7.25 to $9 should be a no-brainer. Republicans say it will cause employers to shed jobs, but that’s baloney. Employers won’t outsource the jobs abroad or substitute machines for them because jobs at this low level of pay are all in the local personal service sector (retail, restaurant, hotel, and so on), where employers pass on any small wage hikes to customers as pennies more on their bills. States that have a minimum wage closer to $9 than the current federal minimum don’t have higher rates of unemployment than do states still at the federal minimum.
A mere $9 an hour translates into about $18,000 a year — still under the poverty line. When you add in the Earned Income Tax Credit and food stamps it’s possible to barely rise above poverty at this wage, but even the poverty line of about $23,000 understates the true cost of living in most areas of the country.
Besides, the proposed increase would put more money into the hands of families that desperately need it, allowing them to buy a bit more and thereby keep others working.
A decent society should do no less. ( Continue… )
There’s no chance of passage so why are Republicans pushing it now? “Just because something may not pass doesn’t mean that the American people don’t expect us to stand up and be counted for the things that we believe in,” says McConnnell.
The more honest explanation is that a fight over a balanced-budget amendment could get the GOP back on the same page — reuniting Republican government-haters with the Party’s fiscal conservatives. And it could change the subject away from social issues — women’s reproductive rights, immigration, gay marriage – that have split the Party and cost it many votes.
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It also gives the Party something to be for, in contrast to the upcoming fights in which its members will be voting againstcompromises to avoid the next fiscal cliff, continue funding the government, and raising the debt ceiling. ( Continue… )
Part of the President’s State of the Union message and of his second term agenda apparently will focus on public investments in education, infrastructure, and basic R&D.
That’s good news. But how do we fund these investments when discretionary spending is being cut to the bone in order to reduce the budget deficit?
Answer: By treating public investments differently from current spending.
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No rational family would borrow to pay for a vacation but not borrow to send a kid to college. No rational business would borrow to finance current salaries but not to pay for critical new machinery. ( Continue… )
If you’re sitting in the well of the House when a president gives a State of the Union address (as I’ve had the privilege of doing five times), the hardest part is on the knees. You’re required to stand and applaud every applause line, which means, if you’re in the cabinet or an elected official of the president’s party, an extraordinary amount of standing and sitting.
But for a president himself, the State of the Union provides a unique opportunity to focus the entire nation’s attention on the central issue you want the nation to help you take action on.
President Obama has been focusing his (and therefore America’s) attention on immigration, guns, and the environment. All are important. But in my view none of these should be the central theme of his address Tuesday evening.
His focus should be on the joblessness, falling real wages, economic insecurity, and widening inequality that continue to dog the nation. These are the overriding concerns of most Americans. All will grow worse if the deficit hawks, austerity mavens, trickle-down charlatans, and government-haters who have commanded center stage for too long continue to get their way. ( Continue… )