The Teabaggers hate everything that isn’t them. Based in racism, the Teabaggers transcend that disgusting practice. Case in point: the obstruction of a Nobel Prize-winning economist for the Federal Reserve Board. Peter Diamond won the Nobel Prize in Economics for his research on the labor market. You know – labor – the thing that actually drives the world’s largest economy. Wages drive demand. Demand drives the economy – not supply as the Teabaggers zealously cling to.
The obstruction was wrought by one man; one white, upper-class racist Teabagger from Alabama: Sen. Shelby. He successfully held up the nomination of a Nobel Prize-winning economist because that economist doesn’t agree with with Shelby’s fringe views on how economies work.
I don’t know why Sen. Shelby hates America or Americans. I don’t know why Sen. Shelby thinks that tens of millions of unemployed Americans is good for the economy. I don’t know why Sen. Shelby decided that he – and he alone – knew more than any other American about economics. Actually, I do know. Sen. Shelby wants the Black Man out of the White House. Anything else, including extending the Great Recession and allowing China to dominate world affairs for the next century, is way down the priority list for Sen. Shelby. He hates the idea of a black man as President more than he loves his country.
158,434 homes in some stage of foreclosure sold in the first quarter. With around1.9 million homes remaining in foreclosure, the supply of just these types of homes will last between 2 and 3 years. If no other major economic disruptions occur in the meantime, it will only be after that time that any economic recovery from 2007 can truly occur.
I’m not an economist, but I don’t see that as likely, quite frankly. Seven years after the last recession started will be a prime time for another to start. And the Federal Reserve and Treasury Department has done more to prop up billionaires than lower and middle class Americans, despite the fact that the latter sets are what actually drive the U.S. economy toward growth. Moreover, those two institutions have run out of actions they can take. Interest rates continue to hover near zero for banks (not that you and I see any tangible benefits) while trillions of dollars (literally) have been loaned to banks at those near-zero interest rates. And that’s only a couple of examples of how close to the end of the string they are.
What left? Well, the government abdicated its responsibility to ensure that a large enough economic stimulus was provided in 2009. Politicians of both major parties refused to listen to economists who were experts on how we exited the Great Depression. As a result, we’re left with a tepid economy and even worse disparate wealth differences between the top and bottom than prior to 2007. I don’t see the situation improving appreciably any time soon.
For those still left wondering what happened this election cycle, perhaps the Fed’s plan to buy up to $900 Billion in Treasuries by next June can shed a little light on things. They’re going to announce details of how they’re going to buy them ahead of time, allowing wealthy investors (not average Americans) the chance to buy them first, then sell them to the Fed for a profit. The rich devise plans to make themselves richer, not share with the rest of America. That’s one reason why tax cuts for the rich are such a stupid idea. Wealthy entities are wealthy for a reason: they horde their wealth. Keep the nonsensical Bad Trade deals around while inventing new ways for the wealthy to multiply their wealth and the rest of America continues to fall further and further behind.
Jobs aren’t coming back, they’ve been shipped overseas. Without jobs, Americans can’t spend. Without growing consumer demand, corporations have no incentive to hire. Meanwhile, banks get to kick people out of their homes, which in some cases might be illegal. No jobs and no houses means no growing economy. Nobody in government is stepping in to meaningfully stem the tide on these disastrous trends, letting the “market” to iron out the problems instead. This is what worshipping at the free-market mantle has wrought.
The Democrats left in office are for the most part more progressive than the corporate apologists that got voted out of office. If they want to fare better than their colleagues did in 2012, they had at least better make a show of fighting for Main St and tell Wall St to start sucking it up. The economy is not too far away from that cliff President Obama keeps talking about. If Republican Teabaggers get what they want, we’ll fall right over it.
I’ve written about this a little since Sep 15th, when everything in the financial markets went to hell. I didn’t trust the Bush “administration” to handle the financial crisis with any degree of honesty or integrity. I take no pleasure in reading news reports that my worst fears continue to come true. Bush and Sec. Treasury Paulson are taking American taxpayers for a ride; a ride that they will never be held accountable. How bad is it already? As detailed by Jerome a Paris, here are the up-to-date details:
$150 billion for AIG, on much sweeter terms than they were paying for the earlier $85 billion bailout (with a whoopping 5% drop in the interest rate they have to pay, for instance);
lest we forget, the $29 billion guarantee to JPMorgan for Bear Stearns assets (but that’s almost small change now);
and $1,200 billion new liabilities on the Fed’s (ie ultimately the taxpayers’) balance sheet, backed by mostly junk paper;
Wall St. continues its free fall, with the Dow falling over 500 points today after falling 370 points yesterday. Indices are at the same level as they were in the fall of 2003. Retirement accounts have lost $2 Trillion in value. The problem? Despite the approval of the Bush Bailout by Congress last Friday, no one has any confidence in anyone else. Banks still refuse to lend to one another or to credit-worthy customers. As I and others stated last week, the Bush Bailout didn’t address the fundamental problems in the economy. More and more people recognize that and are reacting to it.
They’re also reacting to the realization that the Bush administration’s refusal to do anything about the housing bubble for over two years spread tons of bad debt and risk around to world banks. So the world is staring a deep recession in the face because the Bushies decided they’d rather wait until America was in debt past its eyeballs before proposing something.
The Federal Reserve is offering to buy up another $300 billion of loans from banks, without collateral of course, to unfreeze credit markets. How are they going to pay for that? By borrowing money from the banks. By printing more money. Printing more money, by the way, increases inflation, which was at 5.4% last I checked (and that’s a b.s. low-ball calculation by economists who want to pretend the economy is doing better than it really is). In an era of stagnant incomes and rising unemployment, higher inflation will simply wreck the middle class’ ability to stay afloat.
The economy has been running on credit, as everyone should be well aware of by now. First in the 1980s and 1990s with credit cards. Then in the 2000s with home equity. Now that credit is being taken away in a flash. What’s left has two distinct faces: consumer borrowing is down for the first time since 1998. While it’s good that people are borrowing less, it also means they’re going to spend less. After all, incomes after inflation haven’t increased in years. Consumers without credit will have no money to spend unless one of two things happen: incomes increase (the better solution) or credit flows again (the worse option). Raising incomes will put our economy back onto the path of health again in a meaningful way.
But in West Virginia last year, it [RealtyTrac] counted fewer than 500 foreclosure notices. New federal statistics counted 12,000 notices in the state, since the start of 2007.
Heck, that’s only 24 times as bad. Who’s counting? Thankfully, a Democratic Senator in July co-sponsored the Foreclosure Prevention Act, which Congress passed in July. The bill required the Department of Housing and Urban Development to measure foreclosure rates in each state.
Out here in the Western U.S., we know that forest fires are a critical issue. Forest health is an issue that should receive serious attention by those we send to represent us in D.C. As usual with Republicans in charge, the publics’ best interests aren’t being considered. Here is the Bush administration’s plan to deal with forest fires: slash forest fire prevention budgets, then propose that the shortfalls in budgets be made up by selling off the timber that would have otherwise had to have been protected from fire. Ingenious, no?
But the proposal slashes the agency’s preparedness funding by $77 million, including a $13 million reduction in money to remove dead trees and overgrown brush that act as kindling for fires in 155 national forests.
Republicans are out to prove to the American public that government can’t work. That’s why you shouldn’t vote for them. Would you go to a doctor who wanted to prove to you that medicine didn’t work? The Bushies are out to pad the pockets of their corporate cronies. Affected citizens are getting the shaft.
Meanwhile, climate change continues to impact these areas that were mismanaged by forest policies for a century. A drier climate will not make the Forest Service’s future tasks any easier.
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Now, some economic news.
Last week, a barrel of oil cost $135, setting record after record. Following suit, gas prices continue to rise. The national average? $3.90 today. That’s putting some hurt on consumers.
The Federal Reserve last week lowered their 2008 economic forecast, then raised their projections for inflation and unemployment. Which should worry all of us because the most widely accepted values of both inflation and unemployment miss significant portions of our economy. If those commonly accepted values are increasing, the values that more closely match reality are also rising, and likely doing so more quickly.
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Dick Wadhams and Bob “Sweatshop” Schaffer are in the news trying to make something out of nothing. They’re pushing the meme in the corporate media that Mark Udall really does live in Boulder, gosh darn it! Why would they be wasting their time on this? Aside from the fact that they have nothing of substance to offer Colorado voters this fall, they’re trying to magically legitimize Dick’s favorite name for Mark: “Boulder liberal”. Mark Udall moved to Eldorado Springs over five years ago. Dick’s latest plug: showing Udall’s mailing and physical address zip codes, the former is in Boulder, the latter is in Eldorado Springs, according to the Assessor’s office.
Stygius at S2 shared a good zip code that’s much more relevant to the issues:
96950. That’s the zip code for the Mariana Islands, where Bob Schaffer helped out labor bosses and Jack Abramoff’s agenda. Human rights, labor rights, the child sex trade and forced abortions: issues Bob Schaffer and Dick Wadhams want to distract our attention from by repeatedly calling Mark Udall names. It’s one reason why Bob Schaffer will lose this election.
I’m sure more than a few of us read that the Federal Reserve and JP Morgan Chase bailed out the large investment firm Bear Stearns last week. Actually, we’re the ones that bailed the bank out. Jeff Blum at OpenLeft has some darn good questions. For instance, why can’t we provide a few billion dollars to help out the borrowers? What benefit will bailing out this firm provide the rest of us?
My feelings on this are: we shouldn’t be bailing out large investment firms that knowingly took on incredibly risky investments. It’s interesting to listen to the economic elite put all the blame on the sub-prime mortgage mess on the people who signed the papers. According to the lenders, if people didn’t know what they were signing for, they shouldn’t have signed. Therefore, they deserve what happens to them. Well guess what, turnabout is fair play. If the borrowers should have known what they were getting themselves into, what responsibility should the lenders have? Apparently none.
Additionally, I find it very interesting that this move is reminiscent of activities last undertaken … in the Great Depression. But according to Bush, the economy is doing just fine! Why do Democrats constantly have to clean up Republican’t messages?
I also think it’s disgusting that these same elitists want government to stay out of their business with regard to application of regulations, but as soon as things look bleak they think it’s the government’s responsibility to bail them out. Seriously, WTF?! Does the ‘free market’ work or does it not? Really, who are the real welfare queens? Bear Stearns and the other large firms got themselves and the rest of us into this mess, more knowingly than those who borrowed from them. I have absolutely no pity for these entities who operated for years as though they were above the law. They should reap what they sowed – maybe a couple large firms’ failures would serve as a wake-up call to the remainder of them to work with regulators in the future. Bailing this firm out sends a message to all of the firms that taking on too much risk is okay since the taxpayers allow themselves to be fleeced time and time again.
Update – Well isn’t this interesting: Bonuses handed out in 2006 at Bear Stearns totaled $2.6 BILLLION. As of today, the company is only worth 1/10 of that, down from $40B back in January. Tell me again why taxpayers got saddled with a multi-billion dollar bailout please. Oh yeah, because regulation is bad and greed is good.
Remember this when you pay your next insurance premium: we can’t afford universal health care because it’s more important to bail out Bear Stearns.
