One of the biggest targets for politicians, as far as economics are concerned, is becoming the payday loans industry. Governors across the country are trying to rid their states of the industry altogether, and so far, Georgia, North Carolina, and Oregon have succeeded. The result was that bankruptcies, foreclosures, and also the number of overdraft fees due to bouncing checks went through the roof, which doesn’t do anything for the citizens afflicted in these turbulent times, and only is really good for the banking industry. Despite these negative effects, other states are looking to follow the example and do the same. Even at the national level, presidential candidate Barack Obama, is weighing in his own agenda on the issue, and advancing his own intentions on getting rid of the industry in the United States completely. If these measures, both on state levels and nationally, are successful, the results are going to be increased unemployment, more debt, more foreclosures, and an even worse economy.

Being misinformed can lead to disastrous results especially if you are making crucial decisions based on skewed facts and false information. The advantages and disadvantages of payday loans are often misconstrued. Many politicians across the United States are making an effort to pass legislation that would limit or completely abolish your ability to get a payday loan. Sad to say, the anti-payday loan legislation has been passed in some states, and there are many states that are beginning to follow suit. These new laws are foolishly based on the supposition that payday loan companies utilize the same poor ethical standards as predatory lenders and illegal loan sharks. Your financial independence relies on the knowledge of the American people. So don’t be misinformed on the facts and don’t let your friends and family be misinformed either; share what you know about the advantages of the payday loan industry.
Post Courtesy of Personal Money Store
Professional Blogging Team
Feed Back: 1-866-641-3406
Home: http://personalmoneystore.com/NoFaxPaydayLoans.html
Blog: http://personalmoneystore.com/moneyblog/

Mark, we have a situation in the UK, where most of our doctors and nurses are going abroad once they qualify. We therefore need good staff for the NHS from abroad, and I don't have a problem with that. However, we then have to look at the reason why so many of our home qualified staff are migrating - because the NHS does not pay enough for a newly qualified health worker to live on. The UK is supposed to be the fifth biggest economy in the World, and we cannot afford to pay our key workers a fair wage.
This is a disgusting situation, and one which successive governments have been aware of.

The result is the intent. Think about it.

Andy,
I'm sorry to hear what is going on in the UK concerning immigration and the declining standard of living. I can definitely relate to what you are saying. I'm thoroughly disgusted that the political leaders there are of the same mindset as the ones who are taking this country down the tubes. All I can say is too keep fighting the fight and to keep being politically involved. You can bet that there are millions of other people who feel just like you do.
I'm especially concerned about the large numbers that you mention. Undoubtedly the UK has had an incredible impact on both US and world history, yet Britain numerically isn't that large and could easily be overrun by foreigners. People have a right to self-determination and both people in the UK and the US have the right to change their governments when their governments' act in opposition to the people's interest.
No one in the US (nor in the UK, I suspect) minds some sensible immigration policy, but the mass migration of foreigners with no limits is egregious and unacceptable. The same is true here. Good luck looking for Americans in building or highway construction here in America-you won't find them. These jobs used to be good paying and were occupied by indigenous inhabitants. In South Carolina, where a third of the population is black, these jobs were held white and black working classes by about 50/50. No more. Americans were priced out of the market and were all the while told it was for their own good. I have one of the few manufacturing jobs left, but when it's gone, I guess I'll end up working for Wal-Mart or some mini-mart. I guess that's for my own good too.

Craig,
That's some interesting information concerning the people's real behavior concerning investments. I hope you can be the man to take this information to the public. Interestingly it is the physicists who are making the most important strides concerning economics (e.g., Levy, Yakovenko) because of the similarity among the distributions. We need some smart people to go out and tell the people the truth. Thanks for your thoughts.

The Clinton campaign quoted a statistic, that 80% of new job growth occurred in businesses employing 25 people or less. Unfortunately, Obama and Clinton both talk about raising marginal income tax rates and raising the cap on social security taxation. Both of these kind of measures hit small business disproportionately. The wealth and income of the Corporate Aristocracy never shows up on the "gross adjusted income" line of a tax return. Small business actually has to perform in a true "market economy", ie multiple buyers and multiple sellers of goods as services. Big corporations operate as a monopoly/oligopoly. Wall street brags about corporate america being the result of successful market capitalism. They aren't. All they do is soak up wealth and outsource jobs. If the democrats can't come up with tax policies to go after corporate wealth, what good are they? In the end, they are no better than a McCain/Huckabee. We've reached a point where Wall Street would rather have the democratic offerings rather than the republican offering.

Mark, it may interest you to know that the same stoichastic process found in the Boltzmann-Gibbs distribution and exchange provides an accurate stock exchange model as well. Traditional economic theory says that rational investors will buy low and sell high. Realistically, people panic, people need money even when their stocks are low, etc, so the exchanges are made almost randomly. Guess what? Turns out this concentrates wealth as well, since the larger investors have the ability to weather minor storms that destroy smaller investors - they can even make a profit.
So the question in my mind becomes are "the rich", whether they're the top 20%, 5%, 0.01% or whatever, manipulating a system to stay on top (and thus keep us down) or just unconciously benefitting from a system that does the same? I have a feeling that most of the upper class who make under a million a year probably are as unaware of how the system is keeping them rich as are the poorer people. They are content to think that their hard work has somehow made them better off, ignoring those others who work hard without making similar money.
Craig

Mark, it is now quite obvious, that there are millions of people in the States and UK, who are in the same situation. We have millions of people in the UK, who are in temporary employment, millions who are on the minimum wage of $11 an hour, and millions more on wages of under $16 dollars an hour. The government comes along with an average wage figure of $56000 per year, yet I know many people who are on less than $40000. The average cost of a two bedroom house where I live is $400000, so what chance do people have to improve their situation. Many people (myself included) cannot afford to pay into a pension fund, and even if we could, what would it be worth? We have an ageing population, and in a country of 60 million, we have had an influx of immigrant workers (mainly from Eastern Europe), which is estimated at possibly 3 million in the last two years. The immigrant workers are allowed to enter the country in unlimited numbers - because the Government has told us that it is good for the economy - and work for the minimum wage, even doing skilled jobs such as a plumber or electrician. This has the result of depressing the wages even more, and causing unrest in certain areas of high unemployment. There are extra burdens placed on education and the health service, with extra staff having to be employed as interpreters. I know that there are occasions, when staff have to be sourced from other countries, but you simply cannot open the floodgates, and let everyone in, with no restrictions. The only people who have benefited from this, are employers who want to cut their overheads, and the government, from the extra tax paid.
We are in a real mess - someone show me how to escape!!

To Andy, Daniel, and Mirf:

Many thanks for your replies. I have to tip my hat you since you intuitively understand what it took me a long while to come to grips with. My entire adult life has been filled with repeated downsizing and outsourcing. The manufacturing jobs are gone, and where I live in South Carolina, the results have been devastating. Many people are living off of high interest credit cards and on credit issued by loan sharking payday lenders. The tax code is regressive on the federal and state levels, and many people are on the verge of losing their homes. The government is beholden to the Chamber of Commerce as is the mainstream media.

All of this is the result of unfettered capitalism, yet perplexingly, many ordinary people I know are mad at the wrong entities. I like Mike Huckabee's personality, but he is dead wrong about his regressive national sales tax. A national sales tax is exactly the wrong thing to do because it punishes people who are on shaky economic ground to begin with.
The US and Britain have the most wealth inequality of any advanced nations, but large numbers of people are voting for politicians whose policies are at odds with the common man's interests.

It's not that people are dumb: it's that they've taught the wrong things by most economists and politicians for the past thirty years-from Milton Friedman to Reagan, and from Thatcher to Clinton (and Tony Blair too).

Back in 2003, when I was unemployed (again), I was listening to politicians from both parties and it struck me how different the modern view of economics was from the recollections I had of my parents' (WWII) generation. I distinctly remembered how they used to talk about "chance" concerning the Great Depression. The modern view advocates free markets, deregulation, competition, and "merit": you get what you deserve given equal opportunity.
On the other hand, many folks from my parents' generation saw people as being basically equal with chance rewarding a lucky few. People who grew up in the Depression spent much time thinking about what had happened, and every single of them that I talked with back in seventies mentioned chance as determining one's fortune.

When people of that generation talked about chance, they meant the chance of being born into certain circumstances, or living in a particular community, or being in the right place at the right time. The merit system that was created after WWII was supposed to eliminate chance as being the determining factor, yet that system itself has facilitated an even further class stratified society. My parents understood that being well off financially tilts the odds in your favor.
No system of merit can compensate for the way that capitalism naturally re-distributes wealth to the already wealthy. All a merit system can do is decide who gets what slot and receives the most booty in an economic system that is statistically unfair to begin with.

I still have several versions of the model economy on my computer: unfortunately though, they're written in a proprietary language. I've been so busy working that I haven't had a chance to convert them to another language. It's no small undertaking to do this because the program is quite large.

Here is a more technical description of how the program works for anyone who is interested. Many thanks for your replies and thoughts.

Sincerely,
Mark Whittington

Yes, I do assert that wealth tends to remain static and unequally distributed-and that's a good starting point for a more technical description of how the model works. Perhaps the best way to explain this is by reviewing the reasoning, step by step, that I initially used to create the model.

Back in 2003, the first thing I did was to create an array of one thousand agents, and I gave them each ten dollars. The program would select the first agent in the array and then select another agent at random in the array. Each agent would take the same percentage of his wealth and then exchange with the other. The program would click through each agent in the array and perform the same process. After the last agent in the array performed an exchange, then the entire array was sorted in order of wealth. The process repeats itself over and over again, and a distribution soon developed (also the same distribution developed each time, every time). The program took the distribution over time, and averaged it for each iteration to give a solid, repeatable distribution of wealth. At the time, I didn't even know the name of the distribution, but after some research, I found that the distribution is called a Boltzmann-Gibs distribution. This is the same distribution that appears concerning particle collisions that is used in physics. It's an exponential distribution, but it is nowhere nearly as concentrated as the real distribution of wealth in capitalism.

After developing this initial distribution based only on monetary exchanges of equal percentages of individual agent wealth, I started trying other scenarios. What if the percent exchanged was selected at random, or what if an agent would only make the most advantageous exchange from a number of possible exchanges? After trying many different scenarios concerning exchanges, I found an important truth: the Boltzmann Gibs distribution is robust. It doesn't matter how much or in what percentage that people make monetary exchanges because the B.G. distribution will always develop over time. The important thing is that all people make exchanges, and then the B.G. distribution will necessarily develop.

Equally important though, is the fact that although the same exponential distribution always develops, the people filling slots in the distribution continually change. Using just monetary exchanges, wealth continuously shifts from person to person. One moment you may be rich, but in a very short amount time you may be poor in a never ending cycle.

This fact gives me insight into how capitalism must have developed. Long ago people must have figured out this boom-bust cycle concerning their personal wealth. Once people became rich, they probably started looking for ways to preserve their wealth because they knew from experience that if they kept making monetary exchanges without an advantage, that they would soon become poor again.

Consequently, I programmed an advantage in the system in the form of capital investment. So now in the program each agent in the array would give a portion of his wealth to other agents and receive back proportionally the gain or loss from the agents that he gave money to. Every agent in the array still makes monetary exchanges.

An amazing thing happens when capital investment is added onto the monetary exchange system: wealth becomes much more concentrated and people tend to become more static within the distribution. Rich people tend to stay richer and poor people tend to remain poor.

For a long time I tried to find how much a person would have to invest, and how many people he would have to split his money among to maximize his own wealth. I found that the agents would have to invest half of their wealth between two other entities to maximize their return in the long run. Based on this information, I surmised that income should be about half of wealth-a fact that I latter confirmed through the Federal Reserve Triennial Survey. Since the survey began, I found that median wealth is almost exactly twice that of median income (1.97:1).

So, with exchanges and capital investment, it is possible to construct more realistic wealth distributions, but there is one more piece to the puzzle. Up to this point, the distributions are lopsided, but not lopsided enough to match real capitalism. The distribution at this point is almost the right shape. Thinking about it though, how would one even further reduce his risk in conjunction with capital investment? If I'm on the top and if I want to reduce my risk, then I just don't invest in anyone, I invest in people who are just below me in relative wealth, and they in turn invest in people just below them in relative wealth. Regardless if people below me gain or lose money in the aggregate, I always gain the majority of what was gained.

That's what makes capitalism so attractive to the wealthy-they're pigeonholed to win because the hierarchy limits their risk-the wealthier you are, the less risk you are at. You're bound to remain on top. That's why you or I will never switch positions with Bill Gates or the Wal-Mart people.

So in the program when a hierarchy is added to capital investment and monetary exchanges, then the correct distribution develops. It's only beneficial for people down to average wealth though to continue participating in the hierarchy because after that, no monetary gain is realized for the agents. Average wealth in a capitalist system starts at the top 20%, so in the US that means people with four year degrees and above who a part of a corporate hierarchy benefit from the system, and through history aristocracies and what was latter called a middle class (called upper middle class today) have always involved roughly the top 20% of their respective societies. Capitalism, regardless of what textbooks tell you, has been around for a long time even though historians have called it aristocracy.
As a final note, in addition to the wealth percentages that I cited in the original article, I found the natural Pareto coefficient to be 1.76. Also, although I don't have the time to get into it, in 2005 I found the real name of the wealth distribution. It's the Woods Saxon potential curve (which looks a lot like a Bell curve). The log of wealth vs. the number of agents ranked from richest to poorest is in the shape of a bisected Woods Saxon potential curve. Incidentally, I also found a shell structure concerning wealth that closely mimics nucleon shell structure that is used in nuclear physics. Thanks for reading this.

Mark Whittington,

I don't quite get all the turns of your model. Is there a more in-depth explanation or "for Dummies" primer I could read?

kloro- I too have recently been dissatisfied with Google. Adding more search engines with Dogpile helps. Does anyone know some specific search engines which are tops in certain areas of expertise?

Good start, but congresspersons get kickbacks and perks -- and "timebomb" or time-release perks, apparently, which must be backroom deals that result in money and/or lobby positions after they leave office.

It is a crime to take a kickback after one leaves office?

Since Reagan (and maybe earlier) the US Government has interpreted its main economic function as increasing GDP: without regard to its distribution and without regard to the impact on aggregate quality of life.

Let me suggest a reform that fundamentally change the government's focus: A constitutional amendment that would tie congressional salaries to median income growth.

The GDP would instantly become irrelevant--as it should be.

To AndyUK,

Thanks for on-the-ground economic perspective from the UK. Most of us have few places to hear this here in US.

To Mark Whittington,

Thanks for in-depth economic discussion and your correct take on why progressive taxation is needed.
Now that Huckabee is resurfacing (perhaps as V.P. nominee), we need a lot of truth talk about the so-called "FairTax" (sales tax on consumption) he is proposing. I hope you'll weigh in on this.

Daniel David

Great writing, Barbara, I applaud the truth in your essay! From a minimum worker standpoint (of which I am), I heartily agree that pricing goods beyond what ordinary people can pay and constantly being solicited by credit card and mortgage companies is not the way to 'stimulate' any economy- it is what it is; preying on the underpaid.

"If all the economists were laid end to end they couldnt reach a conclusion." George Bernard Shaw

It is all so very simple really. Who wants a middle class, educated people are such a bother to swindle. So much easier to have the mass of Americans in temp jobs with little or no benefits and absolutely no job security, lets see 'em protest now!

We the people allowed Reagan to deceive us with his "all government is bad" mantra and his elimination of the Sherman Anti-Trust statutes. We the people stood by as Bush 41, Clinton (1?) and then little Georgie allowed corporations to become transnational, employ no Am,ericans, pay little or no US taxes despite reaping billions in profit from us, incidentally ruining the economy of various third world nations increasing the flood of desperate people crossing our borders to find work. We the people have stood by and allowed our election process to become almost irelevent and easily manipulated, controlled by the power of money not votes.

So , I wonder, what are we the people going to do about it all?

You really have to give credit to big business where credit it due. They sold us an 'easy money' scam to justify outsourcing, didn't they? They said that we will all be better off because most of the unpleasant jobs (the ones we hate to do) will be off-shored, while we sit at our computers and manage the assets and reap the benefits of cheaper goods. Then we said, "Wait a minute," when they started off-shoring those 'easy money' jobs too, and all we were left with were chintzy paying service sector jobs.

I remember one of my friends who is a Mensa member with a degree in engineering and a MA in business administration singing the praises of outsourcing (and GWB as well), until he also lost his job to outsourcing. He never saw it coming!

Now, how or why we let BB sell us an 'easy money' scam, telling us that we could make a mint typing at our keyboards while the rest of world labored for us, just boggles the mind. How long can anyone last when they consume more than they produce? Doesn't take a rocket scientist to understand that one.

Again, we gotta hand it to those wiley corporate weasels, even if they are laughing all the way to the bank.

On the plus side, though, we won't have to worry about building that fence along the border because few will come once the jobs dry up (especially those 'service sector' jobs). Might not be a bad idea to learn about farming again.

Hi Mark, I don't know if you, like me are from the UK, but you certainly share my beliefs and theories about Capitalism today. The profits distributed to a tiny minority, investment (shares and returns) not dependant on the individual skill of the investor.
I also agree that progressive taxation is the only fair way to regulate modern Capitalism. It would seem as though the modern rich are among the most unsatisfied people around. They do not believe that they have enough money, and certainly do not think they should pay any tax, if they can get away with it. They are also, the greediest and most selfish people, keeping many employees on rates of pay very close to the minimum wage, and never giving bonuses or incentives to so called "support" staff.
It is interesting, and also alarming that in the UK, our third party, the Liberal Democrats, advocate both progressive personal taxation, increasing capital gains tax above a certain threshold, and reforming the electoral system, in order to introduce proportional representation, instead of the first past the post system, which in my opinion does not represent a democracy.

A Model Economy Proves The Statistical Bias of Capitalism

Have you ever wondered why a few people end up owning and controlling the vast majority of a society's wealth, or why aristocracies inevitably develop in practically every culture, past or present? Have you pondered the egregious wealth inequality in the US where the top 1% owns the wealth equivalent of the bottom 95% combined? Some years ago, I set out to investigate how capitalism really works using a totally clean slate and using new computer programming methods. Over several months during the spring of 2003, I constructed a model economy using statistically equal entities, and I achieved results far beyond my initial expectations. It turns out that huge levels of wealth inequality are built into capitalism-even among statistically equal people. Capitalism takes the wealth generated by the society and then re-distributes it to a tiny minority.

My model economy programs use stochastic (i.e., equal chance) methods with economic agents who own equal amounts of wealth initially. Economic agents follow the following simple paradigm:

Agents make investments.
Agents make monetary exchanges.
Agents receive returns on investment.

Using just the three points above, a decent approximation can be made of what an actual capitalist wealth distribution will actually look like. Through trial and error, and by reconstructing the process that would tend to maximize individual agent relative wealth, I found that an investment hierarchy in addition to the above points generates correct wealth distributions. The "investment hierarchy" that I am speaking of represents the employer to employee relationship (especially corporate management): in the model economy as in real capitalism, employer investment money becomes employee labor income. In turn, the next lower tier employee becomes the employer and source of labor income to the tier of employees below him, and so on and so forth. After the hierarchy makes their investments, monetary exchanges take place for goods and services, and then return on investments filters back up through the hierarchy. This methodology produces astoundingly accurate results. Not only can one accurately predict personal wealth using this algorithm, but it also produces correct stock market capitalization (i.e., corporate wealth) distributions.

Using the model economy program, one may now answer the following question: What will be the long term distribution of wealth of any large group of people participating in capitalism without taking taxes into consideration?

Answer: According to the model,

The top 1% will own 35% of the wealth
The top 5% will own 64% of the wealth
The top 10% will own 75% of the wealth
The top 20% will own 84% of the wealth
The bottom 60% will own 5% of the wealth
The bottom 40% will own .013% of the wealth

If you keep track of such things, then you may have noticed that the above computer generated predictions match the current US wealth distribution almost exactly. However, I also said that the predictions don't take taxes into consideration. It turns out that taxes in the US have no re-distributive effect whatsoever. Our tax system guarantees that wealth will be as concentrated as possible.

Let me make a few more observations about capitalism as illuminated by the model economy:

The investment process itself causes wealth inequality for the entire population. Moshe Levy of the Jerusalem School of Business proved that success in investing was independent of investment ability for the wealthiest people. My paradigm generalizes this idea for the whole economy because it takes trade into account, and because it shows that all people are investors.

If people are equal in every respect, and if they can make even the most basic decisions to increase their wealth, then a wealth distribution such as the one I have described has to develop. This distribution appears in every real free market capitalist economy

All members of an economy are investors. Even though people at the bottom get most of their money through labor income, they still have to invest at the same rate as the wealthiest people if they are going to maintain their relative wealth (i.e., their piece of the pie). An example of how an ordinary person invests could be: a person pays someone to remodel their kitchen, and then their house is sold for a profit or loss when taking the original house cost plus the remodeling cost into account.

The neo liberal idea that if the trade rate increases, then the wealth inequality decreases is true, but it doesn't work well in a real economy. If there were no hierarchy (bosses and workers), then neo liberalism would work (but the environment would be damaged since increasing the investment rate increases consumption proportionally).

The hierarchy's effect on increasing wealth inequality far outweighs trade's ability to decrease wealth inequality.

The vast majority of wealth inequality is caused by the hierarchy (bosses and workers). However, it would be impractical to remove the intermediary agents between investors and producers because economies have large numbers of people, and single people would have great difficulty making exchanges with tens of thousands of people.

Progressive taxation is the best way to reduce wealth inequality in a free market capitalist system. The easiest way to do this is to tax the income of the wealthy, but a wealth tax would work too. Taxation though, has to redistribute wealth, or it won't work.

Some simple statistics here, which may or may not be familar to most people.
When I purchased my house back in 1992, it cost £49000, it is now valued at £190000.
In 1992 I was earning £17000, I am now earning £31000.
Petrol (gas) costs in the UK have now gone over £5 ($10) per gallon.
90% of the people in the UK are in financial difficulties.
In some areas, 60% of people have negative equity, probably because they have taken out extra loans against their property.
We need to see the return of the unions, because ordinary workers need to be protected from the abuses which are commonplace now. If you cannot do your job on time, because of staff cuts, then you are accused of having bad "time management" skills.
In the UK, we have no manufacturing industry of note (making war machines is the largest), and instead, we rely on the "services" sector for our GDP. This sector comprises the richest people in the country - Merchant Bankers, Accountants, Lawyers, Property Developers, Insurance.
The fat cats are laughing all the way to their yachts and glitzy apartments in Monaco, in the knowledge that all of their "hard earned" cash is going to evade the Chancellor, meaning no tax bills.
There was a time during the Thatcher years, when I thought that the "loadsamoney" culture would die out, and a more tangible and sustainable economic model would prevail.
Unfortunately, it is a case of "same old, same old".

kloro - you are just starting to hit on the answer. Just about every economic number is calculated differently every year or two. If you change the way you calculate the number to get a less frightening outcome then everything sounds ok.

We are also doing this in health care. Now millions of people get no health care unless they drop over in public or are so sick they can get into an emergency room. They are calculated as healthy until that point because no money is spent on their care. So we can hide much of the cost of our wasteful private system that still costs twice as much as some of the better plans in other countries. Proper measures would be life expectancy, frequency of preventable disease, healthy births etc. By those measures we SUCK BIG TIME.

In economic terms used today the bridge collapse in Minnesota will be a big gain because of all the spending on rescue, clean up, extra gas to drive to other bridges, traffic jams, insurance payout for damage, increased premiums because of the damage and building a new bridge. But when done the new bridge will only be more valuable because it has a longer life being newer. Notice that merely being safer will not have any economic value at all. Safety is about the most valuable thing a bridge can have.

It's all about control, or should I say "kontrol."

Dubya's "ownership society" is not about owning but rather BEING owned. Another brilliantly twisted concept, framed brilliantly for the gullible folks. The only way to keep the masses in line was to make them believe that they--like little "masters of the universe"---could own a portfolio, a morsel of American wealth. Just keep those eyeballs glued on those stock quotes, and yes, you too can become a capitalist and protect and defend our free market fortress. The American dream---why that's passe!
Why ask for a modest little house when you can have much, much, much more. Don't need it? No, you gotta have it.

It's a drugged-out nation...drugged on shopping, drugged on vapid TV, drugged on junk food, drugged on money, drugged on illusion and denial, drugged on pettiness, drugged on tabloid news, drugged on religion. Oh what a world it would be if the population was drugged on intellect, on imagination, on learning! All the comments on this blog have been astoundingly intelligent, well-reasoned, and in some cases deeply analytical, regardless of what one agrees with.

COMarc, thanks for bringing up a complex mind like Thomas Jefferson. The operative word for solving our problems is "local." I have been thinking about that for the last six months; "local" is the magic key. Economies of local scale can work to disarm corporate power just as local governments can become an antidote to abuse of federal power.
Never underestimate what a tiny bacteria can do to a dinosaur. Local economies promote energy efficiency, resuscitate entire communities, strengthen human bonds, honor a sense of civics. In that "village" everyone has a role and each one is needed; every talent and human resource is applied and pride is restored to the individual.

Of course, the corporatists will falsely label it socialism in order to destroy it; remember what they did to the word "liberal"? They're just afraid that it would truly represent the concept of free enterprise. Imagine a self-sustaining community of local entrepreneurs, merchants, and professionals: how would that sit with Walmart and other community-destroying big box stores?

Let's start by turning off the TV.

Check this site out for buying power of the dollar:
http://www.measuringworth.com/uscompare/

Economists slice and dice it several ways, since this is an inexact science. One of the real stumbling blocks, I'm certain, is that technology changes, and sometimes has no precursor to measure against. e.g. What did a TV cost in 1890?

Try using Google, Wikipedia, any search/info site you choose to peg the dollar or pound to real-world buying power. It's nearly impossible. Recently I tried to find out how much a US dollar or a British pound would purchase in 1776 compared to today. Very little luck.

Proaltenergy's post above got me thinking earlier, so I posted a bit of my historical buying power. I still can't figure out how she/he was able to buy clothes, etc. in the 1970's on $450/month. I could barely pay my bills. One month our entertainment was an eleven cent library fine.

Hmmm. That must be it. I was supporting a wife and a baby on my salary. Pretty much the same as now. Factor in "inflation" and my salary now buys.... OHHHH! My head hurts.

Maybe I should just go watch some tv. RELAX! I was just kidding!

"What the old liberals weren't counting on was a depressed minimum wage, weak unions and a witch's brew of management strategies to hold wages and salaries down."

The "old liberals" can be counted on less than one hand; they were the people in congress who voted against the U.S. joining the WTO, NAFTA, and all the other trade agreements that were deliberately designed to trickle wealth upward while the average-Joe wages and salaries would trickle down.

Anyone in the House or Senate who bothered to read the rules of the WTO and the "entrenched rights" granted to the largest global banks and multinational corporations could have figured out that these rules were written to benefit the super-wealthy and not the laborers.

The U.S. government is responsible for the economic crisis we face today. It was Congress that passed the Gramm-Leach-Bliley Act which repealed and replaced the Glass-Steagall Act. As a result, financial institutions were given a green light to engineer mortgage-related and other types of over-the-counter, high risk derivatives that are now threatening to collapse the entire global financial system.

Outright greed and negligence will bring us all down! As Michael Bloomberg recently said: The jig is up! Rational fiscal policy must be put into place if this country and the rest of the world want to survive and prosper.

well, i went looking myself for the answer to my question and after about 20 minutes of googling with no satisfactory results, i went in desperation to the LaRouche people and got a very interesting piece at:

http://www.larouchepub.com/other/2000/ref_quality_adj_2742.html

from which i think the following is a good taste:

"Between 1980 and 1981, for example, the average transaction price of a new car rose from $7,574 to $8,910, an increase of $1,336. Based on that, it is possible to calculate the rate of car-price inflation for 1981, at 17.6%, a very substantial increase.

"But the wizards at the BLS [Bureau of Labor Statistics] got rid of most of that increase. In a BLS document, "Quality Changes for Passenger Cars, 1969-99," the BLS initially attributed 99% of the price increase to "improved quality." Then, after it made further adjustments, the BLS finally attributed 66% of the 1981 increase in the price of a car to "improved quality," and 34% to actual price increase. The BLS reported to the BEA [Commerce Department's Bureau of Economic Analysis], that only $454 of the $1,336 price increase in 1981 was actually an increase in price. Thus, the BLS threw away two-thirds, or $882, of the price increase you paid in 1981. It reported an auto-price inflation rate of just 6.0%."

yeah it's by a LaRouche person, but Newton had his batty side too.

but what i really don't understand is why there is so little available through google on this overwhelmingly important topic. am i missing something or do we need a "peoples' web searcher?"

what about inflation? where can we get figures that give the real rate of inflation for the bottom half?

lizard:

Most people actually are warming up to single-payer health care at this point. But they're too readily fooled by professionals to act against their own interests.

Obama or Hillary will just fatten us up for the next butchering. Bush & Co. (along with the Keating Five) were there when the S&L's collapsed. Bush the Still Lesser was there during the sub-prime collapse.

Probably the script for the next 8 years is to fatten up social security, medicare, health savings accounts or some other big public pot. A little deregulation magic by another Bush behind the curtain -- and alakazam! Disappearing money trick again! The people will complain and the Democrats will kindly tell us why they can't do anything. Anti-progress.

St. John,

You are so right. You really get it.

A few years back, I got a prophesy: "The rich shall be brought low and the poor lifted up. Then they will look into each others eyes and see a brother."

As long as this country keeps turning down high quality candidates in favor of professional politicians with charisma offering money, there will be no change. The people are not cohesive except in war. The people don't want one payer health care because they want to be free to try to get the best compared to others. They don't want to see themselves as compromising for the general welfare. They want to go at it alone. That's America, and that's what's wrong with it.

St. John- That is the way. Keep your eye on the prize, and that is, "humanity".

I think the worst addiction Americans have today is MSM - they just can't turn off their TVs and radios - in fact, they even PAY to be brainwashed. I know this isn't the only problem, but it is one of the gravest threats we face today. How can you have a sane converstation with friends, relatives, or neighbors when they are brainwashed? It is impossible to discuss anything with someone who cannot grasp even a theoretical alternative - because they only know the corporate song-and-dance.

Hitler once dismissed protesters by saying 'Your children will know nothing else." That's what's happened to Americans today - several generations know nothing else, other than what they have been told by MSM. Even older generations - those who lived through the depression and/or post-WWII boom years - have been brainwashed by the constant stream of BS pouring into their lives, mainly through TV and radio, although propaganda is also prevalent in print - billboards, magazines, movies, and even school books.

People have been told what to think - and what is acceptable to say, or even think - by the very people who are exploiting them. This is why slaves didn't revolt, or why oppressed people often don't revolt - at least until their very lives are threatened. They just don't have any alternatives - they have been told that this is the way it is, and this is the best way - the only way.

We know (at least on CD) that a better life is possible - but that requires honesty, fairness, responsiblity (accountability) and justice - true freedom, especially freedom of speech. This doesn't mean just getting your own soapbox, but having a venue for all people to express opinions and debate alternative models. This DOES mean shutting off the propaganda machine - and that IS within our reach - it is a choice we make. So why do so many people actually PAY to be brainwashed? It is an addiction - just try turning off your TV and radio for a month, and you'll see what I mean. (Most families simply cannot do this - that's how bad the addiction really is in our society.)

I was never addicted to either TV or radio, and because my family lived under Nazi occupation, I was made aware of propaganda and media ploys all through my childhood. I am flabbergasted that almost every person is addicted to TV and radio - so much so that they actually prefer being brainwashed to engaging another real live person. (Just try visisting with someone when their 'favorite' program is on and you'll see what I mean.)

In the computer trade we have a saying - GIGO - 'garbage in, garbage out' - that applies to our current social predicament. Until Americans (or any people) can shut off the relentless tirade of corporate propaganda, we will be unable to address our social problems. And let me remind you that many billions of dollars of sophisticated research has been developed by psychologists to assure that brainwashing is irresistible - you simply cannot consume this tripe and stay sane. The drum-beat goes one from Day One - chidlren are indoctrinated from the earliest ages, and this brainwashing goes on in school as well as via TV babysitters, right on up to 'talk radio' for those times you are away from your TV. This is the real Orwellian threat - and Americans are addicted. Generation after generation has been brought up with the corporate model drummed into their heads - and the message is reinforced with appeals to the primitive brain - note all the sexual messages, food, competition, etc, stressed to hook you. Have you ever asked why people watch sports on TV instead of playing them? Why they would want to watch other people pretending to have sex - instead of having a healthy sex-life themselves? (We used to call such voyeurs 'peeping toms' - now it's just 'normal' movie, TV, and magazine fair.)

Deprogramming is difficult - beating an addiction is difficult - and here you have the double-whammy. So don't wonder why we are living like this. After all, tyrants have ruled by controlling the media all through history - that's why the slaves didn't revolt, and why oppressed and exploited people suffer even when their very lives are threatened - it's the message, stupid! But shutting off this debilitating threat to our lives is so difficult that most people simply cannot comprehend why they should do it, let alone dare tackle such a formidable issue. It's easier to live in denial - keep pretending that this insidious threat really isn't doing any harm.

The 'ruling elite' control people by deciding what they can think or say - and most Americans go right along with this idiotic program. Stalin, Mao, or Hitler never dreamed it could be so easy!

Americans are indeed to blame for their misfortunes - they can't or won't turn off the damned corporate propaganda machine. So it's their own fault - being anti-social still means that you are a sociopath. And all that BS about 'individualism is just that - BS. Humans are social animals - they get to choose their own society. So look around and see what your fellow humans have chosen for you. And maybe call them on that...

I have a novel idea - ban advertising. Yes, ban all advertising, of any kind - only factual information (with no pictures) should be available. This would stop a lot of the problems - and it would end much of the money-trail that corrupts everything in our lives.

Kivals,

"The 18th Century Scottish philosopher Adam Ferguson recognized that human societies typically follow a similar pattern — small groups combine, general order is established, great wealth is created, a small wealthy elite is formed and rules, the wealthy elite becomes corrupt, the society decays and falls. What is happening in the US is far from unique and is repeating a pattern that has been with us throughout the history of human civilization."

Actually, I think Plato beat your man Ferguson by a thousand years or so in his writing of "The Republic" (the small wealthy elite is called the "oligarchy"). But it's a valid point.

When does logic begin to kick in? (please look at the statement
below from a recent CNN business article and
see my counter-points)

Weakness spreading:

Economists took the latest report as a sign that problems are no longer restricted to just housing and manufacturing.
"We're definitely seeing conditions spread to more parts of the economy. The big drop in business activity, that's a huge red flag," said Gus Faucher, director of macroeconomics for Moody's Economy.com.
Faucher said his firm now believes the economy is in a recession but he believes it's possible that growth will resume in the second half of this year.
However, Faucher noted this will depend upon additional rate cuts from the Federal Reserve, coupled with Congress quickly passing a proposed $150 billion stimulus package. That package includes $600 tax rebates for most U.S. taxpayers and some temporary tax cuts for businesses.
Economist Bob Brusca of FAO Economics said he doubted that the U.S. was in recession a week ago, but now he believes there's about a 75% chance that a recession began in January.

"That's what recessions do. They come upon you all of a sudden," he said. "When you look back at history, you're struck by how even-keel it is until the bottom just falls out."

IF I OFFEND ANYONE WITH WHAT I'VE WRITTEN BELOW I APOLOGIZE BUT I'M SEARCHING FOR ANSWERS IN PLACE OF THE SHODDY LOGIC/LIES THAT SEEMS TO HAVE TAKEN OVER:
My (Jeremy's) Counter-Points - Growth this Year? Ok, so when do these guys realize that what they are selling makes absolutely no sense?
Point 1:We're in an incredibly expensive war that our current President says we're finally "winning" but that "winning" formula is based off of our "troop surge". Those surging troops are scheduled to come home in a few months BUT the President won't/can't bring them home in a few months because, if you have the advantage of using logic, the minute we draw down those troops Iraq becomes a really bloody place again. Why, because the Iraqi's do not have a functioning government so all the underlying issues (much like America actually) remain unsolved and unresolved. So it's a powder keg that will explode the minute we reduce our presence. So the President won't reduce the troops this year no matter what as that would be a death nail to the Republican's Presidential Election chances. So the unabated expense of Iraq will continue through the rest of this year at least.
Point 2: If the Federal Reserve keeps lowering interest rates (I.E. printing more money) against an already internationally weak dollar inflation is inevitable, but it won't just be inflation we incur but STAGFLATION. Which is a much more insidious and ruinous problem as it combines inflation with total stagnation of the economy (jobs, wages, financing, real estate all stagnate during a recession). Most economist don't even know how to correct this problem and most agree it takes at least 5 years to come out of a stagflation type economies. In fact the best remedy is RAISING INTEREST RATES:
"Stagflation is a complex dilemma. Economists generally agree that no known monetary policy changes or fiscal policy changes are sufficient to remedy the problem in less than five years. Stagflation is difficult to remedy because no single solution will balance the market. Even fiscalists tend to agree with monetarists that eventually, to remove the inflation component of stagflation, the money supply must be reduced, which worsens the recession." - Wikipedia
Point 3: Our housing market is in shambles and only somewhere in the middle of the initial meltdown (foreclosures). Once the foreclosure calm down then you'll be left with the long process of "finding the bottom" of the market. How do you even find a bottom to a housing market that is tanking on its own DURING A RECESSION? You don't, expect incredibly cheap houses 3-5 years from now ($125,000 homes in the San Fernando valley again?). Plus, for almost all of us our houses double as our savings (excluding retirement funds which can't be practically used w/o massive tax issues/losses). So we'll all be faced with credit card debt (if you a "normal" debt ridden American that is), no savings, no equity or even worse upside down mortgages (house worth less than your mortgage). So how will $600 - $1500 rebates do a damn thing for any of us exactly?
Point 4: Tied to the housing market: The mortgage industry is practically destroyed at this point and the banking industry is caught up in the massive problem of "bundled sub-prime" securities worth nothing. So write-off's are occurring on a massive scale in the banking industry. That then trips the bond insurers who backed the Banks on these securities. This effect is just coming to light now and nobody has any grasp on just how massive that problem with be for the Bond Insurance Market and no tax cut for businesses can fix this problem. In fact even a government bailout like the S&L bailout of years ago would not work for a number of fairly complicated reasons. So at best the Banks will be saved by foreign investment like Citigroup recently was (I.E. - the $500 billion we're giving to the middle east and Russia in oil imports each year now) and our banks will then be owned by the Middle East or the Banks will literally collapse. I could go on an on with this point but you get the picture.
Point 5: I'd call this the 8,000,000 pound Gorilla in the room which nobody wants to talk about. We are at the tail end of the fossil fuel era. However you slice or dice it, Oil, Natural Gas and even Coal have "peaked" or are just about to (doesn't really matter much at this point which it is). If you picture a Bell Curve we are at the top of it with almost all fossil fuel resources (not to mention massive fresh water issues) and about to begin the downward slope, which is an exponential downward slope. But the world is still on a very steep upward trajectory in demand/use of fossil fuels to support their "exponentially growing economies and populations" throughout the world. This real and absolute contradiction can barely last during this moment much less another few years or decades. The price of oil is not coming down anytime soon and will in fact rise dramatically from here on out resulting in more war and more desperation to keep our current system even in some kind of recognizable existence. Everything you will touch, eat or walk on today was created, produced or derived from the benefit of cheap fossil fuels, think about that.
Point 6: Healthcare costs keep rising and our system sucks for just about all of us in either costs, full coverage or care. Enough said on this one.
Point 7: The overriding financial problem that will not go away now no matter what stimulus package, rebate, etc. occurs. GLOBAL WARMING. Is it real? Yes. How bad and how fast will it change everything? No one really can say but so far the conservative world of science has underestimated the speed and damage of it at every turn so far much to the surprise of nearly everyone. But if you still doubt, riddle me this: "if Global Warming is still in doubt, why is the most anti-environment President in history willing to put the Polar Bear on the threatened list due to Global Warming?".
Point 8: This is the point that the "stimulus package" is really meant to help, our economy is based 75% on consumer spending and services (well it's really based on Military Spending but government revenues prop that up so without consumerism related tax revenues the government has no money to hand over to the Lockheed and Boeing's of the world). But the average American is so debt ridden and now "house" poor that at best the stimulus package would temporarily "blow up the consumerism balloon" one last time but to no real lasting effect. Logic dictates most of all here. We've tried to have it all ways, in all directions for a long time now and it just can't continue with are consumer economy as more and more forces line up opposed to it.
Final Point: This is an election year, politics will trump everything and stall most things from getting done. The President is one of the lamest of lame duck President's in history and just proposed a $3 trillion budget (try counting to $3 trillion some time). Over a trillion of that is marked for Military Spending. A reduction in Medicare and all other healthcare funding by the federal government is proposed to be reduced. Do any of you really think that our economy produces $3 trillion in tax revenue, etc. for our government in any given year? Really?
So I would argue, don't believe the hype about a quick fix to our problems. We're entering a new era in American economy, change is coming. View the recession as the recognized beginning of a painful transition which will lead to an economy that bears little resemblance to the "fossil fuel economy based on exponential growth" that all the countries of the world are now driven with. The middle class in America must begin a dialogue amongst itself in order to save itself, big government and the self-interested elite/corporations do not care about you or me and as soon as your checkbook reads $0 you will be tossed aside and ignored until you become a viable consumer for them again. None of us lived during the dawning of the Industrial Era, The Great Depression or World War II so none of us have felt the instant jolt of massive, unplanned for change but it can and does happen. One day it's this the next day it's that. "When you look back at history, you're struck by how even-keel it is until the bottom just falls out."
If you find this useful or interesting feel free to pass it on, if you feel I'm insane I would tend to agree with you, if you feel you have a better view of any or all of the above please write back. This was written very quickly and I was not an "A" student in English to begin with.
Regards,
Jeremy Schneider

chessgame56,

There aren't many people who lack such attachments -- and those who do have no interest in running for political office.

I see it as a sustained power stalemate. Build power structures and regulations producing no apex, small political jurisdictions, no single person representing more than like 1,000 constituents, build systems which forbid the massive accumulation of power.

Sure, there is human nature (shit floats to the top). It's the broader backdrop, the institutions themselves, which must change. Because as it currently stands, our institutions for centuries primarily promote power cannibals, carnivores, soothsayers and sycophants. Our most sociopathic qualities.

this according to Marx would finally lead to a revolution where the working classes take over the capital and spread the labor earnings evenly.

--the problem is that deep down human nature is the same in the working class as in the elite, and if and when the poor become the 'new elite,' they behave the same. That's why any real solution will have to come from authentically enlightened individuals who are free of fear and greed. Other than that the best we can hope for is temporary fix.

Hey, there are quite a few economists who refer to this "occult process would intervene" you mention as a Marxist Revolution, but ok, call it an "occult process" if you like. Most economists agree that as competition between capital goes up, the only way to take out profits is to take it from the labor side of the equation, this according to Marx would finally lead to a revolution where the working classes take over the capital and spread the labor earnings evenly.

I liked Alex Cockburn's line "bitch slapped by the invisible hand".
The truth is we are being robbed. The corporate "masters" as Adam Smith called them, have skimmed all the cream and more.
We need to cap prices and at previous levels. Imagine the economic stimulus from buck fifty gas. From ordering health insurance bandits to lower premiums thirty percent.
We could use government to help us instead of helping the thieves rob us into a depression. Oddly they are suffering "catastrophic success" and would be better off if we spanked them a little.

The decline and fall of the American Empire is upon us.

The 18th Century Scottish philosopher Adam Ferguson recognized that human societies typically follow a similar pattern -- small groups combine, general order is established, great wealth is created, a small wealthy elite is formed and rules, the wealthy elite becomes corrupt, the society decays and falls. What is happening in the US is far from unique and is repeating a pattern that has been with us throughout the history of human civilization.

What is unique about the current predicament is that the US government possesses the means, as in nuclear weapons, to end civilization and even human life on earth if not all vertebrate life. As US citizens, on recognition of this danger it becomes our duty to minimize the probability of catastrophe as this weakening giant desperately tries to remain a hegemon.

Quality,

Great observation. Why is no one standing up and demanding change? It is called indoctrination. Perhaps the most sophisticated and best system of mass propaganda ever devised. Why else would most of the posts above talk about curtailing or regulating corporations. That makes about as much sense as allowing your child to spend only 3 hours instead of 8 with a mass murdering psychopath. Capitalism, and as a result the foundation of America is/has been corrupt and evil from day one. Remember the native indians? How about the 2 million Vietnamese civilians Americans bombed into oblivion? How about the incinerated civilians at Hiroshima and Nagasaki? Don't like that, how about the close to 1 million Iraqi civilians? I am sure the germans justified their genocide of the Jews with similar arguments. The fact that America cannot apply to itself the standards it applies to others has already decided your country's fate.
Capitalism will not survive it's next great crisis which is coming....

This has been going on for at least the last 27 years, when Reagan came into office and bad mouthed us all as workers. Funny how before he got into office, we were the envy of the world as the most productive people, making the best products, of anywhere on the planet. Once he became president, we were all shiftless, lazy, drunken or drugged out, and would rather be on welfare than working. Suddenly, the layoffs started, I know people who lost a decade's worth of wage increases practically overnight, and WE had to pay 100% for the insurance that the company used to pay for or do without. And it was the "welfare queens" and the waitresses who weren't claiming their meager tips as wages who were all ruining America. Those people who still had jobs had to do the work of those who had lost their jobs, and somehow, they did it.

Go forward from that, and even that wasn't good enough. So we got the NAFTA shaft, and they took even those jobs away and gave them to those in other countries who wouldn't or couldn't complain about the 14 hour days, unsafe sweatshop conditions and no vacations. Funny thing is that for those of us who were saying that this was going on ever since Reagan, we don't get to work, anymore, and there is very little comfort or joy in being able to say "I TOLD YOU THIS WAS GOING TO HAPPEN!" It's pretty sad when I, a trained musician without any formal knowledge of economics at all, can tell you 27 years ahead of time what is going to happen, and those in economics can't see that without spreading the money around to more poeple instead of less, you DON'T HAVE an economy. This magic of the "free market" is just that, foolish belief in magic. Meanwhile, the congress passes tax breaks for dismantling a factory and offshoring jobs, and replacing them with NOTHING, and talks about how it's great for business. It's just diastrous to the American worker, the economy, and the country in general, that's all.

It's just foolish to keep living under this Alzheimer's economic system that rewards those who destroy the country for their own greed. Unless we go back to a system that spreads out the money instead of concentrating it in the hands of a very few, it won't get any better, but will, in fact, will get worse.

Good article but it doesn't go back far enough to show you why we are where we are now. It might take a book to do that, though, and space is limited...

why is everyone, especially so-called liberals, so afraid of using the four letter word- JOBS!. JOBS!JOBS!JOBS!JOBS!JOBS!JOBS!JOBS!JOBS!
they sent them all overseas and now we can't afford to but the things they make. brilliant business plan. now gimme my $300 check so i can get one more month out of my truck and a tank of gas before they repossess it. then i'm on easy street. right. ain't the capitalist religion wonderful.

Sorry RJ Hayes, the Democratic Party will not field a populist candidate as long as they are addicted to the corporate bucks that non-populists can garner.

Notice how the party pretends Kucinich doesn't exist.

With all due respect, it takes two to tango. Sure, the fed and the corporations have teamed-up to maximize obscene profits, but if real "change" is to occur, the oppressed classes need to accept responsibility for our share of the mess we're in. As BE says, it's not like we weren't warned. Yet, we didn't save, we didn't re-prioritize, we didn't go green, we didn't rise up against the greed machine, we allowed a band of nuts to tear apart our country for eight long years, we didn't - or wouldn't - read the fine print on the loans we knew we couldn't afford, we didn't campaign hard enough for progressive candidates, we can't even get ourselves to stop buying Exxon products.

Yes, "they" are conspiring against us because their disease, Greed, can never be sated. But we have yet to stand up and take responsibility for our own actions and behaviors.

Dubyuh's great economy story is starting to wear a little thin now that the "Sub-prime"-(read garbage loan) crisis is starting to reach a crescendo. The economy has always been great for Dubyuh since he has never participated in this thing most people know as "reality". Food and fuel are not included in the official economic numbers since these would tend to confirm that the economy is heading toward full scale disaster. Payday loans and house flipping have kept many with a false sense of well being since the REPO man had not yet arrived to throw them out of their abodes. Well the repo man a.k.a. the wolf at the door is comin' a knocking to a gated community near you.

The stocks are plummeting again now that the word on the street is that the service sector, those jobs that are among the most difficult to send to China, are going steeply downhill as well. Are you in need of a job kid? Payday loans- That's where the action is in Dubyuh's Amerka these days. Are you feeling lucky- Punk?

Those actuairal types devalued the value of human beings, you know for life insurance or other losses. You know if someone deprives you of a limb or finger...it is worth less. That is not to say the actuarily speaking you cannot survive on unemployment or even social security very long, and they have figured out exactly how long. Trust me, they know exactly what they are doing.

Recession. Inflation. It really doesn't matter to the person trying to stay afloat. When I started my job it was a fairly good job with a few benefits. But, in the last few years that have been no raises, and benefits have been dropped, including medical insurance. During that time the price of gas has nearly doubled, as has the price of basics like milk and eggs. And, I am not in this boat alone. There aren't any jobs available in my area so quitting is not an option. Barbara has a good grasp of the plight of the poor and middle classes, moreso than most writers. I welcome her articles.

If they can get stock prices up, expect economists to resume the propaganda that the economy is great. The people who are meaningfully affected by a poor worker's economy are not important enough to gain media attention. Bush has been touting his superior economy for years without being called on it. Expect more of the same. Never underestimate the favor that money buys. Cynical? Yes. Realistic? I sure think so.

We have a largely regressive tax system. IP law, patent law, monopolies, big boxes, globalization, offshoring, NAFTA, worker visas, passports, total absence of any Commons, entitlements to the m.i.c., etc. all act to impede the economic mobility of wage slaves.

We'll need better than what most Democrats have to offer in order to really address these issues. Capitalism's very existence is predicated on a permanently sustained under-class. We have growing poverty, gap between rich and poor, etc. not accidentally, but as a direct byproduct of an economic system fundamentally at odds with democracy. Note that I'm not suggesting socialism as the only theoretical alternative.

Quality Time,

Our problems in der Heimat, in the grand scheme of things, are nothing. It's unfortunate that our way of life is somewhat built on the exporting of so much violence. But in historical cases, people even allow genocides to occur to their own populaces (USSR, China, etc.) without rising up. Why didn't more slaves rise up? The crux of the problem is lack of safe harbor.

Quality Time: I'll tell you. I started teaching in 1973 for $405/month take home. That was just before the "Oil Crisis." Gasoline went from 29.9 cents/gallon to 62.9 almost overnight. Hamburger went from 49 cents/pound to $1.29, etc. and I'd just signed a one year contract. And I was one of the lucky ones. By the 1980's I still had my low-paying job; I still do. Most of my relatives and friends were "laid off." Fired, sacked, same thing.

TV news in the 70's always had some reporter shoving a microphone into a bypasser's face and asking, "Do you believe in the Energy Crisis?"

Well, that got me thinking. Remember, Nixon was still President and Kissinger was looked upon as some sort of a Hero/Genius. The way I figured it at the time, they and their Buddies had had enough of those pesky "protesters" of the 60's and early 1970's. They probably decided that hungry, jobless folks don't think about protesting, they think about their next meal and rent payment. I know I did. Fix oil prices.... Voila! "Protester" problem solved.

Of course my friends and relatives thought I was nuts when I shared my insights. They may have been right. But so may have I.

Does that help to answer your question?

If you had been working in IT or manufacturing sector, you probably felt we've been in a 'recession' for quite some time now. Credit began to seem like real money, especially between contracts (if you were lucky enough to even get a 3-month gig), forget job security or benefits. And all the while, MSM is telling you how great the economy is doing. Then you ask yourself, "is it just me??"

Live in a red state and you find people are in such deep denial that they tell other members of their church congregation (while continuing to donate money they don't have), that all is well, until one day they quietly disappear because their house was foreclosed on.

Through all that it of little comfort to know that you're safe from the dreaded terrorists, which at least would be something if only it were true.

Paul,

The basic difference in "qualities" is that Dems are tax and spend, Republicans (lately) are borrow and spend. This latter approach leaves the dollar in tatters, and makes Pareto's predictions come true that wealth gaps tend to widen if not deliberately countered with taxes.

So tell me, if things are so bad, why aren't people angry? Why is no one interested in rising up and demanding change?

Through the lust for greed and power the invisible hand has morphed into the invisible fist.

Dan,

Our country has had only Republicrats in the White House for 150 years. If the history of the corporate parties leads only to this, to periodic depressions that even a two-bit hack amateur economist saw years away, how many more years do your Democrats need? Another 150?

The funny thing is that you predicate success on a mere empty label "Democrats", not on qualities. Tell us what those presumed qualities are, and why they are so exclusively locked into partisan containers?

And to think the observers here at CD have been slamming me for months over our need to switch (yesterday) from Republican power to Democratic power in government. Ya think it doesn't matter who runs the agencies, the Supreme Court, the veto power, the budget and tax policies, the Fed, the MIC, the entitlements' futures and the federal oversight of everything economic?
Well, it does. And we now have years of damage to (slowly) undo and repair. And that's IF we're lucky enough to get the chance. A lot of tax-cut money is going to oppose you (us) this year. You pass the top end tax cuts, you let 'em keep the millions and billions, and guess what? That money sloshes into your next political campaign to fight YOU.

when I first started working in the 1970's, I made $450 a month as a secretary and that provided for $150 rent, $50 car payment, $75 groceries... I always had money for clothes and extras... and the jobs were easier, no multitasking, making one person do three jobs, the dollar has been devalued, all of the money has gone to fight an unethical war, while people starve, go homeless, without medical care, it is a travesty what has happened to our country during the Bush years, and also in the Clinton years... we need CHANGE... REAL CHANGE..

An endless war for the filthy rich and Daddy Warbucks is all the 'stimulus' we can stand. Our surviving children have been condemned to lifetimes of slavery as it is.

And remember when all we heard about was the encouragement of
"an ownership society". The system has to change from the top down. Economic stimulus should look towards some sort of savings plan, not spending.

"Recession", like most economist terms, are framed from the perspective of the top, the financiers, bankers, wealthy investors, etc. The way the modern globalized economy (predicated on sweatshop, developing world and communist labor) is arranged, recession works a couple logical statements like this:

1. A recession for the wealthiest 1-5% DOES mean a recession for the remaining 95-99% because they'll pass their losses onto consumers and governments.

2. A recession for the bottom 95-99% does NOT necessarily mean a technical recession as indicated in the GDP -- since the top 1-5% may still be raking in fantastic wealth from their offshoring: they just aren't sharing it around.

The problem of defining terms like recession, gross national product etc. is that it looks only at a few factors. I was at a conference once and asked an economist why they didn't factor in pollution, number of child deaths, number of hungry, homeless. He couldn't answer.

Somewhere along the line we evolved, from being personnel (which hints at us being human), to a resource, which tells us in no uncertain terms, that we are to be worked like a machine, and then discarded when we cannot keep up with the pace, just like an asset, which is depreciated over a number of years.
The 90% of us who struggle, are too busy watching our backs and working, to organize any kind of action. There is always the chance that any kind of industrial action will end with us losing our jobs. Once upon a time, we had political parties who would fight our corner, but today, all politicians are owned by industry and the media.

ehrenreich's comment about economists' frustration over public perception reminds me of my days working in a hospital: elderly female patient complains of difficulty breathing (pale face, blue lips and starting to panic); the intern on call examines her, looks at her chart, and says in perplexity "but your O2 sats are almost 100%"---in other words, are you going to believe me or your lying lungs?

The worst offenders IMHO are the "Human" "resources" crowd---they are the f**in' gatekeepers that undermine both white collar and any other collar workers. They intentionally create glass ceilings that never side with workers, only management. That's why "over-qualified" people with training and education and experience wind up being janitors. HR floats vague job descriptions, establish wage and salary points, don't negotiate, and cover management's asses doing actuarial-type lay-off and "downsizing" schemes. Anybody who's worked at all would know that HR is the Orwell Department of any company.

The credit crisis and recession started long before all these highly publicized mortgage defaults. We've been in a recession for years. Regular folks (you know, the ones who pay higher payroll taxes for WORKING than those who get paid via investment dividends) have been getting screwed for so long it is finally starting to backfire in the face of all the wealthy investor hedge fund types. Funny, how the only time you hear the media start talking recession and our economic woes is when those who have been raping and pillaging us start to complain about how it's hurting them.

Barbara comes close, but doesn't get to the crux of the problem. Namely, the technical definition of "recession" isn't something we need to hold our breaths for, nor is it a good economic descriptor for the bottom 90% of America.

Furthermore, the US apparently doesn't honor such a neat and tidy definition of recession. It may be largely the research of this group: http://en.wikipedia.org/wiki/National_Bureau_of_Economic_Research

(But I see this Wikipedia page has been edited recently, check other sources to verify)

"GDP" is sort of like counting the plunder after a Viking raid returns to the homeland (from Asia in this case). If the shares aren't divided among the villagers, and only retained by the chieftains -- it may continue to make the GDP look good in the aggregate, but it is not a statistical mean/median measure.

Still worse, recessions aren't even calculated at the state level. The Minnesota state economist has already indicated that our state is in a recession: http://minnesota.publicradio.org/display/web/2008/01/15/recessionmain/.

Seen on Common Dreams: "Mommy, the free hand of the market is touching me inappropriately!" All too often as corporations gain wealth they typically lobby the government to take advantage of the poor and the neophyte. Corporations have been given judicial 'person' status, but they can live forever in multiple nations at the same time and they have no feelings. However, a person without feelings is usually called insane. I think we should give corporations a different judicial status, perhaps "The Undead." I believe attempting to regulate corporate crime is in our best interest, but some say, no, capital flight will make things worse. So, they say, it's best to just let them have their way with us, but increasingly they will take their pound of flesh. And do not expect any "activist judges" to ride to the rescue (this is The Bush Legacy, after all). Populism was gnawed to the bone. Consumption was a disease when I was born. Now it's the leading driver of our economy. We used to manufacture useful items. Now we manufacture sophisticated ponzi schemes of sub-prime mortgage repackaged derivative moneymaking miracle assets and even gift-wrapped with AAA ratings, all at no extra charge. Those AAA bond insurers are now in trouble, as things continue to cascade. Many Americans are near bankruptcy. Add in the national debt and each one of us owes an additional $30,000. This has yet to metastasize, but it will. We spit blood in the Middle East. We ship bales of hundred dollar bills to Iraq and lose track of them; and so the dollar plummets (the remainder of The Legacy). It's been reported (unsubstantiated) that American oil companies are offering $5 million per vote in the Iraqi legislature to get a new oil law in place that is highly favorable for these corporations. This is surely a sick joke. Exxon has just made $40 BILLION last year and the value of Iraqi oil is on the order of $30 trillion. Offering a paltry $5 million per vote is truly insulting. Surely those votes are worth $10 million each, if they're worth a penny. Even at 10 times this figure, this would be a boon to the oil companies and possibly to America. So, what's not to like? Well, plenty actually. Not only does it show the world the hypocrisy of American-style democracy of the richest, but also long-term, it undermines the great changes that are needed and needed soon to compete with Europe and China, and to work with the world to mitigate the worst of global climate change. What changes are needed? Well, more ideas and less consumption; more efficiency and less extravagance; more sharing, less selfishness. Resurrection and redemption are possible, but I fear silver bullets have become too precious.

The Democrats need to pick up this and act
to develop a populist consciousness in the
party.

There aren't many people who lack such attachments — and those who do have no interest in running for political office.

--Yes, Paul, as it stands modern politics is nothing if not a competition between egos. It seems that now, though, more than ever, the status quo is becoming a threat to the survival of the entire race. For some reason, when given a choice, the majority appearantly prefer taking the road to self-destruction. That being said, I think it is due as much to ignorance as evil (which some might attribute it to). And the powers that be need to keep us in ignorance to rule us as they do.

Quality Time,

The obvious answer is fear. Inherent to the culture, and fertilized quite actively. We even have a color scheme now for how much fertilizer is being applied to innervate the public.

One of the key of Thomas Jefferson's concept of Democracy was to keep power as close to the local level as possible.

Corporations have done exactly the opposite. That is they've moved power to the highest level possible. Up to the Federal government or even up to WTO or NAFTA trade bodies. This puts power out of reach and out of contact for ordinary citizens. You can talk to your city councilperson. Or you can organize a local campaign to unseat a city councilperson who is unresponsive to citizens. But its much harder to talk to a US Senator or to unseat a US Senator. Money plays a much bigger role in such contests. And bodies like the WTO or NAFTA are unaccessible to citizens.

The way the corporations have this today, their ability to control federal or international rules over-rules any local actions.

What we need is the opposite. What we need is what Jefferson had in mind. Government and power as local as possible. That doesn't mean we won't have corrupt officials. It just means we can watch them and replace them easier.

Very little mention,in these comments,on the demise of the Trade Unions.You don't think the employers worked so hard to get rid of them for no reason? The workers are now too busy or too scared of losing their job to fight the bosses for wages and conditions.This was the job the unions used to do:that protection has been disappearing fast to the joy of most employers.

The U.S. decline started years ago when government allowed outsourcing of jobs and giving corporations tax relief to screw American workers. Clinton's push for NAFTA really let the "shit hit the fan" by screwing the American workers beyond belief. When he signed NAFTA, I knew it was the end of jobs. America has now become a country of buying things then making things. Jobs created are in the low wage service areas. We have lost our manufacturing base and are headed for a third world economy. The wealthy have their money invested somewhere else and not in dollars. They knew this would happen and you can bet it was planned. Corporations own our government and the politicians and the deregulating of business gave them the carte blanche to do anything they wished. Reagen, Clinton and the Bushes have sold America out. Only the weathly will survive (as usual). None of the current candidates will change things and again Americans continue to vote against their own best interests. The recent primaries show how dumbed down Americans are. They believe the BS these candidates give ( in both parties). "Elections are a scam" article at www.bigeye.com/elections.htm says it all. Edwards was the only one talking about the working class, middle class, poor and elderly issues and Americans didn't take the time to search out the internet on him. They rely on the corporate owned media-TV and newspapers to tell them who to vote for. If elections are rigged as evidence says then we (the classes above) are in a ride to hell. Our Constitution is in shreds and sad to say, there doesn't seem to be a way out. The plans have been set and it is all in the favor of the elite who have enough money and care only for power and the hell with the citizens. They want to get rid of the poor, elderly and working classes because they see it a drain on bigger ownership plans of the country! We are now a Fascist country and as our Constitution crumbles to the ground, the government will say "EVERYTHING IS A- OKAY" and Americans believing the lie!

To frank1569,

The average folks are busy surviving, besides the media kept telling
them that things are great and if they are struggling then it is their
fault. Either they are lazy or not smart or educated enough. And this
have been drummed in their ears for years to the point of like brain
washing. The super rich has a very efficient and clever propoganda machine against a naive and not very polotically aware population.

To Daniel David,

The mess we have right now was greatly helped by your beloved Bill clinton.
He shoved NAFTA down our throat after saying he is against it
He is for globalization and "free" trade. He signed the telecommunication
act that concentrated the Media in very few very rich hands. He deregulated the finacial markets by repealing the Glass-Steagal act. He opened most of the public lands for logging and mineral interest. In short he was president for the rich and powerful and diffinetly not for
the average Joe and Jane. What we need now is a third party. Keeping alternating between the two parties looking for that elusive "CHANGE" will not do. The current problems are too big for that useless and worn out approach.

Chessgame56: You are on the right track. The solution is not in the economy or the political parties or the corporations. The solution is systemic change and conscious enlightenment. As long as we view our "problems" as those of lack of jobs and inequality of wealth distribution, we are succumbing to the old paradigm of competition as the only means of achieving progress in any endeavor. Look at the game of musical chairs and you have the model for global economic policy. We scramble for the last chair, and are willing to allow the one who fails to capture his/her seat to perish. Read The Soul of Money by Lynne Twist for a clear perspective of who we are with regard to money/wealth/prosperity/humanity.

How many of you would allow your child to perish if they did not meet the requirements of society for success? Why do we have "special education" categories for the "sub-prime achievers" in society? And why do we defund those programs first when the budgetary negotiations begin, in favor of the "Defense Budget"? In fact, in answer to the question I asked about allowing your child to perish for failing to achieve "normally", we do just that: we allow them to enter military service to pay for their education and become "all that they can be".

The time is now to radically shift our focus from competition and struggle to cooperation and compassion. We cannot afford to continue as we have been and expect to survive. The wealthy cannot survive without the contribution of the "working classes", and the working classes cannot survive without opportunities to paricipate in the creation of new ways of being in the world. Leisure and creativity are keys to progress; not unimpeded growth. The traditional definitions of work will be replaced with ones of collaboration and partnership. War has never worked, really. Peace is an active state of consciousness in which all stakeholders are taken into account, including the planet and all of its inhabitants. It is time to awaken to the Power of Love and release Fear and Greed.

peace,
st john

Trade unions.

First, think about the amount of anti-union propaganda you see on corporate media. Union leaders in most fiction, movies and tv shows are always portrayed as corrupt. And unions are always portrayed as something that gets in the way. There are very, very few stories that portray how unions help ordinary workers. You almost have to have had the personal experience of working in a union company to see that.

Also, think about sports and unions. Another avenue of anti-union propaganda. Anytime there's a labor dispute in sports, the corporate media blames the union for the fact that the people don't get their bread and circuses for awhile.

That's just the public perception of unions. What they've done is convince most people who aren't in a union that unions are a bad thing and that they shouldn't even think about having one.

Then there's the next level of all the nasty tricks to keep unions from forming. Strange rules on who can group together in a union, rules that let them intimidate elections, and the way they act pretty much means that trying to start a union can cost you your job.

Then of course, this all combines with outsourcing. A very standard claim is that a company will close a plant and move it overseas if the workers dare to form a union. Actually, although out-sourcing isn't mentioned in this good article, its a constant cause of much of this. For all workers, union and non-union, outsourcing is used as a threat. Don't ask for more money because there's someone in China who'll do your job for less.

And another line of defense for corporations is the corruption of union officials. We've seen times when Union officials seem to take the side of corporate management over the cause of workers at a plant. Making nice with corporate management seems to be more important to some union leaders than doing anything to help workers. Try typing "Freightliner 5" into google to see a recent case.

Trickle-down economics has shown its failures.

Don't pee on me and tell me it's raining.

The bit about allowing your child to perish if not economically useful is hitting the nail on the head.

Everyday on my way to the corporate job I struggle to keep, I drive through the mission district. So I see everyday the people that our capitalist economy has discarded. The message from capitalism is that if you are not economically useful to someone with money, you should just go off and quietly starve to death.

The mention of "full employment" in the above piece is the same idea. Way back when, people used to press their politicians for 'full employment'. The way ordinary workers would define that is obvious. That is, full employement is when everyone has a job. Seems pretty basic.

But, somewhere along the way, the corporate economists decided to redefine 'full employment' as when there is about 5% unemployment. They got the politicians, including the Democrats to accept this definition. So today we see references like the above that the economy is at 'full employment' when there is 5% unemployment.

5% is one out of twenty. Think about that for a moment. Corporate America has decided the economy is a peak efficiency (for them of course) when there is one worker out of twenty out of work. Thus, those that manage the economy will do nothing to increase jobs with one out of twenty is unemployed.

But think about that. For most Americans, especially those in the lower wage\more unskilled end of the spectrum, everyone has to live paycheck to paycheck. Its so hard to get by these days that anything more is pretty much impossible. So, when someone at that level gets 'unemployed', its a pretty short trip to homelessness and lack of nutrition.

So, the official policy of this country is that one worker out of twenty should be out of work, and thus either homeless and struggling to survive or fighting and struggling to stay above that level. This of course helps corporate profits by making sure the other workers know they can be unemployed quickly because there are people out there who'd desperately want their jobs. Which in turn is part of the reason why the gains in the economy and productivity don't translate to a better life for those working.

Those two policies are both inherently evil to me. To say that you are willing to have people who aren't economically useful die of starvation or exposure is sick. And to say that you plan on having one worker out of twenty out of a job because that's what's best for corporate profits is also sick.

And you won't ever hear a Democrat candidate criticize either of these ideas.

Time for a consumer strike:

www.spudkat.com