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The Biggest Risk to the Economy in 2012, and What’s the Economy For Anyway?
Treasury Secretary Tim Geithner, speaking at the World Economic Forum in Davos a few days ago, said the “critical risks” facing the American economy this year were a worsening of Europe’s chronic sovereign debt crisis and a rise in tensions with Iran that could stoke global oil prices.
What about jobs and wages here at home?
As the Commerce Department reported Friday, the U.S. economy grew 2.8 percent between October and December – the fastest pace in 18 months and the first time growth exceeded 2 percent all year. Many bigger American companies have been reporting strong profits in recent months. GE and Lockheed Martin closed the year with record order backlogs.
Yet the percent of working-age Americans in jobs isn’t much different than what it was three years ago. Yes, America now produces more than it did when the recession began. But it does so with 6 million fewer workers.
Average after-tax incomes adjusted for inflation are moving up a bit. (They increased at an annual rate of .8 percent in the last three months of 2011 after falling 1.9 percent in prior three-month period. For all of 2011, incomes fell .1 percent.)
But beware averages. Shaquille O’Neal and I have an average height of six feet. Exclude Mitt Romney’s $20 million last year — along with everyone else securely in the top 1 percent — and the incomes of most Americans are continuing to slip.
Consumer spending picked up slightly in the fourth quarter mainly because consumers drew down their savings. Obviously, this can’t last.
Meanwhile, government is spending less on schools, roads, bridges, parks, defense, and social services. Government spending at all levels dropped at an annual rate of 4.6 percent in the last quarter – and that’s likely to continue.
Some economists worry this drop is a drag on the economy. But it also means fewer public goods available to all Americans regardless of income.
Congress still hasn’t decided whether to renew the temporary payroll tax cut and extend unemployment benefits past February. If it doesn’t, expect another 1 percent slice off GDP growth this year.
Tim Geithner is surely correct that the European debt crisis and Iran pose risks to the American economy in 2012. But they aren’t the biggest risk. The biggest risk is right here at home – that most Americans will continue to languish.
All of which raises a basic question: Who or what is the economy for? Surely not just for a few at the top, and not just big corporations and their CEOs. Nor can the success of the economy be measured by how fast the GDP is growing, or how high the Dow Jones Industrial Average is rising, or whether average incomes are turning upward.
The crisis of American capitalism marks the triumph of consumers and investors over workers and citizens. And since most of us occupy all four roles – even though the lion’s share of consuming and investing is done by the wealthy – the real crisis centers on the increasing efficiency by which all of us as consumers and investors can get great deals, and our declining capacity to be heard as workers and citizens.
Modern technologies allow us to shop in real time, often worldwide, for the lowest prices, highest quality, and best returns. Through the Internet and advanced software we can now get relevant information instantaneously, compare deals, and move our money at the speed of electronic impulses. We can buy goods over the Internet that are delivered right to our homes. Never before in history have consumers and investors been so empowered.
Yet these great deals increasingly come at the expense of our own and our compatriots’ jobs and wages, and widening inequality. The goods we want or the returns we seek can often be produced more efficiently elsewhere around the world by companies offering lower pay, fewer benefits, and inferior working conditions.
They also come at the expense of our Main Streets – the hubs of our communities – when we get the great deals through the Internet or at big-box retailers that scan the world for great deals on our behalf.
Some great deals have devastating environmental consequences. Technology allows us to efficiently buy low-priced items from poor nations with scant environmental standards, sometimes made in factories that spill toxic chemicals into water supplies or pollutants into the air. We shop for great deals in cars that spew carbon into the air and for airline tickets in jet planes that do even worse.
Other great deals offend common decency. We may get a great price or high return because a producer has cut costs by hiring children in South Asia or Africa who work twelve hours a day, seven days a week. Or by subjecting people to death-defying working conditions.
As workers or as citizens most of us would not intentionally choose these outcomes but as seekers after great deals we are indirectly responsible for them. Companies know that if they fail to offer us the best deals we will take our money elsewhere – which we can do with ever-greater speed and efficiency.
The best means of balancing the demands of consumers and investors against those of workers and citizens has been through democratic institutions that shape and constrain markets.
Laws and rules offer some protection for jobs and wages, communities, and the environment. Although such rules are likely to be costly to us as consumers and investors because they stand in the way of the very best deals, they are intended to approximate what we as members of a society are willing to sacrifice for these other values.
But technologies for getting great deals are outpacing the capacities of democratic institutions to counterbalance them. For one thing, national rules intended to protect workers, communities, and the environment typically extend only to a nation’s borders. Yet technologies for getting great deals enable buyers and investors to transcend borders with increasing ease, at the same time making it harder for nations to monitor or regulate such transactions.
For another, goals other than the best deals are less easily achieved within the confines of a single nation. The most obvious example is the environment, whose fragility is worldwide. In addition, corporations now routinely threaten to move jobs and businesses away from places that impose higher costs on them – and therefore, indirectly, on their consumers and investors – to more “business friendly” jurisdictions. The Internet and software have made companies sufficiently nimble to render such threats credible.
But the biggest problem is that corporate money is undermining democratic institutions in the name of better deals for consumers and investors. Campaign contributions, fleets of well-paid corporate lobbyists, and corporate-financed PR campaigns about public issues are overwhelming the capacities of Congress, state legislatures, regulatory agencies, and the courts to reflect the values of workers and citizens.
As a result, consumers and investors are doing increasingly well but job insecurity is on the rise, inequality is widening, communities are becoming less stable, and climate change is worsening. None of this is sustainable over the long term.
Blame global finance and worldwide corporations all you want. But save some blame for the insatiable consumers and investors inhabiting almost every one of us, who are entirely complicit. And blame our inability as workers and citizens to reclaim our democracy.
Robert Reich, one of the nation’s leading experts on work and the economy, is Chancellor’s Professor of Public Policy at the Goldman School of Public Policy at the University of California at Berkeley. He has served in three national administrations, most recently as secretary of labor under President Bill Clinton. Time Magazine has named him one of the ten most effective cabinet secretaries of the last century. He has written thirteen books, including his latest best-seller, Aftershock: The Next Economy and America’s Future; The Work of Nations; Locked in the Cabinet; Supercapitalism; and his newest, Beyond Outrage. His syndicated columns, television appearances, and public radio commentaries reach millions of people each week. He is also a founding editor of the American Prospect magazine, and Chairman of the citizen’s group Common Cause. His widely-read blog can be found at www.robertreich.org.
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81 Comments so far
Show AllThe nation, as represented by the corporations and the top managers, are doing fine, the people of this nation are not. Yet we are our own worst enemy it seems. Despite a decade or more of ownership of both parties by the top 1% we the people continue to refuse to see how our trust and our votes are betrayed, refuse even to consider thrid party growth as an effective means of combating the creeping (galloping) fascism that engulfs our governance.
Escalating inflation in the costs of essentials such as food, health care and energy continue to more than offset the low cost of mass produced consumer goods to which Reich alludes.
Reich fails to mention one devastating characteristic of the dismal job market whereby ever increasing millions of older US workers who are delaying or canceling retirement due to inflated cost of medical insurance and other essentials, deflating real estate values, low interest rates, cuts in Social Security, Medicare, Medicaid and other domestic programs.
Young Americans are experiencing the highest unemployment rate of any age group.
The longer Obama and Congress continue to make it more difficult for older workers to retire, the higher the unemployment rate for young Americans will climb.
doubledee wrote:
"... refuse even to consider thrid party growth as an effective means of combating the creeping (galloping) fascism that engulfs our governance."
... while third party growth, to compliment the people's awakening being provided by the occupy movement, would almost certainly make progressive politics a force to successfully contend with the corrupt one party duopoly.
That progressives are not actively working to strengthen a third party is to make the same mistake that was made in the '60s and '70s - believing that demonstrations, occupations and disruptions in themselves are sufficient to change the system.
"That progressives are not actively working to strengthen a third party is to make the same mistake that was made in the '60s and '70s - believing that demonstrations, occupations and disruptions in themselves are sufficient to change the system."
Perhaps some but certainly not all who call themselves progressives are actually deserving of said designation. It is my belief that ,whether those demonstrations in which I participated in the sixties and seventies, or the current OWS variety, the purpose served was not to directly change the system, but to educate and enlighten, to become a rallying point for those who think themselves isolated and alone.
As to disruptions, clearly many such incidents are simply govt. sponsored attempts to cast aspersions on the activists in general and distort the message in particular. With the stranglehold of corporations upon the process of election, with the stranglehold that the two party system ( an oxymoron perhaps) has on the process, shown blatantly by the harsh struggle the Greens have had to wage to even get a place on the ballots, it seems a miracle that slow but steady growth of Green candidates has occured.
"And blame our inability as workers and citizens to reclaim our democracy."
How are we to blame as workers and citizens? The upcoming election should point out that the choices the electorate are given are very selective and limited, much as our consumer goods are. I didn't intentionally feed my dog tainted cheap foreign made dog food. I purchased it locally and it was wrapped up in pretty American branded packaging. I assumed some inspection and quality assurance of that product was made before it reached the shelves of my local market. I was told that's what my tax dollars were used for How was I complicit?
How exactly are we to regain our democracy when we're not given a real choice? We get to choose between column A and column B and they are both made in the same "kitchen", and we're told we can't walk down the street and choose from someone else's menu. We're not even allowed to pot luck it and bring our own.
Your metaphor is apt. I had always described it as "you can vote for to play the "A" side of the record, or to play the "B" side of the record. You just can't vote to change the record."
Thanks Zero, for reading my comment and commenting on it. I post here just because I have to have a say somewhere. I value input unlike many merchants, politicians and corporations. And I don't mind if you change the record or menu. In fact the diversity leads to exploration and new solutions.
The point is that Reich is blaming the victims, just like the Democratic Party and the GOP blame the victims whenever the victims demand even a little bit of accountability.
Unless Reich is going to be specific in chastising the US electorate for never giving Nader more than 3% of the popular vote in any of the past four elections, his blaming the victims strategy is unproductive.
My New Year’s Resolution for 2012.
I pledge to never again vote for Obama or any other Democrat just because they claim that their GOP opponent would be an even worse choice. Even if it’s true.
Doing slightly less harm is not enough.
Please join me. Vote for a third party candidate; Justice Party, Green, Progressive, Socialist, Libertarian, or write in Franklin D Roosevelt. Heck, write in yourself if you want to. Just DO NOT choose Orwellian "Hope and Change" just because Tweedle-Dee seems marginally less distasteful than Tweedle-Dum.
Help destroy the Two-Party System, which is a very effective system for not giving us a choice.
Do not stay home from the polls on election day. Instead, vote anything but Democrat or Republican.
How are we to blame when we are unemployed, uninsured, and still have to stretch whatever small incomes we have to last an entire month of food, shelter, electricity and transportation? Trust me, I would prefer to buy organic everything and insulate my home so I use less energy. But if people have no job, or part time job(s) that don't keep you afloat, or debt from illness...they HAVE to buy the cheapest.
Tell me about it. I am wearing four layers of clothing so I can keep my thermostat at 51 degrees so I can keep my utilities down. And still their more than ten times what they are in the summer. My computor is 15 years old and I use a free dialup and have to wait for ages even to post here. I'd love to put in double pane windows and insulate, but I can't afford to. I've got to budget for my car licenses, taxes and insurances etc. just to get back and forth to work and live,not even break even. Do I shop the local Walmart...you betcha I can't afford to do otherwise. Health insurance that's a luxury I can't afford. No "flat" screen tv here.
I hear you, Dmadrone! This is another slick attempt to spread the blame EQUALLY around. Just as a rich U.S. citizen has a FAR greater ecological/consumer imprint than a poor one, Western nations in general hold bigger footprints (as per their CO2 output) than impoverished ones. Culpability, responsibility and accountability are not shared in equal proportions. That's why the word "we" is so useful as a smoke screen.
In addition, corporations don't just go for the bottom dollar of affordable pricing. If that style of altruism were really the motive, why would the Walton family contain some of the richest persons on earth? And we know that corps are holding those profits, not investing them in the US or in better wages.
This is a vile essay. It doesn't speak of the Regulatory Capture, or the way that big money, funneled into DC over the past 3 decades specifically to erase regulation (when not putting a muzzle on it) has sent environmental destruction into overdrive.
When a system cannot be purged entirely, conscious entities work to at least bring a balance between profits--to the corporation--and benefits to The People. Since the sustainability of The Commons, along with all that will sustain life for the many... is of vital interest, and THAT goal is being undermined, clearly the power of the big money interests has overwhelmed the key equations that sentient life relies upon. Global corporate capitalism without conscience ON steroids is literally cannibalizing all living systems. IF consumers truly understood the relationship between the products they use and global climate change (as opposed to being propagandized by The Deceivers who work for the big energy companies, and produce effective dis-information campaigns suggesting the contrary)) then collective behavior would at least have a compelling cause to change for the better.
Due to the current economy, I suspect (and see evidence in my region) that more people are shopping at thrift shops, consignment shops, and what I term "Recyclatoriums." This form of trade requires that nothing NEW be produced or added to Mother Nature's burdens. With the exception of food, almost everything else CAN be recycled... including some water and enery systems. There's already more than enough to go round...
This all comes back to the original sin of NAFTA and "Free Trade Agreements" which
neoliberal Clinton and a minority of Democrats along with almost all Republicans passed in the 90's. Supposedly these "Free Trade Agreements" were supposed to
protect the rights of workers, enforce Environmental standards and adhere to US
safety standards. Of course the WTO tasked with enforcing the provisions of global trade agreements has never negated trade on these bases that I know of.
Sure the WTO has challenged Chinese govt subsidies to their solar manufacturers,
intellectual monopoly rights etc.
But there have not been trade sanctions on the basis of the slave labor conditions outlined by the NY Times by Chinese Apple parts manufacturers, the rampant pollution of first the maquiladoras in Mexico and now China, etc.
Yet all these agreements were passed with the promise that worker/human rights, the
Environment and basic health and safety would be protected.
So we were lied to by the neoliberals like Clinton, Thomas Friedman, Gore etc for the 1% to make untrammeled profits off destroying our manufacturing while they pillage
humanity and the planet.
This is the problem!
As far as "choice" - what choice? Even a few years ago I was shopping for a new leather belt in reputable stores like Macy's etc. Unless I wanted to pay $200 for
a designer Italian Armani belt, every single belt was Made in China.
So what was my choice?
It seems rather absurd that a country with as many cows as the USA cannot even
make a leather belt here as opposed to in all likelihood shipping all the hides across the Pacific to China, processing in some sweatshop and then shipping them back!
But global trade will collapse as Peak Oil makes shipping way too expensive for items like this..
I am almost certain that Robert Reich supported NAFTA...
http://www.examiner.com/conservative-in-san-francisco/robert-reich-the-man-behind-implementations-of-jobs-killing-nafta
Obama's initial response to OWS was to sign three more NAFTAs into law to assure that none of the unemployed OWS participants will ever get jobs.
I like your jab at "New Democrat" W.J.Clinton. However, I noticed you left out The Reagan/Bush part of the story. The negotiating of NAFTA started no later than 1986 (Reagan) and continued through to the ceremonial signing of NAFTA in December of 1992 by U.S. President George H.W. Bush, Prime Minister of Canada Brian Mulroney and the President of Mexico Carlos Salinas. The effects on the U.S. are quite well documented but the Mexican people fared no better. NAFTA caused up to 5 million Mexican agricultural workers to lose their jobs in subsequent years and where do you think they went looking for work? The flood of new and desperate people gave U.S. companies and nice opportunity to lower wages. Check out the stock markets in the 90's, somebody made a lot money.
Of course the Republicans are always even worse than the neoliberal Wimpocrats.
But my point is that NAFTA only passed under a Democrat like Clinton who corralled just enough Democrats to pass it along with almost complete unanimity by Republicans.
And Robert Reich was then serving as an apologist promising that these trade agreements would create jobs for Americans while protecting labor rights, the Environment, and basic health and safety. (See lead poisoned Thomas the Tank Engine toys, toxic mold Chinese sheet rock, poisoned pet food, poisoned tooth paste etc)
Where are the WTO sanctions against slave labor, rampant pollution and poisoned products?
The other point is that Wimpocrats hide behind excuses like the record Republican filibusters when they could do the same...
When will progressives filibuster the War spending acts?
The Auto Addiction subsidies?
Etc...
@ gardenernorcal--"And blame our inability as workers and citizens to reclaim our democracy."
IMHO, Reich's point here is that the workers and citizens have been hamstrung in their options -- hence our inability to trade in the menu/reinstate a democratic form of government. Your comments elaborate on the stalemate we are in. The Marxists had one thing right, for sure: when the means of production are in the hands of the oligarchs, we are enslaved.
That is pretty passive. Gonna wait for someone to give you a better choice?
Ain't gonna happen unless you act to make it happen.
One thought I've been having relates back to a 60s poster/idea. What if they gave a war and nobody came? So, what if they gave an election and nobody came. It would, at least, be a big embarrassment
How much longer do we have to wait for something to trickle down.
Beside the 1% pissing on our heads, I mean.
As far as I can tell the economy is about the enrichment of the top few percent at the expense of everyone else. And this enrichment is being done increasingly by legalized crime.
Take for example MF Global, over a billion dollars in futures money gone. And this isn't some fairy-tale voodoo investment instrument. In many cases this was money that for example, farmers had parked there to purchase seeds for the 2012 growing season. How many real farms are going to go belly up after their money disappeared into the organized crime syndicate that American high finance has become.
And how long can this go on? In a fiat money system, the only thing that keeps it going is faith. That people believe that their money or investments are safe. Once people loose faith in it, the whole thing is done for.
And if you want more proof that the powers that be don't care about us average folk, just look at the language that is used in the M$M. Take for instance the "jobless recovery". WTF is that supposed to be? Who is recovering? It sure as hell isn't the people without jobs. They no longer count, and the M$M is now right in your face about it.
Good one, NC Tom.
Just add the numbers lost to shoddy no-bid construction contract projects in Iraq, or some of the trillions funneled to the banksters and pretty soon you're talking real money!
Here's THE cartoon that should accompany this arid piece of "journalism."
A rich guy steps out of his limo on a NYC street corner just where a homeless person is scavenging through a garbage bin.
The rich guy puts his arm around the homeless person and says:
"We really need to scale down on our consumption, pal."
Corporations (and the politicians and academics they own) keep devising new ways to blame the victims.
"Or by subjecting people to death-defying working conditions."
Shouldn't that read 'death-dealing' working conditions?'
Just saying...
when reich says: " But save some blame for the insatiable consumers and investors inhabiting almost every one of us, who are entirely complicit."
it makes me want to puke
this guy has been like a fly around a dead carcass with daily musings about this whole mess of a financial system that is run for and by the .0001% of this country who own everything and everybody
credit default swaps, cdo's, and quant theorems on markets have led to a field day for the bankster terrorists and oligarchs
so the working and unworking stiffs who got financially wiped out are every bit a responsible as the .001% who got the 23 trillion dollar handout (and counting)
sure pal
mr reich methinks you are full of batguano bub
this column really underscores your complete lack of comprehension as to the modality and dimensions of this bank scam and the responsibility for it
"In terms of types of financial wealth, the top one percent of households have 38.3% of all privately held stock, 60.6% of financial securities, and 62.4% of business equity. The top 10% have 80% to 90% of stocks, bonds, trust funds, and business equity, and over 75% of non-home real estate. Since financial wealth is what counts as far as the control of income-producing assets, we can say that just 10% of the people own the United States of America."
" and it's shocking: the lowest two quintiles (40%) hold just 0.3% of the wealth in the United States. Most people in the survey guessed the figure to be between 8% and 10%, and two dozen academic economists got it wrong too, by guessing about 2% "
http://www2.ucsc.edu/whorulesamerica/power/wealth.html
i guess that's your job - to say that we who have nothing are as much at fault as those who have everything - ain't it
its called being a gatekeeper
begone damn spot begone
I hear you.
Well, said, Med. On this topic, we see eye to eye.
(I hadn't read down the thread before posting, so I'm glad to see others are not going along with this broad-brush WE thing. It's possibly the 2nd most effective propaganda term after words like "Free" and/or "freedom.")
I say blame a dumb public and soulless technology for making us lazier and dumber. I opened a shop back in 2006 that sold antiques and beautifully constructed hand made linens. I had to close it because the competition from "online" junkyards like Ebay and cheap merchandise manufactured in China became my nemeses.
The other day I went into my local grocery store for an emergency item. I don't shop there as a general rule because the owners refuse to carry organic products or items produced by local merchants. I complained about the absence of both these categories and the first thing the manager said was "people around here don't want to pay the higher prices for organically grown or locally made products".
Hmmmmm. Therein lies the point. Making items by hand or growing produce organically is much more labor intensive. We are the "instant" everything culture. We want it now and at our becken call. I fully expect there will come a day when waiting through a season becomes "too long a wait". The average ADD American consumer will eventually get what he/she deserves: a world made up of Monsanto, Bayer and WalMarts.
The whole system needs to be revamped and morons like Tim Geithner helicoptered to some remote mountain top and dropped off for good. I say the biggest risk to all of us lies in the fact economists are still running the world and telling us what to do.
.
You were willing to buy organic and locally produced. Why didn't you local merchant get that?
You weren't given the choice. Who was he using to make his marketing determinations, definitely not you his local consumer.
It's not the consumers making these choices. It comes down from the multinational corporate headquarters. And they are not in this supposedly "free market" environment giving us as consumers any opportunity to change the results.
Ebay is not an "online" junkyard, what it is an outlet for many of us that can't find a market otherwise, and have to sell what we have just to get by and can't find locally
Too bad about your antique shop and boutique, but I am thinking you should have tried to sell some of your merchandize to a wider market, perhaps through Ebay. You might have found yourself more profitable.
Yeah blame the vicitms, how convenient and lazy of you Dr. Reich, or are you just an apologist?
Dr. Reich is another ivory-tower neoclassical economist who failed to predict the economic crisis we are in. As his viewpoints are slightly progressive, his articles appear here regularly.
However two academic economists (who are very critical of neoclassical economics) who were named in Dr. Dirk Bezemer's study as having accurately predicted the financial/economic crisis we are in, Prof. Steve Keen and Dr. Michael Hudson, do not appear here? Why is that? Are they too critical of the status quo? Dean Baker was also named by Bezemer, and we do see his articles, which makes sense.
Reich, Krugman, Bernanke and the vast majority of academic economists utterly failed to predict the mess we are in. Yet we hear these names regularly and these types are supposed to be credible.
I find it disappointing that two economists who were SPOT ON, are almost absent around here and the economists who utterly failed, do appear. Seems a bit bakwards to me
"Reich, Krugman, Bernanke and the vast majority of academic economists utterly failed to predict the mess we are in."
I think it's worse than that. I think they understood that a housing bubble was underway. Their Democratic party loyalties had them reinforce the illusion of prosperity when their team was in power.
All economists study the Great Depression; and it's impossible not to realize why Glass-Steagall was put in place. It would have been impossible not to notice the arc of naked greed as seen in:
1. The S & L scam
2. The Arthur Anderson "style" of accounting
3. The Enron "School of Business Model."
4. The growing plague of lobbyists in D.C.
5. A Supreme Court that lends its imprimatur to any policy determination putting profit/capital/greed first
In a climate reflecting these insidious elements and more, anyone who couldn't see where the framework of deregulation would lead was granting the massive graft cover.
They are part of a cover-up. And while Krugman at least has a heart and seems to genuinely FEEL for the pain spread round to grind down most citizens, he still only darts towards the margins of allowable discourse as to who's culpable and what forces brought it on.
Those who do see, like Nomi Prins, Catherine Fitts & Michael Hudson are not given any air time to make their insights public.
A real hope and change president would have appointed Nomi Prins Treasury Secretary. She is 1000x more qualified than Geithner.
True that. And Hudson as senior economic advisor. In our dreams. Hudson advised Iceland instead, and tiny little Iceland told the big bad banksters to f off. Then UK PM Gordon Brown, called Iceland terrorists. Gordon Brown, just another phony, crooked, lying politician. The voters of Iceland are an example to be followed.
Notice how many economists and left of center pundits are now saying we need to tax the rich, add transaction taxes, cap salaries, etc. ?
Few if any economists are calling for restoration of FDR's New Deal financial industry regulations. Until those regulations, that addressed the structure of the industry are restored, tax policy changes and salary caps will be of no value.
Franklin D (Hyde Park) Roosevelt! A great one! But we shall have to restore all this world to the service of all its people as he and Henry Wallace would have had it. It's up to us.
Do that and respect Mother Nature as well.
Franklin D (Hyde Park) Roosevelt! A great one! But we shall have to restore all this world to the service of all its people as he and Henry Wallace would have had it. It's up to us.
Do that and respect Mother Nature as well.
I agree SiouxRose, either their loyalties and/or a ideological blinders prevented them seeing what should have been obvious, and was obvious. If it is as bad as "granting mass graft cover", then the likes of Krugman, Reich and Bernanke should be ridiculed and exiled - especially on so-called progressive sites. Instead, articles are posted as if none of the past ever happened.
Not to boast at all, but I saw it coming and we sold our house in 2004 and rolled it over into euros, some gold and CDs. I am sure glad that we did, as we would likely be underwater and broke by now if we had not done so. We are very fortunate indeed, although by no means financially secure. If some nobody like me predicted it, it is really a shame that folks like Kruggie and Reich were not screaming their lungs out in 2006 and earlier.
Yes I would like to see more posted here from the likes of: Nomi Prins, CA Fitts,. Hudson, Keen, Baker, Richard Wolff (economist), Dr. Paul Craig Roberts, Naomi Klein and Gerald Celente to name a few. These folks are too critical of the underlying fundaments of the kleptocratic system that is called "economics" and the political puppets who enable them. That is the only reason why we can assume they do not appear here regularly.
Prof. Steve Keen was on Hardtalk a few months ago (BBC), however I have NEVER heard or seen this man on US media, unless I missed something. I cannot say enough about this man, one of the economic heroes of our time
http://www.youtube.com/watch?v=rGkmgnprrIU
Thank you, Socialist. I would prefer to read articles from these keen fiduciary wits on C.D. Meanwhile, I keep hearing of people buying guns to prepare for a phase where the supermarket shelves will go empty. When a government grants itself the privilege to disconnect from established law, it greases the skids so that on a whim (next 911?) "anything goes." Imagine a proclamation going out across the land demanding that all citizens turn in their gold, even their gold fillngs, as it's a matter of national security.
Did we think we'd see Potemkin Village style elections in our nation? Or laws as despicable as NDAA? I mean, there IS no right to privacy, to be secure in our persons, to be presumed innocent until FOUND (by trial of one's peers, not a MIC kangaroo court) guiilty, etc.
The best investment is probably a healthy lifestyle as it may become next to impossible to afford or obtain medical care in years to come. Then again, all this stress is anything but healthy, and I, for one, feel it.
"The best investment is probably a healthy lifestyle as it may become next to impossible to afford or obtain medical care in years to come"
I cannot agree more. We are experiencing the slow but steady breakdown of healthcare provision in the US. Already there is a shortage of GPs and it is getting worse. Not to even mention the unsustainable insurance extortion system. It is only a matter of time before this erupts into full-scale crisis.
Strictly speaking, I think you're right about Keen not being on US media, but I've caught him more than once on RT. Wait, isn't that the Commie channel?
Commie Channel, yeah! lol!
You're right Lingum, RT shows Roberts, Keen, Hudson, Max Keiser, Gerald Celente - all those Americans (but Keen is Aussie) that are censored from US TV and predicted the financial crisis. The Corporate Propaganda Cartel can't don't want us to know that there were people who warned us about something that " no one saw coming".
RT is proving to be the best TV news in the English language. (with the possible caveat of criticizing Putin/Medvedev).
Steve Keen's website has a prominant article in which he lists the (very few) economists and financial planners who predicted the downturn of 2008. That short list includes Krugman, BTW. He of course is on it, as is Dean Baker. I agree that, especially after what happened in 2008, its useless to take advice from people who were blindsighted by the various bubbles. Its like hiring a roofer who lives in a leaky house.
ubrew. I don't recall seeing Krugman listed. Can you give the link?
http://www.debtdeflation.com/blogs/2009/07/15/no-one-saw-this-coming-balderdash/
Spot on, Sioux. Friends in the banking industry were discussing the fall as of '06, possibly before. They didn't know when, they didn't know just how, but they knew it would snap fairly soon.
Their attitude reminds me of a game we played as kids. One of us would build a house of playing cards, and then we would take turns pulling off one card at a time to see how many cards we could get before it fell down.
Most people in finance see their own behavior as "human nature' and conclude that "the boom and bust" cycle is inevitable.
Latest article from Dr. Michael Hudson that should have appeared here:
http://www.counterpunch.org/2012/01/27/banks-werent-meant-to-be-like-this/
Dr. Steve Keen's site
http://www.debtdeflation.com/blogs/
His brand new edition of Debunking Economics is a must read for anyone interested in economics
Weren't you Secretary of Labor when Bill Clinton pushed Walmarts, Tyson Chickens and all the NAFTA and GATTS off on the rest of us? Where do you think we have to shop today? Fewer places than we did before. Complicit? The only way I can shop anywhere else than Walmart and Staples is to buy online. Do I consider who's selling it? Yes. Do I purchase anyway sure I do if it's a necessity. Does that make me complicit? No I am using the system you helped put in place and just getting barely by.
Mr. Reich has made a good living for himself as a middle of the road economist. His analysis is usually like a magazine article, "The Danger of Razor Blades to Children". The analysis could be correct but the effort meaningless and irrelevant. It simply passes the time and affords Mr. Reich a writing fee.
This article is a pretty low one even for the author. Blaming those who have no say is a complete waste of words.
You know I got the same feeling right after reading the article, everything you said: the obviousnes of the point, the unnecessariness of making the point, and the probable fee as motivation for writing it in the frst place. Thanks for verbalizing that, I feel vindicated.
" But save some blame for the insatiable consumers and investors inhabiting almost every one of us, who are entirely complicit."
This statement by Reich is true, but do we understand why?
It is the dysfunction of the human ego and the love of money that is destroying the world. It is an inner human compulsion that consumer capitalism feeds upon. It is the witchcraft of Madison Avenue. Until we understand that, corporate consumer capitalism will continue to destroy the spiritual nature of our humanity. We are truly spiritual beings living in a material body.
Yes, corporate capitalism is playing the dysfunction of the human ego like a great conductor.
How do you control the human ego? ....by going deeper into the mind, the inner self, in presence, by way of meditation and contemplation, seeking the inner voice of spiritual discernment. This is the spiritual path of the great mystics of the major religions of the world, but organized religion has walked away from spirituality.
Christianity in America needs to become a more prophetic and contemplative faith. Christian fundamentalists (and not just Protestants, but many many Catholics) are living in their own delusional structure of control and certitude.
To me, the great failures in the U.S. are its institutions of control that have an ego of their own. Organized Christianity is one of them because it has failed to transcend the materialism of the American capitalistic culture. As a nation, it seems we no longer know what it means to be truly human.
Here's the real dilemma we face:
Our economy is 70% over-consumption driven.
The majority of We The Consumers are fat/obese - both physically and materialistically. We couldn't consumer more if we wanted to - and more and more of us simply don't want to.
That's why our economy is failing - because it's over-consumption driven, and the Age of Over-Consumption is ending. Fast.
Please adapt accordingly.
I am so tired of "fat" people being demonized. Easy targets aren't they? Grew up ridculing them in school didn't you?
I don't really give a fuck about the so called important "economy" and it's phoney growth. What's really obese and overfed at this time is corporate earnings and CEO and investor earnings. Shall we have a discussion about that? Why the obscene discrepancy in earnings? That's really why the whole system is failing. It has nothing to do fat people or skinny people or smokers vs non smokers, or the insured vs the uninsured, or right to live vs right to choose, or even Muslim vs Christian/judeo, or black vs white, etc.. And everything to do with who is skimming off the top. And we all know who is doing the skimming. But no one ever wants us to focus on that.
Can we ever expect those that were "too big to fail" to adapt accordingly? If anyone should go on a diet and practice restraint it's them. We are only supposed to blame "labor" for expanded production costs while executives now make more than a many hundred times more than any laborer? They still got their bonuses, the rest of us lost our jobs, homes and security. We're supposed to adapt so that they can retain their positions?
Bull Shit! Their fat is costing us more than any poor fat person or smoker ever cost our societies.
What next fat police.... how is that smaller government? Can't tax business, but we can tax fat individuals? Hiw dies that even make sense? The real "fat" we're currently set up to tax and get revenue from is inheritance and capital gains, why aren't we currently doing that? Because the truly "fat" people are investing their extra calories marketing to the rest of us that really isn't "fat". And we're so malnutritoned we can't see the difference.