I am constantly reminded of how poor the “Stimulus” was – but this will not be another entry into the debate of political will vs. reality. I’m not going to argue whether or not an inadequate stimulus was proposed because of political constraints – IE, it had to be kept under X billion to have a chance of passing, regardless of the required size to ensure full employment.
The point that I see no one making is that the design of the stimulus was poor. It shouldn’t have been absolute – it should have been conditional. Instead of saying “we will spend X billion on Y project” – it should have said “we will spend X billion on Y program UNTIL Z condition is met” – with the condition being NAIRU, etc. Considering how awful the CBO is at predicting recessions and their recoveries, they would have scored it low – and we would have ended up with more stimulus when the recession was deeper than they predicted – leading to a faster recovery.
This was an unforced error. Hopefully the democrats have learned from it. I suspect not.
Also, to top it off, they could have put conditional taxes on the back end to pay off the stimulus debt – which would have helped with the score. You could have literally had a CBO score of near $0 over 10 years if the stimulus bill had been written correctly. Just like ObamaCare was written to be near $0. Call it the Responsible Recovery Act.
Instead we got the Half Stimulus Act. And no recovery.
Over at Noahpinion, Noah Smith has a blog post about CWA – Conservative White America, and how they’re (not) functioning in today’s society. Go read the whole post first before getting my thoughts on it.
First, he only mentions racism twice in the entire article. Maybe he’s downplaying the significance race/racism plays in this entire issue. I am a closet liberal who lived in Pennsyltucky and now lives in Miami – and when I was up north, the gross majority of people I knew were white and solidly middle class. And let me tell you, the n-word is still used frequently. (Obviously CWA exists nationwide – not just the South as others have pointed out.) So anyone that thinks that racism doesn’t exist or isn’t a big deal, you’re living in another world. I’m even talking about kids going to both large state universities in PA, who grew up all across the state – supposedly “educated” folk. When you’re white, white people are comfortable with you. I’ve had to ride in a tow-truck with a driver who JUST MET ME, and all he could tell me is how he can’t understand how I live in the city with all those n-words – I know a successful business owner in an all white suburb who says the biggest problem we have is all those n-words taking all the money. In more public settings, they refer to african-americans as “those people.” I’ve seen an awful lot of evidence that racism plays a MAJOR part in CWA – they feel life is hard, they see people more successful than they are, and they are sure SOMEONE is to blame, SOMEONE is taking all their money – cause they’re working damn hard but not getting to the level the REALLY rich are. Now, you can’t blame the really rich, because that’s what you aspire to be! But SOMEONE has to be responsible, and you know from all your hard work it’s not you, so who the hell can it be? And it’s even more pervasive than that. Look at Facebook for one day and you’ll see another “you have an iPhone and a car but you’re paying for food with your welfare card” pictures – who do you think they’re talking about? What does the picture show? A white person? C’mon. And down here in Miami, I’ve learned that african-americans are still the bottom of society, even though I’m in the minority where I live – tons of hispanics from a multitude of countries still refer to them as “monkeys,” etc. Even some of them think african-americans are holding them back!
So that might describe a portion of people in CWA. And in the South, maybe a larger proportion of CWA is the racists. But I’ve also met plenty of people who feel the same way – that they’re working hard, but they’re not getting ahead, they’re not getting rich. But instead of blaming “those people” they blame all the damn “libtards” who run the government and take all their money and spend it on poor people of all races. They don’t seem to have a racial component in their complaint – but they know it’s not the rich as I said above, but it has to be SOMEONE. So BIG GUBMIT LIBRULS must be the culprit – who else could it be! This also explains the contradiction – they have no problem mailing in their taxes to have the largest military empire the world has ever known, because that money is getting sent back to hard working people like themselves who are just trying to get ahead, while keeping us safe. How else do you explain this glaring contradiction? So maybe this is a portion of the people in CWA – but a smaller portion than the racists.
But then again, every time you see a study on the racial attitudes of what we’d consider CWA, underlying everything they believe seems to be racism, even if they don’t consciously acknowledge it.
Or maybe it’s just thousands of individual cases of something along the line of fundamental attribution errors. Millions of CWA don’t see themselves getting ahead, but they know they’re hard working folk – yet when you see others around you not getting ahead, it’s cause they’re lazy or dumb folk. So something must be getting in their way! It can’t possibly be the circumstances which they have no control over. It has to be something else.
On a personal level, I’ll admit I have less empathy for people who are voting for conservatives – they’re getting exactly what they ask for, who am I to tell them they deserve better? I’ll save my empathy for those who vote for solutions that have been shown to work around the world, but instead are getting screwed over by CWA, making their lives worse each and every day. But I also want to caution all the outside observers from thinking that we “have the answer” if they’d just listen to us and stop their backwards ways. It’s not like the South is devoid of books or isn’t aware that Denmark exists or they don’t have internet connections and colleges. Sure, it would be great if they decided one day to do better – but to think we can “force” them to change – good luck with that. This is the same irrational thinking that gets liberals to support never-ending wars in far-off places that have no hope of succeeding, or to support shoving trade and “property rights” down an indigenous group’s throat to make them more “wealthy.” Sure, we “have” the answer, but maybe we can’t just “give” it to them. Maybe they just have to figure it out for themselves, decide what is right for them.
I just wish they wouldn’t kill everyone else off in the meantime.
Now, someone tell me, when is it civil war time for global warming? How many people do we let them kill before we finally say “enough”?
Toyota Motor, the world’s largest automaker by sales, lifted its annual profit forecast on Friday after almost doubling its net income in the quarter that ended in June…thanks to favorable exchange rates.
Net profit in the Japanese automaker’s financial first quarter beat analysts’ expectations by a wide margin, and underscored the boost Toyota and other automakers have received from the economic policies of Prime Minister Shinzo Abe of Japan. Those policies have galvanized Japan’s export industry by weakening the yen by about 15 percent since last year, increasing the value of products sold overseas.
Toyota actually sold almost 37,000 fewer vehicles in the latest quarter, compared with the same quarter last year…
Toyota now expects…an increase of 54 percent from its net profit last year…
Helped by its strong numbers, Toyota is set to become the first automaker in the world to build more than 10 million vehicles in a single year….
Is our economists learning? For the really slow ones, a recap: Toyota has slow sales around the world, sold fewer cars, but due to a weak Yen, makes a KILLING, and will likely set a RECORD for vehicle manufacturing never seen before on this planet.
You see, WE could be the ones selling our manufactured goods around the world, filling the demand gap left by the collapse of the housing bubble.
Another option for these companies would be to simply raise prices. McDonald’s could bump up a Big Mac above its current $3.99, not to mention all the items on its Dollar Menu. (Note to internet: That oft-cited claim that doubling workers’ wages would only require increasing the price of a Big Mac by $0.68: Wrong!)
But it’s hard to call the “Dollar Menu” the Dollar Menu when its contents cost a buck 17. And you can’t raise the price of a Big Mac just a little! It’s $3.99 for a reason. I imagine that sticking to these “magic prices” is as much of a concern for McDonald’s as anything else. And in an era of rising meat costs, it should make you wonder what the company has had to do to its “burgers” to maintain that dollar price point. *Shudder*
Unfortunately the author has never been to Copenhagen, where you can get a Big Mac for about $5 US from a worker who is making over $20 US. And the country hasn’t folded yet! McD’s hasn’t shut their doors! Imagine that! Yet they’re still able to provide every single person with healthcare, a decent education, a number other social services, etc, etc, etc. And you don’t walk over poor people in the streets! Turns out its better for your economy if a few million workers can actually afford your Big Mac, cause no matter how fat Limbaugh gets, he’s only gonna eat a few hundred a year.
PS. There is no legal minimum wage in Denmark. So you can save the nonsense about being “competitive.”
Health insurance rates in Ohio will rise an average of 18 percent for small businesses and 41 percent for individuals participating in the new marketplaces created by the federal health care law, state insurance officials said Thursday…
The agency’s analysis found that the current average monthly cost for individuals was $236.29, compared with an expected average rate of $332.58 next year.
See what they did there? They compared the average COST vs. next year’s average RATE. I.E., the comparison of what people are actually paying for an item, vs. the price of all items next year – regardless of the actual cost due to what people actually purchased.
For example: This year, people go to car dealers and 3/4 of them buy a $20k car, and only a quarter buy $50k cars. So the average COST to consumers is $27.5k. According to Ohio’s Department of Insurance, if the dealer decided to stock 50/50 both car models next year, the average PRICE (known as RATE for insurance) will be $35k next year, even if people still decide to buy the cheaper of the two cars.
You would think a business magazine would know the difference. But you (likely) live in America, in which case, you’d be wrong.
U.S. multinational corporations were actually hiring in 2011 as they were in 2010. Unfortunately as in 2010, they are hiring abroad. In an updated BEA summary on sales, investment and employment by Multinational Corporations for 2011, we have a 0.1% increase in hiring for jobs in the United States while MNCs increased their hiring abroad by 4.4%. Graphed below are multinational corporation employees residing in the United States, scale on the left, against multinational corporation employees located abroad, scale on the right. As we can see multinational corporations are clearly reduced their staff in the U.S. while increasing it in foreign nations. In other words, multinational corporations are not just offshore outsourcing to external, 3rd parties, but also offshore outsourcing American jobs directly.
Two things I think are overlooked.
First, as Dean Baker constantly points out, the dollar is overvalued – and that is a deliberate policy of our government in order to hurt labor, but help companies like Walmart. We could change this tomorrow and bring back millions of jobs – in fact, the only way we will see full employment again is if we allow the dollar to readjust to a proper level, or we engage in another asset bubble (how’d that work out?).
Second, when the North had to compete with the South’s use of slave labor, was the North the more economically advanced economy or was the South? Even though we are competing with other countries who have no problem using (near) slave labor, there is no reason we can’t be competitive in other industries. (And while German manufacturing workers get paid more but are less productive than American workers (!) we don’t hear a peep about how German unemployment or German outsourcing is a problem.)
We shouldn’t be sewing clothes here. But there are other areas we have a comparative advantage – and if the dollar was competitive, we’d be employing the millions of unemployed in these areas.
House Republicans are proposing to double their food stamp savings to nearly $40 billion by rolling back waivers for able-bodied adults and targeting funds to states that are willing to impose greater work requirements on the parents of young children…
As proposed now, the bill would only provide this aid if the state is willing to operate welfare reform-like work activities for mothers with children over 1- years-old.
This is a significant expansion of the current food stamps work rules, which exempt mothers with children under 6.
Tell someone who has little chance of making it in an economy lacking jobs for even college grads that they can get rich through little effort, and yes, they will probably take the bait.
Does any other country do this to their citizens?
Are there not enough real criminals? Do the police not know where Wall Street is located?
Anyways, what else are they supposed to do? The average person at a minimum wage McDonald’s job is almost 30 with a clean record. If you are anything less than that, you have virtually no chance in this economy – which means no food, no house, nothing.
This is the predictable outcome of our nation’s conservative/neo-liberal policies.