Tag Archives | Economy

The Final Nail In The Supply Side Coffin

md_horizTaxes are low and corporate profits are high, but nothing is trickling down to the American worker.

If politicians are going to continue kowtowing to every whim of the rich, can they at least think of a new excuse? Via Salon:

The theory of supply-side economics tells us that if you cut taxes on rich people and corporations, the moguls and businessmen will take their windfall and invest it, creating jobs and accelerating the rate of economic growth. The benefits of a light hand on the upper class, therefore, will “trickle down” to the working man and woman.

Ever since Ronald Reagan first attempted to make supply-side economics a reality and proceeded to inaugurate an era of persistent government deficits and growing income inequality, it has become harder and harder to make the trickle-down argument with a straight face. But we’ve never seen anything quite like the disaster that’s playing out right now.

Read the rest
Continue Reading

The Age Of Perpetual Self-Branding

imageFacebook wants to be the place where you feel most yourself, with the most control over how you are regarded. It inextricably intertwines marketing with selfhood, so that having a self becomes an inherently commercial operation.

Writing for n+1, Rob Horning concocts a frightening, fantastic, and thought-provoking essay on how we live today, connecting the reign of “fast fashion” companies such as Forever 21, social media such as Facebook, and 21st century capitalism’s demand that workers market and reinvent themselves endlessly:

I’ve always thought that Forever 21 was a brilliant name for a fast-fashion retailer. These two words succinctly encapsulate consumerism’s mission statement: to evoke the dream of perpetual youth through constant shopping. Yet it also conjures the suffocating shabbiness of that fantasy, the permanent desperation involved in trying to achieve fashion’s impossible ideals.

Despite apparently democratizing style and empowering consumers, fast fashion in some ways constitutes a dream sector for those eager to condemn contemporary capitalism, as the companies almost systematically heighten some of its current contradictions: the exhaustion of innovative possibilities, the limits of the legal system in guaranteeing property rights, the increasing immiseration of the world workforce.

Read the rest
Continue Reading

Are Banksters Too Big To Jail?

BankUSWhy are we banking on banks to a promote economic recovery? HBO’s “Too Big To Fail” should have been about banksters “too big to jail.”

This week the financial crisis finally went prime time in the form of a big budget HBO docudrama called “Too Big To Fail.”

It was a well-acted docudrama focused on the BIG Men and some women in the banks and in government who tried to put Humpty Dumpty back together again up on that wall to prevent a total economic collapse when panic dried up credit and financial institutions faced failure.

Based on the work of a New York Times reporter, it offered a skillfully-made but conventional narrative which, like most TV shows, showcase events but miss their deeper context and background.

We heard all the explanations, save one.

There was greed, ambition, ego and money lust. There were personal rivalries and ideological battles, parochial agendas and narrow self-interest.… Read the rest

Continue Reading

College Graduates Earning Less

OxfordceremonyCongratulations to all the new college grads out there, but have you thought about how much your expensive new college degree is worth? For 2009-10 graduates who were able to land a job (about half), starting salaries fell 10% versus 2006-8, and it doesn’t look like 2011 will be any better. Catherine Rampell reports for the New York Times:

Employment rates for new college graduates have fallen sharply in the last two years, as have starting salaries for those who can find work. What’s more, only half of the jobs landed by these new graduates even require a college degree, reviving debates about whether higher education is “worth it” after all.

“I have friends with the same degree as me, from a worse school, but because of who they knew or when they happened to graduate, they’re in much better jobs,” said Kyle Bishop, 23, a 2009 graduate of the University of Pittsburgh who has spent the last two years waiting tables, delivering beer, working at a bookstore and entering data.

Read the rest
Continue Reading

Real Rate Of Inflation In U.S. Is Near 10%

Paul Volcker

Paul Volcker

“Lies, Damned Lies and Statistics” comes to mind. John Melloy reports for CNBC First Money:

After former Federal Reserve Chairman Paul Volcker was appointed in 1979, the consumer price index surged into the double digits, causing the now revered Fed Chief to double the benchmark interest rate in order to break the back of inflation. Using the methodology in place at that time puts the CPI back near those levels.

Inflation, using the reporting methodologies in place before 1980, hit an annual rate of 9.6 percent in February, according to the Shadow Government Statistics newsletter.

Since 1980, the Bureau of Labor Statistics has changed the way it calculates the CPI in order to account for the substitution of products, improvements in quality (i.e. iPad 2 costing the same as original iPad) and other things. Backing out more methods implemented in 1990 by the BLS still puts inflation at a 5.5 percent rate and getting worse, according to the calculations by the newsletter’s web site, Shadowstats.com…

[continues at CNBC First Money]

Read the rest

Continue Reading

Last Minute Budget Deal Only Postpones More Serious Economic Warfare

Photo: Ser Amantio di Nicolao

Photo: Ser Amantio di Nicolao (CC)

The Capitol Hill battlefield is still for the moment as the Easter holidays approach and the combatants get a break from the heated polemics and overnight bargaining sessions. In a last minute deal, milked by both sides for maximum drama and political advantage, the government will not shut down—at least not now—even as its budget has taken a major whack.

Each side can posture to supporters as a victor. The President, who managed the process from the shadows, posed for photos in the White House after his great compromise of 2011 was announced.

It was a media moment to be relished, as media columnist Howard Kurtz explained on the Daily Beast:

“The White House escaped most of the blame. Once the spotlight shifted from the political gamesmanship to the human impact of a shutdown—soldiers in Iraq and Afghanistan not getting checks, passport offices closed, national parks off limits—everyone knew an angry public would start pointing fingers.

Read the rest
Continue Reading

Medical Marijuana Is Now A $1.7 Billion Market

MMS

Medical Marijuana shop in Denver, Colorado. Photo: O'Dea (CC)

The medical marijuana market has had a significant growth this year. With seven states who have opened shop and five more states planned to approve medical marijuana outlets this year, cannabis could save many states’ economies. Medical News Today reports:

Medical marijuana is now a serious $1.7 billion dollar market, according to a new report released this week by an independent financial analysis firm that specializes in new and unique markets. Currently, 24.8 million people are eligible to receive a recommendation and purchase marijuana legally under state laws, and approximately 730,000 people actually do.

Ted Rose, editor of the new State of the Medical Marijuana Market 2011 report, comments:

“Medical marijuana markets are rapidly growing across the country and will reach $1.7 billion this year. We undertook this effort because we noticed a dearth of reliable market information about this politically charged business.

Read the rest
Continue Reading

Treasure Islands: The Murky World Of Offshore Tax Shelters

3446025121_072700607fNew Left Project sits down with author Nicholas Shaxson to talk tax havens — a mammoth system of quasi-legal money-laundering which has a far wider impact than we realize, with a large role in the global drug trade and financial crisis. As it turns out, the biggest “treasure islands” are not the Caymans or Monaco, but places such as the City of London and the U.S. state of Delaware:

There is no common definition of what a tax haven is. Everybody has a slightly different definition. Ultimately what a tax haven provides is escape from the rules and the laws of jurisdictions. Tax havens are also about ‘elsewhere’ – the laws of the Cayman Islands are not designed for the benefit of the 50,000-odd population of the Cayman Islands.

The traditional view is…palm-fringed tropical islands in the Caribbean, Monaco, Switzerland, Liechtenstein. Small states. But if you do the analysis of what a tax haven is and what they are selling, you will find that these small islands are generally sideshows to the big event.

Read the rest
Continue Reading

March Madness And The Class War

The term class war has been extricated from the archives of another era, while divisions over the future of the economy have become a battleground in which the adversaries yell at each other, but rarely engage in any discourse with each other in a shared language.

The worse things get, the harder it is for people to agree on what to do.

This is a month known in the USA for the “March madness” college basketball finals, but the madness seems now to be oozing from sports arenas to political capitols.

MARCH MADNESS

In the Middle East, all the political turmoil will ultimately impact on a regional economy build on the flow and price of oil, contends author/historian Michael Klare:

“Whatever the outcome of the protests, uprisings, and rebellions now sweeping the Middle East, one thing is guaranteed: the world of oil will be permanently transformed.  Consider everything that’s now happening as just the first tremor of an oilquake that will shake our world to its core.”

Back in the once thought of as  “stable” United States, the economic crisis has finally spurred a confrontation between right and left with noisy protests following threatened crackdowns on union rights to collective bargaining, and cutbacks on social programs.… Read the rest

Continue Reading