After a disastrous week the GOP presidential candidate, alleged billionaire, Donald Trump introduced his economic advisors, a veritable who’s who of what’s wrong with the US economy as pointed out by economist RJ Eskow. Trump’s team isn’t just monochromatic and male. At least four, and perhaps as many six, of the men are billionaires. They …
Tag: Robert Reich
Aug 09 2016
Sep 25 2013
The income gap between the 99% is has grown to the point that it now as great as it was a the start of the Great Depression. In New York City, Democratic candidate Bill de Blasio built his campaign for mayor around the increased poverty of New Yorkers that he says is creating two cities. According to the US Census Bureau the poverty rate continues to climb in NYC threatening the viability of the city:
The poverty rate rose to 21.2 percent in 2012, from 20.9 percent the year before, meaning that 1.7 million New Yorkers fell below the official federal poverty threshold. That increase was not statistically significant, but the rise from the 2010 rate of 20.1 percent was.
Former Labor Secretary for President Bill Clinton, Robert Reich has released a documentary, Inequality for All, on the fifth anniversary of the fall of Lehman Bothers and the second anniversary of Occupy Wall Street which brought attention to the income gap and change the nation’s conversation about the “American Dream.” Sec. Reich joined Bill Moyers on his show Moyers & Company to discuss his film and the increasing income inequality for all of us.
TRanscript can be read here
“The core principle is that we want an economy that works for everyone, not just for a small elite. We want equal opportunity, not equality of outcome. We want to make sure that there’s upward mobility again, in our society and in our economy.”
By the Numbers: The Incredibly Shrinking American Middle Class
by Karen Kamp, Moyers & Company
A typical American household made about $51,017 in 2012, according to new figures out from the Census Bureau this week. That number may sound familiar to anyone who remembers George H. W. Bush’s first year as president or Michael Jackson in his prime. That’s because household income in 2012 is similar to what it was in 1989 (but back then it was actually higher: you had an extra $600 or so to spend compared to today).
That sobering statistic gives an indication of where the American middle class appears to be headed. Take a look below at a snapshot of where the middle class is now, the problems they face and what our Facebook audience has to say about squeaking out a living these days.
Sep 18 2013
President Barack Obama briefly addressed the country on the fifth anniversary of the collapse of Lehman Brothers and the start of the financial crisis that would see the middle class loose most of its wealth. The president rightfully chastised the obstruction on congress, blasting the Republican threats to shut down the government unless the he agrees to de-fund the Affordable Care Act and he patted himself on the back for how far the economy has come in the last five years.
In his speech the president paints a glowing picture of the economy and his accomplishments:
And so those are the stories that guided everything we’ve done. It’s what those earliest days of the crisis caused us to act so quickly through the Recovery Act to arrest the downward spiral and put a floor under the fall. We put people to work, repairing roads and bridges, to keep teachers in our classrooms, our first responders on the streets. We helped responsible homeowners modify their mortgages so that more of them could keep their homes. We helped jump-start the flow of credit to help more small businesses keep their doors open. We saved the American auto industry.
And as we worked to stabilize the economy and get it growing and creating jobs again, we also started pushing back against the trends that have been battering the middle class for decades, so we took on a broken health care system, we invested in new American technologies to end our addiction to foreign oil, we put in place tough new rules on big banks, rules that we need to finalize before the end of the year, by the way, to make sure that the job is done, and we put in new protections that crack down on the worst practices of mortgage lenders and credit card companies.
We also changed a tax code that was too skewed in favor of the wealthiest Americans. We locked in tax cuts for 98 percent of Americans. We asked those at the top to pay a little bit more.
So if you add it all up, over the last three-and-a-half years, our businesses have added 7.5 million new jobs. The unemployment rate has come down. Our housing market is healing. Our financial system is safer. We sell more goods made in America to the rest of the world than ever before.
However, his rosy view of the current state of the economy isn’t shared by the 99% who are still struggling with low wage jobs, unemployment, and a housing crisis that is still looming.
The president’s speech makes one wonder who is advising this man and what economy was Obama talking about? Then one remembers that it was his best buddy Larry Summers and the Chicago School of Rubinite cohorts, as The Guardian‘s economics editor Heidi Moore notes in her column. Ms. Moore writes that is time to “end the delusion that this White House has done even a fraction of what it should to help the economy” and concludes that the president has had some poor economic advice:
The president’s economic initiatives – food stamps, manufacturing, infrastructure, raising the debt ceiling, appointing a new chairman of the Federal Reserve – have mostly ended in either neglect or shambles. After five years, the Obama Administration’s stated intentions to improve the fortunes of the middle class, boost manufacturing, reduce income inequality, and promote the recovery of the economy have come up severely short. [..]
Here’s the litany of failure: the president has not pushed through any major stimulus bill since 2009, and most of that was pork-barrel junk. Manufacturing is weak and weakening; the employment gap between the rich and the poor is the widest on record; the economic recovery is actually more like an extended stagnation with 12 million people unemployed; the housing “recovery” will be stalled as long as incomes are low and house prices are high; and quantitative easing as a stimulus, while a heroic independent effort by the Federal Reserve, is past its due date and is no longer improving the country’s fortunes beyond the stock market.
Shall we continue? We don’t have a food stamp bill even though 49 million Americans lack regular access to food. Goldman Sachs analysts have said the sequester is taking a toll on stubbornly growing unemployment: “since sequestration took effect in March, federal job losses have been somewhat more pronounced,” they wrote last week; and another debt ceiling controversy – the third of Obama’s presidency – looms in only a few weeks with the potential to hurt what meager economic growth we can still cling to.
The economy for the vast majority of people and small businesses is not going well and won’t improve in the neat future. One of the people that Pres, Obama has ignored is Pres. Bill Clinton’s former Labor Secretary and economics professor that the University of California, Robert Reich. Prof. Reich sat down with Democracy Now!‘s Amy Goodman to discuss the current state of the economy since the fall of Lehman Brothers.
Transcript can be read here
Meanwhile, the president is living in a bubble. Let’s hope his bubble bursts before ours does and he starts to really do something about it.
Jun 10 2013
ACM: Can the human mind comprehend today’s world? A challenge to all who engage in politics
by don mikulecky
This diary is being written by request. The subject is all mine but I am doing this because I was asked. I write this caveat because as time goes on my radical take on the world seems to diverge more and more with the rest of the commentators. I am unable to focus on details and reductionist pieces any more. I long ago came to the conclusion that these methods and the ideas they generated have failed. If this is arrogant then I am arrogant. I have studied for over half a century and these are the conclusions I have come to. I have coauthored a book that sums up much of what I have learned and I’ll give a link if you want it. The purpose of this diary is to give you a snapshot of the world model we have developed. It is changing constantly so it needs periodic updates. Read on below and I will give my answer to the question I ask in the title.
First of all the antithesis to the reductionist approach is that of systems analysis. I will take a moment to remind you that when I use the word “system” it is in a very special context. The reductionist counterpart has no meaning in this context. The group is interested in the writing of Marx. Marx wrote in a context that had little resemblance to the modern world. Yet Marx had insights that outlive those limits. The trick is to save the baby as we discard the bathwater.
Marx, for his time, was ahead of the field in understanding systems. His ideas were founded on a sense of certain things happening without a mechanistic simple cause. He wrote extensively to weave a more holistic view of what economics was as it connected with so many other things in human activity. This was good and we need to go back with our modern understanding and put those ideas into today’s perspective. This diary is not the place for that since it is at least a book.
Rather than do that I want to paint a picture (I am a painter…watercolor) of the world today as we might see it if our minds were able to take it all in. (The reductionist paradigm came about as a way of avoiding such an impossible task). We are being forced to try to grapple with the whole system because we have more or less filled the planet and made the isolation of the past something that is disappearing as we watch in awe.
The earth system with its atmosphere and climate and oceans and ecosystems, etc has never been the subsystems our reductionist mentality created to deal with it, but as time goes on the error is being magnified non-linearly. The role of the human species is a growing influence over time, anthropogenic global warming being but one aspect of this. What Marx was concerned with was the role of the economic/political system in the way this one dominant species impacted on the world although he dealt with it as all humans did and most do, as if we can isolate our existence and our problems from the impact we have grown to have on the earth system.
Humans have generated conflicting world models within the common sphere of reductionist thought. We have religions, reductionist science and other fragmented pieces of human “knowledge”. We evolved from some beings that chimps have for example. We like to think we are very different from them and we indeed are. The scary part is the ways in which we remain similar. Male female relations, political power, etc can be seen to have common features in both groups.
Part of the legacy of Cartesian reductionism is the mind/body duality and the way the living organism was metaphored as a special kind of machine. These factors became integrated into the Capitalism Marx thought about and they shaped the way the relationship between wealth and labor were seen. Power relations became formulated in terms that Marx described so well. The problem is that these ideas were still in a reductionist box and remain there to this day.
So we have the fundamental challenge to face at this moment in history. Is the human mind able to step outside of these long entrenched limits and confines and see us as a rouge species acting almost like a cancer on the planet? Marx diagnosed the nature of this metastatic disease we had become. He saw it in terms of the way the labors of humans that could be used in so many ways were channelled by the owners of the means of production into the creation of capital.
Here is where the systems idea is very enlightening. The traditionional picture is that the greedy among us rise to power and control the rest of us and insist on a growing, unsustainable system to satisfy their greed.
Systems theory asks an important chicken and egg question at this point. Is it the greedy humans that create the system or does the system simply find as many greedy humans as it needs to sustain itself and grow? I submit that Robert Reich was correct in his book about “Supercapitalism” when he asserted that we could eliminate WalMart tomorrow and some other entity or entities would immediatly fill the vacuum and probaly evolve into something worse because of the ability to shed excess baggage.
Reductionism is wonderful for the human mind because it supplies answers. Systems theory, recognizing the myriad complex interactions, can only describe things in general ways and can not supply false mechanistic explanations.
If this makes sense to you I apologize for bringing you to this point for you will not be able to go back. Nor will you come up with answers the way you did before. Nor will the political system seem like a useful tool for helping us. No, those of us who have crossed the line are pessimistic. The system grinds on. It is like a cancer on the planet. And as we look at our kids and grandkids we wonder. And we hurt.
Apr 21 2012
I’ll believe corporations are people when Texas executes one” ~ Robert Reich
Economist and former Clinton Labor Secretary Robert Reich was a guest on Jon Stewart’s The Daily Show to discuss the economy, taxes, and that state of our political system. In a three part extended interview , Sec. Reich discusses taking back of our democracy from the special interests and “the conditions that he believes will lead to the formation of a legitimate third party in the United States.”
One of the most pernicious falsehoods you’ll hear during the next seven months of political campaigning is there’s a necessary tradeoff between fairness and economic growth. By this view, if we raise taxes on the wealthy the economy can’t grow as fast.
Wrong. Taxes were far higher on top incomes in the three decades after World War II than they’ve been since. And the distribution of income was far more equal. Yet the American economy grew faster in those years than it’s grown since tax rates on the top were slashed in 1981. [..]
What we should have learned over the last half century is that growth doesn’t trickle down from the top. It percolates upward from working people who are adequately educated, healthy, sufficiently rewarded, and who feel they have a fair chance to make it in America.
Fairness isn’t incompatible with growth. It’s necessary for it.
President Obama’s electoral strategy can best be summed up as: “We’re on the right track, my economic policies are working, we still have a long way to go but stick with me and you’ll be fine.”
That’s not good enough. This recovery is too anemic, and the chance of an economic stall between now and Election Day far too high. [..]
The President has to offer the nation a clear, bold strategy for boosting the economy. It should be the economic mandate for his second term.
It should consist of four points:
First, Obama should demand that the nation’s banks modify mortgages of homeowners still struggling in the wake of Wall Street’s housing bubble – threatening that if the banks fail to do so he’ll fight to resurrect the Glass-Steagall Act and break up Wall Street’s biggest banks (as the Dallas Fed recently recommended).
Second, he should condemn oil speculators for keeping gas prices high – demanding that the oil companies allow the Commodity Futures Trading Corporation to set limits on such speculation and instructing the Justice Department to investigate and prosecute oil price manipulation.
Third, he should stand ready to make further job-creating investments in the nation’s crumbling infrastructure, and renew his call for an infastructure bank. And while he understands the need to reduce the nation’s long-term budget deficit, he won’t allow austerity economics to take precedence over job creation. He’ll veto budget cuts until unemployment is down to 5 percent.
Finally, he should make clear the underlying problem is widening inequality. With so much of the nation’s disposable income and wealth going to the top, the vast middle class doesn’t have the purchasing power it needs to fire up the economy. That’s why the Buffett rule, setting a minimum tax rate for millionaires, is just a first step for ensuring that the gains from growth are widely shared.
But even before any of what Sec. Reich has put forth, President Obama needs to fire Treasury Secretary Timothy Geithner and appoint Sec. Reich, Prof. Bill Black and Paul Krugman to his Economic Advisory Council.
Oct 17 2009
Robert Reich being interviewed by Australian Broadcasting Corporation, snuck in a pretty good one-liner, I thought might be worth sharing:
ROBERT REICH, PUBLIC POLICY, UNI, OF CALIFORNIA: I wish I could say, Ali, that there were a lot of lessons learned on Wall Street. There don’t seem to be. […]
And yet the public is now out almost $600 billion, having cushioned the blow of the last round of risky ventures that Wall Street entered into. So, I wish I could be more optimistic and upbeat about where Wall Street has come to, but I don’t think they’ve learned a thing.
ALI MOORE: Why is it? Why haven’t the lessons been learned? Why is it that nothing has changed?
ROBERT REICH: A word with five letters: it’s greed.
[Here’s the one-liner]
If you take the greed out of Wall Street, all you’re really left with — is Pavement!
Transcript Broadcast: 15/09/2009
(h/t to Thom Hartmann)