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Reads (2-28-2010)

February 28, 2010 Leave a comment

President Scott Brown single-handedly writes, introduces, sponsors, co-sponsors, passes and signs the new jobs bill.

Jobs, Jobs, Jobs…

President Scott Brown Wins Jobs Bill, Tax CutsHuffington Post

If you were just a casual observer of politics, flipping through the cable news networks, you’d think the Republicans — not the Democrats — passed a jobs bill. A jobs bill that was somehow written, introduced, sponsored, co-sponsored, passed and signed by President Scott Brown. Naturally, my inclination would be to blame the easily distracted, superficial cable news people. And they’re partly at fault here, but it’s mostly the absent, muted Democrats.

Why wasn’t the entire leadership contingent from the Senate, along with the entire West Wing staff, all over television condemning the Republicans for trying to filibuster/block/obstruct a jobs bill stuffed with tax cuts for businesses? Is this not a midterm election year in which the Democrats are sure to lose a couple dozen seats? Have they seen the projections for the Fall?

All eyes on the job market – CNN

With the unemployment rate near 26-year highs just below 10% — and unlikely to improve much this year — the focus right now is on jobs.

On Wednesday, outplacement services firm Challenger, Gray & Christmas reports on planned job cuts for February. But a bigger market mover will be the February reading on private sector employment from payroll services firm ADP.

ADP is expected to report that private-sector employers cut 10,000 jobs from their payrolls in February after cutting 22,000 jobs in January, according to a consensus of economists surveyed by Briefing.com. The report is often a precursor to the more widely watched government jobs report Friday.

GDP Contraction Coming In Second Quarter 2010? – Mish Shedlock

With the consumer confidence present conditions index crashing to a low last seen in February 1983 (see Is Consumer Confidence a Contrarian Indicator? for details), there is no good reason to believe consumers will be doing a lot of heavy lifting.

Unemployed consumers typically do not spend a lot of money and Weekly Unemployment Claims Spiked To 496,000.

Couple that with the fact that New Home Sales Unexpectedly Plunge to Record Low it should not be too hard to envision a flat to negative GDP decline in the second or third quarter unless things turn around right now.

Finally, in light of the fact that economists are an amazingly optimistic these days (save a small group of notables like Dave Rosenberg, Steve Keen, and Nouriel Roubini) expect any economic surprises to be to the downside.

Throw away that V-shaped party hat. A stalled recovery or an outright economic relapse is likely just around the corner.

1.2 million Americans lose unemployment insurance today – The economic populist

As the unemployed face cutoff, Washington continues its infighting:

Without a long-term extension to unemployment, 5 million currently unemployed people will lose their benefits and be forced into welfare or outright homelessness by summer.

The National Employment Law Project (NELP) released a new report last week showing that …
1.2 million jobless workers will become ineligible for federal unemployment benefits in March unless Congress extends the unemployment safety net programs from the American Recovery and Reinvestment Act (ARRA). By June, this number will swell to nearly 5 million unemployed workers nationally who will be left without any jobless benefits.

Senator Burr (R-NC) is questioning the need for another unemployment extension.

To put this $10 Billion lifeline for working families into perspective, let’s look at what has gone down on Wall Street this week:
The federal government owned-AIG lost another $8.87 Billion. They still owe the taxpayers $70 Billion from their last bailout, and might be looking for yet another taxpayer bailout.

Cool Site: Economists for Firing Larry Summers

Who knew they cared?

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A reply to Mr. Lebowitz…

February 26, 2010 7 comments

“There’s an old saying that if you don’t know where you want to go, any road will take you there.  As I’ve said on many occasions, this saying is mistaken.  If you don’t know where you want to go, no road will take you there. In other words, you need an understanding of the goal.  You need a vision for the future.”

Michael A Lebowitz, Socialism: The Goal, the Paths, and the Compass

It’s not what you look like when you’re doing what you’re doing; it’s what you’re doing when you’re doing what you look like you’re doing.”
–Charles Wright, Express Yourself (1971)

Mr. Lebowitz makes an argument that, on the surface, sounds logical, however, what we actually are concerned with is the real movement of society, which is to say, the ultimate result of the capitalist process, whether this process is understood by the members of society or not. To understand why we refer to the real movement of society, rather than some goal or vision, requires us to understand the nature of capitalism as a form of social labor.

Read more…

“Brutal change” is coming to Athens

February 26, 2010 Leave a comment

From Reuters:

Speaking to parliament after a visit by EU economic inspectors, Papandreou said Greece did not want other countries to pay for its debts but expected solidarity from its European peers as it struggled with worse than expected fiscal problems.

“Unfortunately, history has fully confirmed our worst fears,” he said. “Our duty today is to forget about political costs and only think about the survival of our country … Past policies make it necessary to proceed to brutal changes.”

This, of course, means Greece will continue to play bitch to banksters, NATO, and its own wealthy families – ensuring the survival of the country only ensures the survival of their lifestyle.

Naked Capitalism: Some form of global central planning may be necessary…

February 25, 2010 Leave a comment

In an ironic twist to the growing realization that this crisis is far from over despite the glad-handing in Washington on having barely escaped Great Depression II, Yves Smith, of Naked Capitalism, yesterday suggested that some form of central planning – similar to the collapsed Soviet Union – may be necessary to avoid the economic calamity separately predicted by Peter Boone and Simon Johnson, and by Martin Wolf.

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Another reason why economists should be neutered: The case of Bruce Bartlett

February 24, 2010 Leave a comment

Bruce Bartlett, oddly self-argumentative

According to Forbes magazine, Bruce Bartlett is a former Treasury Department economist and the author of several books. His association with the Treasury Department alone, in our opinion, recommends him for a pink slip from the gene pool – we already have enough people waiting in line to destroy the lives of billions, we needn’t add to this extensive list. But, Bruce is a special case: As an economist he is capable of arguing with himself in public in a fashion we find odd. If there is a genetic basis for this capacity among economists, we think it should be purged from the human family tree.

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Reads (2-23-2010)

February 23, 2010 Leave a comment

Hooray! Mississippi decides to join the rest of us in the 21st Century

Notes on a difficult employment outlook –  Hussman Funds

Outlook for employment:

On the other hand, several aspects of the employment picture concern me quite a bit. First and foremost, the unemployment rate is reported as the ratio of individuals who are unemployed and actively seeking work (thereby still being counted as being in the labor force) divided by the labor force itself. The difficulty is that we have seen an unprecedented exodus of discouraged workers from the U.S. labor force over the past two years, which has the result of sharply understating the extent of the unemployment problem. Had labor force participation remained at the same level as it was in 2000, the unemployment rate today would be nearly 3 percentage points higher than is currently reported. Instead, mostly over the past 18 months, the U.S. labor participation rate has retreated to a level we haven’t seen in a quarter century. Moreover, the share of employed individuals who are employed full time has also dropped by 3 percentage points, resulting in a significant contraction of employment activity. Even this would not be a difficulty had we not also vastly expanded the debt burden on the average family since then. Unfortunately, the high debt burdens and weak employment conditions cannot coexist without producing credit strains. Simply put, current employment levels are incongruous with servicing existing levels of household debt.

Who’s Really In Control of the White House? Maybe Not Obama – Alternet

No. Who’s on first!

It began reemerging in September with Gen. Stanley McChrystal’s Afghan escalation plan. McChrystal didn’t just ask President Obama for more troops — protocol-wise, that would have been completely appropriate. No, McChrystal went rogue, preemptively leaking his request to the media, then delivering a public address telling Obama to immediately follow his orders.

Odierno: US Could Slow Exit From Iraq – Antiwar.com

Apparently, who’s on second thoughts as well…

One of Gen. Odierno’s top subordinates, Brigadier General Kevin Mangum said only days ago that the “biggest concern” officials have is not the rising violence ahead of the Iraq election, but the prospect of rising violence after the election. Though levels of violence has jumped all over the place in Iraq in recent months, the trend in sectarian tensions is decidedly toward more, a tailor-made excuse for stalling the pullout.

Ron Paul! – Antiwar.com

The followers of Ron Paul can’t stop slapping themselves on the back. Here Justin Raimondo takes on the NeoCons, Palin, the wars, and Beck:

A rebellion among conservatives has long been brewing, and the CPAC convention represents the first skirmish in a civil war on the right, a war that is essentially over foreign policy. The Paul movement is well-organized, activist-oriented, and well-funded: more importantly, it has a well-grounded ideology, one that offers an alternative to the brain-dead neoconservatism of Republican party hacks and third-rate politicians like Rudy Giuliani – whose single delegate to the 2008 Republican convention fairly represents the strength of the Rabinowitz wing of the conservative movement.


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Boone and Johnson: We may be nearing a calamitous global collapse.

February 23, 2010 Leave a comment

Peter Boone and Simon Johnson argue that Washington’s inflationary policies are leading the world toward disaster:

Over the last three decades, the US financial system has tripled in size, as measured by total credit relative to GDP … Each time the system runs into problems, the Federal Reserve quickly lowers interest rates to revive it. These crises appear to be getting worse and worse – and their impact is increasingly global. Not only are interest rates near zero around the world, but many countries are on fiscal trajectories that require major changes to avoid eventual financial collapse.

What will happen when the next shock hits? We believe we may be nearing the stage where the answer will be – just as it was in the Great Depression – a calamitous global collapse. The root problem is that we have let a ‘doomsday cycle’ infiltrate our economic system …

They add:

We both worked for many years in formerly communist countries, and this project reminds us of central planners’ attempts to rescue their systems with additional regulations until it became all too apparent that collapse was imminent.