JOBS: Romer, Leaving WH, Says More Stimulus Needed. Right Says Stimulus Killed Recovery

-- by Dave Johnson

This post originally appeared at Campaign for America's Future (CAF) at their Blog for OurFuture as part of the Making It In America project. I am a Fellow with CAF.

Before I start this post, let's look at the actual situation. The economy is terrible, people are really hurting, they have been holding out and are starting to drop off the map. There are signs that with the stimulus fading things are starting to turn back down. But compared to what?

The overall jobs picture:

The manufacturing jobs picture:

Finally, the huge deficits. The context of this next chart is that Bush's last budget year left us with a $1.4 trillion deficit! The projected budgets from this President will cut this in half in the next few years.

You can see for yourself from the pictures. (chart source) Under conservative policies everything was spiraling downwards. The stimulus clearly worked and stopped the death sprial, but was not enough. According to the Congressional Budget Office,

The massive U.S. stimulus package put millions of people to work and boosted national output by hundreds of billions of dollars in the second quarter, the nonpartisan Congressional Budget Office said on Tuesday. . . . CBO said President Barack Obama's stimulus boosted real GDP in the quarter by between 1.7 percent and 4.5 percent, adding at least $200 billion in economic activity.

It raised employment by between 1.4 million and 3.3 million jobs during the second quarter of this year, CBO estimated.

The stimulus worked but was not enough. Economists Agree: Stimulus Created Nearly 3 Million Jobs,

Eighteen months later, the consensus among economists is that the stimulus worked in staving off a rerun of the 1930s. [. . .] It's no surprise that the administration would proclaim its own policies a success. But its verdict is backed by economists at Goldman Sachs, IHS Global Insight, JPMorgan Chase and Macroeconomic Advisers, who say the stimulus boosted gross domestic product by 2.1% to 2.7%.

The stimulus worked but was not enough.

What Now?

In the context of this picture of the economy, President Obama's economic advisor Christine Romer is stepping down. In her departing speech she said that the economy needs more stimulus to get us to the point where private business is again driving the economy. Romer Calls for More Stimulus,

U.S. Council of Economic Advisers Chairman Christina Romer, in her final speech before stepping down, called on the country to stomach new stimulus measures to lift the lackluster economy, even in the face of growing fears about the nation’s deficit.

“Concern about the deficit cannot be an excuse for leaving unemployed workers to suffer,”

The clear conclusion from all available evidence: The stimulus worked, but it was not enough. In addition, in an effort "to attract Republican votes" that never came, 1/3 of the stimulus was wasted on tax cuts that leave nothing behind but debt. Much of the package was emergency relief for the unemployed, the states, and other emergency safety net programs but won't contribute to job-creation and reviving business. Only a fraction went to infrastructure, which is the soil in which business thrives and the country maintains its worldwide competitiveness,

The American Society of Civil Engineers puts the bill’s infrastructure spending at $71.8 billion, or less than one-tenth of the package.

The stimulus worked but was not enough. Economists are calling for more stimulus and extending unemployment benefits.

What The Right Says

Meanwhile conservatives are placing their bets on benefiting from a worsening economy, and so are blocking things that might help. Conservatives correctly believe that the worse the economy is doing, the better the chances that they will pick up more House and Senate seats in the coming elections. So it is in their interests to make sure that is what happens. Capitalizing on the shock the nation felt when it heard about the size of the deficit the previous administration left behind, conservatives are trying to block attempts to add stimulus.

And with the original not-enough stimulus fading, the right is trying to drive a narrative that "government spending kills jobs." This follows decades of "tax and spend" rhetoric that claims that "taxes take money out of the economy," "government spending slows the economy" and similar nonsense. The original "starve the beast" plan to kill government and democracy by denying them the funds they need is on the verge of succeeding.

To drive this strategy they claim that it is the stimulus itself which has kept the economy from recovering. Newt Gingrich, in Fire the Job Killers,

The big government stimulus bill, the tax increases of the health bill, the plan to let the 2003 tax cuts expire, and the massive growth of government under the Obama Administration are all actions directly attributable to this administration which have killed jobs.

Gingrich even claims that helping the unemployed, not the recession, is the cause of the unemployment!

A few weeks ago in this newsletter, I cited a study by Robert Barro which estimated that without the extension of unemployment benefits to 99 weeks, the unemployment rate would be 6.8% instead of 9.5%.

Republican House leader John Boehner recently gave a speech on his economic plan in which he said that the economy is "stalled by ‘stimulus’ spending" and "each dollar the government collects is taken directly out of the private sector." (An NDN study found that following the Boehner economic plan will add $4.188 trillion to the debt.)

Some other voices on the right:

Murdoch's NY Post: Romer admits stimulus failed

Dr. Christina Romer is leaving the Obama administration, and in her final speech she admits that the stimulus did not work to revivie the economy as she had hoped and as President Obama promised.

Malkin's Hot Ait: Romer: We had no clue … and still don’t

Instead of cutting taxes (especially capital gains taxes) and reducing regulation to entice new investment, Barack Obama and Congressional Democrats chose to chase a government takeover of health care, a massive tax on energy production that would penalize expansion and growth, and expanding the jurisdiction on Wall Street of the same agencies that had watched the collapse come and did nothing about it.

These are just a few samples from the drumbeat.

America faces a choice. The stimulus worked but was not enough. So we can proceed with "reality-based" solutions that have helped, and demand more stimulus, or we can go back to conservative policies that killed the economy.

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-- Posted by Dave Johnson at 1:54 PM PST on September 02, 2010.

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How Companies Turn People Against Unions

-- by Dave Johnson

This post originally appeared at Campaign for America's Future (CAF) at their Blog for OurFuture as part of the Making It In America project. I am a Fellow with CAF.

If you had a company and could make people work for free, keeping all the proceeds just for yourself, you might do that. If you could. What’s stopping you? There are plenty of unemployed people in the country and in the world – more every day thanks to population growth, and computers and machines doing more of the work that needs to be done. So if someone complains, you can just replace them with someone who doesn’t complain. You have the power. So what’s stopping you?

As a working person, how do you negotiate for fair pay, benefits and rights where you work? People in a job can be on their own against a lot of power, taking whatever the employer is willing to trade for their work. Or they can join with the rest of the employees at the workplace and negotiate as a group. Banding together to fight for a fair share is called organizing into a union.

People who own companies think that the company is their “private property” and they can do what they want with it, regardless of the effect on the people who work there or the surrouding community. Their goal is to make as much money as possible and to do that you lower costs as much as possible. Those costs include the cost of disposing of harmful waste products, the quality and safety of the products produced, and the pay and benefits you provide workers. In this equation unions are a problem. They have the power to make you pay more and provide safety and benefits, so they are in the way of keeping as much as you can just for yourself.

Obviously the greater society -- the people who make the rules that companies are supposed to follow -- has very different interests from the people who own companies. Society wants to avoid being exposed to harmful waste products, and wants the people in the society to be paid well and have good benefits. Society wants healthy communities. Society wants good and safe products that don't use up our resources. The people in the society are generally going to want rules that lead to better results for the greater number of people. Unless they can be convinced otherwise.

So the owners of companies try to convince us that unions are bad. They form and fund "business groups" like the Chamber of Commerce, to fight to keep unions from having the right and power to organize their workers. We hear it repeated over and over in our corporate-dominated society, a drumbeat that labor unions are sinister, shady, harmful, corrupt, violent, “raise prices,” ”cost jobs,” and generally hurt the economy and country. We hear they force workers to pay dues (never mind that unionized workers pay the dues from higher pay and benefits.) We hear that "union bosses" tell workers what to do and "union thugs"make them do it. Nothing could be further from the truth, of course. The owners of companies have a lot of money to spend on convincing the public to let them have free reign, and they know from selling products how to sell things to the public. Repetition, repetition and repetition. Marketing works.

This Labor Day weekend we can expect to hear even more of this. Business groups plan Labor Day blitz against Senate Dems, candidates,

Local chapters of groups like the National Federation of Independent Business, state Associated Builders and Contractors and other commerce and retail groups will hold events on Monday targeting the incumbents and candidates, particularly on their stance on the Employee Free Choice Act (EFCA, or "card-check").

But you shouldn't expect to see, hear or read on any corporate-owned TV station, radio station or newspaper about the benefits to people from joining a union. Think back and see if you can remember the last time you heard it explained to the public in one of these outlets how members of unions are better off?

How widespread is the anti-labor effort? Here’s a quick, admittedly unscientific check. On Google today there are 54,800 websites that refer to “union thugs,” 154,000 websites that refer to “union bosses” and 200,000 that refer to “big labor.” Please click through and look not only at the ridiculous things being written, but also at who is writing them.

The first page of Google “results for “union bosses” lists anti-union pages from Big Government, The Center for Union Facts , The Washington Times, Human Events, Redstate, Townhall, The National Right to Work Legal Defense Foundation and the book “Betrayal: How Union Bosses Shake Down Their Members and Corrupt American Politics” by Fox News analyst Linda Chavez and Danial Gray of the National Right to Work Committee.

The Center for Union Facts, The National Right to Work Legal Defense Foundation and the National Right to Work Committee are anti-union sites funded by corporations and right-wing foundations. According to a report in SourceWatch, The National Right to Work Committee and National Right to Work Legal Defense and Education Foundation even share facilities and employees. Big Government, Human Events, Townhall, Redstate, Fox News and the Washington Times are conservative movement outlets that are part of the coordinated Right Wing Noise Machine, or echo chamber, in which a number of outlets appear to be different entities but work as part of a single movement with a shared goal. (P.S. Big Government is the site where the doctored ACORN videos and doctored video of Shirley Sherrod were promoted.)

Admittedly unscientific, but interesting nonetheless. There's a lot of anti-union money floating around out there.

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-- Posted by Dave Johnson at 10:09 PM PST on September 01, 2010.

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SS On The Table, But BS Not?

-- by Dave Johnson

This post originally appeared at Campaign for America's Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.

The President has a commission looking at ways to reduce the budget deficits which were caused by tax cuts for the rich and military spending increases. Social Security – which has no legal authority to borrow money, so it can't contribute to deficits – is on the table for cuts, at least as far as We, the People are allowed to know. (The commission meets in secret.) That's BS.

Another reason we know SS is on the table is that almost all of the members of the commission have spoken in the past of their inclination to cut or privatize the program. That’s BS.

Republican members of the commission have said in advance that taxes will not be on the table. That’s BS.

In fact, conservatives of both parties are arguing to extend the expiring Bush tax cuts for the rich! That's BS.

The country spends up to $1.2 trillion a year on wasteful, bloated military and related programs, more than all the rest of the countries on earth combined, but the commission isn't talking about cutting that down to, say, only three times our nearest possible competitor? That's BS.

Social Security being involved with this commission at all is BS. If they want to cut something they should cut the BS.

If you want to fix the deficits, fix the problems that caused the deficits, not things that can't. Speaker Pelosi said in July that talking about SS and the deficits are like apples and oranges. With this in mind Rep. Raul Grijalva says Congress should preempt this, and demand that Social Security be left alone.

Ask the candidates in your district and state to sign the Hands Off Social Security pledge, and check the list to see who else is on board.

Also, please visit Strengthen Social Security where you can sign up for information, and to follow them on Twitter and/or Facebook.

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-- Posted by Dave Johnson at 9:13 AM PST on August 31, 2010.

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America Is Strong When Our Unions Are Strong

-- by Dave Johnson

This post originally appeared at Campaign for America's Future (CAF) at their Blog for OurFuture as part of the Making It In America project. I am a Fellow with CAF.

America was formed as a government of, by and for We, the People. It says so right in the first words of our Constitution. To get that Constitution we rebelled against the King and England's aristocracy and their corporations, with their concentrated wealth and power. And we continued that fight and over time we extended our system of one-person-one-vote, adding women and minorities to that equation.

The fight has gone back and forth. When our democratic government works, it pushes for increasing the protections and benefits of a strong economy for We, the People. This has included, for example, the mandated 40-hour workweek and minimum wages to fight exploitation, both pushed by labor. But at other times our government was "captured" by the power of concentrated wealth and working people are not well-represented. Even then we're still not necessarily each on our own. During those times we have depended on labor unions to push back against that power of concentrated wealth. Working people can organize into labor unions to bargain for higher wages and better treatment than workers could obtain individually.

What difference can unions make? In 1945 labor unions represented about 1/3 of all workers. When American unions were strong working people got the minimum wage, the 40-hour week, weekends off, paid vacations, health insurance, pensions, dignity and respect. This was when America built the middle class that everyone has been taking for granted since. Even the wealthy benefited greatly over the long run as more consumers with more money to spend lifted the whole economy.

But what has happened to us since the Reagan Revolution, when concentrated power of the big corporations weakened America's unions? Since the days of FDR membership in unions has fallen, but in 1980 unions still represented 24% of American workers. The Reagan administration famously launched an all-out assault on organized labor, resulting in membership falling to 16.4% by 1989. And the trend continued: by 1998 union membership fell to 13.9 percent. By 2009 that had decreased to 12.3%, but only 7.6% in the private sector. And here are the results:

This is a chart of working people's share of the benefits from our economy. Note the brief return to normal under Clinton, erased by Bush II. But the assault on working people has recently been bipartisan. Clinton pushed to pass the Bush I-negotiated NAFTA treaty which hammered the bargaining position of workers, while Bush II consolidated the practice of "outsourcing" labor competition from non-democratic countries where workers didn't have rights or protections.

As we all know, since the Reagan Revolution weakened the negotiating power of working people, wealth and income have concentrated at the top, our country's debt has massively increased, household debt as well, the country is crumbling and everyone except the wealthy few and big corporations is generally worse off.

Unions still make a difference. According to the Bureau of Labor Statistics, "In 2009, among full-time wage and salary workers, union members had median usual weekly earnings of $908, while those who were not represented by unions had median weekly earnings of $710." Union members also often have paid vacation, paid sick leave, health insurance and other benefits that non-union workers do not. The difference is dramatic. In March 2009, 78 percent of union workers were covered by health insurance through their jobs, compared with only 51 percent of nonunion workers. Seventy-seven percent of union workers participate in defined-benefit pension plans, compared with 20 percent of nonunion workers.

When you hear someone complain about unions and complain that people in unions are paid better than the rest of us, let them know that they are reaching the wrongest conclusion. They shouldn't resent union members and complain about their pay, they should join a union and support unions, so they they and everyone else can come out ahead.

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-- Posted by Dave Johnson at 5:40 PM PST on August 30, 2010.

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There's An Election Coming Up

-- by Dave Johnson

Does the White house know that the mid-term elections are just over two months from now? I wonder if someone can wake up the President and ask him to start making a case?

So far the Dems are just letting Glenn Beck and Rush Limbaugh make the case. This is not good for the country.

-- Posted by Dave Johnson at 9:06 AM PST on August 30, 2010.

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Here's What You Do

-- by Dave Johnson

What Can Obama Really Do? | Ian Welsh

So here'€™s what you do.   As the Federal Reserve you sell $100 billion of the toxic waste on the open market.  Set an actual price for it.  Then you make the banks mark their assets to market value.  They go bankrupt. You nationalize them. (Why not? They are actually bankrupt after all, and they haven't increased lending like they were supposed to;  in fact, they have decreased it.)  You make the stockholders take their losses and the bondholders too, then you reinflate the banks. (If the Fed can print trillions to keep zombie banks '€œalive'€ it can print money to reinflate nationalized banks.)  The banks lend under FDIC and Fed direction, at the interest rates the Fed directs.  The FDIC and Fed eventually break the banks up into a reasonable size.  And while they'€™re at it, they get rid of the entire executive class which caused the financial crisis, and have the DOJ go over all the internal memos and start charging everyone who committed fraud. (Hint: that'€™s virtually every executive at a major bank.)  Again, this is completely up to Obama - €“the DOJ answers to him.

Think Obama can'€™t do this without Bernanke?  Wrong.  Obama can fire any Fed Governor for cause and replace them during a Congressional recess with no oversight.* ('€Cause'€ is never defined, but Obama can note that the Fed's mandate includes maximum employment and not stopping the financial crisis in the first place is certainly plausible as cause as well.)

-- Posted by Dave Johnson at 7:20 AM PST on August 30, 2010.

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A Question For Obama Opponents

-- by Dave Johnson

Obama's opponents say he has "increased spending" and "increased the debt."

Can you provide any specifics? WHAT spending has increased? Has Obama increased or decreased borrowing from when Bush was president?

Seriously, please answer in the comments.

-- Posted by Dave Johnson at 2:00 PM PST on August 29, 2010.

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Beck Rally Draws 3-500,000

-- by Dave Johnson

Glenn Beck Leads Religious Rally at Lincoln Memorial .

Here's the thing. Beck promotes both Christianity and Ayn Rand, but his followers don't know that Rand strongly promoted atheism, teaching things like this:

"the concept of God is degrading to men."

this:

There is a great, basic contradiction in the teachings of Jesus. Jesus was one of the first great teachers to proclaim the basic principle of individualism -- the inviolate sanctity of man's soul, and the salvation of one's soul as one's first concern and highest goal; this means -- one's ego and the integrity of one's ego. But when it came to the next question, a code of ethics to observe for the salvation of one's soul -- (this means: what must one do in actual practice in order to save one's soul?) -- Jesus (or perhaps His interpreters) gave men a code of altruism, that is, a code which told them that in order to save one's soul, one must love or help or live for others. This means, the subordination of one's soul (or ego) to the wishes, desires or needs of others, which means the subordination of one's soul to the souls of others.

This is a contradiction that cannot be resolved. This is why men have never succeeded in applying Christianity in practice, while they have preached it in theory for two thousand years. The reason of their failure was not men's natural depravity or hypocrisy, which is the superficial (and vicious) explanation usually given. The reason is that a contradiction cannot be made to work. That is why the history of Christianity has been a continuous civil war -- both literally (between sects and nations), and spiritually (within each man's soul).

and this,

-- Posted by Dave Johnson at 5:21 PM PST on August 28, 2010.

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For Glenn Beck

-- by Dave Johnson

Have you heard it on the news
About this fascist groove thang
Evil men with racist views
Spreading all across the land

Continue reading "For Glenn Beck"

-- Posted by Dave Johnson at 4:07 PM PST on August 28, 2010.

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Corporate Power

-- by Dave Johnson

We went into health care reform looking to free ourselves from a predatory industry that was harming us and the country, and get ourselves Medicare-For-All.

We came out the other side with all of us ordered to buy health insurance from the predatory health insurers.

This has been another chapter in democracy v.s. predatory corporatist plutocracy.

-- Posted by Dave Johnson at 3:52 PM PST on August 28, 2010.

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