Typical arrested adolescent mindset. When things are good, take the credit. When things are bad, must be someone else's fault. Failure to take responsibility lies at the heart of the problem.
2
The finance industry used to be just that, ordinary, boring funding for entrepreneurs building real factories and real jobs. Money was used as a tool.
The repeal of Glass-Stegal destroyed the protection given to the American citizen from the speculators and gamblers. Now money is the end game and goal itself, divorced from securing the benefit of society. Wall Street has turned the US finance, insurance, and commercial banking industries into gambling, serving no one but the oligarchs.
The repeal of Glass-Stegal destroyed the protection given to the American citizen from the speculators and gamblers. Now money is the end game and goal itself, divorced from securing the benefit of society. Wall Street has turned the US finance, insurance, and commercial banking industries into gambling, serving no one but the oligarchs.
13
Well, Mr. Obama, it appears to me if you "take credit" when the economy is good, you get to "take credit" when the economy starts going bad.. Better fire up those governmental printing presses again...
4
The commenters seem to feel that everything would be just fine if Republicans were gone and the economic technocrats could run free.
But globalization has added hundreds of millions of workers to the world economy. It makes sense that wages would be suppressed in such an environment.
Bernie Sanders thinks that everything will be fine if the rich have to pay more and the money can be redistributed. Perhaps, but where is it written that Americans will then all run out and get jobs reviving the economy?
Sure, education matters, but without enterprise it won't solve any problems. It seems to me that our education system isn't producing much. Will more make it better? I would guess that half the population can't be educated into the kind of skills the new economy will need.
The worlds central banks are competing to make money cheap and abundant. So far, it appears to me that most of that money has gone to the financial industry and its operators. Hence a partial explanation for 'inequality'.
Apparently, large numbers of Americans have little savings. If we have a recession what happens to them?
Infrastructure spending seems like a good idea. Money is cheap. Jobs would be created. But if the regulatory engine has its way the cost of building infrastructure will be high. Take a look at the cost of the western span of the Bay Bridge in SF-Oakland. Not to mention the time it took. The earthquake was in 1989.
Immigrants come from places where they're on their own. They do well.
But globalization has added hundreds of millions of workers to the world economy. It makes sense that wages would be suppressed in such an environment.
Bernie Sanders thinks that everything will be fine if the rich have to pay more and the money can be redistributed. Perhaps, but where is it written that Americans will then all run out and get jobs reviving the economy?
Sure, education matters, but without enterprise it won't solve any problems. It seems to me that our education system isn't producing much. Will more make it better? I would guess that half the population can't be educated into the kind of skills the new economy will need.
The worlds central banks are competing to make money cheap and abundant. So far, it appears to me that most of that money has gone to the financial industry and its operators. Hence a partial explanation for 'inequality'.
Apparently, large numbers of Americans have little savings. If we have a recession what happens to them?
Infrastructure spending seems like a good idea. Money is cheap. Jobs would be created. But if the regulatory engine has its way the cost of building infrastructure will be high. Take a look at the cost of the western span of the Bay Bridge in SF-Oakland. Not to mention the time it took. The earthquake was in 1989.
Immigrants come from places where they're on their own. They do well.
4
with all due respect, the headline and the gist, are the "duh" of the decade...even considering all the other shards in the national crack-up, the bottom line, (known to unheeded voices who have warned of this all along), is that a government beholden to big money, is essentially, chattel.
sanders and trump offer alternatives, trump, however, is a cranky uncle bluster who would rather hold the stage than call the cues, sanders, on the other hand, offers us a chance to actually see in our lifetime, a citizen political in the oval office, his record, (no bag jobs, no selfies) demonstrates a social concern that reflects a commitment to "promote the general Welfare," as the preamble promises, and rather than press him for policy "specifics" (meaningless with a k street congress anyway) we should listen to the ideal, the passion for the vote and the voters right to decide how the country goes, and give him the office and a congress who can properly decide the "how and what" we need to achieve that ideal.
sanders and trump offer alternatives, trump, however, is a cranky uncle bluster who would rather hold the stage than call the cues, sanders, on the other hand, offers us a chance to actually see in our lifetime, a citizen political in the oval office, his record, (no bag jobs, no selfies) demonstrates a social concern that reflects a commitment to "promote the general Welfare," as the preamble promises, and rather than press him for policy "specifics" (meaningless with a k street congress anyway) we should listen to the ideal, the passion for the vote and the voters right to decide how the country goes, and give him the office and a congress who can properly decide the "how and what" we need to achieve that ideal.
1
In a consumer driven economy, government economic and tax policies that have transferred income from consumers (workers) to "Investors" are the ultimate underlying reason for global economic malaise.
Until people understand that there are no "Free" markets, and government regulation is necessary to define the nature of the markets, the American and world economy will continue to flounder. The world relies on the American Consumer as the base source of world economic growth.
Until people understand that there are no "Free" markets, and government regulation is necessary to define the nature of the markets, the American and world economy will continue to flounder. The world relies on the American Consumer as the base source of world economic growth.
1
Who to blame? Republicans, older white men (Bernie excepted) veterans. gun owners, farmers, oil patch workers.
Why is anyone surprised?
When it is a service economy, the passing around of the same dollars will slow down.
How fast it slows down is a factor of taxation.
Had we retained a manufacturing economy, we would not have noticed the braking effects of taxation.
For those who scream what taxation - please do look up what the revenue figures are to the federal government over the same time period of these graphs.
then get back to us
When it is a service economy, the passing around of the same dollars will slow down.
How fast it slows down is a factor of taxation.
Had we retained a manufacturing economy, we would not have noticed the braking effects of taxation.
For those who scream what taxation - please do look up what the revenue figures are to the federal government over the same time period of these graphs.
then get back to us
1
There are trillions of dollars sequestered away by the small group of billionaires that should be sloshing around in the American economy lifting all boats. The trickle down theory purports that by giving the wealthy more and more money via skewed tax breaks, it will "trickle" down on the rest of us. We that's not what's been happening for the last three decades. In fact, just the opposite. There's been a concentration of wealth at the top, and very little to no trickle down as promised or theorized. If those trillions were in the hands of middle class Americans, the dollars would be exchanging between people and businesses and back to people in the form of jobs and raised income.
1
Yeah, what we need is less regulation. Wall Street, unregulated, will make billionaires out of every single American.
And my lord, don't increase costs just to "tilt" towards renewable energy. It's utterly illogical to do this, because after all, we'll all be dead by the time it really, really matters.
And my lord, don't increase costs just to "tilt" towards renewable energy. It's utterly illogical to do this, because after all, we'll all be dead by the time it really, really matters.
5
We're not spending enough!!! Is that every liberals answer to every problem. It's worked well for China, Greece and other European nations, hasn't it? Our problems include the deficit, Fed policy, which has punished savers and created an over-heated stock market, and excessive regulation. Even Bill Clinton - unlike most liberals today - understood that government was the problem... not the solution. The author is right about one thing... we need tax reform.
3
C'mon, Rattner! who gets the blame? Why OF COURSE you folks at the NY Times will blame George Bush. He's good for at LEAST another couple of Democrat-led economic disasters!
3
"This time, if we fail to break out of the current stagnation — or worse, fall into global recession — the fault will lie with our leaders."
It seems to me that to be a "leader" one must have power. The US constitution has so many checks and balances there is no-one who can claim to be a leader. Everyone can block action by anyone else but no-one can actually do anything. There is so much division and dysfunction there is no coherent policy approach.
It seems to me that to be a "leader" one must have power. The US constitution has so many checks and balances there is no-one who can claim to be a leader. Everyone can block action by anyone else but no-one can actually do anything. There is so much division and dysfunction there is no coherent policy approach.
1
There's a guy name Nick Hanauer, a plutocrat, who knows what he's talking about. He talks about the "virtuous cycle" of prosperity which is missing from today's economic recovery. Now getting this "virtuous cycle implemented will require removing the Republican party from control of both houses and electing a Bernie Sanders as president. You can find his TED talk here.
https://www.youtube.com/watch?v=q2gO4DKVpa8
I would recommend everyone including Steve Rattner look at it because it seems to me to make a lot of sense. So check it out everybody.
https://www.youtube.com/watch?v=q2gO4DKVpa8
I would recommend everyone including Steve Rattner look at it because it seems to me to make a lot of sense. So check it out everybody.
5
There are other factors that get left out. Forecasters of a few years ago ignored the fact that if China's economy grew to a US style of at least one car in every garage, they would consume the entire world's refinery output of gasoline with nothing left over for a growing India economy, Europe or the US. That was not going to happen. If China developed a US style throw away economy, they would use the entire world's output of paper. That was not going to happen. However, before they would get there, the Chinese would run out of water and peasants for cheap labor. Both of those have happened, not to mention the unabated killer smogs, and the Chinese are at the end of their rope.
4
>>>>>
When it goes up the GOP gets the credit and when it goes down it's Obama fault. Don't you watch the Morning Joe Show?
When it goes up the GOP gets the credit and when it goes down it's Obama fault. Don't you watch the Morning Joe Show?
4
"it's Obama fault."
Right about now Obama says "I inherited it". He has that line down.
Right about now Obama says "I inherited it". He has that line down.
4
The Fed link is
research.stlouisfed.org/fred2/graph/?g=3x3S
research.stlouisfed.org/fred2/graph/?g=3x3S
If you hold to the idea that the past 50 years of US demand-side growth (aka standard of living) has been in large part a function of short-term and one-off bubbles (women entering the workforce, credit cards on demand, home equity mortgaging, cheap goods due to globalization, and the housing bubble, to name the big 5) I find it very difficult to blame the past decade or so of policies from government.
The fact is capitalism is still more or less working fine for the capital class -- their share of GDP's has skyrocketed in the US and elsewhere.
But for the demand side -- ie, the remaining 99% of us -- our growth has been due to a series of non-sustainable contraptions and one-offs. Since 2008, it has been especially plain that demand side growth is largely in collapse or illusory to begin with.
The supply siders, like this author, prefer to not deal overmuch with that part of the equation. But it is that part of the equation that will spell the end of capitalism as a socially feasible economic system.
And it will not be due to government policies, except inasmuch as those policies have been and still are, nothing more than the stenographed demands of their donor class. Greed is the fly in the economic ointment, and all policy errors can be traced back to it.
So look in the mirror, Mr, Rattner. Eureka, you found the problem.
And what's the solution? There isn't any. The people who are the problem hold all the cards in what is fast becoming a dead casino. Your deal, sir.
The fact is capitalism is still more or less working fine for the capital class -- their share of GDP's has skyrocketed in the US and elsewhere.
But for the demand side -- ie, the remaining 99% of us -- our growth has been due to a series of non-sustainable contraptions and one-offs. Since 2008, it has been especially plain that demand side growth is largely in collapse or illusory to begin with.
The supply siders, like this author, prefer to not deal overmuch with that part of the equation. But it is that part of the equation that will spell the end of capitalism as a socially feasible economic system.
And it will not be due to government policies, except inasmuch as those policies have been and still are, nothing more than the stenographed demands of their donor class. Greed is the fly in the economic ointment, and all policy errors can be traced back to it.
So look in the mirror, Mr, Rattner. Eureka, you found the problem.
And what's the solution? There isn't any. The people who are the problem hold all the cards in what is fast becoming a dead casino. Your deal, sir.
15
The global billionaires have figured out that they can create bubbles by creating buying momentum backed up by optimistic research and news stories (from outlets they own) and then when all the little guys and pension funds buy in, they can pop the bubble, all selling at once at ridiculous prices.
Then prices plummet and everyone else panics and sell low. Then the big guys come back and buy everything again at half price.
This is why the great recession represented a 40% transfer of wealth from the rest of us to the .1%, with no downside for most of the big players.
They have no reason not to do it again.
Then prices plummet and everyone else panics and sell low. Then the big guys come back and buy everything again at half price.
This is why the great recession represented a 40% transfer of wealth from the rest of us to the .1%, with no downside for most of the big players.
They have no reason not to do it again.
3
As far as I know and along with Warren Buffet, I don't think there is any slowing the economy. So why is the Times giving space to someone who is trying to explain a non-event?
1
I agree. The economy is miserable for many americans, but that does not mean it is currently "slowing." Those who are suffering need help, the same help since the economy imploded in 2008. We have systemic problems, that need creative and forward thinking.
"Europe is far worse shape" because it bought into the entitlement craze instead of preaching the gospel of success thru hard work. Add to that its foolish decline in resident birth rates, along with an unwise immigration policy which grant those abroad, specifically those with a diminutive skill-set and scant desire to shed their culture, access to national treasures.
3
Europe STILL has a better quality of live than you can ever imagine.
3
It's so simple that it's almost certainly wrong, but a friend once told me that the market usually crashes in a US election year. We were in the dumps in 2008. 2000 wasn't great. And here we are in 2016 - facing a rough patch in the markets.
.
It does stand to reason that 1: when there's an election for US president, it causes ubcertainty not just here in America, but overseas - because the President of the US is so powerful on the international stage, and the US economy is so large.
.
It does stand to reason that 1: when there's an election for US president, it causes ubcertainty not just here in America, but overseas - because the President of the US is so powerful on the international stage, and the US economy is so large.
2
This is really a vapid article. Not only is there a lack of a coherent economic model but there are also obvious factual errors that an editor should have caught. For example: Amazon is "capital efficient?" Amazon's capital expenditures ($5 billion) are roughly equivalent to Ford Motor Co's, as a percentage of revenue. The cloud is full of machines.
2
The fact that they spend a lot does not make them capital inefficient. Efficiency bespeaks a favorable ratio of expenditure to revenue. The cloud is full of machines that make businesses efficient relative to how they would be doing without machines, and those businesses that emphasize efficiency... well, they tend to stay more efficient than they would otherwise, even when they grow and grow and grow, etc.
The dominant forces driving our local and global economies toward's crisis -- the information technology revolution and re-formation of monopolies along with the undermining of workers' labor rights and citizens' ecological rights.
Look at the simple case of McDonalds replacing the person taking drive-through orders with a remote worker in a lower labor cost state. This action reduces the total wages paid in the US and globally. Next they might move that labor to Bangaladesh. That would reduce US employment and further reduce US and global wages. Finally, they could replace that person with a Siri-like automated function. Then global employment would be reduced along with a further reduction in global wages.
McDonalds, being part of a cartel of monopoly fast food providers, has no competitive reason to pass these labor savings on to its customers and diverts these savings to increased profit.
Repeat this process of outsourcing and automation thousands of times a day and you arrive at our current situation with abnormally high corporate profits and executive compensation along with depressed wages, employment and sluggish demand.
https://research.stlouisfed.or...
Drive workers into economic crisis and you induce the fear and tribalism that is ripe for the first effective demagogue that comes along. We desperately need fundamental change to restore wages to around 50% of GDP. Otherwise technology and corporatocracy will destroy political/economic systems across the globe.
Look at the simple case of McDonalds replacing the person taking drive-through orders with a remote worker in a lower labor cost state. This action reduces the total wages paid in the US and globally. Next they might move that labor to Bangaladesh. That would reduce US employment and further reduce US and global wages. Finally, they could replace that person with a Siri-like automated function. Then global employment would be reduced along with a further reduction in global wages.
McDonalds, being part of a cartel of monopoly fast food providers, has no competitive reason to pass these labor savings on to its customers and diverts these savings to increased profit.
Repeat this process of outsourcing and automation thousands of times a day and you arrive at our current situation with abnormally high corporate profits and executive compensation along with depressed wages, employment and sluggish demand.
https://research.stlouisfed.or...
Drive workers into economic crisis and you induce the fear and tribalism that is ripe for the first effective demagogue that comes along. We desperately need fundamental change to restore wages to around 50% of GDP. Otherwise technology and corporatocracy will destroy political/economic systems across the globe.
9
You missed something
McDonalds is a franchise structure
Each McDonalds is a stand alone small business unit, with some owning more than one.
That the franchise owner can not get people to show up for work, that the wages are pushed up, that the labor costs are moved up by government regulations made that move to a Siri type unit cost effective.
Inside, it has become cost effective to can the worker and invest 10's of thousand into the order entry touch screen systems.
Why do you think self checkout lines were first put into grocery stores, which are often union labor?
The narrow view of how things work, without regard for how it actually works is why the nation is in the mess it is.
Please learn how it actually all works.
McDonalds is a franchise structure
Each McDonalds is a stand alone small business unit, with some owning more than one.
That the franchise owner can not get people to show up for work, that the wages are pushed up, that the labor costs are moved up by government regulations made that move to a Siri type unit cost effective.
Inside, it has become cost effective to can the worker and invest 10's of thousand into the order entry touch screen systems.
Why do you think self checkout lines were first put into grocery stores, which are often union labor?
The narrow view of how things work, without regard for how it actually works is why the nation is in the mess it is.
Please learn how it actually all works.
2
There are two sides to the outsourcing argument. One side as you mentioned, corporations are making bigger profits at the expense of employees. The other side is that America of all countries is conceding defeat to China and Bangladesh? The country which has been the guiding force behind the freedom and the right way.
Sometimes the problem can be looked in a different light. The corporate ownership is not limited to select few. Anyone can buy shares of the very companies that one thinks is working for profits. You could own a piece of the business by first saving and then investing.
Sometimes the problem can be looked in a different light. The corporate ownership is not limited to select few. Anyone can buy shares of the very companies that one thinks is working for profits. You could own a piece of the business by first saving and then investing.
1
The lack of growth is due to lack of any major technological breakthrough that would have increased productivity. There is a limited space for capital formation in country like USA. Moreover, the breakthrough on the horizon like AI will make the economy even more uneven in the favor of capital owners. The other big breakthrough on the horizon is availability of cheap and clean energy as solar becomes cheap and fusion becoming a reality. What else? What is the next big innovation?
1
Boom and bust are the nature of the economic system. It's simply behaving as expected and heading to the inevitable climax.
1
Mr. Rattner is mostly on-target, except for including slow productivity growth as a causative factor. Productivity may be stalled, but it's stalled at a very high level. Wages rose with productivity 1948–73, then they diverged—productivity continued climbing upward on about its previous path, but wages essentially flatlined. In other words—productivity growth stopped contributing to wage growth 40+ years ago; there's no reason to think more productivity growth now would bring wage growth back. But today productivity is high enough to produce massive corporate profits (not mentioned by Mr. Rattner). So at root we have an economy that's actually producing huge corporate profits, yet not working for ordinary people. If we want to ask, "what's wrong with the economy?", we have to clarify—"whose economy are we talking about?" But I agree with Mr. Rattner that our political leaders' austerity and inaction is now the main factor keeping us from economic recovery.
Productivity vs. wages: http://www.epi.org/productivity-pay-gap/
Corporate profits: https://research.stlouisfed.org/fred2/series/CP
Productivity vs. wages: http://www.epi.org/productivity-pay-gap/
Corporate profits: https://research.stlouisfed.org/fred2/series/CP
3
Given that our economic woes have been in the making since the 1970s (as judged by the growth of wealth inequality), we can blame a lot of people. Economists can't predict the future when conditions are stable, which they haven't ever been. So it does come back to reckless greed and "let them eat cake," and "after us the deluge." Now, if I only had a hammer in one hand and a sickle in the other, I could cut down some of them pesky banks. (Actually, I was well accustomed to cutting grass with my father's sickle!) I still have a hammer. Maybe I'll borrow Bernie's sickle.
1
When roughly half the country's population believes that a progressive, intelligent and thoughtful president has deliberately set about ruining the US economy, clearly the most urgent infrastructural need is a good education system, along with a safe energy-efficient transportation system for those being educated.
The Taliblican party's visceral blaming of the president and Democrats for the consistently poor results of their own obstructionist, morally intrusive, overly religious, austere conservative economic policies - see the Kansas economy! - shows their willful ignorance of what high quality leadership and good government comprise.
When a well-educated, savings-happy, motivated, ethnically homogeneous nation like Japan hasn't overcome its economic (real estate) recession from 1989 (N225 was 39,000), economic leadership by the Democrats since 2008 is remarkably successful, and Americans SHOULD BE ANGRY at how much more effective it could have been with even the smallest amount of rational support from the Taliblican party.
The Taliblican party's visceral blaming of the president and Democrats for the consistently poor results of their own obstructionist, morally intrusive, overly religious, austere conservative economic policies - see the Kansas economy! - shows their willful ignorance of what high quality leadership and good government comprise.
When a well-educated, savings-happy, motivated, ethnically homogeneous nation like Japan hasn't overcome its economic (real estate) recession from 1989 (N225 was 39,000), economic leadership by the Democrats since 2008 is remarkably successful, and Americans SHOULD BE ANGRY at how much more effective it could have been with even the smallest amount of rational support from the Taliblican party.
6
I give you Detroit, Chicago and Baltimore to refute your point.
All of them have been run by the very party you hold harmless
All of them have been run by the very party you hold harmless
1
You haven't refuted anything. A city is not an economy unto itself; it is part of the national economy, and the world economy.
1
The timeframe that you have surveyed in this article is VERY short compared to human history, over which the average economic growth rate is less than 1% / year. What's happening now may simply be a regression to the mean level of growth, which is probably a phenomenon mostly beyond the control of the political system.
4
This story is as old as the hills. A famine lies upon the land because a dragon is hoarding all the gold. Saint George, where are you when you're most needed?
Time to drag out the guillotines, and remove some oligarchs' heads.
Time to drag out the guillotines, and remove some oligarchs' heads.
3
The US economy suffers from one thing: Republicans and Republican policies. Republicans are not interested in what is best for the country. They are interested in doing everything they can to cut taxes on the wealthy, cut government, protect the fossil fuel industries, keep wages of working people down, and increase defense spending. They do not care if their policies hurt working people or the country or the planet for that matter. Conservatives in other countries are interested in the same things and they lead to the same results, and now, they form a synergistic partnership that makes the situation worse.
6
Republicans have been in power far less than you may think
1
I see a much more fundamental reason for the slowing economy. The crux of the matter is that "success" is defined to be "growth". Given that in the end, resources are finite, markets can only be so big, people have only so many needs and wants, there are limits to how fast growth can occur; and many times when saturation point is reached, growth will reverse into shrinkage. I think a mathematical model of our economy can be built that will show that in the steady state, the size of the economy will keep fluctuating between growth and shrinkage. As more innovation happens, and as the number of people in the planet increase, the long term trend will be upwards... but surely, when things are headed south, great damage is done so society and people. I think society will do well to settle for a model that is sustainable with slower growth, but is steadier; perhaps the key is to limit our greed, and be content with less, albeit the fact that "less" for some people may still be more than they or many generations of their progeny can consume.
3
I think Congressional Democrats and Republicans could both agree that we need to spend more to build a naval base in Arizona.
2
We could build a base for a Space Navy (Star Fleet) in Arizona.
1
50% Solution. Fix half the nations roads, bridges, and sidewalks. Build 50% more walking trails and bike paths. Update half the nations parks and monuments. This will make most people happy. When people are happy they spend more which in turns creates steady markets and growth. It really is that simple.
3
"This will make most people happy. When people are happy they spend more which in turns creates steady markets and growth. It really is that simple."
Most of that feel good money will go to foreign manufactured goods. Wave bye bye to that money.
Most of that feel good money will go to foreign manufactured goods. Wave bye bye to that money.
You mean all the money is the hands of few is bad for the economy? God, I wish I'd taken Econ 101 and not quit after the first class, which is when you learn that. This is why we need Bernie for POTUS, not bought and paid for corporate shill Hillary.
#FeelTheBern
#FeelTheBern
10
Hello! Of course it's President Obama. He is clearly responsible for all that is wrong in our country today. He likely had something to do with the rise of Trump, Trump's hair and the GOP bloodletting. Of course, he denies this, but, what else would you expect?
The low interest rates? The doubling of the stock market? The low unemployment rate? The focus on climate change? Twenty million citizens now with health care insurance. Yes, you are right again. All this is Obama's fault as well..........
The low interest rates? The doubling of the stock market? The low unemployment rate? The focus on climate change? Twenty million citizens now with health care insurance. Yes, you are right again. All this is Obama's fault as well..........
2
"...too much austerity...." Folks, Mr. Rattner believes that governments are not spending enough of your money!
1
Clearly we should blame the politically powerless, and then craft policy to punish them. I'm thinking school teachers and the disabled are to blame.
2
The world still looks to the US and that means our President. The fact is that our President has been largely AWOL on statements of economic concern and for the matter world leadership. We have had a feckless President except for ACA and that was shoved down the throats of Americans. The candidates of either party do not offer better or actually worse. Trump make Obama look like a god. Cruze is scary. Bernie is a modern Bolshevik. Hillary might be the least deleterious: a safer harbor of sorts, though Michigan Democrats did not think so by a simple majority. What do we do now? Hope that Biden gets drafted? Hope that Ms Rice is coached back into government and the Republicans draft her at the convention? Neither scenario is likely. Help.
1
Bian,
Canadians used to look to the US for leadership. It may be that the developing world looks to the US for leadership but Western Democracies are plotting their own course which moves further from the US every day. We are looking at interest rates near zero for 20 years. We are looking at free trade zones of societies of similar social policies.
On June 23 England may vote to escape the Western Democracies and join the USA in a "freer" economy. In fact Boris Johnson who s probably the best conservative available to take over the GOP will probably become the Prime Minister if Brexit wins and someone doesn't clue in to the fact that he is a natural born US citizen.
Canadians used to look to the US for leadership. It may be that the developing world looks to the US for leadership but Western Democracies are plotting their own course which moves further from the US every day. We are looking at interest rates near zero for 20 years. We are looking at free trade zones of societies of similar social policies.
On June 23 England may vote to escape the Western Democracies and join the USA in a "freer" economy. In fact Boris Johnson who s probably the best conservative available to take over the GOP will probably become the Prime Minister if Brexit wins and someone doesn't clue in to the fact that he is a natural born US citizen.
2
“For a start, global competition and weak productivity growth have held down wages in developed countries “looks like a promising proposal. But it does not hold water because the facts are:
Labor productivity—defined as output per hour—increased in the motor vehicle manufacturing industry from 2000 to 2007, but declined from 2007 to 2009. From 2011 to 2014 the productivity increases every year at an average rate of 2.75%. (BLS)
Secondly, let’s take a look at productivity growth in construction. Measures of labor productivity growth in three industries in construction: Single and multiple family residential constructions from 1987 to 2011, and the construction of highways, streets, and bridges from 2002 to 2011. These data, which currently cover almost one quarter of construction output, show no sign of any sustained productivity decline. (ditto)
Thirdly, the U.S. shines in G.D.P per hour worked as a more accurate labor productivity measure when compared with both the Western European and the Asian countries except oil-rich Norway. (https://www.stlouisfed.org/on-the-economy/2015/march/how-should-labor-pr... )
The U.S. workers suffer so much hardship due to low and stagnant wages with their significant productivity gain. That they feel the pain is because, while automated production increases their productivity, capital pays them less as a result of over-supply of labor power, i.e., increased unemployment or surplus population.
Labor productivity—defined as output per hour—increased in the motor vehicle manufacturing industry from 2000 to 2007, but declined from 2007 to 2009. From 2011 to 2014 the productivity increases every year at an average rate of 2.75%. (BLS)
Secondly, let’s take a look at productivity growth in construction. Measures of labor productivity growth in three industries in construction: Single and multiple family residential constructions from 1987 to 2011, and the construction of highways, streets, and bridges from 2002 to 2011. These data, which currently cover almost one quarter of construction output, show no sign of any sustained productivity decline. (ditto)
Thirdly, the U.S. shines in G.D.P per hour worked as a more accurate labor productivity measure when compared with both the Western European and the Asian countries except oil-rich Norway. (https://www.stlouisfed.org/on-the-economy/2015/march/how-should-labor-pr... )
The U.S. workers suffer so much hardship due to low and stagnant wages with their significant productivity gain. That they feel the pain is because, while automated production increases their productivity, capital pays them less as a result of over-supply of labor power, i.e., increased unemployment or surplus population.
5
“Lacking confidence and seeing weak demand, many businesses have held back on investing, ...” is likewise not correct. The real reason making business shy of investing is over-production, which causes not merely lack of investment outlet but also unemployment and commodity price deflation (see e.g., “Recessions, depressions and recoveries”, by Robert McKee [aka Michael Roberts] 2 December 2015.)
“While falling prices of oil and other commodities help industrialized countries, they signal not just rising supply but also disappointing demand” is problematic because production takes precedence over circulation of capital. The steady and fast progress in the C.O.G (Coal, Oil and Gas) productions has made falling prices possible. Market forces took over as an apparent but not the true reason for prices to decline. Government interference or lack of it has only nominal effects at the best on the recessions, depressions and recoveries, so to speak.
No, it’s not the leaders’ problems that cause recessions, etc. Marx said: “The barrier of capitalist production is capital itself.” Automated production lowers the value (and price) of commodity, increases labor productivity, its surplus value, corporate profits and executive compensation, unemployment, over-production and shortage of investment outlet. Capital can no longer handle such a high-level anarchist production and jobless system. It will eventually have to call its antithesis for rescue. If not, the end of its life is near.
“While falling prices of oil and other commodities help industrialized countries, they signal not just rising supply but also disappointing demand” is problematic because production takes precedence over circulation of capital. The steady and fast progress in the C.O.G (Coal, Oil and Gas) productions has made falling prices possible. Market forces took over as an apparent but not the true reason for prices to decline. Government interference or lack of it has only nominal effects at the best on the recessions, depressions and recoveries, so to speak.
No, it’s not the leaders’ problems that cause recessions, etc. Marx said: “The barrier of capitalist production is capital itself.” Automated production lowers the value (and price) of commodity, increases labor productivity, its surplus value, corporate profits and executive compensation, unemployment, over-production and shortage of investment outlet. Capital can no longer handle such a high-level anarchist production and jobless system. It will eventually have to call its antithesis for rescue. If not, the end of its life is near.
1
Well done Andrew. This problem has many variables to be sure but the one that stands out is the explosion in rent seeking income.
Simply put and hard to argue is the notion that most of the incremental GDP since the crisis has gone to the top. Headline numbers show this to be true and is the theme of our current politics.
QE has succeeded in its goal of lifting asset prices by assuring risk takers the near term cost of borrowing remains low. Entities from corporation and wealthy individuals to the Fed have used this " carry trade" to create enormous income without producing anything.
By the Feds own admission they have returned over 600 billion dollars to Treaury since QE inception.
Set aside the income generated by owning Agrncies like FNM with assets over 11 trillion to finance at or near zero rates.
Extrapolating throughout those able to engage in this, ( including Apple; borrowing near 20 billion to buy stock back with 100's of billion in cash), it's not hard to see how income growth has been vectored to the top.
Dumbing down even more, it begs the question on the difference in spending of the few versus the average family increasing their income from say 45k to 50k. Rich save more.
Sure, exceptions exist like autos but any objective review of the data show this change.
Simply put and hard to argue is the notion that most of the incremental GDP since the crisis has gone to the top. Headline numbers show this to be true and is the theme of our current politics.
QE has succeeded in its goal of lifting asset prices by assuring risk takers the near term cost of borrowing remains low. Entities from corporation and wealthy individuals to the Fed have used this " carry trade" to create enormous income without producing anything.
By the Feds own admission they have returned over 600 billion dollars to Treaury since QE inception.
Set aside the income generated by owning Agrncies like FNM with assets over 11 trillion to finance at or near zero rates.
Extrapolating throughout those able to engage in this, ( including Apple; borrowing near 20 billion to buy stock back with 100's of billion in cash), it's not hard to see how income growth has been vectored to the top.
Dumbing down even more, it begs the question on the difference in spending of the few versus the average family increasing their income from say 45k to 50k. Rich save more.
Sure, exceptions exist like autos but any objective review of the data show this change.
Nice to see an art reference in an economic piece
3
"Notably, failing to act at all has cut deeply into business and investor confidence, an important support mechanism for markets and consumers alike."
Are you kidding me? Here in the U.S., if Mr. Rattner defines "failing to act" as regulating entire industries (coal) out of existence, or loading huge new costs onto entire segments of the economy (Obamacare), then I'm wondering what real action would entail? This administration has "acted" as a serious drag on the system long enough. Time for new leadership that understands that if you overload the horse, it quits!
Are you kidding me? Here in the U.S., if Mr. Rattner defines "failing to act" as regulating entire industries (coal) out of existence, or loading huge new costs onto entire segments of the economy (Obamacare), then I'm wondering what real action would entail? This administration has "acted" as a serious drag on the system long enough. Time for new leadership that understands that if you overload the horse, it quits!
3
If we are being honest here, we cannot blame Barack Obama.
Who gets the blame for where we are in 2016?
Obama supporters.
Heading into 2012, the writing was on the wall. 91 million Americans giving up on finding a job, double digit unemployment before the 2012 election year book cooking by the Obama WH (Labor Dept) and the Black community in absolute shambles.
We even had Obama trounced in the first 2012 Presidential Debate looking aloof, medicated and unprepared. Voters had given Obama 4 years to keep his word, to end politics as usual, unite both parties, end Bush's neocon nation building/regime change, put a stop to USA Patriot Act abuses of privacy and to make transparency and rule of law the cornerstones of his administration.
Like Spiccoli in the movie "Fast Times at Ridgemont High" Obama came to class sporting an F average on all counts and without his homework. Changing course, electing someone new and trying a different approach was the logical solution.
Instead, Obama supporters doubled down, expecting a different outcome from the same thing, which is the definition of insanity.
So here we are.
As Dr. Phil once famously remarked, when it comes to addiction, it's always the enabler driving the car.
Who gets the blame for where we are in 2016?
Obama supporters.
Heading into 2012, the writing was on the wall. 91 million Americans giving up on finding a job, double digit unemployment before the 2012 election year book cooking by the Obama WH (Labor Dept) and the Black community in absolute shambles.
We even had Obama trounced in the first 2012 Presidential Debate looking aloof, medicated and unprepared. Voters had given Obama 4 years to keep his word, to end politics as usual, unite both parties, end Bush's neocon nation building/regime change, put a stop to USA Patriot Act abuses of privacy and to make transparency and rule of law the cornerstones of his administration.
Like Spiccoli in the movie "Fast Times at Ridgemont High" Obama came to class sporting an F average on all counts and without his homework. Changing course, electing someone new and trying a different approach was the logical solution.
Instead, Obama supporters doubled down, expecting a different outcome from the same thing, which is the definition of insanity.
So here we are.
As Dr. Phil once famously remarked, when it comes to addiction, it's always the enabler driving the car.
4
Didnt you get the news? The number of Americans working has increased. Its not just that unemployment is down below 5%, the percentage of Americans in the work force has gone up for the first time in decades. Not to mention the solid record of economic growth that is deeper and more sustained than under Reagan. DC, you are living proof that a law school education is within reach of even the most mediocre minds.
2
It's supply side stupid!
Since Reagan launched supply-side theory - "trickle down" - on America, we've seen a steady erosion of jobs, wages, and the prosperity of the working and middle class. It should really be no surprise then that our consumer-driven economy has gone through a roller coaster ride ever since, boom or bust, is the norm. Boom when credit is easy and workers, whose wages keep dropping, can borrow enough to stay afloat or sometimes even "splurge"; bust when credit tightens. The Bust of '08 was the predictable outcome, but by no means the end because we haven't reversed the policies that create "trickle down".
We need to roll back the tax and accounting laws/rules to pre-Reagan states, whereby long term domestic investments are incentivized, and short term profit taking and offshore investments penalized. We need to undo NAFTA and certainly NOT approve the TPP until we get guarantees of a level playing filed for our workers. We need to immediately launch massive infrastructure repair and expansion, and investment in alternative energy. If you want a "moon shot", make it replacing fossil fuels as the dominant energy source. And we need to restore the more progressive tax rates we had when our economy was at its zenith.
Really, the only question is: why are the "experts" so clueless?
Since Reagan launched supply-side theory - "trickle down" - on America, we've seen a steady erosion of jobs, wages, and the prosperity of the working and middle class. It should really be no surprise then that our consumer-driven economy has gone through a roller coaster ride ever since, boom or bust, is the norm. Boom when credit is easy and workers, whose wages keep dropping, can borrow enough to stay afloat or sometimes even "splurge"; bust when credit tightens. The Bust of '08 was the predictable outcome, but by no means the end because we haven't reversed the policies that create "trickle down".
We need to roll back the tax and accounting laws/rules to pre-Reagan states, whereby long term domestic investments are incentivized, and short term profit taking and offshore investments penalized. We need to undo NAFTA and certainly NOT approve the TPP until we get guarantees of a level playing filed for our workers. We need to immediately launch massive infrastructure repair and expansion, and investment in alternative energy. If you want a "moon shot", make it replacing fossil fuels as the dominant energy source. And we need to restore the more progressive tax rates we had when our economy was at its zenith.
Really, the only question is: why are the "experts" so clueless?
2
I would love the pre-Reagan tax laws
Then most of my income would never be counted as taxable
Did you miss that government revenue is at an all time high?
Then most of my income would never be counted as taxable
Did you miss that government revenue is at an all time high?
2
the US Congress and gridlock are to blame. The infrastructure could have been improved at low cost and would have created jobs but Congress wants the US to fail. They care more about their political party than the US. Vote those bums out.
The power without the glory; the Presidents advisors who don't listen to the Heads of Government Departments and reject their recommendations.
1
Nothing wrong with our economy that can't be fixed by a) raising the minimum wage, b) lowering, yes lowering to 35% corprorate tax rate, c) rebuilding our decaying infrastructure paid for with a carbon tax (instead of just an increase of the gas tax, d) reforming Medicare and Social Security (by raising the eligibility ages). This all should be part of "Grand Bargain" but the Republicans (not the Democrats) are the Party of No.
1
The corporate tax rate is already 35%, but none of them pay that much (most profits are left offshore, so they won't have to pay taxes on them). As for raising the eligibility ages on Medicare and Social Security, you're suggesting old folks just keep working. That seems like you're balancing the budget on the backs of people who've been paying into the system their whole lives. How about we remove the wage cap on Social Security, and increase the Medicare withholding by, say half a percentage point?
How about we tax every single stock market transaction by a quarter of a percent? How about we tax oil revenue, not by how much they get for it overseas (since they can leave those profits in the Caymans), but by barrels pumped out of US soil? Every other oil-producing nation in Europe uses their oil as a way to invest in the infrastructure of the nation. We give ours subsidies, as if oil companies need subsidies to make enough money to survive.
How about we tax every single stock market transaction by a quarter of a percent? How about we tax oil revenue, not by how much they get for it overseas (since they can leave those profits in the Caymans), but by barrels pumped out of US soil? Every other oil-producing nation in Europe uses their oil as a way to invest in the infrastructure of the nation. We give ours subsidies, as if oil companies need subsidies to make enough money to survive.
2
result:
Wall Street moves off shore
U S pumped oil is already taxed multiple ways
OSHA, EPA, Lease fees, transport taxes, wage taxes, now benefits are also taxed.
and what subsidy is Exxon, Shell or BP getting?
Wall Street moves off shore
U S pumped oil is already taxed multiple ways
OSHA, EPA, Lease fees, transport taxes, wage taxes, now benefits are also taxed.
and what subsidy is Exxon, Shell or BP getting?
1. The oil companies are to blame. Buying out politicians in order to spread untruths about global warming, suppressing initiatives to build a new energy economy.
2. Republicans, for fighting against badly-needed infrastructure improvements all around the USA.
2. Republicans, for fighting against badly-needed infrastructure improvements all around the USA.
Tell me how you pay for the infrastructure when China is not lending.
"..[central banks] have run out of ammunition, making the need for more robust fiscal policy even more urgent."
The '90s saw the brief career of a MLB (baseball) player I'll refer to simply by his initials "JP" (to avoid embarrassment). Armed with big muscles & a powerful swing, JP took what one might consider a "robust" approach to hitting. He swung for the fences. Every time. A 20+ home run per season guy, he was a reasonably hot commodity for a time. Alas, JP's "robust" approach also led to his downfall in the form of a .188 career batting average (not good) & 35.6 strikeout percentage (exceedingly 'not good').
The lesson therein is that sometimes a "robust" approach is exactly what you dont need or want. As clearly evidenced by the mess made from our "robust" monetary policy.
The '90s saw the brief career of a MLB (baseball) player I'll refer to simply by his initials "JP" (to avoid embarrassment). Armed with big muscles & a powerful swing, JP took what one might consider a "robust" approach to hitting. He swung for the fences. Every time. A 20+ home run per season guy, he was a reasonably hot commodity for a time. Alas, JP's "robust" approach also led to his downfall in the form of a .188 career batting average (not good) & 35.6 strikeout percentage (exceedingly 'not good').
The lesson therein is that sometimes a "robust" approach is exactly what you dont need or want. As clearly evidenced by the mess made from our "robust" monetary policy.
The real downturn comes with Nixon. Then the Oil Crises, Carter gets blamed. Reagan recovery, Bush 1 downturn, Clinton recovery, Bush 2 disaster. Obama is fighting all of that.
1
Of course the financial analysis of one who has publically stated that Social Security recipients are getting something for nothing on Morning Joe carries little weight to me.
The problem with trade was brought up at the time the trade agreements were first negotiated. Capitalists loved free trade - the labor movement was desperately and rightly afraid. In the US, employers provide a decent wage, benefits and must obey federal regulations from OSHA and EPA and other regulators. None of which is done in the rest of the world. That put us at a severe competitive disadvantage. This was well known and ignored. The result, as predicted, has nothing to do with our leaders. We have simply lost our economic base. Without that, consumers have no money to spend. Yes, we should rebuild more roads and bridges. But this country has always had a full service economy - we made furniture, cars, clothes, machine tools, paper, and innumerable other products. That has all been destroyed by "global markets". Now we are at the mercy of what happens in China, Indonesia, Korea and the third world. That makes nobody comfortable. Both Trump and Sanders strongly advocate changing that and rebuilding America. That is the path back to a strong America.
The problem with trade was brought up at the time the trade agreements were first negotiated. Capitalists loved free trade - the labor movement was desperately and rightly afraid. In the US, employers provide a decent wage, benefits and must obey federal regulations from OSHA and EPA and other regulators. None of which is done in the rest of the world. That put us at a severe competitive disadvantage. This was well known and ignored. The result, as predicted, has nothing to do with our leaders. We have simply lost our economic base. Without that, consumers have no money to spend. Yes, we should rebuild more roads and bridges. But this country has always had a full service economy - we made furniture, cars, clothes, machine tools, paper, and innumerable other products. That has all been destroyed by "global markets". Now we are at the mercy of what happens in China, Indonesia, Korea and the third world. That makes nobody comfortable. Both Trump and Sanders strongly advocate changing that and rebuilding America. That is the path back to a strong America.
4
The only consistent absence are the governments in terms of spending. Consequently, we have a slow down. Let's look at reality for a change, rather than get caught up in all the irrelevant nuances that people are trying to sell.
2
The blame: corporations sit on their cash , coming in free from the Fed, sending jobs to China, the absolute refusal of Wall Street, corporations, the government to help anyone other than the 1%
3
Today , while I read through the comments in the New York times I was again reminded how devastating not know history and literature can be.
Cervantes was I remarkable writer on the human condition and the character we all know is Don Quixote. The ability to turn Don Quixote into Bernie Sanders is remarkable in of itself because Don Quixote is Donald Trump, Hillary Clinton, Marco Rubio and John Kasich. Bernie Sanders is the man with the mirrors.
Don is not short for Donald but indicative of someone born in the right place and the right time and believing his circumstances are merited.
Bernie Sanders speaks truth to the fantasy. What was America no longer lives. When Marco Rubio talks about the land of opportunity Bernie Sanders can talk truthfully about the least upwardly mobile of all the developed Western industrial nations.
When Donald talks about making America great again he talking about a different time and a different world.
Bernie is about looking in the mirror and seeing reality. Bernie's talking about a world where every nation is looking at educating its capable young people to be competitive and understanding the world.
America is about tilting at windmills, seeing enemies that are only windmills. Today are best and brightest have friends in Tehran and Tel Aviv. They interact with Moscow and Beijing and they know what the weather is in London.
Economic growth no longer adds quality to our lives. We need education healthcare and security.
Cervantes was I remarkable writer on the human condition and the character we all know is Don Quixote. The ability to turn Don Quixote into Bernie Sanders is remarkable in of itself because Don Quixote is Donald Trump, Hillary Clinton, Marco Rubio and John Kasich. Bernie Sanders is the man with the mirrors.
Don is not short for Donald but indicative of someone born in the right place and the right time and believing his circumstances are merited.
Bernie Sanders speaks truth to the fantasy. What was America no longer lives. When Marco Rubio talks about the land of opportunity Bernie Sanders can talk truthfully about the least upwardly mobile of all the developed Western industrial nations.
When Donald talks about making America great again he talking about a different time and a different world.
Bernie is about looking in the mirror and seeing reality. Bernie's talking about a world where every nation is looking at educating its capable young people to be competitive and understanding the world.
America is about tilting at windmills, seeing enemies that are only windmills. Today are best and brightest have friends in Tehran and Tel Aviv. They interact with Moscow and Beijing and they know what the weather is in London.
Economic growth no longer adds quality to our lives. We need education healthcare and security.
6
The fed has painted itself in to a corner with low interest rates. Seniors normally spend their money, stimulating the economy. They aren't due to the lack of any worthwhile fixed income investments.
2
Obama, who else?!?!
Before reading any 'blame' op-ed, I read the author's bio to see what think-tank or interest is being supported. The author is a Wall Street executive.
I thought this article was fairly even-handed but the author's slant sneaks out with this line: "Well-intentioned efforts to avoid another financial crisis have put the banking system in a straitjacket."
What straitjacket? Banks are still gambling depositor's money due to the repeal of Glass-Steagall, they stash billions in cash offshore, and the banking industry spends more money buying--err, lobbying--Congress than other industry.
Nice graphs, though.
I thought this article was fairly even-handed but the author's slant sneaks out with this line: "Well-intentioned efforts to avoid another financial crisis have put the banking system in a straitjacket."
What straitjacket? Banks are still gambling depositor's money due to the repeal of Glass-Steagall, they stash billions in cash offshore, and the banking industry spends more money buying--err, lobbying--Congress than other industry.
Nice graphs, though.
6
Two words:
Greed and globalization.
Other things:
1. Loosening of laws which protected the economy from financial institutions. In the US, repeal of Glass-Stegall.
2. The "conservative" movement. Less taxation; smaller government. Cut taxes to stimulate the economy. "trickle-down" economics; a major failure.
3. Exportation of high paying and manufacturing jobs to less developed countries.
4. Implementing loose trade agreements which ended up hurting, and not helping more developed countries.
5. Central bank money management policies.
6. Under reporting, or incorrectly reporting both good and bad economic indicators.
7. Salary and income disparity.
8. Stock market driven by pure speculation, and not by normal economic trends. Pushing the price of oil up in the middle of the Great Recession was one of those moments. Even today, the market rise and fall is being tied to the oil price.
9. Low consumer demand. People are afraid to spend money.
10. Low corporate investment. Companies are afraid to spend money on infrastructure and staff.
Other bloggers can add to this list.
The end result, many factors are involved, but it centers around a failed economic policy which effectively encourages stagnation.
Eventually, the US will fall into recession, because most of the world already has. Such is a service, financial only, non-diverse economy which survives on consumer spending.
Greed and globalization.
Other things:
1. Loosening of laws which protected the economy from financial institutions. In the US, repeal of Glass-Stegall.
2. The "conservative" movement. Less taxation; smaller government. Cut taxes to stimulate the economy. "trickle-down" economics; a major failure.
3. Exportation of high paying and manufacturing jobs to less developed countries.
4. Implementing loose trade agreements which ended up hurting, and not helping more developed countries.
5. Central bank money management policies.
6. Under reporting, or incorrectly reporting both good and bad economic indicators.
7. Salary and income disparity.
8. Stock market driven by pure speculation, and not by normal economic trends. Pushing the price of oil up in the middle of the Great Recession was one of those moments. Even today, the market rise and fall is being tied to the oil price.
9. Low consumer demand. People are afraid to spend money.
10. Low corporate investment. Companies are afraid to spend money on infrastructure and staff.
Other bloggers can add to this list.
The end result, many factors are involved, but it centers around a failed economic policy which effectively encourages stagnation.
Eventually, the US will fall into recession, because most of the world already has. Such is a service, financial only, non-diverse economy which survives on consumer spending.
8
Well, realistically, since the Reagan years, what has been the disastrous trickle down economics and Starve the Beast approach the Republicans, in particular, have promoted, has resulted in the greatest inequality and highest child poverty rate in the industrialized world, so for those and much of the middle class, the recession has remained for the last 35 years. They never came out of it, and in fact, it has gotten progressively worse. The productivity gains and their benefits that economists are so proud to espouse, have gone primarily to the top 1 percent , not the workers, hence the stagnation.
To your list, you might also want to add to the ideas of inequality and child poverty, an infrastructure, that by the accounts of many American civil engineers, is also the worst in the industrialized world.
To your list, you might also want to add to the ideas of inequality and child poverty, an infrastructure, that by the accounts of many American civil engineers, is also the worst in the industrialized world.
2
Thumbs way up on this list. 11. U.S. Corp. profits held overseas and not reinvested at home. 12. High frequency trading acting like an investor tax rather than providing liquidity. 13. Educating the masses in the wrong trades for available jobs. 14. Not enough discretionary money available to the consumer class (what's left over after housing, food, and transportation expenditures). 15. Zero and ready to go negative interest rates for the last 8 years :-0 (a government felony against savers ).
2
The blame goes to greed, and the vulchers with money and power to pursue it.
3
Economic recession always comes with Regime Change.
We're becoming more and more like MExico, where they have a financial crisis every six years just after one President leaves office with all the $$$ in the Treasury.
Bush pulled this stunt off in 23008.
Now, Obama is set for a repeat performance.
We're becoming more and more like MExico, where they have a financial crisis every six years just after one President leaves office with all the $$$ in the Treasury.
Bush pulled this stunt off in 23008.
Now, Obama is set for a repeat performance.
Mr. Rattner, don't you know its President Obama's fault? Everything bad happening in the US or the World is his fault. He's either done too much or done too little depending on which one was necessary. Nothing anyone in a position of power before he took office and nothing any group in power did or didnt do since he took office has had or will have any impact on anything. Its all on Obama. The World was made new in January of 2009 since then everything bad has been on him and everything good has been a happy accident or, perhaps, the work of a Republican governor.
8
Contrary to brave macro-fantasies that governments can steer economies in any direction they want, business cycles always remain.
That governments can stall an economy seems well proven. That governments know how to or could unstall an economy is doubtful. No government ever has.
Governments can at best supply liquidity in a downturn, so as to make the downturn shallower.
Governments operating under the assumption that they can deftly steer an economy, worsen matters by spending every last nickel, if anything is left in their budget at fiscal-year end. This seems the US's favored way, perhaps for no better reason than the US has always emerged from crises before.
Another problem: Trying to steering an economy like a swift-boat is like a firm trying to manage smooth, ever-rising earnings. It can be done for a while. But sales revenues never rise smoothly very long nor do expenses stay perfectly predictable. Then if a rogue event crops up, 'experts' like Greenspan utter absurdities like "Jee! We never expected that. Guess our ideology was off."
Nobody can ever foretell the future far out, yet they still try. Looking a week out is a lot safer, but still not a sure thing.
Accounting tricks that let firms book ever-increasing earnings, eventually use up any slack in in-flows or out-flows.
After all slack is taken in and the accounting bag of tricks empties or when government's choices run out, the first upset will cause disproportionate disorder.
That governments can stall an economy seems well proven. That governments know how to or could unstall an economy is doubtful. No government ever has.
Governments can at best supply liquidity in a downturn, so as to make the downturn shallower.
Governments operating under the assumption that they can deftly steer an economy, worsen matters by spending every last nickel, if anything is left in their budget at fiscal-year end. This seems the US's favored way, perhaps for no better reason than the US has always emerged from crises before.
Another problem: Trying to steering an economy like a swift-boat is like a firm trying to manage smooth, ever-rising earnings. It can be done for a while. But sales revenues never rise smoothly very long nor do expenses stay perfectly predictable. Then if a rogue event crops up, 'experts' like Greenspan utter absurdities like "Jee! We never expected that. Guess our ideology was off."
Nobody can ever foretell the future far out, yet they still try. Looking a week out is a lot safer, but still not a sure thing.
Accounting tricks that let firms book ever-increasing earnings, eventually use up any slack in in-flows or out-flows.
After all slack is taken in and the accounting bag of tricks empties or when government's choices run out, the first upset will cause disproportionate disorder.
You say that "Germany’s aggressive tilt toward renewable energy has raised costs enormously for its industrial sector." That does not seem to have dampened their thriving export markets. In fact aggressive growth in renewables has allowed Germany to achieve increase independence from oil and gas imports(Russia), and generate as much as 78% demand on certain peak summer days. In this country the commitment to future oriented systems for manufacture, construction and maintenance of alt-energy sources, deep infrastructure-water, sewer, power and the creation of modern distribution systems of energy and information is desperately needed, long overdue. The political will to support these endeavors supports the jobs which sustain the middle class for the good of the country.
1
Mostly the voters who elected this failed president, Obama.
5
Just come of your coma when Bush left office?
5
Susan, I read the regrets here each day. Now tell me I'm wrong.
Never ending growth which relies on non renewable extracting resources from a finite planet is a mathematical impossibility. Why do so many people believe in something which is mathematically impossible. It's like a mass delusion.
3
Newfie,
Sometimes the further you are from the action the clearer view you have of the event. I remember being snowed in in St John's and how insightful everyone seemed.
We are a finite planet as Newfoundlanders know, their being at the far Eastern end of North America but smack dab in the center of the West..
Sometimes the further you are from the action the clearer view you have of the event. I remember being snowed in in St John's and how insightful everyone seemed.
We are a finite planet as Newfoundlanders know, their being at the far Eastern end of North America but smack dab in the center of the West..
1
I haven't read all the comments, but it strikes me that the Obama administration, according to all the graphs, has done a better job than every other nation/region in holding a fairly steady course through the economic thickets of the past decade. No small achievement given the appalling obstructionism he has faced.
6
bsebird,
The graph is meaningless because the Western Democracies are withdrawing from the global economy. Living on the US/Can border I have seen the phenomenon at work. The US economy is very important to us but less so every week.
The graph is meaningless because the Western Democracies are withdrawing from the global economy. Living on the US/Can border I have seen the phenomenon at work. The US economy is very important to us but less so every week.
2
There are, indeed, many reasons for the global economic and the associated social slump of trust in governments. Many of them are mentioned in this well-documented column.
However, the column does not give direction to political leaders. One of the reasons for this sad situation is that economists and IMF are coming up short in pointing to the corporatization of the financialization trends in the present economic and political realms. It is the corporate sway that determines the rules of the game in trade pacts, climate legislation, labor laws etc. Sanders’s analysis and prescription is globally speaking correct with its emphasis on the need for equal treatment for all in economics and politics following Piketty’s emphasis on equality.
Personally, I would extend the Sanders approach to the monetary system where Goldman Sachs has an inordinate access and power by having central bankers such as Carney, Draghi and other monetary practitioners came from its stable. It is also their neoliberalism and that of many others that prevents even the discussion of the transformation of the unjust, unsustainable and, therefore, unstable international monetary system. I have proposed such transformation in a carbon-based international monetary system in Verhagen 2012 "The Tierra Solution: Resolving the climate crisis through monetary transformation" (www.timun.net) by basing it on the monetary standard of specific tonnage of CO2e per person.
However, the column does not give direction to political leaders. One of the reasons for this sad situation is that economists and IMF are coming up short in pointing to the corporatization of the financialization trends in the present economic and political realms. It is the corporate sway that determines the rules of the game in trade pacts, climate legislation, labor laws etc. Sanders’s analysis and prescription is globally speaking correct with its emphasis on the need for equal treatment for all in economics and politics following Piketty’s emphasis on equality.
Personally, I would extend the Sanders approach to the monetary system where Goldman Sachs has an inordinate access and power by having central bankers such as Carney, Draghi and other monetary practitioners came from its stable. It is also their neoliberalism and that of many others that prevents even the discussion of the transformation of the unjust, unsustainable and, therefore, unstable international monetary system. I have proposed such transformation in a carbon-based international monetary system in Verhagen 2012 "The Tierra Solution: Resolving the climate crisis through monetary transformation" (www.timun.net) by basing it on the monetary standard of specific tonnage of CO2e per person.
"Governments alone are not to blame . . ."
Rattner needs editorial help. The above formulation is hopeless. If he means governments are not solely to blame, better to say that, because what he says allows also the possibility that only governments are blameless.
Rattner needs editorial help. The above formulation is hopeless. If he means governments are not solely to blame, better to say that, because what he says allows also the possibility that only governments are blameless.
In essence the "issue" depends on your perspective; many people are making money in the downturn. so to them there is no problem. Have we even defined what the end goal is, and whose goal is it really? The worker, the banker, the politician? Perhaps an alignment of goals, rather than a winner take all mentality is the root cause of this issue?
this is very "big picture" and over reaching, but there has been a insidious undercurrent in our economy that has definately magnified and deepened the slowdowns and recessions: namely, the disappearance of true cpmpetitive marlets and the death of anti trust. the last 30 years has seen a race to aggregation in all types of businesses, the creation of de facto monopoly or at best safe harbors. in every case the bureucrats and legislators, bowing to the pressure from big business and big money, have watered down or eraeed the rules that precluded anyone "cornering" a market under the guise of those rules being "outmoded" and no longer relevant. in mulitple economic sectors, companies dont even attempt to win customers and business via superior service and lower prices, but instead eliminate consumer choice and lock in profits. that kills new businesses, expanded marketing, income growth as competitors bid up the best talent. and it rockets income inequality.
2
Perhaps the times when politicians put the public interest above their own personal power are mere anomalies of history. US politics is looking more and more like third world politics.
3
Had the republican leadership acted in good faith for the entire Nation our Nation would be humming right along. We would have invested in major infrastructure and people would have gone back to work in better paying jobs, which is the only real stimulus economies know.
Instead, the LEADERSHIP of the republican party committed sedition and put their party ahead of the Nation, and the World.
That is where the problem and the fault lie.
Own it.
Instead, the LEADERSHIP of the republican party committed sedition and put their party ahead of the Nation, and the World.
That is where the problem and the fault lie.
Own it.
26
If POTUS and the Congress had focused on recovery,jobs and reigning in (or deconstructing) too-big-to-fail banks instead of spending all of their political capital on a half-hearted attempt at health care during the first 2 years of his initial term when the Democrats had controlled both branches of government we would probably A) have a better economy and B) not had a Republican takeover of Congress.
3
Nothing but excuses for the current POTUS.
During the 2012 presidential campaign Obama claimed he ended war in Iraq and left it with a stable government. Then when his junior varsity showed this to be a lie, well the end of the war was all W's timing.
The excuses go on and on and on....
During the 2012 presidential campaign Obama claimed he ended war in Iraq and left it with a stable government. Then when his junior varsity showed this to be a lie, well the end of the war was all W's timing.
The excuses go on and on and on....
2
ah yes, the republicans fault. how convenient.
President obama and the democrats passed the original $832 billion stimulus bill in 2009 -- which was a massive failure. Within the bill, an estimated $300 billion was distributed to democrat citiies and states to keep union teachers, police offices and fire fighters employed. Monies for "infrastructure investment" were largely small time projects as they were disbursed before larger projects could be planned and vetted.
It is estimated that the "bump" from the entire program to the economy was .02 percent economic growth.
And finally, why would obama care about the economy? Don't you remember how he looked into the TV cameras and lied to the American people about focusing like a laser on "jobs?" He didn't do anything to put people back to work. Nothing. People who are working are not dependent on government.
President obama and the democrats passed the original $832 billion stimulus bill in 2009 -- which was a massive failure. Within the bill, an estimated $300 billion was distributed to democrat citiies and states to keep union teachers, police offices and fire fighters employed. Monies for "infrastructure investment" were largely small time projects as they were disbursed before larger projects could be planned and vetted.
It is estimated that the "bump" from the entire program to the economy was .02 percent economic growth.
And finally, why would obama care about the economy? Don't you remember how he looked into the TV cameras and lied to the American people about focusing like a laser on "jobs?" He didn't do anything to put people back to work. Nothing. People who are working are not dependent on government.
2
The whole idea of "leadership" in this country was shattered by the disastrous Republican administration of George W. Bush and the Republican legislators' blanket refusal to cooperate with anything put forward by the Obama administration, even to the point of disregarding the Constitution on the matter of filling a Supreme Court vacancy. Rattner blithely refers to "our leaders." Just who are they anymore?
8
A better question might be "Who Gets the Credit for Economic Growth Slowing Toward Sustainable Rate?"
Consider four drivers of economic growth: population, productivity, income distribution, and debt-to-income ratios. Consider, too, an appropriate goal for economic growth: rising, real per capita income.
By 2019 world population will have tripled since 1944, due in large part to higher life expectancy. That unsustainable tripling supercharged economic growth. Annual population growth rates have fallen by 40% since their mid-century peak and are projected to fall further, which will lessen pressure on a stressed biosphere.
Increasing debt-to-income ratios as a means of accelerating economic growth works until balance sheets become saturated with debt as has happened in the U.S., Europe, and China in recent times. Total system debt-to-income ratios remain near peak values.
Maldistribution of income needs to be remedied as it functions as an unspent tax that retards sustainable growth by diminishing returns on capital spending. That change and boosting productivity growth are the available sources of sustainable, real per capita income gains.
Consider four drivers of economic growth: population, productivity, income distribution, and debt-to-income ratios. Consider, too, an appropriate goal for economic growth: rising, real per capita income.
By 2019 world population will have tripled since 1944, due in large part to higher life expectancy. That unsustainable tripling supercharged economic growth. Annual population growth rates have fallen by 40% since their mid-century peak and are projected to fall further, which will lessen pressure on a stressed biosphere.
Increasing debt-to-income ratios as a means of accelerating economic growth works until balance sheets become saturated with debt as has happened in the U.S., Europe, and China in recent times. Total system debt-to-income ratios remain near peak values.
Maldistribution of income needs to be remedied as it functions as an unspent tax that retards sustainable growth by diminishing returns on capital spending. That change and boosting productivity growth are the available sources of sustainable, real per capita income gains.
2
There's go to be some way to blame this whole mess on GWB, no?
3
Mr. Rattner's statement that banks are in a government 'straitjacket' doesn't hold up to scrutiny. The details of Dodd-Frank are still being negotiated in a stalemated US Congress. Capital requirements have barely changed. Banks are in a self-imposed straitjacket. New businesses no longer bother with banks, they go to venture capital and other alternate forms of finance because the money center banks are so risk averse.
2
President Obama, the Democrats declared war on banks and profitable corporations.
They are responding in kind by retrenching.
Why is anyone surprised?
They are responding in kind by retrenching.
Why is anyone surprised?
4
Odd! HRC is criticized for wanting to continue the Obama legacy, while at the same time, she's criticized for being an oligarch and in cahoots with the banks. I guess Republicans dispensed with consistency a long time ago,
4
We're surprised that anyone would blame Obama and the Democrats for what happened before he was around.
3
He was part of the Congress as well
STEVEN, you are correct, the REAL problem with our so-called "political leadership" is that we do NOT have any REAL leaders in our "political leadership positions" - ESPECIALLY in our highest political position, the presidency - and haven't had for a very, long time. Until THIS is changed, our country will continue downhill until it becomes the disaster that is waiting to happen. This has been happening on a daily basis, and is, obviously, becoming more difficult for those involved to cover up, as they have been attempting to do for such a very long time (decades, if not centuries). I know from direct experience domestically and internationally that the answers, and the many ways to successfully apply unique and innovative programs that uses these answers, exists. These "adapted" programs have ALREADY proven, with on-the-ground results, that they will get positive social, financial, economic, and political results (DOCUMENTED) that benefit ALL people (especially the people who are unemployed, poor, some "living" in extreme poverty, and are violent). Many of the on-the-ground results are tangible, and get started immediately, BUT, as Harry Markopolos titled his book about Bernie Madoff and the SEC - "NO ONE WOULD LISTEN". REAL leaders WOULD listen, get involved, and the change that is needed to better the WORLD, not only our own country, would begin to happen, with our country in the forefront leading the way. The value to global business and prosperity is indescribable.
1
the main problem is that countries have abandoned free market capitalism as a means of organizing their economies. The US ranks 16th on a list ranking countries on how closely their economies adhere to free market principles. not to surprisingly hong kong was the most free market economy, but several of the countries higher on the list than the US were ones Bernie Sanders uses as examples of social democracies. that's says even less for the US's 16th place ranking. a free market economy not only is most efficient at producing goods and services, it also provides for the optimal distribution of wealth. That distribution closely approximates a normal curve - one which most people would consider fairly equitable as well. The fact the in the US wealth inequality has be come so large, concentrated in the top 1 percent, and social mobility moribund, is a good indicator that free market capitalism is no longer the organizing principle of the economy. Trump has been called a fascist by many and would be a perfect match for what the US economy has become.
5
"The past two recessions were caused largely by private actors: the risky lending of the mid-2000s and the dot-com bubble at the turn of the century."
Perhaps one reason that the global economy has been sputtering, is that the financial sector has become simply too expensive.
For all intents and purposes, Finance should be a mere facilitator of economic transactions for consumers and businesses that actually produce goods and create consumer services. However, the financial sector has come to fine tune our economic rules through its outsize influence on economic policy such that Finance's profit interests have the highest privileges within the economic game.
Perhaps one reason that the global economy has been sputtering, is that the financial sector has become simply too expensive.
For all intents and purposes, Finance should be a mere facilitator of economic transactions for consumers and businesses that actually produce goods and create consumer services. However, the financial sector has come to fine tune our economic rules through its outsize influence on economic policy such that Finance's profit interests have the highest privileges within the economic game.
9
How can you not address the issue of governments imposing austerity on a recovering economy as a principal cause of underperformance? Another issue is that the post WWII stimulus (resulting from rebuilding Europe and Japan) and the Chinese stimulus (resulting from China transitioning to a modern economy) are no longer available. A third issue is that the in the major economies growth is slower because their populations have stopped growing, which removes a component of GDP growth. We seem to be transitioning to a new normal, wholly unrecognized in you analysis. Governments can make a difference by simply providing stimulus to recover from depressions, and withdrawing it in the boom times. This would be a great time to rebuild the US infrastructure - by borrowing at today's near zero interest rates, and putting people to work.
8
I rarely agree with Mr Soros, but in this case he's right. Add to that the fact that David Stockman, Reagan's former head of OMB is also predicting a massive meltdown, likely starting in China, and you have both the left and right in agreement that we are about to enter a terrible Obama recession, even depression. It will get Obama's name because he is the cause.
Since 2008 Obama has done NOTHING to repair the real economy from the financial crisis. He stupid stimulus package was NOTHING but a payoff to his supporters. Billionaire democrat donors, Wall Street, and the unions, with Solyndra a tiny but shining example of Obama's corruption.
That of course pales in scope with Obama's massive corrupt spending to buy votes giving us $10 TRILLION in new DEBT by the end of his term. Obama will have run up more nation destroying DEBT than all other Presidents combined. $10 Trillion in debt wasn't enough to keep the economy from collapsing from Obama's job and economic growth killing policies. So we got endless ZERO interest rates, and over $6 Trillion in Funny Money. Even that would not have been enough if oil prices hadn't crashed, and keep in mind Obama fought the energy industry trying to keep prices high, not low. If he had succeeded the Obama depression would have started 18 to 24 months ago. Almost 8 years and Obama had done nothing but lie to us. We have the highest percentage of Americans NOT working in 40 years, and only the rich have prospered under Obama.
Since 2008 Obama has done NOTHING to repair the real economy from the financial crisis. He stupid stimulus package was NOTHING but a payoff to his supporters. Billionaire democrat donors, Wall Street, and the unions, with Solyndra a tiny but shining example of Obama's corruption.
That of course pales in scope with Obama's massive corrupt spending to buy votes giving us $10 TRILLION in new DEBT by the end of his term. Obama will have run up more nation destroying DEBT than all other Presidents combined. $10 Trillion in debt wasn't enough to keep the economy from collapsing from Obama's job and economic growth killing policies. So we got endless ZERO interest rates, and over $6 Trillion in Funny Money. Even that would not have been enough if oil prices hadn't crashed, and keep in mind Obama fought the energy industry trying to keep prices high, not low. If he had succeeded the Obama depression would have started 18 to 24 months ago. Almost 8 years and Obama had done nothing but lie to us. We have the highest percentage of Americans NOT working in 40 years, and only the rich have prospered under Obama.
3
I guess the bad-old Republicans get blamed. Too bad the NY Times doesn't spend more time on really trying to get to the answer on things.
2
I am afraid you are dealing in revisionist history or maybe you are just in denial. Since the Reagan years the primarily Republican Starve the Beast approach has led to the meltdown of 2008, todays Flint and Detroit Michigan disasters with Atlantic City on the verge of bankruptcy.
The Republicans, keep them wars going, government and taxes are evil approach has led to this fiasco that exists today. I would suggest you look in the mirror first for your answers.
The Republicans, keep them wars going, government and taxes are evil approach has led to this fiasco that exists today. I would suggest you look in the mirror first for your answers.
5
Yes everything is the fault of those evil, old, white, male republicans.
1
As this article points out, the U.S. needs to spend money on infrastructure, research/development and education. We can pay for it by raising taxes on our wealthiest citizens and ridding the tax system of loopholes that favor large corporations. Such spending would create a huge number of well-paying jobs, lift the economy (regardless of what is happening elsewhere in the world) and prepare us for the future. It would reverse the trend towards income inequality and help lift the poor and middle class to a higher standard of living. Austerity at this time in the U.S. is totally wrong.
4
It's off topic, but I find the deficits of trust graph interesting. I was expecting to see a sharp drop following the Watergate scandal. But the downward trend following the escalation of the Vietnam War is barely interrupted. One could interpret this to mean the American people were more angered over a war they viewed as needless than undeniable criminal activity in the White House. I find that both surprising and informative to future leaders.
Congratulations Mr. Rattner, a consummate Wall Street insider, who is able to recognize that "growing income inequality, which has pushed more money into the hands of the rich, who are less likely to spend it" is a critical issue.
Republicans play a dangerous game hoarding wealth where their idea of success is the 1% having hoarded all the wealth, leaving the 99% their slaves, begging for a few crumbs.
Ancient Roman plutocrats played the same game, eventually leading to starvation and revolt of the 99% plebs.
Much like the rise of Caesar who passed on some wealth to the 99% we see Trump/Bernie making the same moves.
Caesar succeeded until the 1% killed him, just like the 1% are trying to kill off the Bern/Trump with their attacks rising to a fever pitch warning the 99% how they will destroy the nation.
But Mr. Rattner advises that if our economy fails, "the fault will lie with our leaders".
With respect, Mr. Rattner, congress got elected and have their marching orders from the 1%.
Folks know this, but heretofore have preferred their obsession with guns, gods, lady parts and war instead of groceries.
Voters seem more interested in keeping meat on their ribs lately.
Republicans play a dangerous game hoarding wealth where their idea of success is the 1% having hoarded all the wealth, leaving the 99% their slaves, begging for a few crumbs.
Ancient Roman plutocrats played the same game, eventually leading to starvation and revolt of the 99% plebs.
Much like the rise of Caesar who passed on some wealth to the 99% we see Trump/Bernie making the same moves.
Caesar succeeded until the 1% killed him, just like the 1% are trying to kill off the Bern/Trump with their attacks rising to a fever pitch warning the 99% how they will destroy the nation.
But Mr. Rattner advises that if our economy fails, "the fault will lie with our leaders".
With respect, Mr. Rattner, congress got elected and have their marching orders from the 1%.
Folks know this, but heretofore have preferred their obsession with guns, gods, lady parts and war instead of groceries.
Voters seem more interested in keeping meat on their ribs lately.
3
Funny how this Obama/Clinton maxed-out-contributor tries to shift blame to the out-of-power GOP. Eight years of anemic growth caused directly by huge tax increases, regulatory hyper-growth, and governance by executive fiat just don't seem to make their way into Steven's "analysis". Imagine my surprise...
3
Facts don't seem to have made their way it into your "analysis." Not surprised.
7
1. Capitalization of merged corporations is less than their pre-merge cost.
Capital aggregation drives total market capitalization down.
We live in time when number of merges and acquisitions greatly exceeds number of IPOs.
Historically:
In XVIII century in order to start business it was enough to buy basic materials and tools.
In XIX century in order to start business it was enough to get loan from bank, buy machinery and hire people.
In XX century in order to start business it was enough to take credit line in bank, hire designers and outsource business to China.
In XXI century it is not possible to start any manufacturing business anymore. It is large financial conglomerates business now.
Capital aggregation drives total market capitalization down.
We live in time when number of merges and acquisitions greatly exceeds number of IPOs.
Historically:
In XVIII century in order to start business it was enough to buy basic materials and tools.
In XIX century in order to start business it was enough to get loan from bank, buy machinery and hire people.
In XX century in order to start business it was enough to take credit line in bank, hire designers and outsource business to China.
In XXI century it is not possible to start any manufacturing business anymore. It is large financial conglomerates business now.
Rattner has chutzpah calling out China for rising debt. But the prescription of the #liberal masses like Rattner & Krugman remains - borrow and spend, the debt be damned...
3
Did you notice it was the Republican "conservatives" who turned a surplus into a massive deficit? Nah, didn't think so.
3
Did you notice the U S Treasury reports show there was NO surplus? Nah, didn't think so.
bush took th debt from 5 to 10 trillion
1
Government has failed to act because they are paid to do so. Their corporate benefactors are making more than they ever have, and wages have stagnated -- what incentive to these large multinational corporations have to change that? So naturally, they lean on their corporate shills in Congress to institute gridlock over petty issues. Why else haven't they done anything to close tax loopholes or increase wages? The NYT wonders why Hillary Clinton won't support a $15 dollar minimum wage -- its because she's paid off too!
4
A Wall Street sage shares wisdom with the peons. Shockingly, no mention is made that Wall Street is probably 4x larger than it needs to be, that Wall Street is both the gambler and the house (in Vegas parlance), and that low capital gains taxes have created so much extraneous wealth for the 0.1% that it can't find good investments: money keeps sloshing around into bubbles: dot com, housing, more dot com, more housing. But Wall Street speculators and too big to fail banks couldn't possibly contribute to the problem. Oh no.
It must be the government, right? It couldn't possibly be globalization and the endless merger cycle, so that few businesses are local, wages are driven down, and jobs are shipped around or just out. It couldn't be that the poor and middle class have no spare cash to spend, so that growth on real goods is ephemeral. Could it be that we've been here for 15 years? The lending frenzy hid the fact that there were not enough manufacturing and construction jobs. Now we see that they don't exist. There is a huge section of our citizenry that is unemployable or underemployed. They might find crappy jobs by moving halfway across the country. Or they might find themselves in trouble with no family or friends in their time zone. Thus speaketh the free market gospel: let there be no fetters! Better to be free and destitute than solvent and shackled! Better to be a disposable piece on the board than to have checks and balances! May your banks be ever larger. Amen.
It must be the government, right? It couldn't possibly be globalization and the endless merger cycle, so that few businesses are local, wages are driven down, and jobs are shipped around or just out. It couldn't be that the poor and middle class have no spare cash to spend, so that growth on real goods is ephemeral. Could it be that we've been here for 15 years? The lending frenzy hid the fact that there were not enough manufacturing and construction jobs. Now we see that they don't exist. There is a huge section of our citizenry that is unemployable or underemployed. They might find crappy jobs by moving halfway across the country. Or they might find themselves in trouble with no family or friends in their time zone. Thus speaketh the free market gospel: let there be no fetters! Better to be free and destitute than solvent and shackled! Better to be a disposable piece on the board than to have checks and balances! May your banks be ever larger. Amen.
6
President Obama is responsible for the current state of affairs for our lousy economy. Before that it was Bush. High taxes and high regulation have decimated the middle class. We live in an oligarchy. An example would be Dodd-Frank which crushed community banks that had nothing to do with the great recession, and rewarded the big banks, that along with the government, caused the sub-prime meltdown. Big banks, who helped write Dodd-Frank, now have more market share than ever.
2
Maybe it is a crazy idea, but with almost all US infrastructure aging, neglected, and in need of repair or replacement and with interest rates at historic lows, why doesn't government at all levels undertake massive infrastructure development projects with borrowed funds? We need bridges, tunnels, roads, etc. This would build for the future and create considerable demand. Something like this worked before, perhaps it would work again.
3
Are you offering to lend the U S the funds?
Not a word on the "Continuing Resolution" that allowed the Progressive/Socialist Congress, esp Harry Reid, to destroy the economy with trillions of dollars not voted on and doubling the yearly budget and doubling the National Debt.
That fact coupled with the disgusting Paul Ryan passing this year's candy loaded budget without debate.
That fact coupled with the disgusting Paul Ryan passing this year's candy loaded budget without debate.
The title of the article is "WHO GETS THE BLAME for the Slowing Economy?". This a very different question than "WHO IS TO BLAME for the Slowing Economy?", The answer to who gets blamed can be subjective and depends on the ideology of whom you ask. The answer to go to blame depends on what is economically right and wrong and how the markets actually react. Was Kanes right? Or Hayek? Should we be a free market meritocracy or should economics be based on social justice, or blend of the two. I prefer the free market.Bailing out banks that make risky loans and failing car companies, meddling with secured loan to corporations, and paying able bodied people to stay home may not help.
1
Mr. Rattner's diagnosis of the economic problem seems spot on. But to blame the problem on leaders in general both blurs and evades responsibility. The current administration, for example, has been unable to put this very prescription in place; are they really to blame? We the people have brought these problems on ourselves by selecting such poor representatives. We've been intellectually lazy, and we've voted our pocketbook--our own personal pocketbook, not society's.
1
The government often says it looks out for business' bests interests, but the very same mindset should be used for public spending. If we invest in something, we should get a return. Loop holes under 'complicated' tax policies and tax breaks are exploited and awarded to corporations, but with little to no conditions for these benefits. How can we then secure a return? It seems we can't! At this point the leaders of running the federal reserve and our politicians seem passive on passing any kind of policy that would increase our tax base.
So, what kind of spending can we ensure at the very least a return? Public spending!
Spending on infrastructure has decreased from 50 years ago (and this isn't because we've built all we can!). We clearly have crumbling roads, bridges, and need to direly upgrade and expand our public transportation system. This spending plus extra dollars to hire and create a workforce to work on infrastructure would mean we have middle income jobs for millions of Americans. This seems like such a simple thing, but even our politicians can't bring themselves to reward anyone else than the ones handing them a check directly.
So, who do we have to blame? Well, the ones who get to make decisions!
So, what kind of spending can we ensure at the very least a return? Public spending!
Spending on infrastructure has decreased from 50 years ago (and this isn't because we've built all we can!). We clearly have crumbling roads, bridges, and need to direly upgrade and expand our public transportation system. This spending plus extra dollars to hire and create a workforce to work on infrastructure would mean we have middle income jobs for millions of Americans. This seems like such a simple thing, but even our politicians can't bring themselves to reward anyone else than the ones handing them a check directly.
So, who do we have to blame? Well, the ones who get to make decisions!
66
Thinking, A. Punctuation, F. Lose the exclamation points, and you gain credibility. Now, who do we think has the best chance of fixing this mess we're in?
No, we should blame Muslims, particularly those living and working in peace. We should blame migrant workers, doing jobs no citizen will perform. We should blame "Obama" for his "job killing" (4.9% unemployment?) policies and his ludicrous goals of healthcare for all, of reducing our reliance on energy sources that are literally destroying our ecosystem. Blame anyone but the GOP, their masters, and the fools that elected them to power.
2
I find these writings nothing more than the standard beat of the drum of a failed system. I do hold leadership responsible, corporate and financial leadership have corrupted the system so bad that the American people are forced to chose between a fascist and a socialist. In this case I'll take the later.
2
The sky is falling, the sky is falling, quick elect a Republican and make it all better.
A slowing economy? In whose mind? Wall Street? The One Percent Elite?
Rattner, when all else fails, push the panic button.
And blame Obama and elect a Republican.
Opinion is one thing, thinly disguised propaganda is quite the something else.
A slowing economy? In whose mind? Wall Street? The One Percent Elite?
Rattner, when all else fails, push the panic button.
And blame Obama and elect a Republican.
Opinion is one thing, thinly disguised propaganda is quite the something else.
Low productivity growth has held down wages in developed countries? Productivity has risen since the '70's while wages have been stagnant.
2
as someone trained in the sciences, i am always skeptical of an explanation that requires many causal factors to explain a single outcome -- a "firing squad" hypothesis. the problem is that you give up the two critical attributes of a causal explanation: the ability to say which are the primary vs. the secondary causes, and the ability to say exactly how the cause produced the effect.
here's an alternative: complexity is the cause. as our economies and societies grow, as the thermodynamics of human agriculture, energy consumption and manufacturing increase in scale and intricacy, as opinions diversify, borders become porous, regulations grow more onerous and laws easier to circumvent, the human process becomes more and more complex.
as joseph tainter argued from historical examples, all societies trend toward greater complexity as they grow, then add complexity as the only way to manage the complexity that has already been created, until the sheer overhead of complexity stalls further growth and breaks the "great society" apart.
certainly, unfathomable complexity would explain an outlook that is "unclear" and forecasts that must be revised frequently, and account for the many hidden costs that seem to be slowing growth despite an enormous ocean of capital that finds few good opportunities for investment.
here's an alternative: complexity is the cause. as our economies and societies grow, as the thermodynamics of human agriculture, energy consumption and manufacturing increase in scale and intricacy, as opinions diversify, borders become porous, regulations grow more onerous and laws easier to circumvent, the human process becomes more and more complex.
as joseph tainter argued from historical examples, all societies trend toward greater complexity as they grow, then add complexity as the only way to manage the complexity that has already been created, until the sheer overhead of complexity stalls further growth and breaks the "great society" apart.
certainly, unfathomable complexity would explain an outlook that is "unclear" and forecasts that must be revised frequently, and account for the many hidden costs that seem to be slowing growth despite an enormous ocean of capital that finds few good opportunities for investment.
1
The generation is dying who realized that the auto industry, high level consumer durables with steel, rubber, glass and technology was what drive the post war boom. The gas crisis of 73 and 79(when i got out of college) forced Detroit to go into small front drive cars (GM X car, Chrysler K car) who had severe problems for a few years. The Japanese(especially) had a ready made answer which sold wildly and caused a depression in auto, steel, glass, rubber and all the associated businesses. In 1980 my company (Detroit based Burroughs, long gone) had a $1200 down payment and low cost financing to buy an American made car- I was the onnly person out of 100 who took advantage- all other cars were Japanese or Scandanavian. Now it is rare to see a US made car in the Northeast or West Coast..not s rare in the Midwest. We literally gave away our manufacturing base
2
Did we give it away or were UAW made cars just inferior to Japanese or European ones?
One thing that Rattner does not show is the low inflation rate we have had for the past several years. A healthy goal for inflation by the Fed has been 2%. The inflation rate hovers around 1%. The inflation rate can be steered upwards by government stimulus.
Rattner's diagnosis of global economic ills, though quite correct, is fragmented, as it does not point out root cause(s). And, he offers little in the way of its treatment. It is somewhat like a doctor diagnosing that various organs of the patient are failing, but does not know, or is not confident enough to say, that it might be cancer.
The prevailing thesis is that economic inequality is that disease - which is depressing consumer demand, and consequently production/investment and employment/wages. But this begs further question as to why this historic inequality. Recently, there has been much discussion of this matter in Economics literature, for example in Thomas Piketty's famous book "Capital in the Twenty first Century".
The final diagnosis that most of this analysis compels us toward, is rather simple - and that is, Government's fiscal policy. Monetary policy is secondary since this policy manages the effects expected or created by the fiscal policy.
Decades of tax cuts, promoted as the main solution for growth, have resulted in the inequality we see. This conclusion is to be found everywhere, but for some reason, does not find place in this Rattner piece.
Accepting the diagnosis that the tax cuts of past several decades have caused this economic disease, it is not too hard to find the remedy, which is to reverse these policies.
This diagnosis is ironically not accepted by many in power in developed countries.
So the patient keeps getting the wrong medicine.
The prevailing thesis is that economic inequality is that disease - which is depressing consumer demand, and consequently production/investment and employment/wages. But this begs further question as to why this historic inequality. Recently, there has been much discussion of this matter in Economics literature, for example in Thomas Piketty's famous book "Capital in the Twenty first Century".
The final diagnosis that most of this analysis compels us toward, is rather simple - and that is, Government's fiscal policy. Monetary policy is secondary since this policy manages the effects expected or created by the fiscal policy.
Decades of tax cuts, promoted as the main solution for growth, have resulted in the inequality we see. This conclusion is to be found everywhere, but for some reason, does not find place in this Rattner piece.
Accepting the diagnosis that the tax cuts of past several decades have caused this economic disease, it is not too hard to find the remedy, which is to reverse these policies.
This diagnosis is ironically not accepted by many in power in developed countries.
So the patient keeps getting the wrong medicine.
4
We as humans tend to gravitate to systems to deal with uncertainty.We like to know the decisions we make have a good chance of success.The reality is that there are no guarantees.Religion,government,economic theory,and systems like capitalism are all attempts to deal with uncertainty.Economics began by combining logic with a certain faith in Newtown's mathematics that could explain and predict certain human behaviors.Whether this was science or a belief system that gave people a way of making decisions is another matter.Liberal Government and Capitalism are the concerns in your article.Both these systems are in need of some changes due to conditions in the world today.Capitalism which under conditions of scarcity was the best choice at the time of its inception may have become obsolete in the modern world.Its use of extending credit and globalization of its labor may have created more problems than it solved.Change is inevitable so we need to look past our interests and our outdated systems to deal with our current needs.We can try to deal with our problems with reason and order or we will end up with violence and chaos.Germany is actually an example of the right approach.They are willing to put up with short term costs to address a long term problem.It is our turn in America to do the same.
1
We spent an awful lot of money on security and wars of choice over the last 15 years. Schools, roads, bridges, public wifi, a modern up to date electric grid with free access to all, up to date secure clean water delivery, expanded college and health care not so much.
Our world class infrastructure put together from the 1930's into the 60's no longer exists. We are a welfare state that is continually at war. We need to shift our national priorities dramatically.
Our world class infrastructure put together from the 1930's into the 60's no longer exists. We are a welfare state that is continually at war. We need to shift our national priorities dramatically.
Who gets the blame for the slowing economy? What...is that a joke?
Why, George Bush, of course.
Why, George Bush, of course.
2
Is the economy slowing? I thought that was politics. Don't things always go awry right before an election? Shows that our toxic political culture is not good for America. Public campaign funding would put the people in charge.
1
China's leaders "don't know what to do"?? Really? Is this not at least nominally a free market column? Is not the greatest justification for free market solutions that NO leaders know what to do? Lordy. Granted, Keynes gives us the general, macro-responses that work, but along with stimulus, rather than austerity, lighter on the control lever...please.
Mr. Rattner provides insight into what a President Clinton's economic policy would be
.
1)Viewing unfettered (a better term than "free") trade as an unalloyed good for Americans.
2)making the right noises about ramping up fiscal spending while not really trying too hard to actually achieve it.
3)Parroting banking and corporate propaganda that they are over-regulated or unable to lend because of onerous strictures placed upon them.
4)Trying hard to convince us that low oil prices are bad or are caused by the demand side of they equation rather than pointing to clear evidence of oversupply.
Additionally, the meme that central banks are "out of ammo" because inflation targets haven't been reached is just plain ludicrous.
There was no way central bankers could have known that OPEC (especially the Saudis) were going to try to crush US fracking companies and Russian producers. There was also little way of knowing just how much over-buying of commodities and over-investing in processing those commodities took place in China over the last 10 years.
China has blundered massively in its top-down industrial policy and is now attempting to fob those deflation-exacerbating products on the rest of the world. This potential wave of goods dumping should not be allowed. If we have the conviction to hold it off, our inflation metrics will rebound smartly and monetary policy will have the desired effect. We absolutely must NOT import deflation from China! Mr. Rattner should know this.
.
1)Viewing unfettered (a better term than "free") trade as an unalloyed good for Americans.
2)making the right noises about ramping up fiscal spending while not really trying too hard to actually achieve it.
3)Parroting banking and corporate propaganda that they are over-regulated or unable to lend because of onerous strictures placed upon them.
4)Trying hard to convince us that low oil prices are bad or are caused by the demand side of they equation rather than pointing to clear evidence of oversupply.
Additionally, the meme that central banks are "out of ammo" because inflation targets haven't been reached is just plain ludicrous.
There was no way central bankers could have known that OPEC (especially the Saudis) were going to try to crush US fracking companies and Russian producers. There was also little way of knowing just how much over-buying of commodities and over-investing in processing those commodities took place in China over the last 10 years.
China has blundered massively in its top-down industrial policy and is now attempting to fob those deflation-exacerbating products on the rest of the world. This potential wave of goods dumping should not be allowed. If we have the conviction to hold it off, our inflation metrics will rebound smartly and monetary policy will have the desired effect. We absolutely must NOT import deflation from China! Mr. Rattner should know this.
2
The economic malaise the world is suffering is the result of leaders, particularly central banks, applying the wrong policy prescriptions for restoring growth. Because the right solutions (i.e. reducing government and household debt, allowing failing banks and other companies on Wall Street and elsewhere to go bankrupt, etc.) would have involved more short term pain and resulted in many political leaders being fired, the world's central banks coordinated a massive experiment in aggressive monetary policy (QE, NIRP, ZIRP, etc.) - aka financial engineering - which we now know has done more damage than good. So we find ourselves 8 years later with twice the debt in the U.S., lower incomes, fewer good jobs, a bigger welfare-state, a larger gap between the haves and have-nots, greater social division, unprecedented foreign policy disasters and an Administration that sounds more like PollyAnna than competent leaders. And yet the so-called intellectuals and main-streamers still can't figure out why the "disrupters" and their "radical messages" are resonating with the masses in this election cycle. Go figure.
Presented as evidence in the case against the WW political establishment, 10 months stock market returns since June 1, 2015 and falling growth forecasts from 2010 to 2017. These are very carefully selected starting points. If instead you showed the stockmarket return from 2010 to present and the growth curves from say 2007 you would have a very different story.
There is no doubt that there are economic headwinds and challenges. But the evidence presented here is a good example of how to shape a conversation with very specific sets of data. It can be very misleading.
There is no doubt that there are economic headwinds and challenges. But the evidence presented here is a good example of how to shape a conversation with very specific sets of data. It can be very misleading.
1
After complaining about lower wages, corporate flight due to tax loopholes and lack of public investment, as problems plaguing the US economy, Rattner complains that Bernie Sanders candidacy is making things worse. He equates Sanders and Trump as political impediments to a better economy. Sanders sees all of these things as problems and has solutions for them. This is a shining example of blindness on the part of the establishment.
Polls show that Sanders defeats Trump and all the other possible Republican candidates handily, while Clinton loses to Rubio and Cruz. HIs election would be good for the economy, while nomination of Clinton risks a Republican victory.
Polls show that Sanders defeats Trump and all the other possible Republican candidates handily, while Clinton loses to Rubio and Cruz. HIs election would be good for the economy, while nomination of Clinton risks a Republican victory.
3
All of us, President Obama supporters, expected the President to be more assertive in these last months of his Administration: at the least, we expected him to come out with the new Nominee for the US Supreme Court and also the nominees for all the posts lying vacant; we wanted him coming out with some bold announcements about public works on improving the infrastructure etc., but alas, he has disappointed us! There seems to be a feeling around that he has given up, and thus the acceleration of the general feeling of hopelessness and a sense of distraught. Both Trump and Sanders fills a bit of the void by giving a sense that either would be unconventional and bold, and thus, probably usher in a more vigorous leadership at the White House. What a sense of despair that we have created for ourselves, and Obama has done nothing to counter the tempo or the trend!
1
Guess you have been alseep the last few years. Obstruction is the order of the day for the GOP. They won't even ac on a SC nominee - do you really think they would move forward on anything else Obama proposes? If so, I have some swampland to sell you.
Terrific summary of the hodgepodge of global economic challenges, with no historical precedent due to globalization of labor and production, plus incredibly efficient means of production. What it means to produce goods and services, on the one hand, and consume them, on the other hand, is undergoing an unprecedented sea change. Result: disruption of the status quo, uncertainty for all and shaky markets.
I'm confused. I thought Obama just gave a speech about how well we were doing; economy is growing as is the job market.
Facts: Economy is now global, and third world countries are seeing the uptick in standard of living, while western nations are losing. It's about supply and demand when the economy is global.
Trade agreements are also moving business outside the US; have done little to keep jobs here and improve the export delta (especially with ASPAC).
The Fed has been keeping the interest rate at 0% hoping that we would all borrow more and banks would lend at low rates. The latter is true in the mortgage industry, but not so true in other areas (Fed student loan interest rates are appalling).
Unintended (?) consequence of 'free money' is that the Fed has no where to go, banks don't want the cash that the Fed is pushing on them, people are afraid of the future and are trying to save, and seniors have no way to get interest on fixed income investments - meaning they lose more money every day as inflation is higher than savings interest.
Yes, governments can impact the economy, but when they believe they drive the economy, they are wrong. Bad policies bring about unintended consequences and that's all government seems to be able to enact. Example: my healthcare costs have more than doubled under the ACA, my doctor doesn't know me, and my medical records are always messed up due to the mandate of the EMR.
Facts: Economy is now global, and third world countries are seeing the uptick in standard of living, while western nations are losing. It's about supply and demand when the economy is global.
Trade agreements are also moving business outside the US; have done little to keep jobs here and improve the export delta (especially with ASPAC).
The Fed has been keeping the interest rate at 0% hoping that we would all borrow more and banks would lend at low rates. The latter is true in the mortgage industry, but not so true in other areas (Fed student loan interest rates are appalling).
Unintended (?) consequence of 'free money' is that the Fed has no where to go, banks don't want the cash that the Fed is pushing on them, people are afraid of the future and are trying to save, and seniors have no way to get interest on fixed income investments - meaning they lose more money every day as inflation is higher than savings interest.
Yes, governments can impact the economy, but when they believe they drive the economy, they are wrong. Bad policies bring about unintended consequences and that's all government seems to be able to enact. Example: my healthcare costs have more than doubled under the ACA, my doctor doesn't know me, and my medical records are always messed up due to the mandate of the EMR.
2
The myth that economics, finance, accounting and banking are objective academic intellectual areas of inquiry resting in science and mathematics is refuted by reality. The truth is that all of those fields are gender, color, race, ethnic, sectarian, educational, national political history plus arithmetic. There are too many variables and unknowns along with an inability to establish any meaningful controls to make any useful repeatable comparison.
Indeed, this is all about politics. And there is no more any political science than there is a historical science. Seers, fortune tellers, oracle and voodoo priestess may offer insight on your trip to economic Las Vegas. Or you can consult your banker or financial adviser. Or your horoscope.
Indeed, this is all about politics. And there is no more any political science than there is a historical science. Seers, fortune tellers, oracle and voodoo priestess may offer insight on your trip to economic Las Vegas. Or you can consult your banker or financial adviser. Or your horoscope.
1
All nations should return to basic economic principles and realize/understand that privately held national wealth and non-government jobs are only made, created, and/or acquired when the greedy members of a family or the greedy citizen businessmen of a nation, state, city, island, tribe, school district, hospital district, etc., perform one or more of the following tasks:
1. Plant, grow, and/or harvest something of commercial value from the earth;
2. Extract something of commercial value from the earth;
3. Manufacture something of commercial value that is consumable;
4. Construct a building that is permanently useful for rental income;
5. Tourism income from foreigners;
6. Provide services (professional licensed services such as doctors, lawyers, architects, engineers, land surveyors, and certified public accountants, etc., and licensed tradesmen services such as plumbers, electricians, auto mechanics, aircraft and power plant mechanics, barbers, real estate agents, and other licensed trades);
7. Collect payment for patent and copyright uses;
8. Buy things from foreigners in foreign nations, transport them to another other foreign nation, and then sell them to that other foreign nation at a profit;
And when their citizen businessmen trade, sell, lease, or rent these items and/or services to parties outside of their family or nation in return for a net transfer of gold into their own family (or nation), it is enriched and accumulates (taxable national) wealth.
1. Plant, grow, and/or harvest something of commercial value from the earth;
2. Extract something of commercial value from the earth;
3. Manufacture something of commercial value that is consumable;
4. Construct a building that is permanently useful for rental income;
5. Tourism income from foreigners;
6. Provide services (professional licensed services such as doctors, lawyers, architects, engineers, land surveyors, and certified public accountants, etc., and licensed tradesmen services such as plumbers, electricians, auto mechanics, aircraft and power plant mechanics, barbers, real estate agents, and other licensed trades);
7. Collect payment for patent and copyright uses;
8. Buy things from foreigners in foreign nations, transport them to another other foreign nation, and then sell them to that other foreign nation at a profit;
And when their citizen businessmen trade, sell, lease, or rent these items and/or services to parties outside of their family or nation in return for a net transfer of gold into their own family (or nation), it is enriched and accumulates (taxable national) wealth.
The inadequate educational systems in America have severely limited productivity and have prevented citizens from obtaining good jobs. This failure is also the result of unwise political choices.
The taxable wealth that is created and owned by greedy private businesses and greedy capitalist individuals in any nation is (almost) the only source of wealth available for the federal and local governments to forcibly take or confiscate a portion of in the form of taxes in order for the government to raise funds to pay for all of the WEALTH CONSUMING bureaucratic employee payrolls, government services, entitlements, government contracts, military contracts, “Pay to Play” business deals, political power influenced “Pay to Play” no-bid contract awards, unemployment benefits, income equalization, gigantic Lockheed-Martin type no-bid military contract(s), no-bid pork barrel infrastructure improvements, Solyndra type “Pay to Play” government guarantee business loan then bankruptcy deals, CGI Federal political power influenced “Pay to Play” no-bid contract awards, wars, welfare, unemployment benefits, repay existing of future bond obligations (borrowed money), and other government expenses that pay citizens by expending national wealth for these non-wealth-creating activities that actually consumes and destroys the nation's wealth and national government economic capabilities.
If any nation's wealth-creating businesses all leave that nation (ala Greece) to escape taxation or go bankrupt because of taxation, then the sources for any government funding will reduce or disappear, and the WEALTH CONSUMING government activities will diminish or disappear.
If any nation's wealth-creating businesses all leave that nation (ala Greece) to escape taxation or go bankrupt because of taxation, then the sources for any government funding will reduce or disappear, and the WEALTH CONSUMING government activities will diminish or disappear.
1
Great graphic displays. A graph similar to deficit of trust but for GNP growth overlaid on the trust graph would demonstrate how the business cycle is the driver of our trends.
Sadly the 08 financial meltdown was brought on by the elimination of the Glass - Stegall act which was passed after the great depression. The Dodd - Frank act is about as much as we can expect due to the wall street banksters exerting control over our congress.
So there are people to blame for the 08 financial bust - not a one of those people went to jail.
Sadly the 08 financial meltdown was brought on by the elimination of the Glass - Stegall act which was passed after the great depression. The Dodd - Frank act is about as much as we can expect due to the wall street banksters exerting control over our congress.
So there are people to blame for the 08 financial bust - not a one of those people went to jail.
1
LIbs bashed Bush incessantly for causing the 2008 recession now have the unmitigated gall to try and blame the current mess on Repubs, What color is the sky in liberal candyland today?
2
The "invisible hand" is God, so no human is to blame.
Republicans in both houses are to blame in the US as they fail to understand that you can't choke the economy back to life.
3
Who Gets the Blame for the Slowing Economy? It's the race to the bottom in order to cut costs. This practice makes the very rich that much richer and creates some new very rich in those countries where the cost saving practices are implemented in the new world economy. The best example of this phenomena is China. For the first time in living memory, the city in the world with the most billionaires is not New York City; that distinction now goes to Beijing.
What is the consequence here in the United States? Bernie Sanders provides those statistics for those who can listen with their minds and not just their ears. Just listen with your mind to some of the statistics Bernie Sanders cited in the Flint, Michigan debate last Sunday: 75 percent of Flint’s manufacturing jobs have been lost in the last 25 years; Michigan lost 230,000 manufacturing jobs; NAFTA cost us 800,000 jobs nationwide; we’ve lost 60,000 factories since 2001.
And what did Bernie Sanders say in the debate that would change if he were President of the United States? “If I’m president, they’re going to start having to invest in this country — not in China, not in Mexico. American workers should not be forced to compete against people in Vietnam today making a minimum wage of $0.65 an hour.”
What is the consequence here in the United States? Bernie Sanders provides those statistics for those who can listen with their minds and not just their ears. Just listen with your mind to some of the statistics Bernie Sanders cited in the Flint, Michigan debate last Sunday: 75 percent of Flint’s manufacturing jobs have been lost in the last 25 years; Michigan lost 230,000 manufacturing jobs; NAFTA cost us 800,000 jobs nationwide; we’ve lost 60,000 factories since 2001.
And what did Bernie Sanders say in the debate that would change if he were President of the United States? “If I’m president, they’re going to start having to invest in this country — not in China, not in Mexico. American workers should not be forced to compete against people in Vietnam today making a minimum wage of $0.65 an hour.”
3
Despite Republican obstructionists who worked hard to block recovery from the Bush depression because they wanted Obama to fail, the unemployment rate has been cut in half during his tenure as the private sector added jobs for a record 70 straight months. New jobless claims have dropped to their lowest level since 2007.
1
During the Obama presidency, the unemployment rate has declined every quarter that the Obama WH refused to count tens of millions of long term unemployed and discouraged workers, who now number in the hundred million.
New jobless claims have dropped to their lowest levels since 2007 because more Americans have exhausted unemployment benefits and can no longer apply as first time claimants. Very interesting that the Obama WH doesn't track returning claims for unemployment insurance of long term jobless.
Smoke and mirrors. The Obama Legacy.
New jobless claims have dropped to their lowest levels since 2007 because more Americans have exhausted unemployment benefits and can no longer apply as first time claimants. Very interesting that the Obama WH doesn't track returning claims for unemployment insurance of long term jobless.
Smoke and mirrors. The Obama Legacy.
2
It's interesting that Mr Rattner has come to the conclusion that demand is weak, and everyone pursuing austerity politics (to bat down those nasty deficits!) somehow isn't the solution. But the most depressing part of the article is the "Deficit of Trust" graph, which bears little or no correlation to the actual state of the economy. Journalists and pundits should look hard at this graph and try to figure out how they have left so many people so ill-informed about economic issues over the last decades.
1
Ultimately, the world's current economic problems go back to the glorification of the shareholder as the sole reason for a corporation's existence and the top executives as always deserving of bonuses.
Reagan's tax cuts gave corporate shareholders and top executives a massive windfall, and not surprisingly, they liked it. The pundits of selfishness began spreading the word--in the media as well as in the nation's business schools--that enriching the shareholders was the ONLY purpose of a company and that such enrichment should be accomplished by any means necessary.
Companies regularly justified multimillion dollar bonuses and golden parachutes by saying that the executives "needed to be motivated to work hard." This was true even if said executives had driven the company into the ground. The Grand Pooh-Bahs sat on one another's corporate boards and handed out the goodies to one another.
It was no longer about providing a useful product or service at a reasonable price or providing living-wage jobs for a community. It was all about increasing dividends every quarter.
Look at how many communities and individuals have been devastated by job loss, not because the companies that sustained them were unprofitable but because they were not profitable enough.
Far from being hobbled by regulations and taxes, America's corporations have not been hobbled enough.
Reagan's tax cuts gave corporate shareholders and top executives a massive windfall, and not surprisingly, they liked it. The pundits of selfishness began spreading the word--in the media as well as in the nation's business schools--that enriching the shareholders was the ONLY purpose of a company and that such enrichment should be accomplished by any means necessary.
Companies regularly justified multimillion dollar bonuses and golden parachutes by saying that the executives "needed to be motivated to work hard." This was true even if said executives had driven the company into the ground. The Grand Pooh-Bahs sat on one another's corporate boards and handed out the goodies to one another.
It was no longer about providing a useful product or service at a reasonable price or providing living-wage jobs for a community. It was all about increasing dividends every quarter.
Look at how many communities and individuals have been devastated by job loss, not because the companies that sustained them were unprofitable but because they were not profitable enough.
Far from being hobbled by regulations and taxes, America's corporations have not been hobbled enough.
4
The blames goes to poor allocation of assets. For example European banks were forced by government to buy Greek debt to cover a problem that really needs bankruptcy to clear the market and which leaves little aside for productive investment. China, on the other hand, needs to reverse it's authoritarian reliance on a few experts and go with the expertise of the free market economic swarm to guide it toward efficient allocation of assets necessary for growth. The U.S. on the other hand is very good at it in comparison to others where the source of our recovery came from fracking our way to energy independence independent of government experts who never saw it coming.
1
One point that should be made is the assertion in Economics about transactional value vs transactional volume; the argument that a large number of small value transactions have a bigger impact on an economy than a small number of large value transactions. This has been voiced since Adam Smith. The other issue is the concept of market saturation. Slow growth can be better explained through these 2 concepts than anything else. As capital has become more concentrated an inevitable result is slower growth. As markets become more saturated (which they did before globalization and are now becoming again), growth slows down.
"...Ludwig von Mises, Friedrich Hayek, and many others demonstrated repeatedly that government interference in the free market is the cause of booms and busts. You can refuse to believe the truth, and reality still kicks you in the butt."
Blaming the government has become a religion amongst conservatives. The government is integral to the market, and more often it is lack of proper regulation that causes boom and busts. A great example of laissez-faire boom and bust: the current collapse in the oil industry. The oil industry itself drove a huge boom of very predictable overproduction, which has now led to masses of layoffs in the industry, crashing stock prices, and failing energy companies.
And it was all so predictable.
So please explain to unemployed oil workers how exactly the government, and not corporate greed, caused this latest boom and bust.
Blaming the government has become a religion amongst conservatives. The government is integral to the market, and more often it is lack of proper regulation that causes boom and busts. A great example of laissez-faire boom and bust: the current collapse in the oil industry. The oil industry itself drove a huge boom of very predictable overproduction, which has now led to masses of layoffs in the industry, crashing stock prices, and failing energy companies.
And it was all so predictable.
So please explain to unemployed oil workers how exactly the government, and not corporate greed, caused this latest boom and bust.
2
"Blaming the government has become a religion amongst conservatives."
Just as the government worshiping "progressives" call for ever more government.
Just as the government worshiping "progressives" call for ever more government.
1
It's statements like this that completely invalidate the article:
"Sclerotic labor laws in countries like France result in unyielding double-digit unemployment. In many European countries, regulatory red tape impedes new business start-ups. Germany’s aggressive tilt toward renewable energy has raised costs enormously for its industrial sector."
Beating down the working class is at the heart of the problems of the "developed", or as I prefer, the "undeveloping" countries. And the USA leads the pack. That is why prescriptions whose essence is "Be more like the USA" have no credibility.
"Sclerotic labor laws in countries like France result in unyielding double-digit unemployment. In many European countries, regulatory red tape impedes new business start-ups. Germany’s aggressive tilt toward renewable energy has raised costs enormously for its industrial sector."
Beating down the working class is at the heart of the problems of the "developed", or as I prefer, the "undeveloping" countries. And the USA leads the pack. That is why prescriptions whose essence is "Be more like the USA" have no credibility.
Just to finish up on my last post (sorry, hit the submit button too early)
Mr. Rattner - who gets the blame for a slowing economy? The very people who advocate for tax cuts for the wealthiest, leading to increasing wealth concentration, and the very people who advocate for increasing amounts of globalization without any penalty.
Now who does that sound like to you?
Mr. Rattner - who gets the blame for a slowing economy? The very people who advocate for tax cuts for the wealthiest, leading to increasing wealth concentration, and the very people who advocate for increasing amounts of globalization without any penalty.
Now who does that sound like to you?
1
Look at the chart comparing levels of public trust in government. Then look at what happened in the early to mid-1960s -- the Kennedy agenda pushed through Congress by LBJ ... Medicare, Medicaid, job training programs, VISTA, work study funding, Older Americans Act (area agencies on aging), federal support for under-funded schools, and the civil rights act. Things weren't perfect -- the war in Vietnam was growing and military spending was in hog heaven -- but government was actually ... doing something, rather than just obstructing. Wouldn't you be upset if you were paying for nothing?
President Obama should make a nation-wide address and propose a $1 trillion infrastructure project entirely financed by bonds and such legislation should be passed by Labor Day. He should stress several points:
1. Improved public infrastructure increases real wages in the private sector by improving economy-wide productivity.
2. Improved overall productivity in the domestic economy is better than a trade deal because it makes domestically manufactured products and services more competitive.
3. A dollar of public investment attracts additional dollars of private investment. The opposite does not occur.
4. This recovery is the first recovery since the Great Depression that has not featured a major public works program; that is why the recovery has been weak. (The Stimulus program only included about $100 billion in infrastructure, peanuts in an $18 trillion economy.)
The US economy is not going to improve until a US president takes command of the debate for improving the economy.
1. Improved public infrastructure increases real wages in the private sector by improving economy-wide productivity.
2. Improved overall productivity in the domestic economy is better than a trade deal because it makes domestically manufactured products and services more competitive.
3. A dollar of public investment attracts additional dollars of private investment. The opposite does not occur.
4. This recovery is the first recovery since the Great Depression that has not featured a major public works program; that is why the recovery has been weak. (The Stimulus program only included about $100 billion in infrastructure, peanuts in an $18 trillion economy.)
The US economy is not going to improve until a US president takes command of the debate for improving the economy.
3
Great idea. But spending on infrastructure has been proposed, and the Congress, controlling the appropriations, won't go along. Tough times for the people, but also for those in government who would like to see it work better!
"spending on infrastructure has been proposed, and the Congress, controlling the appropriations, won't go along."
And why won't the GOP not go along? Could it be the democrat demand that all infrastructure work be done only by "prevailing wage" union workers who would then kickback most of their union dues to the democrats?
And why won't the GOP not go along? Could it be the democrat demand that all infrastructure work be done only by "prevailing wage" union workers who would then kickback most of their union dues to the democrats?
The prices at the grocery store always seem to rise when the price of oil goes up. But they have also risen over the past year even as the cost of oil has plummeted. Why is this?
1
Buy gold and silver; repatriate your investment money into American real estate of the moderate-residential type; hold 30% at most in indexed funds; pay down your consumer debt if possible.
The U.S. has a candidate for the presidency, Bernie Sanders, who speaks directly to the economic problems most of us face, and has essential proposals to fix them. He is clear that he alone cannot accomplish the changes that are needed - that we all must work together to do so. It's just too bad that the New York Times has bought into the "more of the same" mentality that Mrs. Clinton represents, even though in another column the editors are telling her how to "adjust" her flawed message. Perhaps the Times will admit its mistake and endorse Senator Sanders.
2
It is always amazing that the roulette game is the fault of political leadership making the wrong guess. It is a worldwide game of chance and the economic soothsayers almost never get it right, at least for very long. The idea that governmental leadership manage the wheel means the game is one that can be micromanaged if only everyone would do what any particular brand of augury is subscribed to. Blame is a useless policy alternative to analysis of what went wrong in the past then using it as a predictor of future events particularly when the wheel is built by and for those who control, not manage, it.
the only people who benefit from growth are the fraudsters working on wall street.
It's fair to blame political leadership for our economic problems. It's obvious that grid-lock in DC has been part of the problem. While some of that grid-lock is a result of Obama-phobia, that is not the whole story. It would be fatuous to imagine that Speakers Boehner and Ryan and Tea Party leaders Goudy and Bachman knew much about macroeconomics or based their indecisions on such matters. Their inactivity was dictated by their puppet-masters whose simple guiding principle is simple and short-sighted. Greed. Lust for power. Never mind the people.
It is also simple-minded to think that such power blocks can be blown away by a few million young voters. Self-interest is the greater motivator. When the oligarchs feel the pinch, they'll be more likely to loosen their grip on our democracy. That is not a project for a single election cycle.
It is also simple-minded to think that such power blocks can be blown away by a few million young voters. Self-interest is the greater motivator. When the oligarchs feel the pinch, they'll be more likely to loosen their grip on our democracy. That is not a project for a single election cycle.
1
The economy can be managed through two tools - fiscal and monetary. Since the government is unable to deploy the fiscal tool in the US due to false warnings on debt buildup, the feds have no alternative but to deploy the monetary tools - i.e. interest rate reduction.
The monetary tool, absent fiscal measures, translates into more risk-taking and in turn works to increase wealth of the 1%; it expands the feds balance sheet and can weaken currency (although in the race to the bottom, it has served to strengthen the dollar). It is a weak tool to stimulate the economy, especially when interest rates are almost 0%.
The fiscal tool, through carefully thought and planned increased public spending increases debt (and if funded by the fed will also expand the fed balance sheet), improves the infrastructure and positions the country better for the future. In the process it increases employment and overall prosperity in the country. It adds to economic growth.
Which tool to use? Really, no brainer!
The monetary tool, absent fiscal measures, translates into more risk-taking and in turn works to increase wealth of the 1%; it expands the feds balance sheet and can weaken currency (although in the race to the bottom, it has served to strengthen the dollar). It is a weak tool to stimulate the economy, especially when interest rates are almost 0%.
The fiscal tool, through carefully thought and planned increased public spending increases debt (and if funded by the fed will also expand the fed balance sheet), improves the infrastructure and positions the country better for the future. In the process it increases employment and overall prosperity in the country. It adds to economic growth.
Which tool to use? Really, no brainer!
24
The debt is a serious concern for many Americans at is it approaches $20 Trillion. The US Govt has record collection of taxes and it is still not enough. We are still projecting $500 Billion deficits for the foreseeable future. How much do you want to increase the debt and the deficit?
No fiscal tools being used? We're over $19 Trillion in debt, over half of which has accumulated under this one president ALONE. We've had TARP, various stimulus programs, corporate bailouts and tax increases.
The problem is that our economy is being run, almost exclusively, by demand-side priorities right now - government, taxation, redistribution and regulation to the rescue.
Except that demand-side economics don't work. They never have. Government doesn't create anything. If can only stay as much (or as little) out of the way of productive, economic growth-producing private enterprise as it chooses. Right now, and for the last 20+ years or so, government has chosen to stay out of the way very little. And the result is what you see now - a private sector besieged by regulation and the highest corporate taxation in the developed world, resulting in trivial investment, resulting in trivial to non-existent growth.
Reagan had it soooo right. Government IS the problem.
The problem is that our economy is being run, almost exclusively, by demand-side priorities right now - government, taxation, redistribution and regulation to the rescue.
Except that demand-side economics don't work. They never have. Government doesn't create anything. If can only stay as much (or as little) out of the way of productive, economic growth-producing private enterprise as it chooses. Right now, and for the last 20+ years or so, government has chosen to stay out of the way very little. And the result is what you see now - a private sector besieged by regulation and the highest corporate taxation in the developed world, resulting in trivial investment, resulting in trivial to non-existent growth.
Reagan had it soooo right. Government IS the problem.
1
The most fundamental problem is that the adjustment processes for recovering from the largely US-generated 2008 debacle that impacted the whole world have either been incomplete or aborted. Much debt remains to be "worked out" and this is badly affecting private and public sector demand. Consumer income is inadequate to sustain consumption (without piling up more debt) because of the horribly skewed state of income distribution, particularly in the US but not only. Spending more money on infrastructure to stimulate demand and improve productivity for the future is fine, but it needs to be productive, of the right kind, and financed in a manner that keeps debt service sustainable. This has not been easy given the starting point from 2008, quite apart from the governance problems especially in the USA, which impede a coordinated and systematic response. Tinkering at the margins of these problems will not solve anything. I agree with Mr. Rattner that governance is an important part of the problem, but not so much at the level of alleviating symptoms - more importantly it needs to reach into root causes, which will require serious structural reforms - economic and political - of a kind not mentioned here, in the US, China, Europe, Japan, etc. We are still passing through very fragile times with distinct possibilities for negative outcomes.
14
You are right. Obama has engaged in an orgy of DEBT, over $10 Trillion by the time he leaves office, and over $6 Trillion in Funny Money, QE, and endless ZERO interest rates. None of which was used to improve our infrastructure, or create real jobs, or fix anything. It was all used to keep Obama's job killing, economic growth killing policies from plunging us into a depression years ago. Obama left the real economy to ROT, while creating bubbles in the Housing and stock markets with ZERO interest rates, funny money, and debt. All of the DEBT and corrupt spending allowed Obama to buy enough votes to be reelected, but it only covered up the problem, and NOTHING was fixed or made better. We all know it even Bernie Sanders and Hillary know the economy sucks and is on the verge of a depression because of Obama. Fragile time indeed!!!
Here's an idea, how about putting more money into the pockets of the middle and lower classes in the U.S. by raising the minimum wage, taxing the rich to help subsidize health care and education costs, and raising salaries of government workers, especially teachers, again paid for by taxes on the, let's say upper 5%, the people who are enjoying more than their fair share of economic growth.
102
Top earners have been the main target of recent tax increases, but the federal income tax system is already highly progressive.
The top 10 percent of income earners paid 68 percent of all federal income taxes, though they earned 45 percent of all income. The bottom 50 percent paid 3 percent of income taxes, but earned 12 percent of income.
When you add sales taxes, payroll taxes, property taxes, the wealthy are already paying a significant amount.
Question, how much of a persons income should they be able to keep. Is it their money or the governments money?
The top 10 percent of income earners paid 68 percent of all federal income taxes, though they earned 45 percent of all income. The bottom 50 percent paid 3 percent of income taxes, but earned 12 percent of income.
When you add sales taxes, payroll taxes, property taxes, the wealthy are already paying a significant amount.
Question, how much of a persons income should they be able to keep. Is it their money or the governments money?
Yeah, let's penalize the successful and take all their money and give it to the losers who are killing growth. The teachers unions are killing education. We don't need to pour more money into a broken system, we need to reform it. Government employees are already paid more than their industry counterparts, yet they are less efficient.
1
Excellent ideas - I would suggest, maybe counter intuitively, that we should all be taxed a fair share for this spending - I even imagine the taxman coming around and taking fifty cents out of the beggar's cup - because I hate the idea of the super-rich telling themselves that they are paying for it all. I know, who cares what they tell themselves? That's true, but ultimately we should be modelling a system that can work without the super-rich at all - we get it working, then we send them all to the Cayman Islands to keep their money company - then we change our currency, so their money's no good here - see, I've got it all figured out...
1
"The past two recessions were caused largely by private actors: the risky lending of the mid-2000s and the dot-com bubble at the turn of the century."
There are many (including me) who pain who believe that federal government policy regarding mortgage lending produced the conditions that enabled "the risky lending of the mid-2000s." While the objectives of promoting lending to to minorities where laudable, eventually those practices led to the virtual elimination of credit underwriting standards by the various mortgage agencies (FHLMC, FNMA, FHA, etc.). And, voila, anyone and everyone who wanted a mortgage got one. The eventual wave of defaults led to the financial crisis of 2008/2009 and the associated recession. Subsequent government policies to counteract the "Wall Street excesses" further constrained the system contributing mightily to our sluggish recovery.
There are many (including me) who pain who believe that federal government policy regarding mortgage lending produced the conditions that enabled "the risky lending of the mid-2000s." While the objectives of promoting lending to to minorities where laudable, eventually those practices led to the virtual elimination of credit underwriting standards by the various mortgage agencies (FHLMC, FNMA, FHA, etc.). And, voila, anyone and everyone who wanted a mortgage got one. The eventual wave of defaults led to the financial crisis of 2008/2009 and the associated recession. Subsequent government policies to counteract the "Wall Street excesses" further constrained the system contributing mightily to our sluggish recovery.
The lack of growth keeps capital in reserve and prevents people from being more productive and prospering, which keeps demand fairly steady and inhibits faster growth. It's great for controlling inflation but eventually it does not help create enough new wealth to serve everybody's needs. In our global and domestic economies the great wealth creator that drives economic expansion is the mass marketing of goods and services and the conversion of raw materials, labor and capital into new wealth and vast profits from everybody's consumption from individuals to businesses and public institutions. Being unable to make and to sell goods to consumers in increasing amounts because the consumers have less to spend and cannot change that condition means diminished potential for economic expansion, which is where the world happens to be right now. Governments are serving the concerns of those trying to preserve the wealth that they have instead of facilitating new wealth creation to product expanding economies. In the U.S. we could repair and improve our infrastructure with money borrowed at very low interest rates without over spending a dime anywhere, but growth is not a priority for the political class dominating the reasoning of public officials.
30
If only 20% of Americans trust govt,why to they continue to support politicians who promise more govt?
3
We want BETTER government. We want government that works for the PEOPLE, not just the 1%.
The only card available in the economic deck that the US hasn't robustly employed is infrastructure investment. It should be doubled or more at the federal level. It should include technological infrastructure like ubiquitous fiber optic connections. It should now include water systems. Airports and transportation systems are obvious, preparing them for automated vehicles is a new twist. Even when there is an occasional boondoggle, at least the "wasted dollars" flow back into the US economy. This spending would serve to take up the slack in the blue collar labor pool, finally driving more wage growth in the middle. Right wing debt hawks have caused America a lot of unneeded pain these past eight years, by blocking robust investment in America's future. The tea party mentality driving congress seems to think we are still a nation of farmers, all living in 1825. A huge labor force not being employed to its greatest level of capability, is the most spectacular waste of economic resources one can possibly imagine.
126
I agree. The future will belong to the nations with clean air and water, efficient transportation/infrastructure, and reliable/renewable energy. The author sites Germany as having problems for moving in that direction. Perhaps the Germans see the future does not consist entirely of the next scheduled shareholder meeting.
IF we are going to rebalance spending on infrastructure instead of increasing the deficit and therefore total debt, we should reprioritize and shift spending from other area's of the Federal budget. These means tough decisions.
In February the U.S. national debt hit a new record: $19.0 trillion. This is the first time the national debt has ever exceeded $19 trillion. That’s more than $58,000 for each person who lives in the U.S. today (including children).
That’s more than $58,000 for each person that lives in the U.S. today (including children).
The main culprit behind the rising deficits and debt is growing federal spending—especially among Military, Social Security, Medicare, Medicaid, and Obamacare.
The long term expense of the debt service will get worse once rates rise and the cost of the US debt increases to an even larger share of spending. This is a real risk.
How about private investment in infrastructure like the Keystsone oil pipeline?
In February the U.S. national debt hit a new record: $19.0 trillion. This is the first time the national debt has ever exceeded $19 trillion. That’s more than $58,000 for each person who lives in the U.S. today (including children).
That’s more than $58,000 for each person that lives in the U.S. today (including children).
The main culprit behind the rising deficits and debt is growing federal spending—especially among Military, Social Security, Medicare, Medicaid, and Obamacare.
The long term expense of the debt service will get worse once rates rise and the cost of the US debt increases to an even larger share of spending. This is a real risk.
How about private investment in infrastructure like the Keystsone oil pipeline?
This seems so obvious yet people still harp on our the national debt. Put people back to work at livable wages updating our infrastructure. This should have been done during President Obama's 1st year in office and raise taxes on the top 10% to help cover the cost. You have to wonder what shape our economy would be in today if they had passed his proposal.
You neglect to mention the Federal Reserve which has an absolutely dreadful record in meeting its other primary objective--job creation. Just today the European Central Bank announced a new program to do just that by encouraging banks to make loans. It's time for more job creativity at the Fed. They should take the lead by offering infrastructure loans to banks willing to partner with state governments to repair our failing road, rail, bridges, mass transit, and other essential public works that would both create new high-paying jobs while also stimulating our economy before it sinks into recession. This is the perfect time for the Fed to act when capital is flooding into the U.S. from China and Europe and interest rates are near historic lows. With the gridlock in Washington, the Fed is our only hope and finally must show the ingenuity to fulfill its mandate.
35
Paul - Where do you get the idea that the Fed is supposed to create jobs? It was created by the Congress to provide the nation with a safer, more flexible, and more stable monetary and financial system. Then businesses can operate efficiently and THAT is what creates jobs. But their toolbox is limited. It is the job of Congress to create policy that will create jobs. But instead, they create INSTABILITY in order to get re-elected by an increasingly polarized electorate. Compromise by both sides is what is needed to create stability.
The Michigan State Legislature, dominated by Republicans throughout the Great Recession, turned down a couple of billion dollars of Federal 2 for 1 matching highway construction funds a few years ago. So state governments are not necessarily good partners for anyone when it comes to doing the right and necessary thing.
There are many other states with equally challenged lawmakers (Kansas comes immediately to mind), that are willing to allow the worst that can possibly happen for their citizens if preventing disaster includes raising funds from their well heeled backers
There are many other states with equally challenged lawmakers (Kansas comes immediately to mind), that are willing to allow the worst that can possibly happen for their citizens if preventing disaster includes raising funds from their well heeled backers
Actually, the Federal Reserve controls the availability and cost of money. When the economy is growing too fast it causes inflation to increase so the Fed increases the cost of money with raising the prime rate which tends to discourage spending and to reduce inflation rates. If it works, then it is likely that employment will slow or fall resulting in higher rates of unemployment. Lowering interest rates should do the opposite. Current the economy is not growing fast enough to create enough jobs for those who are seeking them but the unemployment rate is still far lower than it has been because more jobs are being created. However, since the economy is growing so slowly and consumers mostly don't have much surplus income with which to buy more, inflation has not been going up.
You blame government. I blame the economists who advise them. We've lived in a world of voodoo economics for too long. Tax cuts are not the answer. Monetary policy is not the only tool.
I continue to be baffled by the inability of people in positions of authority or public confidence to call the economy as they see it. Rattner hits the nail on the head when he writes each of the following: "Global competition and weak productivity growth have held down ages in developed countries", "increased saving and growing income inequality ... has pushed more money into the hands of the rich, who are less likely to spend it", "Anti-deficit fervor has led to a meat-ax approach to spending cuts ... nondefense discretionary outlays ... have fallen in real terms ... at a time when they should be growing substantially." And yet, still, he lards his analysis with nonsense like "efforts to avoid another financial crisis have put the banking system in a straitjacket," and "failure to reform our tax system."
The problem is income inequality. Blind faith in free markets and open borders is a cause of income inequality, as is an increasingly regressive tax code. The cause of those, in turn, is the continued dominance of the Republican party at both a state and national level.
The Democrats have their problems too--particularly around trade--but the solution here is not to call for our "leaders" to be less feckless. The solution is to vote Democratic.
The problem is income inequality. Blind faith in free markets and open borders is a cause of income inequality, as is an increasingly regressive tax code. The cause of those, in turn, is the continued dominance of the Republican party at both a state and national level.
The Democrats have their problems too--particularly around trade--but the solution here is not to call for our "leaders" to be less feckless. The solution is to vote Democratic.
Mr. Ratner has touched on many causes for the worldwide economic slowdown, but ignored the impact of so-called free trade. What free trade has done is disrupt the balance of supply vs. demand. Money is like water, it follows the path of least resistance. And the lowest path of resistance is to shift production (and costs) to the lowest price countries and sell them to the highest demand (and price) countries, in particular the United States. In theory, it's simple math and makes perfect sense to corporations. In practice, however, the result has been a massive transfer of wealth from the former producing countries such as the US, to the lowest costs countries such as China. Furthermore, it has also resulted in lowering wages in former producing countries such as the US in an hopeless attempt to compete in the price of production (bring manufacturing back!). Good battle cry, but impossible results unless the US worker is ready to work at Chinese wages. Lower wages in the US means less disposable income, and thus lower demand. Corporations are reaching the point when there in no one left with enough money in the US to buy the products they produce elsewhere. So, instead they use their cash to buy back their shares, artificially inflate their share price, and hope that the game can go on forever. Except, it can't. One needs a new paradigm. In different ways, both Trump and Sanders express their understanding of the need for this new paradigm.
Financial institutions "too large to fail" have already failed. We should prepare for their demise. We don't need these dinosaurs.
At first glance, this globally complex problem contains four problems, among others, that I would cite:
Many issues have become too politicized, seemingly encouraging politicians to win turf battles, rather than solve problems and do what is right for their respective countries.
The global inter-linkage of nations—each with different needs, resources and political environments—spreads economic contagion, while deterring a similar spread of progress.
Austerity in many countries is counter-productive. During a weak economy, individuals and businesses slash spending, that’s the glue that makes the economy function. That requires the government, which is the last hope for recovery to spend, spend, spend! But Austerity, which entails belt-tightening, merely weakens the economy even further.
Lastly, manipulative and managed economic management, such as in China, over-dependence in a narrow economic sectors, such as commodities, and prohibitionist trade policies further hold global growth back.
http://thetruthoncommonsense.com
Many issues have become too politicized, seemingly encouraging politicians to win turf battles, rather than solve problems and do what is right for their respective countries.
The global inter-linkage of nations—each with different needs, resources and political environments—spreads economic contagion, while deterring a similar spread of progress.
Austerity in many countries is counter-productive. During a weak economy, individuals and businesses slash spending, that’s the glue that makes the economy function. That requires the government, which is the last hope for recovery to spend, spend, spend! But Austerity, which entails belt-tightening, merely weakens the economy even further.
Lastly, manipulative and managed economic management, such as in China, over-dependence in a narrow economic sectors, such as commodities, and prohibitionist trade policies further hold global growth back.
http://thetruthoncommonsense.com
The destructive commitment to gain power pursued by the Republican Party has caused damage beyond measure.
The question posed to the GOP candidates about whether they would support Trump if he were the party candidate outed the overriding motive of the party - winning political power regardless of the cost to the country. The answer given - that they would support a candidate that they had just classified as a con man - is completely consistent with Mitch McConnell's statement on Obama's election in 2008 - the GOP job for the next 4 years was not governance, but to insure that Obama was not reelected.
If a political party acts only for its own sake, inflicting damage on the country in furtherance of its own ambitions, and if a majority of the populace supports it, what shall we reap?
The question posed to the GOP candidates about whether they would support Trump if he were the party candidate outed the overriding motive of the party - winning political power regardless of the cost to the country. The answer given - that they would support a candidate that they had just classified as a con man - is completely consistent with Mitch McConnell's statement on Obama's election in 2008 - the GOP job for the next 4 years was not governance, but to insure that Obama was not reelected.
If a political party acts only for its own sake, inflicting damage on the country in furtherance of its own ambitions, and if a majority of the populace supports it, what shall we reap?
It's the hidden costs of cheap imported goods with their "too good to be true" prices. We have lost enough American jobs and our government is trillions in debt trying to make up the slack with subsidies to the un/underemployed.
We were told not to worry and that the salespeople in the Apple store or Foot Locker earned infinitely more than the worker in the factory making the iPhone or Nikes. The problem is all the other industries and jobs (textiles, materials, electronic components, etc.) that have been lost in relation to that production.
We can't be a nation of just sales and retail. We can't survive such an incredibly lopsided trade imbalance and we can't save the world economy by borrowing our way to endless consumerism.
We were told not to worry and that the salespeople in the Apple store or Foot Locker earned infinitely more than the worker in the factory making the iPhone or Nikes. The problem is all the other industries and jobs (textiles, materials, electronic components, etc.) that have been lost in relation to that production.
We can't be a nation of just sales and retail. We can't survive such an incredibly lopsided trade imbalance and we can't save the world economy by borrowing our way to endless consumerism.
1
Let me get this straight. Basically all economics gets it wrong when it comes to predicting downturn. BUT Steven Rattner knows exactly what is causing the slowing economy and its the usual liberal boogeyman(Income inequality and Austerity).
So we can pay everyone the same and have the government go into deeper into deficit spending(like Greece) our economy will keep growing perpetually. Who'd know its so simple?
So we can pay everyone the same and have the government go into deeper into deficit spending(like Greece) our economy will keep growing perpetually. Who'd know its so simple?
Businesses are limited in responsibility to both society and the economy, they exist to provide goods and services that are very profitable to sell and provide equity holders with very substantial income from either creating new wealth or capturing wealth created by other entities. Governments are polities which control and regulate the way people and groups of people conduct themselves with each other in accordance with the will of the sovereign (in the U.S., the people) so that life is predictable, consistent, and reliable. Government which functions well anticipates the needs of the people it services and handles unexpected concerns and events that require the cooperation of all. In the U.S. we try to let people live their lives as they choose without interfering with the lives of others, but sometimes we let things go on that are contrary to the interests of all. Businesses are not concerned with the overall interests of anybody outside of those businesses, and their selfish behavior will work contrary to the welfare of all if not constrained by governments. The notion that markets are an invisible hand more sure and appropriate for governing businesses conduct is silly, it does not happen and it leads to booms and busts in the economy that saps wealth and resources wastefully. Competitive pressures tend to stifle essential innovations to adapt to new challenges and future constraints that ends badly. Government can insist upon behaviors that lead to better outcomes.
The Rally from the 2009 bottom has been entirely created by Central Bankers with 0 % interest rates and QE 1, 2 & 3. Interest rates are the price of money. When you misprice money itself, it flows into activities not supported by economic fundamentals. The result is bubbles in myriad activities such as Commodities(Shale etc.), Agricultural Land, Luxury Homes, Dot Coms, Biotech, Student Loans, Emerging Market Debt and Subprime Auto Loans. The subprime homes that went into foreclosure have become rentals now, being rented to the same people who defaulted on their mortgage. If those families defaulted on their mortgages in the last downturn, why won't they default on their rent in the next downturn? GM and Chrysler were rescued during the last downturn, but they are back selling cars and pickups mainly with subprime loans. Selling autos with subprime loans is a very profitable business until all the cars you sold come back to the dealer lots in the next downturn and all the profits you booked get written down.
First step, stop covering up the state of the economy with the "Everything's Fine" garbage coming out of Washington and New York. If you work on Wall Street or for the government, "everything's fine" but it sucks in the rest of the country.
Secondly, stop paying attention to the top of the economy, they are alright. Formulate policies that will benefit the everyday person. They need good paying jobs with benefits, not one who's only requirement is to say "would you like fries with that?"
This is exactly what is fueling the Trump boom. People see that those at the top are being taken care of, while their life is going down the tubes. Time to wake up to where the real power lies. Those with money can finance a campaign, but they can only vote once. There are a lot of angry people out there and campaign financing is not making them any happier. It is time to address their concerns with more than the contempt that one sees all too often in these pages. If we don't, then get used to saying "Mr. President" to Donald Trump.
Secondly, stop paying attention to the top of the economy, they are alright. Formulate policies that will benefit the everyday person. They need good paying jobs with benefits, not one who's only requirement is to say "would you like fries with that?"
This is exactly what is fueling the Trump boom. People see that those at the top are being taken care of, while their life is going down the tubes. Time to wake up to where the real power lies. Those with money can finance a campaign, but they can only vote once. There are a lot of angry people out there and campaign financing is not making them any happier. It is time to address their concerns with more than the contempt that one sees all too often in these pages. If we don't, then get used to saying "Mr. President" to Donald Trump.
1
At the risk of belaboring the obvious: Economists all know the formula for calculating the GDP, and by extension, the way to grow it.
GDP= C + I + G + (X-M).
Which means if economic growth is to occur, one of four things has to change. Consumer spending has to increase, business investment has to increase, exports have to increase, or government spending has to increase.
Every economist knows this, and every economist could probably come up with a half-dozen different ways increasing each of those four factors. It is not a lack of knowledge that inhibits our economic growth, it's a lack of willingness to put that knowledge into effect.
One can speculate on why we refuse to act. My hypothesis is that a growing economy gives labor and employees more bargaining power, and that the corporate structure of the US prefers slow economic growth to employee empowerment. My experience suggests that whatever corporate America wants, it gets.
GDP= C + I + G + (X-M).
Which means if economic growth is to occur, one of four things has to change. Consumer spending has to increase, business investment has to increase, exports have to increase, or government spending has to increase.
Every economist knows this, and every economist could probably come up with a half-dozen different ways increasing each of those four factors. It is not a lack of knowledge that inhibits our economic growth, it's a lack of willingness to put that knowledge into effect.
One can speculate on why we refuse to act. My hypothesis is that a growing economy gives labor and employees more bargaining power, and that the corporate structure of the US prefers slow economic growth to employee empowerment. My experience suggests that whatever corporate America wants, it gets.
1
Austerity is not equal to being Conservative....that is NOT LOGICAL
in other words...Starvation...does not make a Human Being Healthy..
nor
Does cutting off the flow of currency help a mis managed economy grow.
RX /remedy I would think is the following logic:
Feed the Starving Human
Feed the Starving Economy
No that makes good sense....doesn't it...
in other words...Starvation...does not make a Human Being Healthy..
nor
Does cutting off the flow of currency help a mis managed economy grow.
RX /remedy I would think is the following logic:
Feed the Starving Human
Feed the Starving Economy
No that makes good sense....doesn't it...
There's too much money stored away at the top with nowhere to go. More money needs to get into the hands of the workers. Let them create the new markets for the rich to invest in.
With all the issues we have re: infrastructure, education, poverty...you'd think that alone would equal jobs. But between Congress and the lack of investment by private industry (after all, they only want to play on the Big Board of Wall Street, not Main Street), we got nothing except the same old tiresome "cut taxes" ...and the demonizing of government which is the self fufilling prophesy of the Right.
Sorry to say but the rise of Trump and Sanders is a symptom of poor leadership and strength in government to manage the playing filed as good referees should.
The governments of nation-states, led by the U.S., have gone so deeply into debt no recovery is possible. Mr. Rattner's contribution to the precarious state of government finances was involved orchestrating the auto-industry bailout. Measures to address the debt appear to those whose ox may be gored to be asking too much. They simply refuse to cooperate without rioting if their untenable benefits are cut. Living off the fruits of others labor or government deficit spending is as powerfully addictive as heroin. "Give me my overly generous salary and pension or I'll pull the house down on all of our heads!"
It appears that lower US income tax rates on 'job creators' caused wealth to trickle up rather than trickle down.
2
A Ross Perot clone?
American politicians sowed the seeds of economic destruction years ago by not protecting our own industries from the onslaught of foreign goods being dumped in this country. Our diplomatic elite to gutted the middle class with Trojan horse trade agreements with the eyewash of we can export more corn and beef to Asia, all the while allowing the trading partner to decimate our industrial base and still hold onto import tariffs. Trade deals that killed textiles, auto, furniture, apparel, shoe and manufacturing where unions played a large role that gave these companies the keys to move overseas or below the border. And to add insult to injury, being allowed to leave their income tax free while leaving U.S. taxpayers with the bills for unemployment, welfare, healthcare, reduced property taxes to fund education and the social disruption of families as millions of wage earners lost out.
Couple the above with the deliberate destruction of the $$ by the Fed to boost multinational eps, and the cake was baked.
But the credit card companies had it figured out when they got the usury limits eliminated. They knew the middle class and below could only survive on credit regardless of the interest rates and now cheap imported goods, with every container of products coming from China representing 100's of lost U.S. jobs.
Can u finally hear the great sucking sound Steve? The economic traitors? Why Bush 1, Clinton, W, and Obama. They committed the treason.
American politicians sowed the seeds of economic destruction years ago by not protecting our own industries from the onslaught of foreign goods being dumped in this country. Our diplomatic elite to gutted the middle class with Trojan horse trade agreements with the eyewash of we can export more corn and beef to Asia, all the while allowing the trading partner to decimate our industrial base and still hold onto import tariffs. Trade deals that killed textiles, auto, furniture, apparel, shoe and manufacturing where unions played a large role that gave these companies the keys to move overseas or below the border. And to add insult to injury, being allowed to leave their income tax free while leaving U.S. taxpayers with the bills for unemployment, welfare, healthcare, reduced property taxes to fund education and the social disruption of families as millions of wage earners lost out.
Couple the above with the deliberate destruction of the $$ by the Fed to boost multinational eps, and the cake was baked.
But the credit card companies had it figured out when they got the usury limits eliminated. They knew the middle class and below could only survive on credit regardless of the interest rates and now cheap imported goods, with every container of products coming from China representing 100's of lost U.S. jobs.
Can u finally hear the great sucking sound Steve? The economic traitors? Why Bush 1, Clinton, W, and Obama. They committed the treason.
Surely the scenario described is not an optimal policy for "the 1%". If we were to believe they are (indirectly, through lobbying and influencing membership of Congress) controlling the economy as an oligarchy, we wonder why they are doing this so poorly from their own point of view. For a less short-sighted policy,
what would be best for the Koch brothers, etc.?
Rattner speaks of the fault being with our leaders and that applies to the control direction of the 1% with "fault" being with respect to results not in their own long term interests
what would be best for the Koch brothers, etc.?
Rattner speaks of the fault being with our leaders and that applies to the control direction of the 1% with "fault" being with respect to results not in their own long term interests
Who is to blame for the slowing economy? The tax code. It encourages the wealthy to build fortresses around their money and greatly discourages redistribution of any kind. The very tip-top of the financial food chain is sitting on the majority of our country's wealth. The worst part of this situation is that they're not creating any economic value with that wealth. The money is just sitting there and growing because of a tax code that has been rigged its favor.
Until that money dam is torn down, the economy and the bottom 90% of the country are going to continue to stagnate in the small creek it has created.
Until that money dam is torn down, the economy and the bottom 90% of the country are going to continue to stagnate in the small creek it has created.
Here's the bottom line: infinite growth is unsustainable in a world with finite resources. The conventional economic obsession with "growth" as the end-all be-all is a distraction from what we need to be doing long-term to ensure a planet that is safe and livable for all--especially as fossil fuels and mined materials reach their limits. Regardless of our politics, continued overconsumption of the type that drives "growth" isn't going to save us.
2
With Citizens United Wall Street now gets the government it pays for. It's interesting that a Businessman scares Wall Street as much as a Socialist mayor from Vermont. Good citizenship could be the answer instead of the belief that self interest is the simple key. Freedumb. REH
Mr. Rattner provides insight into what a President Clinton's economic policy would be.
1)Viewing unfettered (a better term than "free) trade as an unalloyed good for Americans.
2)making the right noises about ramping up fiscal spending while not really trying too hard to actually achieve it.
3)Parroting banking and corporate propaganda that they are over-regulated or unable to lend because of onerous strictures placed upon them.
4)Trying hard to convince us that low oil prices are bad or are caused by the demand side of they equation rather than pointing clear evidence of oversupply.
Additionally, the meme that central banks are "out of ammo" because inflation targets haven't been reached is just plain ludicrous.
There was no way central bankers could have known that OPEC (especially the Saudis) were going to try to crush US fracking companies, and Russian producers. There was also little way of knowing just how much over-buying of commodities and over-investing in processing those commodities took place in China over the last 10 years.
China has blundered massively in its top-down industrial policy and is now attempting to fob those deflation-exacerbating products on the rest of the world. This potential wave of goods dumping should not be allowed. If we have the conviction to hold it off, our inflation metrics will rebound smartly and monetary policy will have the desired effect. We absolutely must NOT import deflation from China! Mr. Rattner should know this.
1)Viewing unfettered (a better term than "free) trade as an unalloyed good for Americans.
2)making the right noises about ramping up fiscal spending while not really trying too hard to actually achieve it.
3)Parroting banking and corporate propaganda that they are over-regulated or unable to lend because of onerous strictures placed upon them.
4)Trying hard to convince us that low oil prices are bad or are caused by the demand side of they equation rather than pointing clear evidence of oversupply.
Additionally, the meme that central banks are "out of ammo" because inflation targets haven't been reached is just plain ludicrous.
There was no way central bankers could have known that OPEC (especially the Saudis) were going to try to crush US fracking companies, and Russian producers. There was also little way of knowing just how much over-buying of commodities and over-investing in processing those commodities took place in China over the last 10 years.
China has blundered massively in its top-down industrial policy and is now attempting to fob those deflation-exacerbating products on the rest of the world. This potential wave of goods dumping should not be allowed. If we have the conviction to hold it off, our inflation metrics will rebound smartly and monetary policy will have the desired effect. We absolutely must NOT import deflation from China! Mr. Rattner should know this.
2
Gee Steve, longest private sector job growth in US history. Wages increase. Unemployment below 5% (Mitt promised below 6% in another 2 years). So why are conservatives decrying the economy? Because they care more about politics than they do their country. And yet Steve, rather than point out that the fault lies with Conservatives, you do the typical on one hand and on the other media blame everyone. Why don't you point out that President Obama has proposed a comprehensive solution, but that Republicans have refused to budge. Instead Republicans propose outdated tax cuts and spend theories from the 1980's, that have no basis in reality for today's market, tax situation and financial policy.
Yet you say a pox on all their houses...
Typical Steve... Typical...
Yet you say a pox on all their houses...
Typical Steve... Typical...
5
More mealy-mouth-speak that means nothing. This is "unclear," that is "uncertain," and the future is...well, the future. Oh, and who's to blame. Let's not forget "who's to blame." Never mind the markets are recovering from a slump, the nation is creating jobs every week and...nobody knows the future.
If anyone tells you they know what's going to happen in the economy, ask yourself: Why is this person talking to me? He/she should be on his yacht in the Mediterranean.
If anyone tells you they know what's going to happen in the economy, ask yourself: Why is this person talking to me? He/she should be on his yacht in the Mediterranean.
1
This is an extraordinarily informative, well-reasoned and well-written article by Steven Rattner. Anyone who wants to confirm what has happened to the American and global economies should print the entire column and keep it as a handy reference.
One might criticize Mr. Rattner for being too polite – a rarity these days – by not being more forceful in laying the blame for our economic woes squarely where it belongs, in spite of the title of his article.
The Republican Party in its foolish austerity obsession, its political extremism in obstructing nearly any program proposed by President Obama and its ideological and often cruel refusal to correct income disparity, has caused much of the woes which plague – unnecessarily – American households and businesses.
Mr. Rattner, one suspects, may have felt that the message of what has actually happened is so important that he tried to avoid having people ignore the message because of their political bias.
Any American who has read and thought rationally for the past eight years can draw his or her own conclusions.
One might criticize Mr. Rattner for being too polite – a rarity these days – by not being more forceful in laying the blame for our economic woes squarely where it belongs, in spite of the title of his article.
The Republican Party in its foolish austerity obsession, its political extremism in obstructing nearly any program proposed by President Obama and its ideological and often cruel refusal to correct income disparity, has caused much of the woes which plague – unnecessarily – American households and businesses.
Mr. Rattner, one suspects, may have felt that the message of what has actually happened is so important that he tried to avoid having people ignore the message because of their political bias.
Any American who has read and thought rationally for the past eight years can draw his or her own conclusions.
4
Austerity is just another one of those deceitful, socialist words for fiscal sanity.
Mostly correct.
Having said that, I feel free to ask: If Germany is the 'juggernaut', then why are you worried about the cost of Germany's 'tilt' toward renewable energy? Germany is facing reality - the necessity of getting off fossil fuels - sooner than anyone else, and should be applauded for this. There's more to existing on this planet than Mr. Rattner's limited view of what constitutes the 'economy'.
Having said that, I feel free to ask: If Germany is the 'juggernaut', then why are you worried about the cost of Germany's 'tilt' toward renewable energy? Germany is facing reality - the necessity of getting off fossil fuels - sooner than anyone else, and should be applauded for this. There's more to existing on this planet than Mr. Rattner's limited view of what constitutes the 'economy'.
5
The Republican Congress has most of the blame at their feet for slowing this economy. Obstruction never works and they will be punished this year.
5
"Closest to home, of course, is gridlock in Washington. Anti-deficit fervor has led to a meat-ax approach to spending cuts, under which nondefense discretionary outlays (which include key pro-growth areas like research and development and infrastructure) have fallen in real terms by nearly 20 percent over the past five years, at a time when they should be growing substantially."
Steven, Steven, Steven.
Please say it like it is. The Republican Party has damaged the American economy.
Deliberately.
Let's give credit, where credit is due.
Steven, Steven, Steven.
Please say it like it is. The Republican Party has damaged the American economy.
Deliberately.
Let's give credit, where credit is due.
16
The G word, Growth, the false God of economists everywhere. All former financial implosions came from too much growth, for the chart to decline, it had to be higher. Slow growth avoids nasty surprises.
The decline in trust in the government is only a reflection of citizens' awareness. The government has always been duplicitous. Investigative journalism, social media and whistle-blowers have altered the naive Norman Rockwellian perceptions of America. Not to mention perpetually failed military interventions and cops shooting everyone the gun crowd hasn't gotten around to yet.
Calling politicians leaders is a thinking and attitudinal error. Politicians are employees hired to represent the people and make the government work as efficiently and fairly as possible. See, you pay politicians, that's how you know you're the boss.
The decline in trust in the government is only a reflection of citizens' awareness. The government has always been duplicitous. Investigative journalism, social media and whistle-blowers have altered the naive Norman Rockwellian perceptions of America. Not to mention perpetually failed military interventions and cops shooting everyone the gun crowd hasn't gotten around to yet.
Calling politicians leaders is a thinking and attitudinal error. Politicians are employees hired to represent the people and make the government work as efficiently and fairly as possible. See, you pay politicians, that's how you know you're the boss.
3
Politicians only get paid for telling people what the people think they want to hear.
I was just thinking how seldom politicians, particularly Presidents, actually do what they said they would do when they were running for office. Voters line up behind empty promises and, from cycle to cycle, never learn that when it's all said and done, much is said, little is done.
I studied economics over forty years ago. After deciding that even if I were wise, all knowing, and possessed with all the answers, it still would not matter I decided to quit my studies. I likened the situation then to a game of telephone. Today it is the same or worse. Even the right answer after passing through the many filters of an immense bureaucracy will become so muddled that failure and mismanagement is a certainty. This is the excuse for the free market, and why China is having problems. A lack of any reasonable fiscal policy insures that our country will continue to crumble and that wealth disparity will continue to grow.
28
So there's one right answer when it comes to managing (dictating) the economic affairs of millions of people and you know what it is?
One can't suppose that business can act in its own best interests here. After all, it's much more important to show that quarterly gain even if it means cutting employees or hiring the cheapest ones possible who don't live in the country or can be brought here and paid less than an American who can learn or do the job. For the past 35-40 years American businesses have not invested in their employees preferring to return all gains to themselves or the shareholders. Continuing this means that there will not be a viable consumer economy because consumers can't count on having jobs that pay a decent salary, finding new jobs once they are downsized, or having any sense of security about the future.
I know. I'm 57 years old. I retrained from the sciences to work in the IT field because those jobs disappeared. Now I'm unemployed again and the chances of finding another decent job are slim to none. I can't retire. I can't get benefits because I'm single adult. I can't sign a lease. I can't save for the future. All I've been doing my entire working life is to save money for the times I'm unemployed. Businesses need to start contributing to the average American's life in terms of work. If you want us to spend you have to hire us, pay us, and stop the nonsense of outsourcing. If you don't care we can't make you but remember when you aren't making money that you created this situation. No work, no spending, no profit.
I know. I'm 57 years old. I retrained from the sciences to work in the IT field because those jobs disappeared. Now I'm unemployed again and the chances of finding another decent job are slim to none. I can't retire. I can't get benefits because I'm single adult. I can't sign a lease. I can't save for the future. All I've been doing my entire working life is to save money for the times I'm unemployed. Businesses need to start contributing to the average American's life in terms of work. If you want us to spend you have to hire us, pay us, and stop the nonsense of outsourcing. If you don't care we can't make you but remember when you aren't making money that you created this situation. No work, no spending, no profit.
25
The demographic headwinds are huge in Europe and China. How can you grow when more than half the population is over 45? These people have all the goods they need, and are looking to save for retirement. In 20 years, it will be much worse. If you want to see what the future holds, look to Japan, with a declining population and a comatose economy.
2
The most logical and realistic description of the events in economies in some time, reflecting the facts and decisions and totally without ideological overtones.
In particular, Ratner realizes that the lack of demand reflects lower wages, lower labor participation and more inequality as the major causes for failure to increase global trade and the shared responsibilities for individuals, corporations and governments.
In particular, Ratner realizes that the lack of demand reflects lower wages, lower labor participation and more inequality as the major causes for failure to increase global trade and the shared responsibilities for individuals, corporations and governments.
5
I want to second a comment below by "Pete" of West Hartford that Rattner and other economic writers would be more useful if they used shorthand phrases less and did a bit more careful explaining. Second, will the NYT please begin to integrate the graphs and illustrations into their print view page. Especially in pieces such as this one, the graphic material is integral to understanding the thrust of the argument, yet I cannot see these figures when I read the piece offline on my tablet.
2
The fact that the republican party has been harping for years on how bad the economy is under Obama, people are maybe getting a little leery of what might happen. Our economy is fairly strong compared with other nations, we just need congress to do something, anything other than repeal Obamacare. Our roads and bridges are horrendous, fixing them would go a long way to building up our economy - people work, they spend.
15
If everything up until now has been George Bush's fault, wouldn't the logical assumption be that the current problems are the fault of the current President?
His fault that our economy is recovering better than the rest of the world's? Well, OK
13
Would be if he had been allowed to do anything since 2010.
3
Our current President is blocked from all bills that would increase employment by the Republicans in the Senate and House. On the night of Obama's election, 14 republicans met in a restaurant in Washington DC and pledged to block every bill the President asked for. Remember bills originate in Congress. Why was not the action of those 14 called treason? They are in congress agains any budget that does not cut money for R&D, etc. unless it is for the military-industrial complex then they give them more than the request!
2
Raise interest rates, cut the military, reinstate Glass-Steagal, flatten the tax code, streamline regulations and yes invest some of that back in R&D.
But more drastic action or stimulus from the government? How is that working out for Japan? Debt to GDP is off the charts everywhere else too. I think Germany is being vindicated on that front.
But more drastic action or stimulus from the government? How is that working out for Japan? Debt to GDP is off the charts everywhere else too. I think Germany is being vindicated on that front.
4
When the private sector invests overseas shutting down domestic factories, government must step in and provide jobs. No jobs, no consumer spending, no economy. More wages (higher minimum wages) allows people to pay the rent, buy houses, clothe and feed their families and more taxes allows the government to provide the services we need. Need roads, bridges, police and fire departments. Don't vote for military-industrial-complex supporter Hillary Clinton of the 1%, vote for Bernie Sanders who is trying to bring back the middle class by Medicare for All single payer health care, higher education for all so we can compete with better educated overseas candidates. When we restrict paths to affordable education, we are doomed to stupidity like the Republican presidential candidates' appealing to the religious right whip are poor and poorly educated.
This is the usual astute analysis I come to expect from Mr. Rattner. In this case, he blames government leaders for the slowing economy. But how does that explanation differ from that of the crash of 2008, which was caused by government leaders, too--Alan Greenspan, Ben Bernanke. They failed to tighten the screws on lending until it was too late.
The problem is that government leaders, then and now, are subject to economic and political forces that are hard to overcome. Thus, where is the will to raise interests so long as the economy seems weak and tottering?Looking back five years from now, it might be just the right thing to have done.
Alas, as Hegel noted, "the owl of Minerva takes flight only at dusk."
The problem is that government leaders, then and now, are subject to economic and political forces that are hard to overcome. Thus, where is the will to raise interests so long as the economy seems weak and tottering?Looking back five years from now, it might be just the right thing to have done.
Alas, as Hegel noted, "the owl of Minerva takes flight only at dusk."
1
They are not government leaders. They are the spokesperson for a PRIVATE BANKING CARTEL. This s the crux of our broken system, even our own citizens are to dumb to know the truth.
People tend to forget that we experience a recession every 8-10 years. We had one in 1981, 1991, 2000 and 2008. The economy is way too dynamic for government manipulation. The cycle will continue - the US economy is very vulnerable to an economic downturn in 2016. Americans had better have saved up for the inevitable slowdown. Whistling past the graveyard isn't a solution.
http://www.nytimes.com/2016/02/05/upshot/if-there-is-a-recession-in-2016...
http://www.nytimes.com/2016/02/05/upshot/if-there-is-a-recession-in-2016...
I don't think politicians, like Trump and Sanders, who proclaim to favor the working class reduce consumer spending. I'd say its the politicians who promote the same old, same old one percenter policies that are suppressing consumer spending. Two offer hope, the others offer the same old empty promises.
4
The author answered his own question when he mentioned, "For a start, global competition"...as in free trade. Free trade is the root cause of our economic problems, it funnels wealth into the hands of the already obscenely wealthy. Worker productivity doesn't go up because workers have no incentive to work harder, their wages never go up, no matter how much productivity goes up, so what's the point?
Our economic problem is that wealth inequality is built into the system, as in the system is rigged to funnel wealth to the one percent. The rest of the economic concerns are all symptoms and the results of free trade.
Our economic problem is that wealth inequality is built into the system, as in the system is rigged to funnel wealth to the one percent. The rest of the economic concerns are all symptoms and the results of free trade.
13
The article is the usual grab-bag with not much incisive analysis, featuring the usual elite even handedness and repetition of conventional wisdom:
-- "misguided spending priorities and too much austerity," (agreed on austerity, but what are the wrong priorities? Rattner has previously called for means testing Social Security)
-- apps like Uber are causing a slowdown in business investment (really?),
--"meat-ax approach to spending cuts" (so Rattner wants some type of deep spending cuts, just not "meat-ax"?),
-- French labor laws cause unemployment (and also provide much higher basic incomes), etc.
Rattner does call for "more robust fiscal policy," so that's a good thing. But more robust fiscal policy means higher deficit spending--infrastructure and science/R and D, sure, but also public employment, more labor market regulation in the US (higher minimum wage, more unionization, etc.) Our problem is effective demand, and the cure is much, much higher deficit spending, public job creation, and legislation to improve job quality. To that extent, Rattner is right that the fault lies "with our leaders."
-- "misguided spending priorities and too much austerity," (agreed on austerity, but what are the wrong priorities? Rattner has previously called for means testing Social Security)
-- apps like Uber are causing a slowdown in business investment (really?),
--"meat-ax approach to spending cuts" (so Rattner wants some type of deep spending cuts, just not "meat-ax"?),
-- French labor laws cause unemployment (and also provide much higher basic incomes), etc.
Rattner does call for "more robust fiscal policy," so that's a good thing. But more robust fiscal policy means higher deficit spending--infrastructure and science/R and D, sure, but also public employment, more labor market regulation in the US (higher minimum wage, more unionization, etc.) Our problem is effective demand, and the cure is much, much higher deficit spending, public job creation, and legislation to improve job quality. To that extent, Rattner is right that the fault lies "with our leaders."
8
And by our leaders, you mean Congress which has stymied every attempt by Obama to do exactly what you just said.
5
If you have not followed the primary elections, even Paul Krugman suggests massive government spending on infrastructure. Bernie Sanders is the only candidate who will get us out of the recession we are in by saying that the people need to rise up and demand higher minimum wages, single-payer health care for all (Medicare which we already have for people over 65), fixing our roads, bridges, sewer/water pipes which are rusting out, solar/wind clean energy and no more tracking which is causing earth quakes and when they pump dirty, unusable water even for irrigation, down into the earth, causing oil/gas spills into our aquifers, rivers and oceans. Vote for Bernie Sanders, our economy demands it. He is the only candidate who is alarmed by global warming. The future is in our hands and these primaries are crucial. Independents, who have been sitting by the sidelines are now changing parties to Democratic so they can vote for Bernie!!!
Times are reasonably good and the reasons to believe we would fall into recession are pretty weak. Only in the echo chamber of Wall St would you think the opposite.
6
I really hope you don't believe that, seeing as how we're heading into another 2008.
The ECB has just taken extraordinary measures--0.0% interest rates, for example. Echo chamber?
Much of the fall in commodity prices is a result of the situation in China, where stocks have fallen significantly and demand for oil and raw materials has declined. It is uncertain what effect this will have on the rest of the world and the calling for alarm here and in the rest of the world seems premature. Looking at the data, job growth continues to be strong and the stock markets have begun to rebound somewhat after the early year slump. Even the lowered IMF forecasts point to higher global growth in 2016 when compared to 2015. This article strikes me as an author looking to raise alarm where there is none to be raised.
2
"Our leaders" (meaning the current administration in Washington) can take credit for largely insulating us from the ill-conceived economic policies of the Chinese leadership. Foreign political leaders make their decisions based on their own domestic considerations. It is unclear whether they know or care about Mr. Rattner's opinions.
2
As the U.S. economy sank into recession, so too did confidence that the greenback could maintain its long-held position as the world’s No.1 currency. In Beijing, Moscow and elsewhere, policymakers railed against the dollar-dominated global financial system as detrimental to world economic stability and vowed to find a replacement. Many countries recently showed their support of BRACS including the UK with the thought that China will soon usurp the US dollar becoming the world’s leader in Reserve Currency.
The reason why the US dollar is still so strong is due to the economic and military action of our presidents to covertly do whatever is necessary to protect the dollar by supporting countries that will buy and sell energy for US Dollars. That is the only reason why radical ME countries like Saudi Arabia and Qatar are considered our friends.
We sanctioned Iran, Iraq and Russia when they refused to sell oil and gas for US Petro Dollars. We went into Afghanistan to get a pipeline to India. We invaded Iraq, soon after it started selling its oil for Euros. We supported the invasion of Syria, a moderate state compared to Saudi Arabia, using weapons from Libya and we trained terrorists, so that Qatar could get a gas pipeline through to the EU. It is my belief that the Hong Kong riots and China’s Stock Market woes are due to outsiders influencing the events.
The reason why the US dollar is still so strong is due to the economic and military action of our presidents to covertly do whatever is necessary to protect the dollar by supporting countries that will buy and sell energy for US Dollars. That is the only reason why radical ME countries like Saudi Arabia and Qatar are considered our friends.
We sanctioned Iran, Iraq and Russia when they refused to sell oil and gas for US Petro Dollars. We went into Afghanistan to get a pipeline to India. We invaded Iraq, soon after it started selling its oil for Euros. We supported the invasion of Syria, a moderate state compared to Saudi Arabia, using weapons from Libya and we trained terrorists, so that Qatar could get a gas pipeline through to the EU. It is my belief that the Hong Kong riots and China’s Stock Market woes are due to outsiders influencing the events.
1
In the U.S., other than President Obama and his cabinet, what leaders do we have? The republicans certainly have done nothing for 7+ years but obstruct progress and vote to defund ObamaCare and Planned Parenthood. Worse yet, if they were to do something, it would be more like Europe's failed policies as they have done in Kansas and Louisiana.
5
Oh boy, I knew where this analysis was leading --- the fault lies with our leaders now. One look at our Congressional leaders and then the Republican party candidates would indicate we are heading for a recession.
1
In a perfect world in the good time governments would save and pay down debt so that in bad times they could borrow and stimulate the economy by building and repairing roads and bridges.
One criticism of the article is Steve's criticism of corporations not bringing money they earned overseas home to the U.S. Of course they won't as the corporate tax rate is astronomical compared to that of other countries It makes sense for them to leave it there. It is the fault of the U.S. government that the money is not invested back home.
Another problem is the waste of money by creating the Homeland Security nightmare (that alone should have created a boom economy) but the money went to the wrong pockets, none productive pockets. Also since we have the largest and the strongest armed forces not being willing to cut the defense budget due to the loving of the defense/industrial complex and the macho get me elected complex of the politicians.
All this and more is keeping from improving infrastructure and hospital care for veterans.
But one of the biggest problems is not restructuring the tax code to a simple flat tax for every type of income wether it be earned, capital gains, corporate tax rate, interest dividends, the first 35 K income of the individual who actually earned it would not be taxed and then it would a flat rate but and here is a critical part there would be no deductions of any kind. The deductions are what is now used by rich individuals and corporations to cut tax
One criticism of the article is Steve's criticism of corporations not bringing money they earned overseas home to the U.S. Of course they won't as the corporate tax rate is astronomical compared to that of other countries It makes sense for them to leave it there. It is the fault of the U.S. government that the money is not invested back home.
Another problem is the waste of money by creating the Homeland Security nightmare (that alone should have created a boom economy) but the money went to the wrong pockets, none productive pockets. Also since we have the largest and the strongest armed forces not being willing to cut the defense budget due to the loving of the defense/industrial complex and the macho get me elected complex of the politicians.
All this and more is keeping from improving infrastructure and hospital care for veterans.
But one of the biggest problems is not restructuring the tax code to a simple flat tax for every type of income wether it be earned, capital gains, corporate tax rate, interest dividends, the first 35 K income of the individual who actually earned it would not be taxed and then it would a flat rate but and here is a critical part there would be no deductions of any kind. The deductions are what is now used by rich individuals and corporations to cut tax
1
What Mr. Rattner and many others seem to miss is that we just can't consume much more. I don't need more "stuff" for my house. The only things I buy are food and clothes, and clothes only when they wear out. Oh, and the occasional piece of technology, again, when something breaks. Other than that, I don't need more stuff. I think many Americans are in that position. I do agree that incomes have been stagnant and that certainly has a bearing on demand. But in the end, the assertion that demand is infinite is just plain wrong. In other words, we've built expectations of growth that we can't possibly sustain forever, and the game just might be up.
8
The paradox of capitalism. Its success is predicated on sowing and nurturing the seeds of its own destruction. Government has saved capitalism from itself in the past but this time, I'm not sure governments have people with the foresight to fend off catastrophe.
5
It is not just a coincidence that tax cuts for the rich have preceded both the 1929 and 2008 depressions.
Since 1969 there has been a tremendous shift in the tax burdens away from the rich on onto the middle class. Corporate income tax receipts, whose incidence falls entirely on the owners of corporations, were 4% of GDP then and are now less than 1%. During that same period, payroll tax rates as percent of GDP have increased dramatically. The overinvestment problem caused by the reduction in taxes on the wealthy is exacerbated by the increased tax burden on the middle class. While overinvestment creates more factories, housing and shopping centers; higher payroll taxes reduces the purchasing power of middle-class consumers
Equally unhelpful in terms of addressing the income and wealth inequality which results in the overinvestment cycle that caused the depression are those who emphasize various non-tax factors. Issues such a globalization, free trade, unionization, minimum wage laws, single parents, problems with our education system and infrastructure can increase the income and wealth inequality. However, these are extremely minor when compared to the shift of the tax burden from the rich to the middle class. It is the compounding year after year of the effect of the shift away from taxes on capital income such as dividends over time as the rich get proverbially richer which is the prime generator of inequality..."
http://seekingalpha.com/article/1543642
Since 1969 there has been a tremendous shift in the tax burdens away from the rich on onto the middle class. Corporate income tax receipts, whose incidence falls entirely on the owners of corporations, were 4% of GDP then and are now less than 1%. During that same period, payroll tax rates as percent of GDP have increased dramatically. The overinvestment problem caused by the reduction in taxes on the wealthy is exacerbated by the increased tax burden on the middle class. While overinvestment creates more factories, housing and shopping centers; higher payroll taxes reduces the purchasing power of middle-class consumers
Equally unhelpful in terms of addressing the income and wealth inequality which results in the overinvestment cycle that caused the depression are those who emphasize various non-tax factors. Issues such a globalization, free trade, unionization, minimum wage laws, single parents, problems with our education system and infrastructure can increase the income and wealth inequality. However, these are extremely minor when compared to the shift of the tax burden from the rich to the middle class. It is the compounding year after year of the effect of the shift away from taxes on capital income such as dividends over time as the rich get proverbially richer which is the prime generator of inequality..."
http://seekingalpha.com/article/1543642
10
If you have been around for awhile and involved somehow with what was initially marketed as free trade, that gained serious momentum and matured into what we coin as Globalization one would find no surprises in a muted economy, and a movable reduced standard of living. We exported in all our wisdom millions of jobs, and governments marketed the idea 20 nations could co-ordinate their economies, managed by Central Banks. Point is clear too many moving parts. Economist by their own admission are always behind the curve with their charts and graphs. So where are we. Keynes model, debt.
2
The last line in this piece
"This time, if we fail to break out of the current stagnation — or worse, fall into global recession — the fault will lie with our leaders."
I haven't seen any leaders anywhere lately, I have seen servants of the ruling class, fighting for more trickle down and tax breaks for billionaires, ignoring the demand economy and all those little people.
The state of Washington is in a tail spin having just been shaken down by the Boeing Corporation. Boeing told the state if they don't get massive tax breaks they were going to move 2,000 jobs from one of their plants out of Washington. The state responded by signing a bill that gives Boeing 8.7 billion in tax breaks over 15 years, Boeing responded by announcing they were going to move 2,000 jobs out state from a different program, while they stuck to the letter of the agreement but certainly not the intent. They outraged anyone who was paying attention but our "leaders" remained mute.
To add to the tragic opera of corporate rule the Boeing board of directors did happen to give themselves massive bonuses for the masterful con job they perpetrated on the state. One politician has gone on record as saying "We've been had" as they to find money to fund education, fix failing roads and bridges and keep up the infrastructure Boeing insists on using but refuses to pay for.
"This time, if we fail to break out of the current stagnation — or worse, fall into global recession — the fault will lie with our leaders."
I haven't seen any leaders anywhere lately, I have seen servants of the ruling class, fighting for more trickle down and tax breaks for billionaires, ignoring the demand economy and all those little people.
The state of Washington is in a tail spin having just been shaken down by the Boeing Corporation. Boeing told the state if they don't get massive tax breaks they were going to move 2,000 jobs from one of their plants out of Washington. The state responded by signing a bill that gives Boeing 8.7 billion in tax breaks over 15 years, Boeing responded by announcing they were going to move 2,000 jobs out state from a different program, while they stuck to the letter of the agreement but certainly not the intent. They outraged anyone who was paying attention but our "leaders" remained mute.
To add to the tragic opera of corporate rule the Boeing board of directors did happen to give themselves massive bonuses for the masterful con job they perpetrated on the state. One politician has gone on record as saying "We've been had" as they to find money to fund education, fix failing roads and bridges and keep up the infrastructure Boeing insists on using but refuses to pay for.
12
Sounds to me like the WA legislature should take back the $8.7B by repealing their corporate welfare bill...
The 1% will topple if they keep starving the horse they are riding on...the US consumer.
8
It's a puzzling global picture. I find it very puzzling, for example, that the sustained decline in energy prices has not conferred more demand-side economic benefits. At least in the U.S., the drop in oil prices, for example, should itself, or so I thought, function much like a decrease in taxes, putting more money in the pockets of consumers who would then spend it. Presumably, the expected benefits have been offset by other, demand side dampening factors. Who's to blame for tepid demand side response?
Who knows? This much is certain: in 2016 the "blame game" will continue to be played in earnest. As to the other part of the problem, specifically, how you stimulate this non-roraring economic recovery. Worry not. At least in the U.S. for the remainder of the year, the election will ensure that absolutely nothing gets done.
Who knows? This much is certain: in 2016 the "blame game" will continue to be played in earnest. As to the other part of the problem, specifically, how you stimulate this non-roraring economic recovery. Worry not. At least in the U.S. for the remainder of the year, the election will ensure that absolutely nothing gets done.
2
NeoLiberal economics and Crony Capitalism is the problem.
3
There's a least one other layer of the onion underneath NL econ and CC: plutocracy and international capitalism, with no shred of patriotism on show among America's plutocrats.
Really, one can liken government or corporate spending to a family budget. If I want to increase my budget surplus, I can limit my children to one meal a day to save on grocery expenses, we can all change our clothes and shower only one day per week to lower water bills, and I can sell my car to get some extra cash and cut transportation costs. The problem is that while my budget may be balanced, my kids are now half starving, we are all smelly and dirty, and I can't get to work. This is essentially what austerity measures lead to. I see it in my state. Infrastructure is failing, schools are underfunded, and lack of job opportunities (just had another corporation leave for Mexico--cheaper labor = higher corporate profits) means young people leave the state while meth lab production continues to increase. But hey! We have a budget surplus so it's all good.
10
There is no correlation between a government budget and a household budget. They are two different species. Governments can and should borrow in order to keep the economy in gear.
Really? No mention of falling oil revenues which used to transfer more money from the working populations of the US and Europe to rich nations who then lend it back to the US to fund war around the world? The huge deficit which will not go away if this spending is slowed or stopped? The billions poured into Iraq and other countries for defense contracts and the continuous rebuilding of infrastructure with no society to support it or continue it once the US leaves (whenever that might be?) Yes, the tax structure for corporations allows them to offshore their money. I would indeed be nice to get some of this money back into US revenues to pay for the infrastructure these companies count on. But let's not ignore that our pockets have been fleeced for foreign wars that will haunt us for decades to come.
7
If money goes to “the rich”, they do not sit on it like Smaug on his golden hoard; they either spend or invest it. It goes right back into the economy; it does not disappear. Stealing from the successful to fund handouts will not improve matters; it’s a zero sum game.
Nor are low energy prices or efficient businesses problems to be solved.
You’re right about governmental spending; we'd be much better off if we hadn’t blown through $7 trillion or so in borrowed money these last eight years. And if, by “austerity”, you mean tax increases, you’re absolutely right; they’re profoundly destructive.
Businesses send profits overseas? The problem is not too many tax loopholes, but obscene taxes rates. We do not suffer from a want of governmental spending.
The Great Recession would not have happened if government didn’t demand that lenders make bad loans and subsidized the results with Fannie and Freddie.
We can’t save the globe, but we can save ourselves. Eliminate corporate taxes and pare back extremist regulations which make construction almost impossible. Adopt Canadian-style immigration policies and send illegals home to boost local wages. Repeal the ACA and adopt pro-freedom, pro-market reforms to reduce health care costs. Learn from Norway’s ethos – “thou shalt not sponge” – rather than its welfare state.
The US prospered most when it created the world’s freest country. We’ve fallen behind. Catching up requires that we rediscover that freedom works every time it’s tried.
Nor are low energy prices or efficient businesses problems to be solved.
You’re right about governmental spending; we'd be much better off if we hadn’t blown through $7 trillion or so in borrowed money these last eight years. And if, by “austerity”, you mean tax increases, you’re absolutely right; they’re profoundly destructive.
Businesses send profits overseas? The problem is not too many tax loopholes, but obscene taxes rates. We do not suffer from a want of governmental spending.
The Great Recession would not have happened if government didn’t demand that lenders make bad loans and subsidized the results with Fannie and Freddie.
We can’t save the globe, but we can save ourselves. Eliminate corporate taxes and pare back extremist regulations which make construction almost impossible. Adopt Canadian-style immigration policies and send illegals home to boost local wages. Repeal the ACA and adopt pro-freedom, pro-market reforms to reduce health care costs. Learn from Norway’s ethos – “thou shalt not sponge” – rather than its welfare state.
The US prospered most when it created the world’s freest country. We’ve fallen behind. Catching up requires that we rediscover that freedom works every time it’s tried.
2
Boy oh boy, where do I begin? Yes the rich do some spending and some investing, but the ultra rich park a lot of money overseas to sit. And there it sits, not investing, not in better wages for workers to increase demand--but just sit to avoid those "obscene" taxes which most of them pay well below the so called obscene rate. The trillions...well we are still at war, still paying for years of the war before the current administration, some went to propping up the country after the recession. Lots of NEW spending, we had cuts, not increases. Did Government demand lenders make bad loans? No, they requested that it be easier for people to buy a home. Lenders in their GREED made bad loans and Fannie & Freddie the scapegoats of the Right, were actually late to the sub-prime party. If we can't save the globe-we won't have a planet to exist on, so saving ourselves might be problematic. Corporations are the biggest beneficiaries of US tax policy, and they should contribute their fair share for the infrastructure that makes good commerce possible. Extremist regulations, like not letting toxic materials be dumped into the air and water (that we won't be able to save ourselves without), or decent working conditions, safety conditions, regulations that demand you build something that can remain standing and not fall apart in less than a decade! Pro market health care was rising so fast that NONE of us would be able to afford it today without the ACA. No profit in health care.
2
The only problem with what you say is that a core reason for our lack of freedom is this crony-capitalist system we now have, that causes corporations (yes, corporations, seems like you love them but idk why), to exploit the 99%. And really? If the rich didn't sit on their treasure like Smaug and it actually made its way to the rest of the people then trickle-down economics would prove successful, but alas, thats never happened.
2
Great post Michael, but I suspect it is over the head of most people who comment here. It is far easier to blame the 1% and support leaders who will steal from our neighbors to give us all the "free" stuff we want. Too many leftists want politicians like Wilson and FDR, when what we really need is another Calvin Coolidge. Equality is the new ideal while freedom and liberty have fallen out of favor with the left.
It’s not just the Republicans in Washington that are trying to undercut the economy, it’s also in Republican state legislatures who are messing with the success of business and industry. In North Carolina, the switch from income to service and sales tax is causing consumers to try new strategies to avoid the new taxes. These new ways to reduce or avoid sales and service taxes include shopping in bordering states with lower taxes, putting off services and purchases, and switching to do-it-yourself instead of calling a service guy. All these are ways that businesses lose.
7
"the reasons for the sagging economies are multifarious and jumbled, more de Kooning than Mondrian."
Or Salvadore Dali maybe?
A mere individual in the middle, ion the bottom really, of this morass is powerless, and paralyzed.
Or Salvadore Dali maybe?
A mere individual in the middle, ion the bottom really, of this morass is powerless, and paralyzed.
So the same Steve Rattner that screamed that monetary easing was going to give us runaway inflation now tells us: "Well-intentioned efforts to avoid another financial crisis have put the banking system in a straitjacket, discouraging lending and reducing liquidity on trading desks, which has contributed mightily to market gyrations." How exactly does mildly tighter regulations cause market gyrations?
And he tells us that "gridlock" is the word for the willful sabotaging of government function by the Republicans, as though somehow the legislative pathways are just too full of bright ideas. Ideas like trying to repeal Obamacare for the 100th time?
Rattner is the definition of false equivalence and mealy mouthed sequipedalian tergiversation.
And he tells us that "gridlock" is the word for the willful sabotaging of government function by the Republicans, as though somehow the legislative pathways are just too full of bright ideas. Ideas like trying to repeal Obamacare for the 100th time?
Rattner is the definition of false equivalence and mealy mouthed sequipedalian tergiversation.
2
Is it time to question the underlying assumption, as at least Bernie if not Trump is doing, that constantly accelerating growth is 'the good thing'? In most other systems accelerating growth of one part, finance, at the expense of other parts health, the environment and just time, is considered a cancer threatening the organism as a whole.
Given that we now can feed, house and provide comforts for people with machines doing the drudgery isn't it the moment to point our enterprising nature at something beyond production? Is that not the real reason Governments are forestalled. They either want to go back to the Puritan hard work ethic (austerity) which has been overwhelmed by the machine or don't know where to go and so do nothing. Shouldn't economists, scientists and that demeaned discipline philosophers be looking to address the biggest cultural shift since the agrarian to industrial revolution?
It is a new world and increased productivity through automation doesn't enslave us to capital but frees us from the drudgery of production.
Johnny
Given that we now can feed, house and provide comforts for people with machines doing the drudgery isn't it the moment to point our enterprising nature at something beyond production? Is that not the real reason Governments are forestalled. They either want to go back to the Puritan hard work ethic (austerity) which has been overwhelmed by the machine or don't know where to go and so do nothing. Shouldn't economists, scientists and that demeaned discipline philosophers be looking to address the biggest cultural shift since the agrarian to industrial revolution?
It is a new world and increased productivity through automation doesn't enslave us to capital but frees us from the drudgery of production.
Johnny
You refer to the German "juggernaut" but seem unwilling to examine why they are so successful. They certainly look more like Democrats than Republicans to me.
6
Here's a radical idea: why don't we try empowering consumers to drive a consumer-led recovery.
We could begin with a government plan to eliminate existing student-loan loan debt; aka a bailout for the middle class. This would free tens of millions of consumers to redirect income toward economic activity that actually benefits the present-day economy, instead of further filling the coffers of banks that refuse to lend.
We could begin with a government plan to eliminate existing student-loan loan debt; aka a bailout for the middle class. This would free tens of millions of consumers to redirect income toward economic activity that actually benefits the present-day economy, instead of further filling the coffers of banks that refuse to lend.
7
And yet we hear that the average compensation for a banker on the street hit a record 400K. Economics ain't science folks, they will never decipher human greed. My plan, let's cut down the remaining tropical rain forests and replace them with factory farms. Think of the economic growth and capital gains.
2
Here is the very essence of something I tried to publish in many op-eds that were regularly trashed by the wide variety of the newspapers here in America over the last fifteen years.
If we embrace the concept of the free trade and are forced to compete with the Chinese and Indian workers (that thanks to the massive exodus by the global corporations have the identical top technology available to the American workers), then mathematically it’s just a matter of time before their wages and our wages converge to the same level.
Of course, after it happens, the consumer-driven economies like the American one are doomed to shrink, thus pushing the entire middle class already burdened by the heavy debt into the massive bankruptcies and consequentially both America and the world into the Great Depression.
In the absence of good, smart and brave leadership to act preemptively and national willingness to significantly economically sacrifice today, that’s the only rational outcome.
That’s what I tried to warn the fellow Americans about since 2000, but my analyses were diligently scrapped, dismissed and discarded...
If we embrace the concept of the free trade and are forced to compete with the Chinese and Indian workers (that thanks to the massive exodus by the global corporations have the identical top technology available to the American workers), then mathematically it’s just a matter of time before their wages and our wages converge to the same level.
Of course, after it happens, the consumer-driven economies like the American one are doomed to shrink, thus pushing the entire middle class already burdened by the heavy debt into the massive bankruptcies and consequentially both America and the world into the Great Depression.
In the absence of good, smart and brave leadership to act preemptively and national willingness to significantly economically sacrifice today, that’s the only rational outcome.
That’s what I tried to warn the fellow Americans about since 2000, but my analyses were diligently scrapped, dismissed and discarded...
2
A much more believable culprit is Energy. We continue to be obsessed with the petroleum industry instead of walking away. Again the companies too big to fail have us over a barrel. Literally.
3
"...more deKooning than Mondrian". Love that analogy. Two of my heroes. But Willem deKooning was razor sharp. He may have LOOKED confusing to those not knowing what to look for.
1
That's rich, a Wall Street Exec first blaming "private actors" and now blaming "our leaders". These are YOUR leaders Steve, bought and payed for by you and your ilk. "Congress hasn't passed tax reform" yet you and yours scream if Congress wants to eliminate the ridiculas idea of charging the capital gains tax rate for the income of hedgefund managers. The problem, Steve, is you, and as long as you think it's everyone else, the problem will continue.
8
Companies and banks are focused profits quarterly and stockholders. They need to focus on annual or longer time profits. We need to focus on infrastructure improvements. Our highways, railroad lines, water lines, waste water systems and locks and dams all need improvement. This would create jobs
5
"This time, if we fail to break out of the current stagnation — or worse, fall into global recession — the fault will lie with our leaders."
Our leaders are elected by the people. The fault lies squarely on the electorate who install the leaders. Our electorate is, for the most part, irresponsible in their voting. A large portion do not even exercise their right to vote. Those who do vote are uninformed, in fact, most deliberately so. The electorate suffers from a self-imposed ignorance. Why waste time giving careful consideration to issues? Easier to just vote based on jingoistic propaganda, personal prejudice, myths that are "common knowledge", or just gut instinct (because we are each innately intelligent, you know, it's the other guy who's stupid). So across the board, CEOs, moguls, entrepreneurs, small business owners, professionals, ordinary folks, vote for what they "know" innately to be their own best interest. Plus, they vote against whatever particular group(s) they blame for anything bad. What they are in fact doing is voting against themselves and against their country. The result is political leaders who are at best good-intentioned but ineffective, or at worse intentionally evil. It is a lose-lose situation for each citizen, for business and industry, and for the country as a whole.
Our leaders are elected by the people. The fault lies squarely on the electorate who install the leaders. Our electorate is, for the most part, irresponsible in their voting. A large portion do not even exercise their right to vote. Those who do vote are uninformed, in fact, most deliberately so. The electorate suffers from a self-imposed ignorance. Why waste time giving careful consideration to issues? Easier to just vote based on jingoistic propaganda, personal prejudice, myths that are "common knowledge", or just gut instinct (because we are each innately intelligent, you know, it's the other guy who's stupid). So across the board, CEOs, moguls, entrepreneurs, small business owners, professionals, ordinary folks, vote for what they "know" innately to be their own best interest. Plus, they vote against whatever particular group(s) they blame for anything bad. What they are in fact doing is voting against themselves and against their country. The result is political leaders who are at best good-intentioned but ineffective, or at worse intentionally evil. It is a lose-lose situation for each citizen, for business and industry, and for the country as a whole.
2
The whole discussion is a fantasy screaming "ignore that man behind the curtain". The blame is a corrupt world global economy protected by corrupt world governments, and now for the last 10 years been on life support provided by those same governments out of the pockets of their sucker voters. Running in a super computer world that no one understands or can control, it is in the midst of WOPR like meltdown that will take the planet with it.
Time for a game of chess.
Time for a game of chess.
Ratner says economist consistently fail to predict the market, then proceeds to predict the market. Predictions fail for a very simple reason, markets are artificial, man made creations.
We are at the crossroad.
We have three paths in front of us – the economic sacrifices by everybody and spiritual sobering up in order to start controlling our greed and selfishness, the Great Depression and the Civil War as the way to saddle one segment of population with the colossal economic suffering.
Those are the only choices that history provided us with.
There are no good options. Being smart consists of choosing the least detrimental one...
After the crazy party there is always the morning after and the time to clean up the mess and pay the bills.
The sooner we start doing it, the sooner we will get out of troubles...
Recovery starts with printing $20 trillion and paying off the creditors. That’s how they are charged with exploiting the system and creating the structural problems. The rest of us will experience a significant drop in the standard of living.
Whoever promises you more, he or she is simply lying to you...
We have three paths in front of us – the economic sacrifices by everybody and spiritual sobering up in order to start controlling our greed and selfishness, the Great Depression and the Civil War as the way to saddle one segment of population with the colossal economic suffering.
Those are the only choices that history provided us with.
There are no good options. Being smart consists of choosing the least detrimental one...
After the crazy party there is always the morning after and the time to clean up the mess and pay the bills.
The sooner we start doing it, the sooner we will get out of troubles...
Recovery starts with printing $20 trillion and paying off the creditors. That’s how they are charged with exploiting the system and creating the structural problems. The rest of us will experience a significant drop in the standard of living.
Whoever promises you more, he or she is simply lying to you...
The global economy has been straitjacketed by the austerity fever by the rich. The most conspicuous example is EC where austerity forced to the members, particularly economically unfortunate countries. The Euro, the single currency, without fiscal integration has become the additional straitjacket for the weak economies. These are main reasons why EU face danger of deflation and over 10% unemployment. The rich in the US also has been slowly straightjacketing our economy by the austerity, stagnant wage level, lack of infrastructure and basic research investments in both public and private sectors. China and other developing countries are suffering not only from their excessive capacity increases but also from the lack of demand increase from the advanced countries. Japan, plagued by the aging of population, has made wrong decisions in the past to increase consumption tax in spite of the deflation environment. In the meantime, most of the advanced countries even the US are facing aging society without preparations. It is obvious that we would be doomed unless drastic change of mindsets occur especially among the rich.
1
A basic premise that Mr. Rattner ignores is that consumers and their spending are also affected by the doom and gloom that the "economists" preach. While a silly spending bubble is not not good, preaching doom and gloom is popular. Say it long enough and you can say:"See, I told you so.".
Poorly done and hardly touches the real issue of global corporations sucking the wealth out of this country as they set up shop in foreign countries and stash wealth in off-shore banks all while preaching "conservative ideals".
Ta them and get the wealth where it belongs!
Poorly done and hardly touches the real issue of global corporations sucking the wealth out of this country as they set up shop in foreign countries and stash wealth in off-shore banks all while preaching "conservative ideals".
Ta them and get the wealth where it belongs!
2
"...the fault will lie with our leaders." Spoken like a true Wallstreeter. Recessions happen regularly for whatever reason. That's the problem with free market capitalism. The solution to look for is with the problem of vulnerable people suffering because of this. I say again, we need a national job market, set up and financed by the federal government, and based on the idea that in a country this big, recessions are uneven. At any time there is a job somewhere for everyone suitable to their qualifications. A national job market could instantly find those jobs for anyone. It would be an expensive 'social safety net' program, but with the internet, infrastructure requirements could be minimal. Face-to-face meetings with your government-employed career counselor and even with prospective employers could be conducted using Skype or whatever is the next best thing. It would go a long way towards solving the big problem with capitalism while preserving the benefits of jobs (most of the time), prosperity, and wealth.
During the past 7 years, the self-serving Fed has transferred trillions of tax dollars and lost interest on savings from the middle classes and seniors to Wall Street, suppressing spending ("pushed more money into the hands of the rich, who are less likely to spend it"), wages, and labor participation, while simultaneously increasing income inequality. These consequences of letting unaccountable private bankers control the economy have synergized with post-Reagan tax rates, which have similar effects. These two major government forces provide a structural explanation for why the economy is "slowing".
8
Until wages reach a point of at least 20$ an hour and regulation put into place that end the era of big banks all interest rate should be frozen.
Austerity never ever worked in the history of mankind and there is no use repeating the same mistake by saying lets try it again maybe it will work this time.
Austerity never ever worked in the history of mankind and there is no use repeating the same mistake by saying lets try it again maybe it will work this time.
3
"Who gets the blame, you and your fellow bankers that were the enablers and profiteers in our winner take all society, the bankers and vulture investors that created vehicles to strip mine venerable companies and toss the carcasses on the rubbish heap of globalization, the bankers that have heaped the likes of Uber, Amazon or Airbnb on us creating immense wealth for a few while destroying millions of small businesses that provided good livings for families for generations. Does anyone really aspire to being a part time cabbie, renting your couch out to strangers or packing books and diapers to send around the world? It seems that our best Universities have produced nothing more than a generation of sociopaths intent on fulfilling the prophecy of Judge Louis Brandeis in his observation of our "race to the bottom". By the new metrics I would imagine Juan Corona to be the perfect C.E.O. he not only stripped workers of their dignity, their benefits and their pay as the current crop of corporate elites have done he buried them in a field when they were no longer useful. Bernie gets it and on some baser level so does The Donald", we need a real political revolution and we are getting it, this great nation is turning into a banana republic with a big army available to the highest bidder. Cast your vote for change the status quo has failed us miserably.
2
3 major factors, in order of importance:
1) Cheney-Bush handed Obama two failed elective Wars and the Second Great Depression- then loudly, proudly announced a campaign of "obstruction and NO!".
2) Europe is struggling with German induced austerity.
3) Chinese economy sinking.
1) Cheney-Bush handed Obama two failed elective Wars and the Second Great Depression- then loudly, proudly announced a campaign of "obstruction and NO!".
2) Europe is struggling with German induced austerity.
3) Chinese economy sinking.
2
This crisis is a foregone conclusion because of our monetary system where we need to create debt in order to create money. This system works well until the debt level becomes so large that servicing the debt and the debt itself creates problems with liquidity and such.
>
On top of this, there was the problem that resulted in the crash of 2008 and how this administration's response was less than nothing. Dodd-Frank was passed, but that only papered over the problems by doing such things as making the too big to fail banks even larger.
>
Add to this tax increases and passing Obamacare which forced people to take what discretionary money they had left and either pay for insurance or a fine and you constrict people's buying habits in an economy driven largely by consumer spending.
>
Worse still, is while this administration crows about all the jobs created, they fail to tell you the overwhelming majority are part time and/or minimum wage jobs that offer lower wages and shorter hours worked each week.
>
While many of these issues are inbred into the monetary system, this administration has shown itself to be utterly ignorant of basic fiscal knowledge. Worse still is the arrogance shown by them and their inability to work with others. (And when you punch someone in the face just because, blaming them for not liking you or wanting to work with you is absurd, but that is what this administration has done).
>
When incompetence meets hubris, what should you expect?
>
On top of this, there was the problem that resulted in the crash of 2008 and how this administration's response was less than nothing. Dodd-Frank was passed, but that only papered over the problems by doing such things as making the too big to fail banks even larger.
>
Add to this tax increases and passing Obamacare which forced people to take what discretionary money they had left and either pay for insurance or a fine and you constrict people's buying habits in an economy driven largely by consumer spending.
>
Worse still, is while this administration crows about all the jobs created, they fail to tell you the overwhelming majority are part time and/or minimum wage jobs that offer lower wages and shorter hours worked each week.
>
While many of these issues are inbred into the monetary system, this administration has shown itself to be utterly ignorant of basic fiscal knowledge. Worse still is the arrogance shown by them and their inability to work with others. (And when you punch someone in the face just because, blaming them for not liking you or wanting to work with you is absurd, but that is what this administration has done).
>
When incompetence meets hubris, what should you expect?
1
Coming from a southern right-wing conservative with the name of Cleetus, your simplistic and badly misinformed comment is exactly what I would have expected.
2
The first to be blamed is Steven Ratner.
Our economy has been on the wrong course for two decades and he belatedly wonders what could be done NOW.
Now nothing could be done. Now you pay the price for the reckless policies that were implemented under the Clinton, Bush and Obama Administrations and endorsed by equally foolish Congress.
If you don’t know how to solve the problems you are obviously incompetent to write about them too.
Just let the REAL EXPERTS do it, no the phony Wall Street gurus and even more foolish financial pundits.
The idea that the Wall Street gets the credit for the booming economy and the elected leaders are to be blamed for the depressions and recessions could be uttered only by the individuals ripe for a mental institution.
Both the Wall Street and the politicians are equally responsible for everything happening with our economy...
Our economy has been on the wrong course for two decades and he belatedly wonders what could be done NOW.
Now nothing could be done. Now you pay the price for the reckless policies that were implemented under the Clinton, Bush and Obama Administrations and endorsed by equally foolish Congress.
If you don’t know how to solve the problems you are obviously incompetent to write about them too.
Just let the REAL EXPERTS do it, no the phony Wall Street gurus and even more foolish financial pundits.
The idea that the Wall Street gets the credit for the booming economy and the elected leaders are to be blamed for the depressions and recessions could be uttered only by the individuals ripe for a mental institution.
Both the Wall Street and the politicians are equally responsible for everything happening with our economy...
1
Politicians and economists have a difficult time understanding the concept that the planet is finite, therefore growth has to stop at some point. With 7 billion people, a warming planet, depleting aquifers, etc. we are reaching that point. So they keep trying to stimulate and prod the economy into growth, but all they get is debt. This is more about physics than economic policy.
3
"the reasons for the sagging economies are multifarious and jumbled, more de Kooning than Mondrian." Nicely put sir.
Dear Mr. Rattner,
Simple enough.
"Who Gets the Blame for a Slowing Economy"?
Your column features a photo of them; the greedy crooks on Wall Street take ALL the blame knowing that the taxpayers will bail them out when their excesses blow up in their faces.
Simple enough.
"Who Gets the Blame for a Slowing Economy"?
Your column features a photo of them; the greedy crooks on Wall Street take ALL the blame knowing that the taxpayers will bail them out when their excesses blow up in their faces.
I AM CONFUSED.
What the Mr Rattner seems to be advocating is more government (especially federal) debt. Federal Government debt is up by almost 9 BILLION dollars. Isn't that enough stimulus? Should it be 12 billion, 15, 20? What "austerity" is he talking about? Should we borrow as much as Japan? It doesn't seem to have worked for them, so far, no?
What the Mr Rattner seems to be advocating is more government (especially federal) debt. Federal Government debt is up by almost 9 BILLION dollars. Isn't that enough stimulus? Should it be 12 billion, 15, 20? What "austerity" is he talking about? Should we borrow as much as Japan? It doesn't seem to have worked for them, so far, no?
1
It is worse than you think and it is possible you are confused regarding trillions, not billions.
If Obama had sent 5 or 10 of the top Wall Street gangsters to prision - real prison not a white collar country club- he would have been able to demonstrate what America is supposed to be about.
Or how about executing the banking corporations - after all our very own supreme court has declared that corporations are people too. Ruining the lives of millions is certainly a capital offense!
Or how about executing the banking corporations - after all our very own supreme court has declared that corporations are people too. Ruining the lives of millions is certainly a capital offense!
8
I think one can classify this as classic Steve Rattner "want your cake and eat it too" logic. Borrowing is a function of demand. If rates are low, theoretically there should be more borrowing. It isn't happening. Reason, there are no profit making opportunities worth a 3% carry. Government must now spend. They don't and won't, due to GOP control of Congress. So just sit back and accept it. The next down leg will take down most of those left standing in the middle class. This will make the cycle back to serfdom complete. China, who cares?
3
Slow down? Evidently I missed the pick up...
1
Pleasing to see that the usual blame of immigrants, labor unions, or ISIS was not on display. However, Rattner misses three big items.
First, we have a so-called "health care" system that costs us twice as much as it should. That is over a trillion dollars wasted annually - most of it going into the pockets of middle-men who add no value.
Second, the idea that some regulatory red tape is preventing investment is horse-manure. A long history of abuse and no sign of change shows that big business needs to be regulated. Far more damaging is a regulatory regime that constantly changes. Who can plan when one year solar cells are subsidized and the next not?
Third, and most important, we continue to accept the cancer of an ever expanding income/wealth margin. Due primarily to a rigged system that allows those in power to socialize costs and privatize profits. Revelation after revelation show yet another fortune made off the back of some tax-funded expenditure. Not one oil or mining company has ever paid the true cost to restore the damage they do to our shared environment. Yet we continue to reward them with cheap rights to public lands and tax breaks - and their executives walk away with fortunes that would make the robber barrons of old blush.
If the social and economic priniples that conservatives espouse were applied fairly, then perhaps you would see a boom.
First, we have a so-called "health care" system that costs us twice as much as it should. That is over a trillion dollars wasted annually - most of it going into the pockets of middle-men who add no value.
Second, the idea that some regulatory red tape is preventing investment is horse-manure. A long history of abuse and no sign of change shows that big business needs to be regulated. Far more damaging is a regulatory regime that constantly changes. Who can plan when one year solar cells are subsidized and the next not?
Third, and most important, we continue to accept the cancer of an ever expanding income/wealth margin. Due primarily to a rigged system that allows those in power to socialize costs and privatize profits. Revelation after revelation show yet another fortune made off the back of some tax-funded expenditure. Not one oil or mining company has ever paid the true cost to restore the damage they do to our shared environment. Yet we continue to reward them with cheap rights to public lands and tax breaks - and their executives walk away with fortunes that would make the robber barrons of old blush.
If the social and economic priniples that conservatives espouse were applied fairly, then perhaps you would see a boom.
6
where does the writer foresee this boom that could /may be on the horizon if we were to follow conservative social and economic principles. presently, according to the current prophets of conservatism if we would only cut taxes,increaser defense spending, rid the society of obana(but its true name should be romney )care we would reenter our beloved seventh heaven. seriously? there is no doubt our government has followed the path laid out by keynes for the past sixty years with the defense spending laced through every congressional district which served us well enough but the whole idea got mistaken. none of the products so produced where ever supposed to be used. just make them and dispose them. that scenario was fine as long as it was backed up by a capital intense industrial base. so what developed was the mass exodus of our national capital to low labor cost areas. now we are stuck with minimum wage, no benefit (right to work states) workers - how in heavens name are you going to create a boom with that lot? remove abortion rights, cancel gay marriage will that do it?
If I were in charge of Steven Rattner career, he would be sitting right now in a class with the first-graders working on his elementary education.
For months Donald Trump has foolishly claimed that China, Japan, Korea, India, Pakistan, Vietnam or Mexico are manipulating their currency and that’s why we cannot compete with them.
It’s hard to determine who is more incompetent between those two gentlemen.
That’s a kind of the logical mistakes our primitive ancestors were making many millenniums ago.
They naively looked at the sky and the moving stars and concluded that the entire space is rotating around the Earth.
It never crossed their minds that maybe our planet is rotating.
Of course it means our country is manipulating our currency to overvalue it. That is why we cannot compete with the rest of the world.
Our government cannot balance the federal budgets so it puts the spending on a credit card claiming it will be paid off. It will never happen. It’s the colossal lie.
If we honestly told the world that we cannot pay off the national debt and that we have to print the money to pay the bills, the values of dollar would nosedive and the value of the currencies of the exporting countries would skyrocket. Afterwards the world would have the sustainable balanced trade.
It beats me why the world prefers to fool self. We can solve the problems right now, right here or continue to act recklessly waiting on the next Great Depression.
The question is what we prefer.
For months Donald Trump has foolishly claimed that China, Japan, Korea, India, Pakistan, Vietnam or Mexico are manipulating their currency and that’s why we cannot compete with them.
It’s hard to determine who is more incompetent between those two gentlemen.
That’s a kind of the logical mistakes our primitive ancestors were making many millenniums ago.
They naively looked at the sky and the moving stars and concluded that the entire space is rotating around the Earth.
It never crossed their minds that maybe our planet is rotating.
Of course it means our country is manipulating our currency to overvalue it. That is why we cannot compete with the rest of the world.
Our government cannot balance the federal budgets so it puts the spending on a credit card claiming it will be paid off. It will never happen. It’s the colossal lie.
If we honestly told the world that we cannot pay off the national debt and that we have to print the money to pay the bills, the values of dollar would nosedive and the value of the currencies of the exporting countries would skyrocket. Afterwards the world would have the sustainable balanced trade.
It beats me why the world prefers to fool self. We can solve the problems right now, right here or continue to act recklessly waiting on the next Great Depression.
The question is what we prefer.
1
And the cause of most debt? Dishonest tax cuts for the wealthiest taxpayers. People who have so much extra wealth, they literally don't know what to do with it. Below the radar lurks the fact that they invest much of their windfall tax break dollars in foreign ventures, not companies spending in the US. Republicans want to cut taxes disproportionally more for the rich once again, to what end? So they can invest still more in India and China? Right wingers want to move social security to the Wall Street casino, why? So that our precious retirement dollars can be invested in foreign growth too? The rich are allowed to move money offshore, and incented to invest offshore. Debt is not the main problem, tax law is.
1
It's ironic that the moment the Great Recession hit can be traced to the late 90's when in the midst of the "New Economy" (also called the Dot.Com Bubble), unilaterally, Alan Greenspan, the head of the Fed, in an act of INCREDIBLY destructive hubris, decided that the Fed needed to show Wall Street and NASDAQ who was boss. The Fed began, for no darn good reason, to tighten the money supply, to slow the economy, I suspect, in part, he had political motives, seeking to help the GOP win back the Presidency. Then, when the economy was slipping into recession, and George W. Bush proposed huge, irresponsible tax cuts for corporations and the rich that mathematically would move the budget from a surplus to a deficit, Greenspan whole-heartedly endorsed them. The economy began collapsing and then....having squandered the "rainy day" savings, 9/11 hit, and we've never fully recovered from that hit because of the damage done afterwards.
As pointed out, the only good our gridlock has done is prevent us from doing what the Europeans did--seriously cutting spending and having the central bank(s) clamp down on lending and the money supply. It's kicked off the European recession, the collapse of the Euro, and a possible "Brexit".
The collapse of oil prices, good for the consumer and the environment, but bad for OPEC and Exxon, has not resulted in economic growth or recovery in anything but the automobile sector.
IOW, the "Conservative" reaction to recession is the worst possible thing.
As pointed out, the only good our gridlock has done is prevent us from doing what the Europeans did--seriously cutting spending and having the central bank(s) clamp down on lending and the money supply. It's kicked off the European recession, the collapse of the Euro, and a possible "Brexit".
The collapse of oil prices, good for the consumer and the environment, but bad for OPEC and Exxon, has not resulted in economic growth or recovery in anything but the automobile sector.
IOW, the "Conservative" reaction to recession is the worst possible thing.
6
Steve Rattner has the august New York Times as a venue and yet clearly has no idea what he is talking about.
Politics in the long run is marginal to economic activity. Politicians cannot dial in growth and usually their economic intervention is clumsy and results in unintended consequences.
Perhaps Ratter needs to go back to his earlier days and re-read Adam Smith?
Politics in the long run is marginal to economic activity. Politicians cannot dial in growth and usually their economic intervention is clumsy and results in unintended consequences.
Perhaps Ratter needs to go back to his earlier days and re-read Adam Smith?
3
Whatever supply side economics is good for it has been disastrous since 2007. What has been lacking in the United States has been demand. The main problem for banks, besides stupid management, is a lack of borrowers. Governments with their austerity ideology has only made things worse. With interest rates still at record lows there needs to be government spending. In the United States, in particular, there needs to be a boom in infrastructure spending, and a relief for the budgets of states and localities.
152
Austerity ideology? What universe do you live in? Have you read the most recent CBO report on the implications of our spending and the unfunded liabilities that are baked into our economy? Infrastructure spending? You mean like the Stimulus of almost a Trillion dollars that was a slush fund for democratic constituencies. Your comments make ones head spin. The debt and deficit will crash this country is something isn't done. Your prescription? SPEND MORE. sheesh!
Sure. We should plummet further into debt. $20,000,000,000,000 isn't even debt yet?
The reason there aren't enough borrowers is because small business startups are way down (and bankruptcies are up). Increased regulations (and higher costs for things like health care) are driving away small business development.
The reason there aren't enough borrowers is because small business startups are way down (and bankruptcies are up). Increased regulations (and higher costs for things like health care) are driving away small business development.
"austerity ideology" - you DO live in the USA don't you?
Obstructionist republicans in Congress have been paid to hold the status quo for their billionaire money masters. They are responsible for the not-so-slow decay of democracy and prosperity in America. WE must remove them from every elected office in America as well as positions in OUR governments across America. The tax-free financial elite are looking at their end of days.
27
The fault for the crash of 2008 lay with banking and finance and the economists and politicians who assumed that those industries could regulate themselves, and that the Fed could rescue us in case of difficulties. Although there are many possibilities for economic difficulties in the future, the most likely cause of the next crash is still the same. There are some more nominal restrictions, but banking and finance are more powerful than ever and the probability is that they will find ways to overextend again. Yet Rattner almost always opposes regulation.
Rattner seems to be trying to blame government preemptively, but he does not specify exactly what it is supposed to do. He finds fault with Chinese authorities for trying to restrain the stock market when it is booming and stimulate it when it is falling - what else are they supposed to do? It's very easy to assign blame for economic downturns after the fact, but Rattner is taking the blame game to a new level - pre-assigning.
Rattner seems to be trying to blame government preemptively, but he does not specify exactly what it is supposed to do. He finds fault with Chinese authorities for trying to restrain the stock market when it is booming and stimulate it when it is falling - what else are they supposed to do? It's very easy to assign blame for economic downturns after the fact, but Rattner is taking the blame game to a new level - pre-assigning.
18
You state that economists / forecasters often get it wrong. You fail to point out that they are often paid to lie - to add an intellectual veneer to a big con such as the housing bubble. The distrust of government tracks the distrust of 'factual' institutions. For example, anyone who believes the 'Chicago School' of economists should have their head examined. These folks sold their intellectual souls to enable to 2008 crash.
34
Don't look for evil when it's only the nature of the job. Economists and forecasters get it wrong because there's very little way to get it right, other than luck. Anyone who could forecast accurately, regularly, would not be working at a job. He/she would be on his/her mega-yacht somewhere, laughing at the rest of us.
And maybe the reason the global economy is slowing down is that we tend to get a recession every seven years or so and we just happen to be overdue for one now.
But Mr Rattner touches (lightly) on a key point rarely if ever mentioned in our public discourse, which seems strange given how much we seem obsessed with income inequality these days. And that is the effect of China's integration into the global trading system and the ways in which such has impacted worker earnings in the West.
After all, part of foreign trade is to induce efficiencies by exposing domestic economies to foreign competition. And the way it does so is that higher wage economies see wages stagnate in exposure to lower wage economies, who see their wages rise as opportunities arise. So the higher wage economies (us) shed jobs and income, while lower wage economies (China, India, etc) see theirs grow, with the more developed supposedly moving higher up the skill ladder, sloughing off lesser skilled and lower paid jobs to the less developed, to whom those are still better than what they have had.
Is it coincidence that income and opportunity for our lower classes have stagnated over the period in which China has taken such an important position in global trade?
Now theoretically, that should free up our workers for higher level stuff. But human capability is on a Bell Curve and most are neither capable or have the inclination to make that jump, and so, stagnate. Why is this getting so little attention?
But Mr Rattner touches (lightly) on a key point rarely if ever mentioned in our public discourse, which seems strange given how much we seem obsessed with income inequality these days. And that is the effect of China's integration into the global trading system and the ways in which such has impacted worker earnings in the West.
After all, part of foreign trade is to induce efficiencies by exposing domestic economies to foreign competition. And the way it does so is that higher wage economies see wages stagnate in exposure to lower wage economies, who see their wages rise as opportunities arise. So the higher wage economies (us) shed jobs and income, while lower wage economies (China, India, etc) see theirs grow, with the more developed supposedly moving higher up the skill ladder, sloughing off lesser skilled and lower paid jobs to the less developed, to whom those are still better than what they have had.
Is it coincidence that income and opportunity for our lower classes have stagnated over the period in which China has taken such an important position in global trade?
Now theoretically, that should free up our workers for higher level stuff. But human capability is on a Bell Curve and most are neither capable or have the inclination to make that jump, and so, stagnate. Why is this getting so little attention?
31
"human capability is on a Bell Curve and most are neither capable or have the inclination to make that jump, and so, stagnate."
I thought that it was not politically correct to mention the Bell Curve. According to the liberal/progressives everyone has the same IQ.
I thought that it was not politically correct to mention the Bell Curve. According to the liberal/progressives everyone has the same IQ.
1
China is a unique case given its size.
1
Your explanation is so simple and so correct. It is not PC as most blue coller folks will not accept the view of where they may fit on the curve. We have sent the jobs ever westward. We ignored the old saw, "East is East and West Is West and never the twain shall meet"
1
Mr. Ratner leaves out a very important contributor to the problem and that is the changing nature of corporate Behavior. Somewhere in the last 10 years it's become very fashionable for companies to stop investing in their businesses, preferring insteadto hoard cash and reward stockholders. Between tax loopholes kept place by political gridlock and a focus on profits over expansion, corporations are doing fine but workers are not.
We need radical tax reform and a return to the original premise of capitalism that that is a partnership of Labor and management. Today it is far too much a system that benefits only a few. Unless the lower and middle class is brought back into the production cycle , we will have to endure this lopsided economic system where the purpose of business is profit over people.
We need radical tax reform and a return to the original premise of capitalism that that is a partnership of Labor and management. Today it is far too much a system that benefits only a few. Unless the lower and middle class is brought back into the production cycle , we will have to endure this lopsided economic system where the purpose of business is profit over people.
229
Absolutely. Anyone who has started a new job in the past 10 years can tell you that job training is non-existent. You start a job and if you actually have computer access on day one and can find anyone to tell you what you are supposed to be doing, you are waaaay off the norm. Employees are no longer seen as assets but a drain on corporate profits. I've seen it first hand too many times.
4
Why invest? The Fed gives them free money to pay down and finance stock buybacks and dividends and the best of all, they have learned that spreading a million around K-Street allows them to harvest a billion in rule changes, tax bennnies and out right gimmes. Why on earth take the risk of building a factory, investing in R&D and hiring workers?
The game is rigged and getting worse.
The game is rigged and getting worse.
3
What's wrong with rewarding stockholders? Stockholders are the co-owners of a business, they take on some of the risk that a business faces, why shouldn't they be rewarded? If you are the sort of person who buys into an enterprise without expecting a return on your investment, then please get in touch with me.
2
"governments haven’t done enough to help the situation — and have done a lot to exacerbate it."
Yet what governments have done is exactly what Rattner has consistently supported, austerity and tax cuts. What governments have not done are things Rattner consistently opposes. He does not here say what they should do, just notes the problems of lack of demand that come from income inequality and lack of consumer equity and credit.
"contenders like Donald J. Trump and Bernie Sanders, who promise unconventional, and potentially disruptive, changes if elected."
More of the same won't work. That is pushing us to recession.
The "disruption" feared from these two, especially Bernie, is specifically to fix the problems this article just admitted, such as income inequality and lack of demand.
Rattner suggests a safe candidate who will do more of what isn't working, the very things that "done enough to help the situation — and have done a lot to exacerbate it."
He isn't sincere about any concerns here, just listing them then suggesting what he always wants that doesn't work. Just vote Hillary.
Yet what governments have done is exactly what Rattner has consistently supported, austerity and tax cuts. What governments have not done are things Rattner consistently opposes. He does not here say what they should do, just notes the problems of lack of demand that come from income inequality and lack of consumer equity and credit.
"contenders like Donald J. Trump and Bernie Sanders, who promise unconventional, and potentially disruptive, changes if elected."
More of the same won't work. That is pushing us to recession.
The "disruption" feared from these two, especially Bernie, is specifically to fix the problems this article just admitted, such as income inequality and lack of demand.
Rattner suggests a safe candidate who will do more of what isn't working, the very things that "done enough to help the situation — and have done a lot to exacerbate it."
He isn't sincere about any concerns here, just listing them then suggesting what he always wants that doesn't work. Just vote Hillary.
63
Yes, adding $9 Trillion in Debt through QE ad infinitum is so "austere."
Look at CT, wealthiest little state in America. Two large tax increases, over spending, now saddled with record debt, 49% of its citizens want to flee, countless companies left, folded, are fleeing (like GE, but hey, who needs a mutli-billion dollar company in their state; as Gov. Malloy said "win some, lose some, eh), or sure to flee like Aetna & Travelers, lost two Billionaires last week, and sure to lose two more next week.
Clearly the Democrat policies enacted at the State level can be seen as destroying the state. But golly, Democrats think the problem there aren't more policies like CT.
Nuts.
Look at CT, wealthiest little state in America. Two large tax increases, over spending, now saddled with record debt, 49% of its citizens want to flee, countless companies left, folded, are fleeing (like GE, but hey, who needs a mutli-billion dollar company in their state; as Gov. Malloy said "win some, lose some, eh), or sure to flee like Aetna & Travelers, lost two Billionaires last week, and sure to lose two more next week.
Clearly the Democrat policies enacted at the State level can be seen as destroying the state. But golly, Democrats think the problem there aren't more policies like CT.
Nuts.
...And, Hillary would turn a blind eye to the "business as usual" behavior of Wall Street and "Big Business."
1
Until the Federal reserve is throttled, the dual mandate removed and the incestuous selection of Chairmen and governors is dismembered, nothing will change.
The Fed has lived beyond its original necessity of providing market priced liquidity to solvent member banks.
Now they travel the globe sipping champagne and eating lobster touting economic baloney.
Another institution that has outlived its usefulness. And ZIRP and QE
only went into the pockets of deadbeats, debtors and speculators while robbing savers and retirees of their wealth. Where is it written that the Fed can reach in and steal so easily without shame or remorse while taking credit for job growth as they impoverished seniors? Only in America.
The Fed has lived beyond its original necessity of providing market priced liquidity to solvent member banks.
Now they travel the globe sipping champagne and eating lobster touting economic baloney.
Another institution that has outlived its usefulness. And ZIRP and QE
only went into the pockets of deadbeats, debtors and speculators while robbing savers and retirees of their wealth. Where is it written that the Fed can reach in and steal so easily without shame or remorse while taking credit for job growth as they impoverished seniors? Only in America.
"We" keep shifting the tax burden onto the middle and lower income population - just the people who actually *buy* things. The outcome is a foregone conclusion.
195
How about some evidence?
Taxes are not the economy.
you betcha. and when the proposals of flat taxes keep surfacing it is another form of more gifts for the greedy promoted by the greedy.
Already, in most states, particularly in "no income tax" Texas, bought off politicians have been able to burden the middle class and below with high property taxes, high sales taxes and every other form of tax attacking modest disposable income levels while the wealthy once again get a free ride.
Already, in most states, particularly in "no income tax" Texas, bought off politicians have been able to burden the middle class and below with high property taxes, high sales taxes and every other form of tax attacking modest disposable income levels while the wealthy once again get a free ride.
1
Debt is a risk, as banks in the US showed us, as have Greece, Venezuela, Argentina and China teaching us. Thank you history, for spoon feeding us this lesson over and over again. Perhaps one day the US will learn to live within our means. Meanwhile, governments around the world are afraid to let a business cycle simply unfold. Downturns are inevitable and actually necessary part of long term economic paths. Keynes himself recommended governments spend more in downturns, and cut back in upturns. We have lost our way.
10
Debt is NOT the issue! It is the type of debt or timing of debt.
The USA has had debt from the beginning of the republic and deficits frequently over the last couple hundred years.
DEBT: We had large increase in the debt for the civil war and WW2, smaller increases during the Great Depression and a couple recessions. And we recovered.
DEFICIT: We ran budget deficits for most of modern history (http://si.wsj.net/public/resources/images/BN-EX454_wwii10_G_201410081430...
And we had a budget surplus which reduced the debt as recently as 1995-2000... until squandered by Republicans.
The deficit in 200-2010 was NECESSARY as we were in an economic war, effectively.
But you can see from the graph that it is reducing
Downturns are indeed inevitable but cushioning the fall is reasonable and should be expected of govt by their citizens
But your statements are contradictory- we cannot "ive within our means" while at other times then spending in downturns and cut back in upturns..
The USA has had debt from the beginning of the republic and deficits frequently over the last couple hundred years.
DEBT: We had large increase in the debt for the civil war and WW2, smaller increases during the Great Depression and a couple recessions. And we recovered.
DEFICIT: We ran budget deficits for most of modern history (http://si.wsj.net/public/resources/images/BN-EX454_wwii10_G_201410081430...
And we had a budget surplus which reduced the debt as recently as 1995-2000... until squandered by Republicans.
The deficit in 200-2010 was NECESSARY as we were in an economic war, effectively.
But you can see from the graph that it is reducing
Downturns are indeed inevitable but cushioning the fall is reasonable and should be expected of govt by their citizens
But your statements are contradictory- we cannot "ive within our means" while at other times then spending in downturns and cut back in upturns..
1
Could it be that the decision makers at the majority of corporations, financial institutions and in government are bean counters. It appears that what happened is that leading up to 2008 lenders were very liberal in their practices, basically making risky decisions and accounting for the risk through increased rates, then when it all came down they became overly conservative which results in stagnant growth. In addition to this government institutions became more conservative in their practices whereby they began to tighten their belts as well, exacerbating the situation. I understand that this is a very simplified explanation, however, it makes a lot of sense to me who has worked with in the construction industry with engineers who are fine decision makers, and where the accountants are the ones in the back office typically making few if any decisions.
5
Too much "hand-waving" here. Please explain to a non-economist like myself:
1) why "weak productivity growth" ? (less automation? and wouldn't more
automation possibly result in more unemployment?)
2) why does "increased saving" "push" more money into hands of the rich?
3) How do "efforts to avoid another financial crisis" discourage lending?
(are lower rates meant to discourage lending? or to encourage
borrowing? what is the impact of rates vs regulations like Dodd-Frank?)
4) how do "weakened credit markets" (less bond demand due to lower
rates?) compare with the alleged benefits (stimulus? more borrowing?)
5) how does the downside of energy sector cuts stack up against the upside
of lower energy costs for everybody else?
1) why "weak productivity growth" ? (less automation? and wouldn't more
automation possibly result in more unemployment?)
2) why does "increased saving" "push" more money into hands of the rich?
3) How do "efforts to avoid another financial crisis" discourage lending?
(are lower rates meant to discourage lending? or to encourage
borrowing? what is the impact of rates vs regulations like Dodd-Frank?)
4) how do "weakened credit markets" (less bond demand due to lower
rates?) compare with the alleged benefits (stimulus? more borrowing?)
5) how does the downside of energy sector cuts stack up against the upside
of lower energy costs for everybody else?
9
On increased savings, the rich save more on 2 levels: they have more income and need to spend less of it to meet daily expenses, and secondly their luxury spending wil be limited because you can only buy so many yachts. The more therich save, tthe less their money goes into the economy making jobs for others. And it is not like these savings go to fund new businesses. Rich people leave their money in low risk investments, like Apple stock, that do little to drive the broader economy.
Amen. It's fine to historically examine the patterns of economic trends and behaviors. It is entirely something else to pretend we know cause/effect, action/impact, etc.
Republicans do not want to spend any money unless a similar sum is cut somewhere else in the federal budget. They do not want to increase the deficit. History shows that this is monumentally stupid.
Every time we have balanced the budget, eliminated deficits, had surpluses, took in more in revenue than we spent, every time we have done this for more than 3 years we have immediately fallen into a real depression. Since at least WWII almost every recession has been preceded by a decrease in the deficit. In the present case, the excruciatingly slow recovery is primarily caused by a 75% reduction in the deficit.
Now history does not show that large deficits guarantee prosperity. The money must be wisely spent. If taxes are cut, it must be sensibly done. But there have been long periods with mostly deficits that have significantly increased the debt that were very prosperous.
Here are two examples--post WWI and post WWII. After WWI we eliminated deficits for 10 years. We decreased the debt by 38% by 10/1929. Then the economy fell off a cliff. After WWII we had deficits for 21 of the years between 1946 and 1973. We increased the debt by 75%. And we enjoyed Great Prosperity. For example, real median household income surged 74%.
We are never going to get back to real prosperity, prosperity not based on private borrowing from banks, if we do not give up the idea that federal deficits and debt are bad for the economy. KItchen table finances just do not work for the US government.
Every time we have balanced the budget, eliminated deficits, had surpluses, took in more in revenue than we spent, every time we have done this for more than 3 years we have immediately fallen into a real depression. Since at least WWII almost every recession has been preceded by a decrease in the deficit. In the present case, the excruciatingly slow recovery is primarily caused by a 75% reduction in the deficit.
Now history does not show that large deficits guarantee prosperity. The money must be wisely spent. If taxes are cut, it must be sensibly done. But there have been long periods with mostly deficits that have significantly increased the debt that were very prosperous.
Here are two examples--post WWI and post WWII. After WWI we eliminated deficits for 10 years. We decreased the debt by 38% by 10/1929. Then the economy fell off a cliff. After WWII we had deficits for 21 of the years between 1946 and 1973. We increased the debt by 75%. And we enjoyed Great Prosperity. For example, real median household income surged 74%.
We are never going to get back to real prosperity, prosperity not based on private borrowing from banks, if we do not give up the idea that federal deficits and debt are bad for the economy. KItchen table finances just do not work for the US government.
103
I agree that excess hand wringing over deficits, especially in times of recession, can and has been extremely damaging historically. But conversely there is an infrequently discussed downside to running persistent deficits and consistently growing the total debt figure, especially if they're growing at a higher rate than the GDP.
In 2016 $283 billion of the federal budget, about 7%, went to debt interest payments. In recent years it has been upwards of 15%. This is money that comes from everyone, but is paid primarily to those wealthy enough to own large amounts of Treasuries. It is basically a 'back door' that effectively makes the tax code more regressive than it appears on paper. If interest rates rise, this effect becomes even more pronounced.
Yes, you could argue that pension funds for the middle class also reap these benefits as do middle class holders of bond funds and money markets, but that table is slanted.
As with debt incurred by any person or entity, the true measure is does the benefit you're getting outweigh the payment of interest? If the money is for an investment in the future; a capital expenditure - infrastructure, education, research - then the benefits should be greater. Unfortunately, what the federal government has been spending this money on could be accurately described as squandering.
In 2016 $283 billion of the federal budget, about 7%, went to debt interest payments. In recent years it has been upwards of 15%. This is money that comes from everyone, but is paid primarily to those wealthy enough to own large amounts of Treasuries. It is basically a 'back door' that effectively makes the tax code more regressive than it appears on paper. If interest rates rise, this effect becomes even more pronounced.
Yes, you could argue that pension funds for the middle class also reap these benefits as do middle class holders of bond funds and money markets, but that table is slanted.
As with debt incurred by any person or entity, the true measure is does the benefit you're getting outweigh the payment of interest? If the money is for an investment in the future; a capital expenditure - infrastructure, education, research - then the benefits should be greater. Unfortunately, what the federal government has been spending this money on could be accurately described as squandering.
1
Mike, this is one time absolute numbers are the wrong thing to look at. After you account for the interest returned by the FED on the Treasury bonds it holds, our debt service is running below 1% of GDP which is the lowest in about 60 years. Tell me when in all of US history had the debt or the deficit or the debt service ever hurt our economy.
It is true that it is better to spend the money wisely, but as I have remarked, if we do not have deficits for a while, the economy has always crashed. This is true in good times and bad.
1. In the history of the US we have had 6 depressions.
2. Each of these was preceded by a sustained period of federal surpluses which sucked money out of the private sector, & each such period was followed by a depression. As the economy grows, it needs more and more money. If it doesn't come from a huge favorable trade balance, the only place outside the private sector the money can come from is from the federal gov by means of deficit spending which is money for people, businesses and state & local govs.
3. When the amount of useful money in the private sector becomes insufficient to support commerce, people & businesses borrow from banks. Private debt explodes.
4. The banking system can handle only so much debt. In each of the 6 cases, it failed, & the economy crashed.
In the absence of a large favorable trade balance, federal deficits are necessary not only for prosperity, but to avoid disaster. But they are not sufficient.
It is true that it is better to spend the money wisely, but as I have remarked, if we do not have deficits for a while, the economy has always crashed. This is true in good times and bad.
1. In the history of the US we have had 6 depressions.
2. Each of these was preceded by a sustained period of federal surpluses which sucked money out of the private sector, & each such period was followed by a depression. As the economy grows, it needs more and more money. If it doesn't come from a huge favorable trade balance, the only place outside the private sector the money can come from is from the federal gov by means of deficit spending which is money for people, businesses and state & local govs.
3. When the amount of useful money in the private sector becomes insufficient to support commerce, people & businesses borrow from banks. Private debt explodes.
4. The banking system can handle only so much debt. In each of the 6 cases, it failed, & the economy crashed.
In the absence of a large favorable trade balance, federal deficits are necessary not only for prosperity, but to avoid disaster. But they are not sufficient.
3
Who gets the blame? Paul Krugman.
When you spend more than you take in, your economic decisions are just plain wrong.
When your government spends more than it takes in, its economic decisions are just plain wrong. It doesn't take a Ph.D or a Nobel prize in economics to determine this. No calculus is involved.
When your government spends more than it takes in, this has an effect. This effect is bad, no matter what the government tells you. Because let's face it, the entity acting badly is not going to tell you it has acted badly.
In order for you to spend more than you take in, you have to borrow. In order for the government to spend more than it takes in, it too has to borrow. When you borrow money to cover your excess spending, you reduce the amount of money available to your immediate neighbors. When the government borrows money to cover its excess spending, it reduces the amount of money available to everyone in the country, and other countries besides. This reduces the amount of money that the productive enterprises in the country (which the government is not) can use to create products that consumers want.
The end result: A recession.
Ludwig von Mises, Friedrich Hayek, and many others demonstrated repeatedly that government interference in the free market is the cause of booms and busts. You can refuse to believe the truth, and reality still kicks you in the butt.
When you spend more than you take in, your economic decisions are just plain wrong.
When your government spends more than it takes in, its economic decisions are just plain wrong. It doesn't take a Ph.D or a Nobel prize in economics to determine this. No calculus is involved.
When your government spends more than it takes in, this has an effect. This effect is bad, no matter what the government tells you. Because let's face it, the entity acting badly is not going to tell you it has acted badly.
In order for you to spend more than you take in, you have to borrow. In order for the government to spend more than it takes in, it too has to borrow. When you borrow money to cover your excess spending, you reduce the amount of money available to your immediate neighbors. When the government borrows money to cover its excess spending, it reduces the amount of money available to everyone in the country, and other countries besides. This reduces the amount of money that the productive enterprises in the country (which the government is not) can use to create products that consumers want.
The end result: A recession.
Ludwig von Mises, Friedrich Hayek, and many others demonstrated repeatedly that government interference in the free market is the cause of booms and busts. You can refuse to believe the truth, and reality still kicks you in the butt.
13
I beg to differ. It is the LACK of using government's power to act anti-cyclically that allowed the boom-and-bust problems leading up the the Great Depression.
You really need to review your history of the 19th century "Panics" as recessions were called, the destructive constrictions the Gold Standard inflicted on the economy, and WHEN the economy was actually successful.
Since your clearly a Republican, you need to review that when St. Ronald was President he tripled the National Debt, and I'm sure you'd argue that was a "golden era" for the economy, totally disproving your thesis. In fact, if you look at Rattner's chart of confidence in the President, the 4 giant drops came under LBJ, Richard Nixon, George H.W.Bush, and George W. Bush. The BIGGEST gain came under Bill Clinton, followed by Reagan (which fell off precipitously at the end), and Jerry Ford and (surprisingly) Jimmy Carter came off fairly even as does Obama.
The whole thesis that under Democrats the economy founders and under Republicans prospers simply hasn't been borne out by the facts and history. Both Bushes left us with economic chaos and each of their Democratic successors has "righted the ship" and kept it from sinking.
You really need to review your history of the 19th century "Panics" as recessions were called, the destructive constrictions the Gold Standard inflicted on the economy, and WHEN the economy was actually successful.
Since your clearly a Republican, you need to review that when St. Ronald was President he tripled the National Debt, and I'm sure you'd argue that was a "golden era" for the economy, totally disproving your thesis. In fact, if you look at Rattner's chart of confidence in the President, the 4 giant drops came under LBJ, Richard Nixon, George H.W.Bush, and George W. Bush. The BIGGEST gain came under Bill Clinton, followed by Reagan (which fell off precipitously at the end), and Jerry Ford and (surprisingly) Jimmy Carter came off fairly even as does Obama.
The whole thesis that under Democrats the economy founders and under Republicans prospers simply hasn't been borne out by the facts and history. Both Bushes left us with economic chaos and each of their Democratic successors has "righted the ship" and kept it from sinking.
4
Read Charlap above with real data. National economics is not kitchen table economics. Pay of the debt, get a recession or depression.
3
This is too simplistic. The argument you present needs to have one other
factor included-interest rates and inflation. When gov. borrowing reduces private borrowing due to lack of available funds, we should see high interest rates-we don't. You could argue that is is because gov. is "printing money" (all those Austrian economists do), but then we would see high inflation-we don't.
factor included-interest rates and inflation. When gov. borrowing reduces private borrowing due to lack of available funds, we should see high interest rates-we don't. You could argue that is is because gov. is "printing money" (all those Austrian economists do), but then we would see high inflation-we don't.
1
This is just a justification for "business as usual" hoping for a return to the good old days of growth and . . . and who knows what? What and whom were the good old days good for? And even if they were really good, was this economic model sustainable? It used to be the couple of people in China and India just didn't count. We complained about their governments, but secretly hoped they didn't unleash their potential, and the growth (and environmental destruction) they were capable of.
We need to steer towards a new ec0onomic model -- a sustainable one. So hoping for a return to the good old days is suicidal. Why is Wall Street so pathological?
Bernie Sanders, who promise unconventional, and potentially disruptive, changes if elected.
We need to steer towards a new ec0onomic model -- a sustainable one. So hoping for a return to the good old days is suicidal. Why is Wall Street so pathological?
Bernie Sanders, who promise unconventional, and potentially disruptive, changes if elected.
9
... Would ensure an immediate collapse in the economy by increasing taxes by 50%.
There, i finished that last sentence for you.
There, i finished that last sentence for you.
And the U.S. Continues to operate like someone on over draft and with a credit card on a 22% interest rate.
2
The U.S. government borrows money at something less than 3%. This comment makes no sense.
3
What are you taking about? Interest rates are incredible low. The right can't seem to figure out there is a difference between sovereign debt and credit card debt.
3
Let me put it this way. If it wasn't for the obstruction of the Republicans on every jobs plan President Obama put forth, just to hope he fails, we wouldn't even be having this conversation.
201
And it is possible that corporate america is engineering this "downturn," so that people loose faith in a democratic administration and then their boy wins. Except this time "their boy" might be Trump who is nothing if not a wild card, and is probably not the dupe of corporate America that the rest of the GOP is. Confusing and disruptive times, indeed!
Ongoing US and global economic problems are due to two concurrent and related forces: 1) GOP obstruction to any attempts to grow jobs or improve the economic situation of the middle class and the poor
2) Greedy elites, the millionaires, billionaires, corporations and those who enable them (in the media, in politics) who have decided that more than they can ever spend or amass in a lifetime is not enough.
Both need to be aware that it can't go on forever and that past history shows what happens - France 1789, Russia 1917, China 1949, the list goes on. Eventually the peasants revolt.
2) Greedy elites, the millionaires, billionaires, corporations and those who enable them (in the media, in politics) who have decided that more than they can ever spend or amass in a lifetime is not enough.
Both need to be aware that it can't go on forever and that past history shows what happens - France 1789, Russia 1917, China 1949, the list goes on. Eventually the peasants revolt.
50
Please review history. None of your examples were provoked by "peasants".
That's an easy answer. Who gets the blame for a failing economy. If a democrat is running the country. It's George Bush's fault. If a republican is running the country it's their fault.
8
One factor that you fail to mention when it comes to people's confidence in government is effect of several decades of oligarchs who purposely set out to undermine public confidence in government solutions. There motive is clear, if they can neuter government they are free to operate in a manner that optimizes their profits at the expense of most of the people. The result is a lack of confidence in government which weakens government's ability to act in a forceful way to address our problems in economics and other areas. Fox News, talk radio, and politically oriented right wing NGAs have been quite successful in creating this situation. The media could help to educate people about what is going on, but I say little evidence of their willingness to expose the damaging effects of dark money on our country and the world.
54
Andrew Carnegie reacted to the 1873 financial crisis by taking the opportunity to replace his Bessemer furnaces with open-hearth furnaces and to hire new workers. When the crisis ended he was in the drivers seat. Too many of today's CEOs lack that kind of courage and foresight.
16
That kind of foresight would result in more companies replacing human workers with automated machinery resulting in more efficiency and fewer jobs. I am sure that the liberals would be very quick to condemn that as "greed".
1
The analogous public sector opportunity is to take advantage of low interest rates by rebuilding our infrastructure, investing in R& D, health care, education, etc.--all things that add value to our nation, provide employment, and stimulate the economy.
Elementary, my dear Watson, when private sector demand is not enough and interest rates are so low.
Elementary, my dear Watson, when private sector demand is not enough and interest rates are so low.
1
Hear, Hear, Mr. Rattner, for you are on track. Off-course here as usual, I have been telling friends and kind strangers 'Save your pennies, because none of us are getting richer in the future'. A hard-working carpenter brought me as a gift a Mexican taco back from his lunch. He is voting for Trump.
4
The world economy is based on, and sustained by, an over-abundance of cheap mass labor, without the cheap labor of Southeast Asia, Eastern Europe and the agro-industries of Latin America global capitalism as it exists today would not be possible. But these teeming masses who are willing to work for sustenance wages can only carry out their work when their countries are stable enough to sustain them and to keep the wheels of this global order in place.
The problems of the past couple of decades is that it is becoming increasingly difficult to control the teeming masses, simply because they are growing far too quickly for the world economy to absorb them. This is especially the case in Islamic countries, who are not beholden to global capital, where human population growth has long ago far outstripped the ability to sustain it. Countries like Egypt and Turkey are human powderkegs, and will at some point collapse in Syrian fashion.
The global economy today is an attempt to continue making use of this cheap capital while desperately trying to keep this human powderkeg under control. At some point--and this is inevitable--this powderkeg will in some way explode, as it did in the previous two world wars.
The problems of the past couple of decades is that it is becoming increasingly difficult to control the teeming masses, simply because they are growing far too quickly for the world economy to absorb them. This is especially the case in Islamic countries, who are not beholden to global capital, where human population growth has long ago far outstripped the ability to sustain it. Countries like Egypt and Turkey are human powderkegs, and will at some point collapse in Syrian fashion.
The global economy today is an attempt to continue making use of this cheap capital while desperately trying to keep this human powderkeg under control. At some point--and this is inevitable--this powderkeg will in some way explode, as it did in the previous two world wars.
13
Dear Mr. Rattmer,
It is easy to slip the main contributor of our economic malaise amongst many other lesser causes, in order to conceal the decades long three card monte game that has led to the pickpocketing of the American middle class.
There are times when Consumer (C) and Business investment (I) spending are together insufficient to maintain the demand side of an open economy and therefore the economy remains sluggish or depressed, despite other attempts at improving it.
It is during these times that massive Government spending is the only sufficient driver of the demand side in order to revive the economy and, in turn, drive higher sustainable growth from C and I. The textbook example was the use of many government spending/stimulus programs under the umbrella of "The New Deal" during the Great Depression, which improved the US economy dramatically.
Top 10 New Deal programs:
1. CCC - Civilian Conservation Corps
2. CWA - Civil Works Administration
3. FHA - Federal Housing Administration
4. FSA - Federal Security Agency
5. HOLC - Home Owner's Loan Corporation
6. NRA - National Recovery Act
7. PWA - Public Works Administration
8. SSA - Social Security Act
9. TVA - Tennessee Valley Authority
10. WPA - Works Progress Administration
Where are the New Deal programs of today, to revive our current moribund economy? Listen to the candidates running for president. The "Socialist" is speaking loud and clear on what must be done. Feel the Bern!!
It is easy to slip the main contributor of our economic malaise amongst many other lesser causes, in order to conceal the decades long three card monte game that has led to the pickpocketing of the American middle class.
There are times when Consumer (C) and Business investment (I) spending are together insufficient to maintain the demand side of an open economy and therefore the economy remains sluggish or depressed, despite other attempts at improving it.
It is during these times that massive Government spending is the only sufficient driver of the demand side in order to revive the economy and, in turn, drive higher sustainable growth from C and I. The textbook example was the use of many government spending/stimulus programs under the umbrella of "The New Deal" during the Great Depression, which improved the US economy dramatically.
Top 10 New Deal programs:
1. CCC - Civilian Conservation Corps
2. CWA - Civil Works Administration
3. FHA - Federal Housing Administration
4. FSA - Federal Security Agency
5. HOLC - Home Owner's Loan Corporation
6. NRA - National Recovery Act
7. PWA - Public Works Administration
8. SSA - Social Security Act
9. TVA - Tennessee Valley Authority
10. WPA - Works Progress Administration
Where are the New Deal programs of today, to revive our current moribund economy? Listen to the candidates running for president. The "Socialist" is speaking loud and clear on what must be done. Feel the Bern!!
85
Funding overseas wars with disposable ordinance that must be continuously replenished with profits for "defense" corporations. How many Americans are employed by this industry? Where would they work if the wars stopped? How about on our own roads and bridges and schools?
1
None of the your 10 materially "revived" the depression economy.
In fact, the NRA not only did not help, it hindered. Its complex web
of price controls, wage controls, quotas, and other complex and
contradictory rules confused and stymied recovery. When Court
ruled that it violated the Constitution (which it did), the FDR
Administration was relieved that it could escape from this
disaster and yet make political hay blaming the 9 Old Men.
In fact, the NRA not only did not help, it hindered. Its complex web
of price controls, wage controls, quotas, and other complex and
contradictory rules confused and stymied recovery. When Court
ruled that it violated the Constitution (which it did), the FDR
Administration was relieved that it could escape from this
disaster and yet make political hay blaming the 9 Old Men.
It is a fair question to ask whether a politician who has spent their entire career governing one of the whitest states in the nation (95%), with a population the size of Detroit (but without the demographics and problems) could face the kinds of challenges involved with governing an incredibly large and diverse nation that is the biggest player on the international stage.
Because Sanders, elected to Congress in 1990, has had 26 years to convince his colleagues to pass something, anything, to get his revolution' started, yet out of 781 bills he has sponsored, he was able to get only three bills passed. Three. And two of them were about renaming post offices in his home state of Vermont. The other one was about a cost of living adjustment for veterans, hardly controversial with the GOP.
So how again would he be more effective from the Oval Office than he has been in Congress in 26 years?
Because Sanders, elected to Congress in 1990, has had 26 years to convince his colleagues to pass something, anything, to get his revolution' started, yet out of 781 bills he has sponsored, he was able to get only three bills passed. Three. And two of them were about renaming post offices in his home state of Vermont. The other one was about a cost of living adjustment for veterans, hardly controversial with the GOP.
So how again would he be more effective from the Oval Office than he has been in Congress in 26 years?
About the Deficit of trust in the USA, I have noticed that Johnson, in spite of the Vietnam War, ended his mandate with approval above 60%, while Obama, who has retreated from Irak, is around 20%.
Who deserves praise more, the leader who continues a disastrous war, or the leader who puts an end to it? Unfortunately, popularity does not mean wisdom.
Who deserves praise more, the leader who continues a disastrous war, or the leader who puts an end to it? Unfortunately, popularity does not mean wisdom.
4
Gallup polling says Obama presently has a 51% approval rate.
At this point in their Presidencies, G. W. Bush had a 32% approval rate and Bill Clinton had a 63% approval rate. You are misreading the author's chart.
At this point in their Presidencies, G. W. Bush had a 32% approval rate and Bill Clinton had a 63% approval rate. You are misreading the author's chart.
3
The chart is about "Percentage of Americans who said they could trust the government in Washington to do what is right “just about always” or “most of the time.”
It's not just about President Obama, of course, but he's the head of the Government in Washington, and "the buck stops there", with all due respect.
It's not just about President Obama, of course, but he's the head of the Government in Washington, and "the buck stops there", with all due respect.
"Fueling still more fear among consumers and businessmen alike is the looming presidential election and the surprising strength of contenders like Donald J. Trump and Bernie Sanders, who promise unconventional, and potentially disruptive, changes if elected."
I am shocked, shocked that a Wall Street insider would fear a President Bernie Sanders. But consumers? Please. We low-life consumers would do just fine under a President Bernie Sanders. Maybe not so much, Wall Street titans.
I am shocked, shocked that a Wall Street insider would fear a President Bernie Sanders. But consumers? Please. We low-life consumers would do just fine under a President Bernie Sanders. Maybe not so much, Wall Street titans.
27
As soon as I read the man saying that a return to 2008 was "almost certainly" too pessimistic, I knew he didn't know what he was talking about. No one can judge the near-term probability of another financial crisis. The rest of his article confirms his bad judgment. For example, isn't it possible that the secular stagnation thesis proposed by Gordon and Summers for different reasons is right?
3
Whether the creation of the private sector greed, or of the policy failure of the governments, the economic recessions and crises are essentially the man made catastrophes hitting the common man the hardest.
43
I would say that a legislatively-campaign to destroy the administration of a newly-elected President has had more to do with Economic Sluggishness than anything else. (And we all know who to blame for that)
3
Rattner has lots of interesting data and facts, but hides his key point: we need robust fiscal stimulus to keep our economy and the world economy from sliding into an unnecessary global recession.
The economy can't grow if consumers don't consume and with wages flat, economic growth can't be anything but slow.
There are obvious candidates for a fiscal stimulus program, including rebilding our bridges and highways and replacing lead water pipes nationwide.
Although private employment has grown steadily for a record streak, employment in the public sector is still below pre-recession levels and nearly 2 million jobs below trend. An infrastructure bank is pretty obvious as well, subjecting projects to proper diligence and taking advantage of low interest rates.
But none of it will happen.
Bogus research on national debt levels (This Time Is Different--Reinhart & Rogoff,) added to Republican fever pitch anti-deficit propaganda, prevent any rational discussion. Changes in spending, taxes and the debt can't happen unless the Congress acts, as the Constitution stipulates.
So here we go again. Millions will be hurt, losing jobs, homes and any sense of economic security.
For no good reason.
The economy can't grow if consumers don't consume and with wages flat, economic growth can't be anything but slow.
There are obvious candidates for a fiscal stimulus program, including rebilding our bridges and highways and replacing lead water pipes nationwide.
Although private employment has grown steadily for a record streak, employment in the public sector is still below pre-recession levels and nearly 2 million jobs below trend. An infrastructure bank is pretty obvious as well, subjecting projects to proper diligence and taking advantage of low interest rates.
But none of it will happen.
Bogus research on national debt levels (This Time Is Different--Reinhart & Rogoff,) added to Republican fever pitch anti-deficit propaganda, prevent any rational discussion. Changes in spending, taxes and the debt can't happen unless the Congress acts, as the Constitution stipulates.
So here we go again. Millions will be hurt, losing jobs, homes and any sense of economic security.
For no good reason.
148
Clear eye excellent post but I might add: When there have been attempts such as Tarp the money was squandered or stolen by bogus ventures. There really needs to be much Bigger Government as was the case of the W.P.A. When contracts werent let out to private contractors who merely turn around and hire the cheapest labor(illegal) possible to maximize their profits doing nothing for the underlying problem of unemployment for Americans. Crony capitalism has replaced the free market ushering in an era of privitazing the profit and socializing the debt. Although this is an issue the Republicans can claim much blame for, it's really a wink and a nod, there is blame and complicity all around no better exemplified than by Hillary, Schummer and their Wall Street ties, even regrettably, Harry Reid in the end with his Bonderman deal. The charade must end or our democracy will implode. Bernie is addressing this and I like millions of others see one last chance to restore fairness and equality to our divided nation. Please for all our sakes get out and vote, millions have died for the privilege!
3
"There are obvious candidates for a fiscal stimulus program, including rebilding our bridges and highways and replacing lead water pipes nationwide."
And of course the democrats will demand that all infrastructure repairs be done only by "prevailing wage" union workers who will then kickback most of their union dues to the democrats. The GOP would be absolutely stupid to agree with such an arrangement that gives kickback money to the democrats.
And of course the democrats will demand that all infrastructure repairs be done only by "prevailing wage" union workers who will then kickback most of their union dues to the democrats. The GOP would be absolutely stupid to agree with such an arrangement that gives kickback money to the democrats.
1
Talk to any Republican about government spending and the deficit and they will bring up the mountainous national debt and how it will leave "our children and grand children with an enormous burden" of increased taxes to pay off the debt. Stop them right there and point out that each and every Congressional Republican has pledged to Grover Norquist he or she will "never raise taxes." So their children and grandchildren are safe from those scary tax increases.
1
Out of control rogue capitalism with no costsly requirements for worker safety, decent wages or environmental safety created a manufacturing juggernaut that destroyed manufacturing in hitherto healthy countries that in turn shattered incomes.
That, not lack of artificial monetary stimulus, has crippled consumer demand in developed countries.
End of story. Except China is collapsing as demand sinks , leaving mountains of debt. Even big thinkers such as Ratner can't tell us what to do when the oncoming debt bomb detonates.
That, not lack of artificial monetary stimulus, has crippled consumer demand in developed countries.
End of story. Except China is collapsing as demand sinks , leaving mountains of debt. Even big thinkers such as Ratner can't tell us what to do when the oncoming debt bomb detonates.
30
Good article.A good overlook of the economy.Rooted observations and not empty talking like let's charge Mexico for the emigration problem,China for rigging its currency or vague progressive tasks like improve our Infraestruture when a Congress is blocking any investment in the last 7 years.Or climate change moves when we face a good amount of our citizens thinking it is an hoax.Bringing our steel mills back like Cruz and Sanders think,even from two different political spectrum,is bringing back low add value jobs,is bringing back the pollution that is poisoning the Chinese children.We are facing pure demagogy talks,not smart talks that this nation deserves.
8
The answer is simple: the American electorate, you get the economy you deserve. The economy is a function of the politicians you elect. In choosing O, they voted for a highly regulated economy and the actions of the Fed, which in reality is an extension of government. Blame is the name of the game now, as we watch the presidential race hurry to the abyss. We are about to 'trust' the same old, same old, that being the voters. In summary: born to be conned, again. Stupidness rules.
9
Do you really think we have a 'highly regulated economy"?? you must be from the planet Uranus.
3
What did they vote for with W? Let's see, less regulation, tax cuts for the upper income taxpayers and two financial panics with equity losses in excess of 50%(check the NASDQ). So take your W, I'll take the O. Besides you can do more with a vowel than a consonant like W.
5
Net Jobs:
Bush: Zero
Obama: 14 million
Change in Deficit:
Bush +1.8 trillion
Obama -1.0 trillion
Change in stock market (DJIA) (starting three months into Presidency)
Bush: -26%
Obama: +117%
Clinton's numbers, of course, would simply make you weep as a republican.
So yes, let's try the same old democratic policies again. They almost always work. But let's stop talking about republican policies, like tax cuts for the rich and less regulation, that have failed over and over.
Bush: Zero
Obama: 14 million
Change in Deficit:
Bush +1.8 trillion
Obama -1.0 trillion
Change in stock market (DJIA) (starting three months into Presidency)
Bush: -26%
Obama: +117%
Clinton's numbers, of course, would simply make you weep as a republican.
So yes, let's try the same old democratic policies again. They almost always work. But let's stop talking about republican policies, like tax cuts for the rich and less regulation, that have failed over and over.
2
Forget de Kooning and Mondrian. If Donald Trump gets in, we'll soon have Hieronymus Bosch!
39
You paint a grim but accurate picture. To which I reply - maybe it's time for "unconventional, potentially disruptive, change", Sanders-style.
24
Seems like enough of the unwashed masses who have been told for 35 years that lower taxes on rich will trickle down finally realize it was fraud. Time for unconventional indeed. Establishment refuses to accept it.
2
And if Congress does not turn Blue, as Sanders insists it will?
Then what? Is there a backup plan for what happens when Congress (inevitably) stays Red and not one of his "ideas" so much as makes it to the floor for a vote?
If only, after 26 years in Congress, Vermont's economy was doing better and child poverty was not higher in 2015 than it was in 2008, it would be easier to believe that Sander's ideas could ever make it through Congress.
Because if Sanders has not been able to fight and win in Congress for his own state in all those decades, why would he be any more successful as President?
Basing an entire agenda on winning a majority in the Senate is not the same as having a real plan, because what if that does not happen?
Then what? Is there a backup plan for what happens when Congress (inevitably) stays Red and not one of his "ideas" so much as makes it to the floor for a vote?
If only, after 26 years in Congress, Vermont's economy was doing better and child poverty was not higher in 2015 than it was in 2008, it would be easier to believe that Sander's ideas could ever make it through Congress.
Because if Sanders has not been able to fight and win in Congress for his own state in all those decades, why would he be any more successful as President?
Basing an entire agenda on winning a majority in the Senate is not the same as having a real plan, because what if that does not happen?
2
Sanders cannot singlehandedly turn Congress blue in order to effect the needed change. That's our job. It's what he calls a revolution. Campaigning and voting for a leader is the easy part. Staying engaged, working within the party to make it more relevant, writing to your representatives, marching and protesting are more labor intensive, but required for positive change. Finally, staying informed and voting in two years to give the President the support he needs will be crucial. This revolution will work, no matter which Democrat gets the nomination. Our Pesident sets the course, but we voters propel the ship.
Different governments have different problems.
The U.S.'s problems are largely due to a fiscal policy deficit problem, so much so that monetary policy is used to resolve the issues.
The EU has been marred by its austerity regime. It is so wrong headed that it makes the U.S. the cleanest shirt in the entirely laundry basket.
China is never a democracy. With 3T dollar in reserve, it can solve its debt problem if it wants to. It is stuck between its authoritarian regime and desire to be market driven the worst of both world.
While every country has its unique normative troubles, deep down it is because countries fail to coordinate and have a moderate regime for everyone. Instead of Nash's equilibrium where everyone wins, the race to the bottom beggar-thy-neighbor approach is a classic prisoner's dilemma. Everyone loses. Which further exacerbates the world's condition when the extremists, right and left, rule the day
The U.S.'s problems are largely due to a fiscal policy deficit problem, so much so that monetary policy is used to resolve the issues.
The EU has been marred by its austerity regime. It is so wrong headed that it makes the U.S. the cleanest shirt in the entirely laundry basket.
China is never a democracy. With 3T dollar in reserve, it can solve its debt problem if it wants to. It is stuck between its authoritarian regime and desire to be market driven the worst of both world.
While every country has its unique normative troubles, deep down it is because countries fail to coordinate and have a moderate regime for everyone. Instead of Nash's equilibrium where everyone wins, the race to the bottom beggar-thy-neighbor approach is a classic prisoner's dilemma. Everyone loses. Which further exacerbates the world's condition when the extremists, right and left, rule the day
36
"fiscal policy deficit problem"
Is this your way of saying we do not have enough federal deficit spending? If so I agree.
Is this your way of saying we do not have enough federal deficit spending? If so I agree.
7
No Len, while I have no particular aversion to deficit spending if it is well spent and can pay for itself longer term, it is a lack of fiscal policy at all I was referring to. In other words, I am blaming congressional paralysis.
Personally, I like a pragmatic middle-of-the-road approach in time of emergencies, i.e., we should spend prudently and everyone needs to give back some. Obviously, those who can afford to give a bit more, probably should.
But America is America, people who work hard here should be rewarded. Hopefully, they derive satisfaction out of the work but we shouldn't impose our value system on them. A friend couple of mine work hard all their lives and money is part of their value system. Nothing wrong with that.
On the flap side, there are a lot of hard luck cases out there. They need help. Hopefully, they will pay it forward.
In between though, there are indeed ill gotten gains. And there are also people who like to game the system.
Therefore, not all rich people should get blamed and not all poor people are guilt free. Deficit spending is just a tool, devoid of blame. It is a matter to apply it appropriately
Personally, I like a pragmatic middle-of-the-road approach in time of emergencies, i.e., we should spend prudently and everyone needs to give back some. Obviously, those who can afford to give a bit more, probably should.
But America is America, people who work hard here should be rewarded. Hopefully, they derive satisfaction out of the work but we shouldn't impose our value system on them. A friend couple of mine work hard all their lives and money is part of their value system. Nothing wrong with that.
On the flap side, there are a lot of hard luck cases out there. They need help. Hopefully, they will pay it forward.
In between though, there are indeed ill gotten gains. And there are also people who like to game the system.
Therefore, not all rich people should get blamed and not all poor people are guilt free. Deficit spending is just a tool, devoid of blame. It is a matter to apply it appropriately
The U.S.'s problems are largely due to the concentration of wealth in fewer and fewer hands with numerous negative impacts. Money is power, and the super-wealthy have--not for the first time in the history of humankind--used that power to benefit themselves, not the society of which they are a part. One of their pernicious influences is in reducing the taxes they pay--the richest .01% pay (to the extent that they pay) at exactly the same marginal rate as a married couple filing jointly with a taxable income of, say, $500,000 on their $35,000 over ~$465,000. While $465,000 seems like huge wealth to most of us, it is in reality a drop in the bucket compared to the super rich. Until 1978 we had 25 to 26 brackets; under Reagan we reached a nadir of 2. The number fairly quickly went back to 5 or 6 and is now at 7. But that's where it ends. Along with power comes the ability to finance propaganda to convince people they are overtaxed. I once received a call from some a woman working for an organization that wanted to do away with the "death tax". When I queried her, I discovered--as I suspected--that she had no actual idea what the "death tax" was or that it had no impact whatsoever on either or me.
This concentration of wealth hurts us in so many ways. It makes ever higher incomes for the already wealthy ever more attractive--at the expense of the rank and file and middle income earners. It leads to speculation and lack of investment in "nuts and bolts". It's killing us.
This concentration of wealth hurts us in so many ways. It makes ever higher incomes for the already wealthy ever more attractive--at the expense of the rank and file and middle income earners. It leads to speculation and lack of investment in "nuts and bolts". It's killing us.
Two sentences of Rattner's contain gross contradictions and unsubstantiated errors without a scintilla of evidence, which disputes his own argument and leads us to reject it: "Well-intentioned efforts to avoid another financial crisis have put the banking system in a straitjacket, discouraging lending and reducing liquidity on trading desks, which has contributed mightily to market gyrations. In turn, weakening credit markets stir fears of corporate bankruptcies."
First examine his logic: his conclusions depend solely our accepting his loaded, emotionally laden descriptions: "straitjacket," "stir fears," "discouraging," "bankruptcies."
Take bankruptcies: does Rattner say why, when, which sectors, regions, or revenue size, public or private or recommend a fix? Does he offer trend numbers or forecasts from the 383,000 series of FRED (Federal Reserve Economic Data) put out daily/weekly/monthly by the St. Louis Fed, the most complete and highly reliable public economic data set in the world? Is Apple about to topple? Goldman? Home builders? Fracking operations? Lodging? More: is bankruptcy bad? Does it create disruption or greater efficiencies? He is prompting bandwagon fear!
Rattner's final conclusion, with the same flourish of assurance, blames unnamed "officials" and "fiscal policies"--again with no specifics! Is it Europe, China, the US or all three to which he points?
His greatest challenge to our understanding is in his description of credit markets.
First examine his logic: his conclusions depend solely our accepting his loaded, emotionally laden descriptions: "straitjacket," "stir fears," "discouraging," "bankruptcies."
Take bankruptcies: does Rattner say why, when, which sectors, regions, or revenue size, public or private or recommend a fix? Does he offer trend numbers or forecasts from the 383,000 series of FRED (Federal Reserve Economic Data) put out daily/weekly/monthly by the St. Louis Fed, the most complete and highly reliable public economic data set in the world? Is Apple about to topple? Goldman? Home builders? Fracking operations? Lodging? More: is bankruptcy bad? Does it create disruption or greater efficiencies? He is prompting bandwagon fear!
Rattner's final conclusion, with the same flourish of assurance, blames unnamed "officials" and "fiscal policies"--again with no specifics! Is it Europe, China, the US or all three to which he points?
His greatest challenge to our understanding is in his description of credit markets.
105
Rattner does not explain how Central banks offering fund rates near or even below zero, "weaken" credit or "reduce liquidity" when these rates do precisely the opposite: the credit weakness is in its demand not in its regulation or monetary policies--a weakness more impacted by the political economy of austerity that weakened demand, cycled a secondary bottom in the recovery and dampened growth by weakening demand through reductions in spending (deficits not withstanding).
Rattner argues both ways as he ignores the cause of the last global fiscal crash, unregulated runaway cash (much of it as unbacked derivatives) that imploded, capped by the LIBOR rigging scandal at the loan desks of the major global banks. Yet he says demand is weakened by the very actions on principles taken to reign in this corruption and restore confidence and honest liquidity without fear.
Absent of math and models, his fuzzy logic of buzz words doesn't work!
Rattner argues both ways as he ignores the cause of the last global fiscal crash, unregulated runaway cash (much of it as unbacked derivatives) that imploded, capped by the LIBOR rigging scandal at the loan desks of the major global banks. Yet he says demand is weakened by the very actions on principles taken to reign in this corruption and restore confidence and honest liquidity without fear.
Absent of math and models, his fuzzy logic of buzz words doesn't work!
51
Thank you for pointing out both the lack of specificity and the use of a particular language, designed to inspire fear.
9
I couldn't agree more, Rattner is always guilty of:
1/ cherry picking the available data
2/ making egregious unsupported statements
3/ finds patterns where none exist
4/ spins specious causal chain narratives
5/ uses 'charge' words (alarm bells?)
1/ cherry picking the available data
2/ making egregious unsupported statements
3/ finds patterns where none exist
4/ spins specious causal chain narratives
5/ uses 'charge' words (alarm bells?)
10
Worldwide debt is at record levels, as are the balance sheets of central bankers. "We" are all to blame. The hangover still exists and the cure is not more debt. P.S.: You failed to mention Japan. They have the lowest 30 year bond rate and a debt ration near 250% of GDP. I agree with Mr. Soros. This can't end well.
6
Nark, you should distinguish between public debt and private debt. When the federal government spends more than it takes in, the difference, the deficit goes to people, businesses and state & local govs. This reduces the need for private borrowing from banks. So public debt is sort of the opposite of private debt.
Public debt has never hurt us in the US since we can just roll it over until it becomes insignificant. For example, in 1946 the public debt ratio was almost 50% larger than it is today. Rather than pay it down we increased the debt by 75% in the next 27 years, Nevertheless it became insignificant.
Also since we can print as much money as we need and the public debt is in our own currency, we could pay it down if it ever became a problem.
So actually the cure is more public debt which implies less private debt.
Public debt has never hurt us in the US since we can just roll it over until it becomes insignificant. For example, in 1946 the public debt ratio was almost 50% larger than it is today. Rather than pay it down we increased the debt by 75% in the next 27 years, Nevertheless it became insignificant.
Also since we can print as much money as we need and the public debt is in our own currency, we could pay it down if it ever became a problem.
So actually the cure is more public debt which implies less private debt.
18
Republican obstruction and Republican refusal to govern, to compromise, to rebuild the infrastructure, Republican willingness to trash our credit by shutting down the government are the cause. Austerity in a time of decline assures decline. Our economy should be the engine that drives the world economy but because Republicans would rather drag us into another Republican recession so they can blame Obama, they refuse to pass a transportation bill that will restore our roads and bridges, that will also create millions of jobs. What a mess they have created! What a mess the Republican Party is.
496
Aw shoot. Guess I messed up. It isn't "W's" fault it's all the republicans.
2
Completely agree - the gridlock is because Republicans have blocked everything. Presumably their rich donors like it that way, or just don't care as long as they get their special breaks.
I would also point out that this editorial takes a completely short-term view, which is a big problem with the Wall Street perspective it reflects. New regulations are always bad because they are a short term drag on the stock market. You know, it would be nice to avoid giant meltdowns in the future, for a change!
I would also point out that this editorial takes a completely short-term view, which is a big problem with the Wall Street perspective it reflects. New regulations are always bad because they are a short term drag on the stock market. You know, it would be nice to avoid giant meltdowns in the future, for a change!
3
I'd like to see the 'Deficit of Trust' data mapped against periods of Democrat and Republican control of congress.
83
Yes!
2
My thoughts exactly. Laying all results on the executive makes no sense in a government founded on separation of powers, and the disparity between the public's respect for Obama (around 50 percent) and its respect for this feckless Congress (single digits) would make plotting that data against who controlled Congress at the time a lot more revealing than by president.
1
This government won't act as long as there is a party that believes in a magical, mythical free market and that all governments need to keep their hands out of it. They seem to not want to understand that economies are driven by demand, not supply.
300
There isn't a party that "believes in a magical, mythical free market and that all governments need to keep their hands out of it." There's a party that says they believe in that, then passes "right to work" laws, taxes that favor the wealthy over the general population and invasions of foreign countries that make the government bigger, more expensive and more intrusive than ever.
5
But the labor market *is* driven by the law of supply and there is an oversupply of labor, leading to low wages for the 99%, and that cannot be fixed by importing even more labor.
In the past seven years, the US economy has added four million jobs. In that same time period, we have allowed in seven million *legal* immigrants, one million every year, not including a few million more refugees, illegal aliens, and H1B visa workers. We have been doing this for decades, while wages for working and middle class Americans have (inflation-adjusted) declined.
While we need the energy and ambition of young educated immigrants, we do not need a massive influx of workers *at this time*, when even skilled jobs are scarce, nor do we need to import more poverty, as if adding competition for our own low skilled workers, while burdening the taxpayers with social services will somehow magically 'fix' our ailing economy.
Or we can continue our downwards slide with an immigration policy that has not worked for 40+ years, while insisting this time it will be different, because anyone who dares bring up this incontrovertible fact will be called a 'racist' and a 'xenophobe'.
In the past seven years, the US economy has added four million jobs. In that same time period, we have allowed in seven million *legal* immigrants, one million every year, not including a few million more refugees, illegal aliens, and H1B visa workers. We have been doing this for decades, while wages for working and middle class Americans have (inflation-adjusted) declined.
While we need the energy and ambition of young educated immigrants, we do not need a massive influx of workers *at this time*, when even skilled jobs are scarce, nor do we need to import more poverty, as if adding competition for our own low skilled workers, while burdening the taxpayers with social services will somehow magically 'fix' our ailing economy.
Or we can continue our downwards slide with an immigration policy that has not worked for 40+ years, while insisting this time it will be different, because anyone who dares bring up this incontrovertible fact will be called a 'racist' and a 'xenophobe'.
2
@FSMLives! - I'm not sure that's true, but rather the way we're used to looking at it. Yes, many of those high-paying factory jobs are gone. Yes, too many high-tech jobs are being taken by H1B visa holders. Yes, there are real problems.
However, there are so many places where we are in fact short of sufficient workers from professionals who work 50 or 60--or even more--hours a week to parents who would like to work part time while their children are young but who can't afford it or who risk losing out on their chosen career path. Doctors who are in short supply in some areas of the country. Doctors who are apparently not in short supply in big cities--but who can't see patients for weeks or even months or who have no room for new patients. Shortages of government employees at all levels from small towns to federal agencies. Understaffed retail stores. Lack of various kinds of home services in various places. Understaffed schools and nursing homes. The horrendous voice answering systems with their endless push 1, push 2, instead of human beings. The skilled labor shortages that are looming as baby boomers retire (facilitated by our looking down on no-college-required jobs). The lack of jobs because of lack of funding (as the article points out) in infrastructure and R&D. And the growth in employment that would follow if more people were either employed or better paid in current employment so they could purchase more in the way of goods and services.
However, there are so many places where we are in fact short of sufficient workers from professionals who work 50 or 60--or even more--hours a week to parents who would like to work part time while their children are young but who can't afford it or who risk losing out on their chosen career path. Doctors who are in short supply in some areas of the country. Doctors who are apparently not in short supply in big cities--but who can't see patients for weeks or even months or who have no room for new patients. Shortages of government employees at all levels from small towns to federal agencies. Understaffed retail stores. Lack of various kinds of home services in various places. Understaffed schools and nursing homes. The horrendous voice answering systems with their endless push 1, push 2, instead of human beings. The skilled labor shortages that are looming as baby boomers retire (facilitated by our looking down on no-college-required jobs). The lack of jobs because of lack of funding (as the article points out) in infrastructure and R&D. And the growth in employment that would follow if more people were either employed or better paid in current employment so they could purchase more in the way of goods and services.
1
Hmm, I think its get what he's saying. Everyone is to blame from those who do something to those who don't do anything. Very comprehensive.
4
I think the elephant in the room is all the money is concentrated in a relatively few hands across the planet. Until the money starts trickling down instead of up, this will be the result. It's almost as if the oligarch's have reached their goal of having all the wealth, but the reality is that unless they spread it around, the entire system will collapse. But the question becomes...who will/can stand up to them and reverse the situation? I'm not very hopeful...
249
Social unrest will stop it. But we aren't quite there yet and it could still be years until that happens. The big question yet to be answered is whether this gross inequity in wealth will be resolved through political reform like FDR did with the New Deal or will it be left to fester until a critical breaking point is reached and the riots start? Our politicians all seem to be blind to the seriousness of what is happening. This is not surprising because they are too cozy with the oligarchs and are all feeding at the same money trough.
21
SC: Bernie is standing up to the oligarchs and we the people can reverse the situation. Vote for change!
4
I'm grateful that Ms. Hillary Rodham Clinton has an excellent plan to rein in Wall Street and tax the wealthiest without destroying America with another depression, SC. SHE has my vote. SHE IS THE WOMAN FOR THE JOB!
2
THIS IS THE REALITY.
The jobs crisis is PERMANENT, and will NOT end with better economic times.
A 2012 Independent Publisher Book Award winner, giving a fresh view on what is happening with American jobs, will tell you all about it. Work’s New Age: The End of Full Employment and What It Means to You is a resource for all of us. It explains what we are experiencing in terms of numbers, trends, and social patterns, and what we can – and cannot – do about it. Work’s New Age is the first full-length book in years to address this massive national concern. It shows why the gap between workers and jobs will get ever larger, and which possible solutions will only harm. It is well documented and thoughtful but easy to understand. The book even provides hope, by demonstrating how we have the potential to transform this crisis into a new American golden age.
Work's New Age is available on amazon.com, barnesandnoble.com, and worksnewage.com, and either on the shelves or by special order at your local bookstore. For much more information on what is really happening with jobs in America, see http://worksnewage.blogspot.com/.
The jobs crisis is PERMANENT, and will NOT end with better economic times.
A 2012 Independent Publisher Book Award winner, giving a fresh view on what is happening with American jobs, will tell you all about it. Work’s New Age: The End of Full Employment and What It Means to You is a resource for all of us. It explains what we are experiencing in terms of numbers, trends, and social patterns, and what we can – and cannot – do about it. Work’s New Age is the first full-length book in years to address this massive national concern. It shows why the gap between workers and jobs will get ever larger, and which possible solutions will only harm. It is well documented and thoughtful but easy to understand. The book even provides hope, by demonstrating how we have the potential to transform this crisis into a new American golden age.
Work's New Age is available on amazon.com, barnesandnoble.com, and worksnewage.com, and either on the shelves or by special order at your local bookstore. For much more information on what is really happening with jobs in America, see http://worksnewage.blogspot.com/.
4
Might want to correct the "Less Than Zero" chart (US = 0.34%, not 3.4%).
4
Steve describes the cause of the worldwide economic malaise.
Its effect is the rise of populism and anger among those who suffer from a stalled economy. If the political class does nothing we could have social breakdown or war.
Let's not allow that to happen.
Its effect is the rise of populism and anger among those who suffer from a stalled economy. If the political class does nothing we could have social breakdown or war.
Let's not allow that to happen.
16
Good piece…3 things –
1) If you look at the time domain using the National Bureau of Economic Research (NBER) numbers on Expansion and Contraction, we are currently in the 4th longest expansion period since 1900. The longest being 120 months from March 1991 to March 2001. So taking the 120 months as an upper bound, there is a VERY high likelihood of contraction in the next 3 ¼ years. Combined with the premise of your article, the actions by Governments will determine the severity and length of that Contraction
2) We are just now beginning to see the end of the Great Recession effects on overall wages and overall labor participation. While employment has kept pace with the recovery, these two metrics have been depressed to keep demand and inflation very low and are out of sync with the rest of the recovery. This seems to suggest that in the next recession, Governmental action rather than austerity will be required to decrease the length of contraction.
3) Spending on infrastructure, both physical and mental (i.e. roads & bridges and R&D) are long term payback items. I agree with your contention: the current short sightedness of Congress’ inability to fund these bedrock pieces of economic wellness will have hidden long lasting effects for our future economic health if we cannot transport goods to market or innovate new products / materials / intellectual property.
1) If you look at the time domain using the National Bureau of Economic Research (NBER) numbers on Expansion and Contraction, we are currently in the 4th longest expansion period since 1900. The longest being 120 months from March 1991 to March 2001. So taking the 120 months as an upper bound, there is a VERY high likelihood of contraction in the next 3 ¼ years. Combined with the premise of your article, the actions by Governments will determine the severity and length of that Contraction
2) We are just now beginning to see the end of the Great Recession effects on overall wages and overall labor participation. While employment has kept pace with the recovery, these two metrics have been depressed to keep demand and inflation very low and are out of sync with the rest of the recovery. This seems to suggest that in the next recession, Governmental action rather than austerity will be required to decrease the length of contraction.
3) Spending on infrastructure, both physical and mental (i.e. roads & bridges and R&D) are long term payback items. I agree with your contention: the current short sightedness of Congress’ inability to fund these bedrock pieces of economic wellness will have hidden long lasting effects for our future economic health if we cannot transport goods to market or innovate new products / materials / intellectual property.
10
The political problem isn't "gridlock in Washington. " Let's call it what it is. The problem is Republican stonewalling motivated by a desire to cause a Democratic administration to fail which exceeds the GOP desire to see the United States succeed. Remember Pres. Obama's "jobs initiative" and the Congressional Republicans' response to it?
421
The graph showing European bank interest rates seems to have a glaring error. The line showing United States rates seems to indicate 0.34% but the figure at the end is 3.4%. If 3.4% is correct the line should rise above the 2% maximum of the scale.
7
Good eye! This is what can happen when you do a manual override in Powerpoint. You can see he placed a text box over the graph at the right - the font and number formatting are different from the Powerpoint-generated ones for other data points. It's OK to manually annotate a graph like that -- just be more careful!
5
Rattner describes the effects of oligarchy - disrupt the oligarchs.
261
Perhaps the oligarchy will realize that now is "The time for all good men (women) to come to the aid of their party”. They must realize it is clearly in their interest to share their wealth for "the good of the planet". The GOP notwithstanding.
2
jim - We should remember who we're dealing with, epitomized in the words of Martha Bach, Arthur's grandmother in the movie Arthur:
" Don't ----- with us; we are ruthless people. "
Everything that has to be won back will have to be pried from 1/10th%-ers clutching fingers, opened up one by one; the obstructionism is also manifested with Senate GOPers saying they will not even talk to any potential SCOTUS nominee.
" Don't ----- with us; we are ruthless people. "
Everything that has to be won back will have to be pried from 1/10th%-ers clutching fingers, opened up one by one; the obstructionism is also manifested with Senate GOPers saying they will not even talk to any potential SCOTUS nominee.
3
Despite what you feel,
The Sanders New Deal
Is just what our Nation requires
Ideas that range
Fighting climate change
To min wage raises that inspires.
The wealth and the rot
The 1 percent got,
Inequality, standing stagnation,
THE Hedge funders thrive
On bait and switch jive
Creating a Trump-ready nation.
The Sanders New Deal
Is just what our Nation requires
Ideas that range
Fighting climate change
To min wage raises that inspires.
The wealth and the rot
The 1 percent got,
Inequality, standing stagnation,
THE Hedge funders thrive
On bait and switch jive
Creating a Trump-ready nation.
183
Increasing minimum wages by bringing back low add value factories is really a joke.
3
Thanks for your contributions in verse to all us readers of the NYT. Each time you light up my day
In Hillary he is jousting with the best the traditional economy has to put forth.
With Hillary he has to repeat over and over the same talking points with the GOP al he has to do is repeat a single undeniable fact.
The USA has the least upwardly mobile population of any Western industrialized state.
The USA has the least upwardly mobile population of any Western industrialized state.
The USA has the least upwardly mobile population of any Western industrialized state.
The Land of opportunity has the least upwardly mobile population of any Western industrialized state.
If he wants to say something a little different he could say: The auto industry bailout was extortion. We had to bail out Wall Street because the ransom we had to pay out to save the auto industry was being kind to the perpetrators of the crisis that almost destroyed the world economy.