Conspiracy of Silence: Wage Collapse Caused Crisis
ByTasini
Every day, there is another example of the conspiracy of silence that
pervades the traditional media's description of the current economic
crisis. Sure, de-regulation, greed and pure stupidity has a lot to do with
it. But, in truth, the underlying reason for the collapse has been a
persistent war on the wages of American workers. Call it--egads--class
warfare.
What is astonishing, and aggravating, is that much of the traditional
media continues to point the finger at workers--those wild-spending people
who just bought all those yachts, fur coats and mansions in far-away
countries. And, now, shame on them, those wild-spending workers are doing
something awful--they are saving money.
Rick and Noreen Capp recently reduced their credit-card debt, opened a
savings account and stopped taking their two children to restaurants.
Jessica and Alan Muir have started buying children's clothes at steep
markdowns, splitting bulk-food purchases with other families and gathering
their firewood instead of buying it for $200 a cord.
As layoffs and store closures grip Boise, these two local families hope
their newfound frugality will see them through the economic downturn. But
this same thriftiness, embraced by families across the U.S., is also a
major reason the downturn may not soon end. Americans, fresh off a
decadeslong buying spree, are finally saving more and spending less --
just as the economy needs their dollars the most.
Usually, frugality is good for individuals and for the economy. Savings
serve as a reservoir of capital that can be used to finance investment,
which helps raise a nation's standard of living. But in a recession,
increased saving -- or its flip side, decreased spending -- can exacerbate
the economy's woes. It's what economists call the "paradox of thrift."
U.S. household debt, which has been growing steadily since the Federal
Reserve began tracking it in 1952, declined for the first time in the
third quarter of 2008. In the same quarter, U.S. consumer spending growth
declined for the first time in 17 years.
The article goes on to describe how people are now pulling back from
spending and doing with less. But, nowhere in the piece do
we read about the most important factor that lead to people piling up debt:
the lack of wage growth.
I have been doing a presentation around the country about the
short-term and long-term reasons for the economic crisis facing workers.
Here is the slide (courtesy of the Economic Policy Institute and Change To
Win) that I think is perhaps the most graphic, clear explanation of why we
are where we are. It measures productivity versus wages (picture on left):
Basically, the basic bargain was roughly this--if you worked hard and
became more productive, you would see that sweat of the brow in your wages.
And from the post-war era until the 1970s, that deal basically held--as you
can see from the lines that are basically close together until the 1970s.
Then, the lines diverge--dramatically. You can see it yourself. If the
lines had continued to track closely together as they did prior to the
1970s, the MINIMUM WAGE would be more than $19 an hour. THE MINIMUM WAGE!!!
So, in short: people had no money coming in in their paychecks so they
were forced to pay for their lives through credit--either plastic or drawing
down equity from their homes. There are lots of reasons that this
happened--greed, the attack against unions, de-regulation, dumb trade deals.
But, the point is: we will never fix the economic crisis, whether
through short-term economic stimulus and certainly
not through tax cuts, until paychecks are re-inflated. Dramatically.
I outlined
a
whole set of solutions to bailout American workers but the main one is
simple: raise wages. Dramatically. And end--and I know some people cringe at
the term--the class warfare that has been underway for the past three
decades.
The Christmas rituals are over; we’ve eaten the pumpkin pie and listened to
Aunt Martha’s annual stories of her health problems, all in the face of
incompetent and unfeeling physicians. While I was with my wife’s relatives they
pulled out their home movies and we watched as the family jumped from holiday to
holiday in three-minute, Super 8 vignettes.
As we watched and they commented on relatives lost long ago, I would
periodically ask my father-in-law, “How did you ever get by without foreign
cars?” Here was a looking glass into middle-class splendor. “That was my '53
Chevy, and that’s my brother Michael’s '52 Pontiac,” he’d say. Then, as it
jumped to the next decade, “That’s my '63 Super Sport. I can’t believe I let the
kids ride their bikes so close to it.”
No Toyotas, no Hondas, no Kia or Subaru, and yet somehow these people seemed
happy. They had a nice home, a nice car, a good Christmas for the kids, and all
on a middle-class income.
A day later I had my son over who, as an adult, hadn’t seen our home movies, and
he made the same comment, “Look at all the new cars!” Joking, I answered, “Yeah,
they just didn’t know any better, all those American-made cars.” We watched the
movies and I realized that it wasn’t just the cars. The cars were just the most
visible manifestation of prosperity; it was the gifts, as well. The toys, the
clothes, the lights, the wrapping paper, even the candles and the nativity sets
were all made in America.
The money stayed home and circulated through the economy and brought a
prosperity envied and unequaled anywhere in the world. My mother’s friend, Jean
Spidel, was in one of the movies. Her husband was a milkman; he always drove a
Mercury. Our long-time friends Helen and Bob Anderson were in there, too. Bob
was a Ford man and he played Santa for the whole street when I was a child.
Don’t try and tell any of us kids on Elder Road that there was no Santa Claus
because we had all seen him, the same guy, every year. Santa had a good red
suit, not the crappy bootlets but real leather boots, and a wide leather belt.
The street had all pitched in on the suit and the toys were left in the trunks
of all those new American cars. Santa would pass out the toys and take one drink
and move on to the next house.
Each house celebrating the birth of Christ, but also celebrating a middle class
prosperity unknown a generation before. A street full of young, American
families, looking forward to tomorrow with bright eyes and hopeful ambitions.
With enough disposable income to pitch in on a Santa suit after buying Christmas
toys and paying for a new car and a home and doing it on one paycheck, to boot.
My Uncle Tom was in some of the movies, too, in his brick house with a new Buick
or Oldsmobile in the garage. Tom bought a new car every two years even though he
drove them very little; it was a status symbol for him, a display of his
prosperity for all to see.
His wife was a homemaker who had never learned to drive and most of the time
when Tom traded cars they had less than twenty thousand miles on the odometer.
What did he do to earn such a level of prosperity? He was a foreman for
International Harvester. My cousin Danny was a Chicago school teacher; he was
the first person I ever knew that drove a sports car, a bad-ass GTO. Ray was a
used car salesman at the car lot his father owned so he drove lots of cars but
bought his wife a new Impala.
Many of these people thought in old ways; they thought in terms of their
country's well-being. The older men were veterans and I’d heard more than one
say, “Buy Japanese? I already got this from Japan!” whereupon they would open
their shirt or pull up a pant leg to show a war wound. Harry Truman was offered
a new Toyota when he left office and he answered by saying, “It would be
inappropriate for me to accept such a gift, but if I were to accept a car it
would have to be an American car.”
Today such talk is looked upon as archaic. Bob Dole accepted a condo from Archer
Daniels Midland; the Reagans had a mansion built for them by grateful well
wishers, and George Bush the elder was given an undisclosed gift by the Emir of
Kuwait. The Clinton foundation accepts millions from foreign countries and the
message seems to be that this is all right, they are our friends, and we live in
a global economy now so don’t worry about it.
But I do worry about it; even in a global economy there are winners and losers.
Isuzu of Japan recently announced that they had canceled the planned layoffs of
550 workers. They said that they were doing this for the good of their national
economy. Toyota has announced layoffs for the first time ever in America but
will keep workers employed in Japan. The construction of the Prius plant in
Mississippi has been canceled, the contractors told to pick up their tools and
go home because it seems that the Japanese do what is best for Japan. I don’t
fault them for this; I praise them for it. Their government and business
community have not forgotten that they are all Japanese first.
In 1582 Pope Gregory XIII issued a decree dropping ten days from the calendar;
his power was immense yet still today not all follow his decree. Globalism is
sold to us the same way, that it is inescapable, unavoidable and to believe
otherwise is to believe in a flat Earth. Ross Perot was laughed off the national
stage when he declared, “If they pass NAFTA you’re going to hear a giant sucking
sound of jobs leaving this country.” They compared him to the Smoot-Hawley
Tariff, which contributed to the Great Depression. The plan was to make Perot
look like a nut with a funny, obscure name like Smoot-Hawley, and maybe he was a
nut but even a broken clock can be right twice a day.
Perot’s giant sucking sound has turned into a cold wind that is blowing through
the ruins of our cities. America is in recession a year before the experts will
admit to it as millions lose their homes and the government piles up massive
budget deficits that dwarf any ever run in the long ago days of American
prosperity. Those debts then were owed to American banks that bought American
Treasury notes. Today we must sell them to our “friends,” the Japanese and the
Chinese, who buy our raw materials which they turn into manufactured goods and
the bulk of the profits stays in their home countries.
So large has this list of multifarious tyrannies escalated that Southern
senators are now working at the behest of foreign governments to keep American
automobile companies from receiving a bailout. Is it so hard to imagine who will
benefit from the demise of the American automobile manufacturers? If you speak
against globalism like I do, you will soon hear the charge; “Do you want to
start a trade war?” We are already in a trade war and we are losing it, and we
are already in a class war and are losing that as well. We are being beaten so
badly that we have little left to fight back with but our bodies.
We have been sold a bill of goods by those in the employ of foreign
corporations, Quislings who answer to the call of those who pay them while they
wear their cheap, foreign-made flag pins on their lapels. Growth in America is
negative and wages are flat for all but those same folks who insist that
globalism is good for us. The Chinese will buy our Buicks and Chevys, and do.
Products that are manufactured in China by Chinese workers in factories owned
jointly by the People’s Red Army and General Motors. Whose American executives
then come to Washington to beg money of Congress and plan new factories in China
while gearing up their plants in Mexico.
Globalism is a sham, the proverbial wooden nickel. It benefits the very few and
injures the many on both sides of the bargain. China is fast becoming an
industrial wasteland and America an enfeebled, toothless tiger. America’s poor
and hungry are growing at an enormous rate while assistance is reminiscent of
the nineteenth century “Jungle” industrialism. While the federal government must
look everywhere for new buyers of Treasury notes as they pass the money out to
the banks for free and then must pay interest to borrow it back.
How far we’ve come from those once-prosperous, halcyon days when the middle
class drove new cars. Where they saved for their children’s futures, back when
companies were hiring instead of shutting down. When Pittsburgh was known for
steel and Muncie for transmissions, Detroit made automobiles and America made
computers and satellites and put men on the moon and dared to dream that
anything was possible, while today millions of Americans wonder if they will
lose their home this month or next.
An incredible price to pay for cheap junk from Wal-Mart.
Bob Anderson, as Santa, reached the Westenburg's house at the end of Elder Road
and the Westenburg children always insisted that their house was Santa’s last
stop because on Christmas morning when they awoke they found Santa Claus asleep
on their couch.
================================================= David Glenn Cox is the author of The Servants of Pilate.
Senate Minority Leader Mitch McConnell (R-Ky.) voiced skepticism
today about the emerging economic stimulus plan, applying a brake to
Democratic plans to quickly pass up to $850 billion in spending and tax
cuts soon after President-elect Barack Obama's Jan. 20 inauguration.
"As of right now, Americans are left with more questions than answers
about this unprecedented government spending, and I believe the
taxpayers deserve to know a lot more about where it will be spent before
we consider passing it," McConnell said in a statement, which will be
publicly issued later today.
Rant on:
Let me get this straight. A Senator who oversaw one of the
largest expansions in government spending in history is now concerned about
spending? According
to the CBO, total government outlays under Bush and the Republican
controlled Congress from 2001 - 2006 increased from $1.8 trillion to $2.4
trillion -- that's an increase of 33%. At the same time -- again under
Republican rule from 2001 to 2006 -- the total debt outstanding increased
from
$5,807,463,412,200.06 at the end of fiscal 2001 to
$8,506,973,899,215.23. And now a man who helped to oversee this is
complaining about spending? Excuse me?
A note to Senator McConnell. The equation for GDP is simple. Here it is: C+I+E+G = GDP.
In case you are confused, those are symbols. Let's explains
those symbols for you.
C - consumer spending. This is now in the tank. Personal consumption
expenditures are now negative year over year. Retailers just reported a
terrible Christmas. In other words -- 70% of our economy is out of order
right now.
I - Investment. This has been neutral for awhile. You may be familiar
with the housing bubble? (Actually, you probably just became aware of it
because you were probably saying the economy was sound until recently).
Well - there was a housing bubble and it has crashed. As a result, total
investment has been weak for some time now.
E = net exports. The US runs a mammoth trade deficit, so this ones out
as well.
That leaves G -- as in government spending -- to pull us out of this
mess. Unless of course you like depressions you dolt.
On his third day in office President Grant revoked two pardons that had been
granted by President Andrew Johnson. President Nixon also undid a pardon that
had been granted by President Lyndon Johnson. There may be other examples of
this, as these two have somewhat accidentally come up in a discussion focused on
numerous examples of presidents undoing pardons that they had themselves
granted, something the current president did last week. (See
http://pardonpower.com ).
In 2001, President George W. Bush's lawyers advised him that he could undo a
pardon that President Clinton had granted.
Much
of the discussion of this history of revoking pardons deals with the question of
whether a pardon can still be revoked after actually reaching the hands of the
pardonee, or after various other obscure lines are crossed in the process of
issuing and enforcing of the pardon. If President Bush issues blanket pardons to
dozens of criminals in his administration for crimes that he himself authorized,
he will probably -- with the exception of Libby -- not even name them, much less
initiate any processes through which they are each formally notified of the
pardons. He will be pardoning people of crimes they have not yet been charged
with, so the question of timing is something you are unlikely to have to worry
about (except perhaps with Libby).
Virtually none of the discussion of these matters ever addresses the
appropriateness or legitimacy of the pardons involved or of the revoking of
them. The history would appear to establish that you will have the power to
revoke Bush's pardons. I want to stress that you will also have a moral
responsibility to do so and a legal requirement to do so. Morally and legally,
you have no choice in this matter. When you take the oath of office, you will be
promising to faithfully execute the laws of the land. Through Article VI of our
Constitution, the Geneva Conventions and the Convention against Torture and
Other Cruel, Inhuman or Degrading Treatment or Punishment are the supreme laws
of this land. Those laws bind you to prosecute violations, including torture and
other war crimes of which Bush, Cheney, and their subordinates are guilty and
which Bush is likely to try to pardon.
Bush's pardons will not be like other past pardons. Even when his father
pardoned the Iran-Contra criminals, he was pardoning crimes for which President
Reagan, not he himself, held ultimate responsibility. Here we are facing the
unprecedented outrage of a president pardoning crimes that he openly admits
having authorized. The closest thing to this in U.S. history thus far has been
Bush's commutation of Scooter Libby's sentence, to which he is expected to add a
pardon. Libby was convicted of obstruction of justice in an investigation that
was headed to the president. Evidence introduced in the trial, including a
hand-written note by the vice president, implicated Bush, and former Press
Secretary Scott McClellan has since testified that Bush authorized the exposure
of an undercover agent, that being the crime that was under investigation.
The idea that the pardon power constitutionally includes such pardons ignores a
thousand year tradition in which no man can sit in judgment of himself, and the
fact that James Madison and George Mason argued that the reason we needed the
impeachment power was that a president might some day try to pardon someone for
a crime that he himself was involved in. If impeachment was created to handle
the abuse of pardoning a crime the president was himself involved with, how can
we imagine that the pardon power legitimizes such abuse, much less the pardoning
of crimes authorized by the president, much less the pardoning of obstruction of
an investigation into a crime committed by the president? In fact, all such
pardons are themselves obstruction of justice, as well as violations of treaties
requiring the president to prosecute the types of crimes involved.
The problem is not preemptive pardons of people not yet tried and convicted. The
problem is not blanket pardons of unnamed masses of people. Both of those types
of pardons have been issued in the past and have their appropriate place. The
problem is the complete elimination of any semblance of the rule of law if Bush
pardons his subordinates for crimes he instructed or authorized them to commit.
We elected you to restore the rule of law, and you will soon have the
opportunity to either do so or to place a final nail in its coffin. Bush is
likely to attempt to pardon torture, warrantless spying, all sorts of war
crimes, fraud and aggressive war, and the various abuses of the politicized
Justice Department.
We will call on the courts to challenge these pardons and on Congress to reject
them. We will demand that Congress reject any nominee for attorney general who
accepts such pardons as legitimate. But we are also asking you for leadership.
We've elected you for it. We strongly encourage you to uphold your oath of
office and faithfully execute the laws, not the illegal decrees of your criminal
predecessor. If you do this for us, if you help ensure that government of, by,
and for the people does not indeed perish from the earth, we will commit to
working with you in the years ahead as you advance the eternal project of
improving our democracy.
Friday, December 19 2008 @ 01:22 AM PST
Contributed by: Joey Picador
If
it's not Warren, it will be some other mumbler of prayers.
Prayers at the Inauguration, an official Government function. I wonder what the
Founders would think of that...?
And from my perspective, all prayers are equally delusional, so perhaps for that
reason, I fail to see why it is such a terrible thing to have one guy spouting
nonsense to a fictional character over another...and please, don't tell me this
is a "Christian" nation - for it most certainly is not. We're in the running to
be the least Christ-like nation on Earth...invasions, civilian torture, greed
run amuck, profit over conscience, homeless on the streets, children without
basic health care, without food, in the richest country in the world...oh yeah,
Christ would LOVE America...
Seems the Warren choice is simply Obama reaching out to the other side -
something he promised to do - remember? So why the fuss? Because the guy
is a right-wing wacko who holds views that would make Himmler blush? Again, so
what? Is he speaking for Obama? For you? For America? Or is he, as I suspect,
merely speaking for himself and getting the big ego boost being the center of
such attention offers? And if so - then why does anyone care?
We need to tie our shoes together and hang them on the fence surrounding the White House
to show support for freedom in the world, i"ll donate the first pair. Lets start !
A fitting display of affection for Der Leader, wouldn't you say? In Arab cultures, the sole of a shoe is considered a great insult, which is why many Iraqis were seen smacking Saddam's statue with their shoes after Baghdad fell. It's probably similar to how we feel after being flipped off.
And it just goes to show you - invading a sovereign country under false pretenses, does not make you very popular...!!
Take
Arlen Specter, who says he is going to hold up the Holder nomination for
Attorney General, as Holder was involved in the Marc Rich pardon. I think this
used to be referred to as "pissing in the wind."
Sen. Arlen Specter, the top Republican on the Judiciary Committee, has just
thrown a wrench into the Eric Holder hearings planned for early January,
saying Holder's involvement in the Marc Rich pardon is a "red flag" and a
"very serious matter."
. . .
But Specter is already applying the brakes, indicating that Republicans are
going to make a big deal out of Holder at the hearing. Specter said he sees no
way in which the Holder hearings could happen before Jan. 26. Specter said he
still needs to see thousands of pages of background doents and Holder's FBI
background check.
"There are questions that need to be addressed," Specter said in a Senate
floor speech.
Poor Republicans. They are trying so hard to be relevant.
But Specter's efforts will amount to nothing, once Bush's sure to be BIG list of
pardons, is made.
Tuesday, December 02 2008 @ 10:55 AM PST
Contributed by: Joey Picador
This is the Beginning of the Bush Depression - $2 Trillion Credit Lines to be Cut
By
TocqueDeville
Prepare to be afraid.
Last week I was amused to see a debate on CNBC
about whether we were in a depression or not. It is especially amusing now
that we have been "officially" informed that we are in a recession.
What people should know, however, is that what happened to GrannyDoc is
not remotely isolated. Reuters dropped the
bombshell today:
(Reuters) - The U.S. credit-card industry may pull back well over $2
trillion of lines over the next 18 months due to risk aversion and
regulatory changes, leading to sharp declines in consumer spending,
prominent banking analyst Meredith Whitney said.
The credit card is the second key source of consumer liquidity, the
first being jobs, the Oppenheimer & Co analyst noted.
"In other words, we expect available consumer liquidity in the form
of credit-card lines to decline by 45 percent."
Merry Christmas...
It looks like the CNBC panelists arguing that we are in a depression
just got a boost. This is exactly what we saw in the Great Depression -
banks cutting risk, raising interest rates, and contracting the money
supply.
For tens of millions of Americans, their credit card is their lifeline.
And it's about to be pulled right out from under their feet.
In fact, credit cards have been covering the real state of our economy
for many years. Now, combine this impending catastrophe with this recent
report from
CBS News:
(CBS) There's a new wave of foreclosure sweeping across the country,
and the people who are getting swept up are not greedy investors, or
people who got in over their heads with bad loans, reports CBS News
correspondent Ben Tracy. Rather, the crisis is hitting home for those who
never expected to be in trouble until the slumping economy put them out of
work.
"The foreclosure crisis began mostly as a problem for lower income
households," says Mark Zandi of Moody's. "It is now a problem for all
households: low, middle income and even higher income households."
More than 2 million prime mortgages, traditional loans for
people with good credit, are now delinquent. That's 624,000 more
than this time last year, according to the mortgage bankers foundation,
Tracy reports.
"We didn't necessarily expect the distress levels that we are seeing at
this point," says economist Mark Fleming.
What people should understand about GrannyDoc, and millions of Americans
like her with perfect credit and a long record of employment, is that they
are now an increased risk. Banks are increasingly reassessing the American
consumer, and concluding that no one is a safe bet anymore. So they're
adjusting their models to accommodate.
The reason it was so hard for the CNBC people to get a fix on whether we
are in a depression or not is because it is not precisely and universally
defined. But if it walks like a duck...
The real tragedy of all this is that it doesn't have to happen. Like so
many boiling frogs, we are oblivious to how simple the remedy really is.
Many civilizations throughout history have been poor - poor in food,
energy, water, minerals. The US is not one of them. We have everything we
need to put all of our people to work tomorrow building the greatest
civilization the world has ever known.
We have the greatest supply of natural resources of any country on the
planet. We have the greatest storehouse of knowledge. Even with the very
real energy shortage, we could still use what is left to convert to
renewable energy in record time.
And yet all we hear is how we are out of money. Does anyone even
comprehend how ridiculous this is?
How did we allow ourselves to be brought to our knees by parasites who
produce nothing, and a monetary/banking policy that has sucked all of the
money away from the real producers?
Corruption. Plain and simple.
Most people go their entire lives without even questioning where money
comes from. It's just always been. But currency is supposed to be a symbol,
a tool. Not a shackle. We, as a society, have grown so accustomed to never
asking questions about where the money comes from, that we don't see the
most obvious thing in the world - we have become slaves to bankers who make
more money off the money itself, than the goods or services the money is
supposed to represent.
Money is supposed to represent real wealth - so you don't have to carry
around your chickens. It should never be the sole source of wealth. Anyone
who is making money solely off of money is a parasite.
What kind of system penalizes the producers of real wealth, things that
have real value, and rewards the parasites? A system designed by parasites.
This is the greatest opportunity in almost a century to fix this absurd
monetary system, and rebuild our country. But it won't happen because the
parasites also control our political system. So the people are being taxed
to death to pay for the parasites ponzi scheme.
Abraham Lincoln told the bankers to piss off and began printing up
greenbacks - pure fiat currency backed only by the US government. It was an
economic boom and it won him the Civil War. It's a long story. As is the one
about how bankers schemed for a hundred years to put American on the central
banking system of Britain.
But just remember this: Next time someone tells you we can't afford
universal healthcare, ask them what exactly we are short of, Doctors?
Medical equipment? Sick people?
Or when someone says, we can't afford to rebuild our infrastructure, ask
them what can't we afford. We've got plenty of workers, standing idly by.
We've got plenty of rock and steel. We've even got plenty of energy.
No, the only thing we're short of is a symbol.
For more on the money scam, and the true nature of money and our monetary
system, watch this
little video.
On this joyous American holiday, let us give thanks for the food on our table.
Food Banks across the nation are running out of food trying to feed the influx of those who have become recently homeless and those who have had the bad luck of enduring this for several years.
Keep in mind that 10% of all returning veterans and many from Vietnam are homeless as well as disabled.
Please help any way possible. Contribute to Food Banks, just don’t throw loose change in the Salvation Army pot. The Salvation Army are helping people pay their mortgages, utilities and food bills.
But they can’t do it all. Don’t buy that X Box this year just because it’s the latest model. Buy food for the Food Banks or give the money to the Salvation Army.
Just remember. There will be more people in need this Christmas then now.
Please Help! For more information, check out Feeding America - they will assist you in finding a food bank near you!
Freedom Press Handbills Help spread the word about George W. Bush and his band of robber barons intent on destroying Democracy in America! Use our growing collection of handbills as a grocery list, then leave it in the shopping cart when you are finished!
If
it's not Warren, it will be some other mumbler of prayers. 
What people should know, however, is that what happened to GrannyDoc is
not remotely isolated. Reuters dropped the
