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July 21, 2011


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soleri made an important point a couple of posts back and it warrants a review. His point was, that in order to battle the forces of evil here in the state and nationally, we are going to need to get down in the gutter with them and fight fire with fire. That will mean , screaming, yelling, in your face kind of confrontation whenever we encounter the crap they are spewing.

After I read his post I went on to AZCentral and began battling the right wing idiots on that website. I have to tell you, it is tiring and distasteful, but I kept at it until I wore them down. There was nothing nice about it. It was all about name calling and hammering them about what idiots they are and what a bad agenda they stood for. Know what was interesting? They can be shouted down and forced to give up. Hell, they wouldn't be the way they are if they didn't already have small brains. I've started doing it in person too. If I run across a FOXNEWS nutcase, I tease them mercilessly until they back down. I"m not going to go down without a fight.

As a group we need to find ways to take the fight to them. Enough of all this talk and big words. Let's get down in the mud and teach these bastards that the path they have chosen is wrong.

The right isn't going to stop its agenda because Obama has negotiated tax and budget reform that is highly favorable for them. For all his rhetorical skills, Obama possesses a bureaucratic mentality. He is more interested in passing major legislation than standing up for the values of voters who elected him. The Republicans must be quietly thrilled.

Democracy on sale was legitimized in total by the US Supreme Court in its recent ruling reversing a century of case law and statutes which had attempted to regulate payments by corporations to politicians. It is interesting to note that the right did not cry judicial activism in this highly activist ruling. With a right wing Us supreme court apparently judicial activism is no longer a bad thing.

Talk and arguing online are not going to do anything.

The only hope for the United States is an actual revolution. The corporate robbers are not going to stop until actual violence breaks out.

We need protests in the streets, riots, and revolution.

Why don't 24 million unemployed people get smart enough to rebel? Let millions march on Washington DC and corporate headquarters. The Republicans cannot survive that kind of assault.

The corporate robbers can't control 24 million angry people who are ready to burn the country down.

It would be better than passively starving to death.

It would be no worse to die in a revolution than to starve to death, or to die from not being able to pay for medical treatment.

Mick, most of those 24 million unemployed still think if you reduce taxes on the rich, the rich will allow their wealth to "trickle down " on the poor in the form of jobs, jobs, jobs. That is not the makings of a revolutionary army.

I would speculate that the outcome of the current scenario in this country will look more like the book 1984. There will be individuals who will rebel here and there, however, the masses will meekly go along in the hopes that they can get a few scraps of food here and there. America used to be full of Alpha males. Not anymore. The alpha males have been "politically corrected" out of the system. Rural America is where the rebellion will take place. The cities have already been lost.

"As much of America bakes in some of the highest temperatures ever recorded and while Washington argues interminably over taxes, budget cuts and debt caps, one is struck by the unreality of it all. When the House of Representatives votes to preserve the incandescent light bulb for a while as a symbol of personal freedom, it is as if we have entered a wonderland where black is white, up is down and as a nation we have lost touch with reality.

"Our media, the cornerstone of our democracy, clearly has failed to communicate something of great import to us. Perhaps it is the information overload of the electronic age. [...]

"At last count there were at least a dozen mega dangers looming on the horizon all of which have the potential to change the nature of global civilization in profound ways. Yet the body politic seems to take little or no notice and concerns itself largely with issues that will soon be swept away by change.

"Changing a circle of unwarranted optimism that starts with the media, and carries on the voters, their elected representatives, and senior government officials, and then back to the media will be difficult. Realistically we can expect little to happen in the immediate future. Even weeks of 100 degree temperatures or even $4, $5 or $6 gasoline is unlikely to shift many prejudices in the short term. It is going to take a more severe shock -- say food shortages or $10 plus gasoline -- to shake the notion that a return to life as we knew it is still possible."


rioting on an open field is not fun. Have you seen all those protests in Greece and elsewhere? All urban! To start boiling you need lots of like-minded people in the same place. The 20% of spread-out rural America can do their part in paramilitary hide-and-seek games if the future should warrant it. It's up to the other 80% of urban America to prevent total evisceration.

My family is always telling me to look for the silver lining. Make lemons out of lemonade and the like. WTF? 1. Two ten year wars. 2. No viable ALT candidates to vote for. Wall St. crooks on both the GOP and Demos team. 20 mil require better or just any work. College costs out of control. Hundreds of millions of gullible Americans...

I'm living well, but its a hollow feeling in that the collective pain is obvious. We can do better as a country and we aren't really trying.

Left coast dude if your young i suggest Europe


"Why don't 24 million unemployed people get smart enough to rebel? Let millions march on Washington DC and corporate headquarters."

A heady, exciting idea.

What azrebel said, and...

When I was well-employed, making a very good living, protest marches - especially all the way east to DC - were quite the inconvenience. Use vacation time? Fly? Drive? Get some friends together to make the same decision, to reduce disorientation? Eh, just donate a few bucks to some org and let them work out the "right actions." Nothing to be proud of there, but that's the reality of the "bought off" middle class.

Unemployed, really? Are these folks supposed to leave behind any shred of local friend/family support and graze on the plains of middle America as they slog their way eastward? Munch on the arugula on the White House lawn as they chant and posture? Oh, and get the neighbors to forward those unemployment checks - if they're lucky enough to be receiving one - to a rented DC P.O. Box?

I guess that's one reason that I feel in my bones that this is going to play out locally, by building communal support - in which "yelling and screaming" is a bit counterproductive.

Sorry to be glib, but poverty is terribly immobilizing and, after all, your prescription is a bit glib as well.

The President is really trying.
It's hard to argue with a guy whose negotiating strategy is "Here's my bottom line; but I'm willing to settle for less."

Reducing taxes will foster substantial growth within the US? Really? Most current investment action is targeted to benefit from the growth of middle classes in the emerging world. Profits of large US corporations are soaring while the domestic economy is stagnating. Where will the tax cuts for the wealthy and corporations go? To emerging markets via hedge funds or corporate investments abroad. Maybe a few more Gucci bags will be bought in the US.

We can't raise taxes in this weak economic environment? Why don't we hear that we can't cut spending in this weak economic climate? From a macroeconomic viewpoint, changes in taxes and spending will have the same effect on economic activity.

The "liberal" mainstream media? A media dominated large corporations is the reality.

The more I read about Obama's antics around the world, the more I realize George Bush seems like an isolationist, pacifist by comparison. It also makes me think that US Presidents are now just hand puppets for the military industrial complex. Not new news, but frightening all the same.

As Boehner breaks off debt talks and says he'd be a better president, Obama whines that Republicans won't return his calls. Can you imagine this from LBJ or Truman?

Obama knows what the indudtrial military complex is capable of. Osama sleeps with the fishes.

"fight fire with fire"

Bad metaphor. Are you setting a fire break? Or, just adding to the all-consuming flames?

I say, "piss on 'em".

They would probably enjoy it.

In the 1960s and '70s, there was plenty of high-octane drama, from assassinations to demonstrations to presidential criminality to a humiliating defeat in Vietnam. How innocent all that seems in retrospect.

During the worst of it, I was flush with excitement. The old order was giving way to something new and wonderful! What was I smoking? I think you know.

The revolution I thought I wanted came from right field instead of left. While the arc of justice was bending a nation to greater tolerance and freedom, a reaction to that was burrowing its way through our foundation and pillars. We are not one nation, we are Real Americans! A nation of aggrieved "haves" became the wrecking crew that hippies merely played at.

So, here we are watching an ineffectual "liberal" take on the forces of nihilism and the nation suddenly looks played out and spent. There is no hope here to speak of. The change is synonymous with death and decay. Apart from the rote wishes for nice days and safe journeys, the trip has become a bummer. We're going down.

"were going down" But this old dude is going with as much personal pleasure as possible.
Look for City States ran by financial Lords. The rest of you dudes are slave commodities to be sold on the open world flea market.

I can just see my ad in SLAVE TRADER, free copies at all your local Circle K stores.

60 year old male, high mileage, bad back, bad heart, bad eyes, bad knees, cranky. Good for a door stop or paper weight. Will accept any offer or trade.

We'll see how the American media tiptoe around the massacre in Norway. A right-wing killer who targeted a summer camp run by the liberal party. An act of a "madman"? No, a political act. Otherwise, Osama "Sleeps with the Fishes" bin Laden was a mere madman, too.

Speaking of mad men
“We built it you bastards”
Since Richard Boone and Jack Elam died I bestowed the honor on myself of being “The Worlds Ugliest man.” However Jon I must tell you I think the, “We built it you bastards” lite rail in Phoenix is the ugliest thing I have ever seen. Today I was reminded how screwed up the street traffic (read cars) is where lite rail exists. I swear I sat at several traffic signals for hours as a result of the light rail. Makes me want to sell my car. (I know you did). Finally I drove south on Central for a half mile to get where I was going. There was a little traffic going the right way as I went the wrong way but the drivers just ignored me and I didn’t see any cops. Come September I gotta get the F--- out of town and find me some high plains where I can see for miles and miles with little evidence of “manunkind.” ee cummings. May the Sahuaros be with you. Cal Lash and his dog Spot in their Motor home somewhere in the great Sonoran desert. What’s left of it.

Great column, Mr. Talton! So many spot-on points that it's difficult to comment on them all.

I came across a graph in a Wall Street Journal article recently that really puts the issues of federal spending, entitlements, and the national debt into a simple, clear, holistic perspective. The graph comes from the non-partisan Congressional Budget Office.


The top line shows total federal spending as a percentage of gross domestic product. It's projected to rise from roughly 23 percent today to about 27 percent in 2035. That's all, over a whole quarter of a century.

The next part of the graph shows that spending on major health-care programs (e.g., Medicare and Medicaid) and Social Security also rises just 5 percent of GDP in the same period. The graph indicates that health-care spending alone accounts for 80 percent of projected increases in entitlement spending; of that, about 3 percentage points result from an aging population, and about 2 percentage points are attributable to cost growth in health-care.

Interestingly enough, the article starts by noting that the $350 billion in potential cuts to Medicare and Medicaid proposed in recent budget negotiations would do nothing to tackle the rising cost of health-care itself, but instead would simply shift the costs to public hospitals, states, and individuals.

Where's the fire?

Regarding the New Economy, according to a recent USA Today article,

* Workers' wages and benefits make up 57.5 percent of the economy, an all-time low. Until the mid-2000s, that figure had been remarkably stable — about 64 percent through boom and bust alike.

* Corporate profits are up by almost 50 percent since the recession ended in June 2009. By contrast, in the first two years after the recessions of 1991 and 2001, profits rose 11 percent and 28 percent, respectively.

* Unemployment has never been so high — 9.1 percent — this long after any recession since World War II. At the same point after the previous three recessions, unemployment averaged just 6.8 percent.

* The jobs that are being created pay less than the ones that vanished in the recession. Higher-paying jobs in the private sector, the ones that pay roughly $19 to $31 an hour, made up 40 percent of the jobs lost from January 2008 to February 2010 but only 27 percent of the jobs created since then.

* The average worker's hourly wages, after accounting for inflation, were 1.6 percent lower in May than a year earlier. Rising gasoline and food prices have devoured any pay raises for most Americans.

* Americans have a long way to go before their finances will be strong enough to support robust spending: Despite cutting what they owe the past three years, the average household's debts equal 119 percent of annual after-tax income. At the same point after the 1981-82 recession, debts were at 66 percent; after the 1990-91 recession, 85 percent; and after the 2001 recession, 114 percent.


See a pattern here? As income inequality reduces real median household income, households attempt to maintain their standard of living with debt: credit cards, second mortgages and home equity lines of credit. No more.

Not only is housing not going to fuel economic recovery with new hiring in construction, furnishings, and related manufacturing/retail, but it isn't going to fuel a recovery of consumer demand either: in June, USA Today reported that "U.S. home prices have fallen to 2002 levels and are expected to drop further". The chairman of the Standard & Poor's / Case-Shiller Home Price Index is quoted as saying that "Home prices continue on their downward spiral with no relief in sight", reporting also that housing has hit a double-dip in 19 of 20 metropolitan areas.


More than 3/4 of the nation's small businesses either don't plan to hire or plan to cut jobs, in the next year, reports the Wall Street Journal, citing a U.S. Chamber of Commerce survey.


Never mind "uncertainty" -- the problem is lack of consumer demand: if consumers were spending at pre-recession levels businesses would be certain that they needed to hire to keep up with the demand. With lackluster sales, there is simply no need. Small business creates most of the nation's new jobs but in the general case cannot depend on foreign revenues from growth in developing countries.

It's a vicious circle: domestic sales can't increase until consumer demand rises; consumer demand can't rise until hiring increases and household incomes rise; hiring can't increase until domestic sales increase...

The only solution is to jump-start consumer demand.

Cutting consumer taxes won't work if the government cuts spending to offset the lower tax revenue, because then lower government spending in the economy will exactly offset higher consumer spending in the economy.

That leaves either:

(1) Some sort of debt-fueled stimulus program (either infrastructure spending or consumer tax cuts, or both), which is unlikely to please deficit hawks;

(2) Increased taxes on the wealthy and direct redistribution of the revenue from this to those in the bottom third of the income pyramid. The idea of the latter is to take funds that are currently not spent on consumption (used instead to bid-up the values of paper assets via speculation) and give it to those whose consumption needs are not fully met. This won't increase the deficit or debt, will decrease "uncertainty" because it will be a permanent change to the tax code instead of a temporary stimulus program, and will increase both economy growth, hiring, consumer incomes, and government revenues (over time).

Even if some of this is used to pay down debt that's a good thing. See above regarding the stranglehold consumer debt now exerts on consumer borrowing and spending.

Additionally, this is nothing more than an expansion of the Earned Income Tax Credit for working individuals and families (albeit a doozy of an expansion). The EITC was begun by Ronald Reagan. That should give moderate conservatives some political cover.

Incidentally, this could be done with or without an actual increase in top marginal tax brackets. A majority or near majority of the tax breaks for mortgage interest deduction, property tax deduction, and tax breaks for retirement savings, go to the top 10 percent of earners.

(Almost out of time -- more another day.)

Here's another stat which demonstrates, even more explicitly, how very different the New Economy is from past economic recoveries, particularly with regard to how income is divided among investors and workers:

"Wages and salaries accounted for just 1 percent of economic growth in the first 18 months after economists declared that the recession had ended in June 2009, according to Sum and other Northeastern researchers.

"In the same period after the 2001 recession, wages and salaries accounted for 15 percent. They were 50 percent after the 1991-92 recession and 25 percent after the 1981-82 recession.

"Corporate profits, by contrast, accounted for an unprecedented 88 percent of economic growth during those first 18 months. That's compared with 53 percent after the 2001 recession, nothing after the 1991-92 recession and 28 percent after the 1981-82 recession."


Another point raised by Mr. Talton was in reference to 24 million Americans either unemployed, underemployed (i.e., doing part-time work when full-time was sought), or discouraged (i.e., given up searching because work is not to be found, and thus no longer counted as part of the workforce when determining the unemployment rate).

The issue of discouraged workers is important because if they were included in the official unemployment rate, it would be much higher. The ratio of job-seekers to jobs on offer would also be higher if the "discouraged" weren't so numerous. Two aspects of this are important but seldom remarked upon.

The first aspect involves just how large the "discouraged" component is. A recent Associated Press article notes that the number of Americans leaving the workforce in the last six months is nearly twice as large as the number of newly employed (1.3 million versus 765,000). Though the article doesn't give explicit figures for the number leaving the workforce since the recession began, my calculation using the article's other figures suggests about 4,000,000.


The second aspect involves how "discouraged" is officially defined. Since 1994, the government has only counted the "short-term discouraged", i.e., those discouraged for a year or less. That's important, because according to the Wall Street Journal, nearly 1/3 of the unemployed have been out of work for more than a year; and those are just the ones still reporting themselves as actively searching.


The broadest official unemployment rate, U-6, which excludes those discouraged for more than a year, was 16.2 percent in June of 2011.

A non-official alternative measure, using U-6 as the base but attempting to include the long-term discouraged as well, gives an estimated unemployment rate of 22.5 percent. I do not vouch for the accuracy of the latter: I present it simply for consideration by Rogue readers:


In the current debate about extending unemployment benefits, it's seldom noted that "even if all the open positions were filled, 10.7 million people would still be unemployed. That compares with 7.7 million who were unemployed when the recession began in December 2007. The recession ended in June 2009." Again, this only includes those officially defined as participating in the workforce, not discouraged workers.


No matter what comes out of the political theater, the economy will double dip. It may even be the big one this time. And maybe, just maybe, everyone (but the absolute faithful) will blame the Republicans and Tea Party and the Rich and the Corporations for this and through them out at the ballot box or in the streets.

Reading the previous wisdom of our colleagues, I'm left with a nagging question. Who made Grover Norquist into this all-powerful deity? There's got to be some powerful ju-ju there because the guy's apparently never done anything significant in his life. Could someone please enlighten?

Norquist live:

Damon! The best arguments money can buy.

Norquist is merely a face of the "vast right-wing conspiracy," e.g, the huge web of interconnected "conservative" advocacy groups, think tanks, political consultancies, lobbyists and media outlets that has been being built for more than 30 years and bankrolled by the rich and big business. There's simply nothing to match it on the left.

Norquist has a talent for self-promotion and latched onto the "no new taxes!" mantra early. But his real power comes from behind the curtain, and from a large minority of ignorant Americans who nevertheless vote.

Another possibility for increasing U.S. economic growth involves the trade deficit. U.S. exports are about 10 percent of GDP, but imports are about 15 percent of U.S. GDP. That means the equivalent of 5 percentage points of economic growth are being lost as domestic demand and disposable incomes are being diverted to overseas producers instead of to domestic producers.

If even half of this could be re-diverted to domestically produced products and services, the U.S. could experience robust economic growth (more than 5 percent a year, given the assumption of 2.5 to 3 percent a year growth in the absence of such a re-diversion).

China has its own understanding of "free markets". From the Detroit Free Press:

"Imagine paying at least $77,000 for a five-seat Cadillac SRX crossover. The price includes a 25% import duty, a 12% tax based on the engine size and a 17% value-added tax, Chen said. A fully loaded model costs $56,725 in the U.S., including delivery.

"The larger, less fuel-efficient Cadillac Escalade gets even more expensive. It costs the equivalent of $215,000, after the same 25% import duty and 17% value-added tax and a 40% tax on its 6.2-liter engine. In the U.S., a fully loaded Escalade hybrid costs $89,180."


Note especially that 25 percent import duty. Do goods exported from China into the U.S. have a 25 percent import duty levied on them by the U.S.?

The International Monetary Fund predicts that by 2030 China will be the world's largest economy, with an annual GDP of $73.5 trillion; the U.S. economy (in second place) is projected to be half of that, at $38.2 trillion.

There are enormous economic motives for international capital in general, and U.S. corporations especially, to suck up to China and other up & coming developing nations, and to insure that U.S. trade, tax, and capital-movement laws encourage this:

The middle class in [10 major developing nations including China) those countries is growing by about 170,000 people per day. . .

. . . Joseph Zidle, a top investment strategist for Bank of American Merrill Lynch pointed out in March that in the U.S. today, there are 4.25 credit cards for every person. In China, the average is 0.25 credit cards for every person. In the U.S., 1,000 cars per 1,000 drivers. In China, 40 cars per 1,000 drivers.

"If the emerging market consumer were a company, he or she would have the strongest balance sheet out there — lack of debt, future potential spending. They're at the beginning of a credit cycle, not the end," Zidle said.


Obviously, "it's good for corporate balance sheets and investors, and the U.S. consumer is increasingly irrelevant" is not an argument that either U.S. companies or politicians can make; so the argument for such policies has to claim that they improve quality of life for the U.S. consumer.

Interestingly enough, Canada, whose penchant for effective financial regulation and conservative traditional banking allowed it to largest escape the banking and housing crises, also seems to be doing comparatively well where job growth is concerned:

"In the past year, Canada has more than recouped all the jobs lost during the 2008-2009 recession...most full time and in the private sector. Meanwhile, the U.S. remains several million shy of its pre-crisis level and the jobless rate is above nine per cent.


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