Paul Krugman: Be Careful With Debt History

Thursday 19 January 2012

by: Paul Krugman, Krugman & Co.

One thing that apparently comes as a surprise to many people who love to intone about what history tells us about the dangers of debt is the fact that Britain has had remarkably high public debt relative to gross domestic product for most of its modern history.

But here’s a question: How relevant are these historical debt levels to current concerns?

The World War on Democracy

Thursday 19 January 2012
by: John Pilger, Truthout | News Analysis

Lisette Talate died the other day. I remember a wiry, fiercely intelligent woman who masked her grief with a determination that was a presence. She was the embodiment of people's resistance to the war on democracy. I first glimpsed her in a 1950s Colonial Office film about the Chagos islanders, a tiny creole nation located midway between Africa and Asia in the Indian Ocean.

The camera panned across thriving villages, a church, a school, a hospital, set in a phenomenon of natural beauty and peace. Lisette remembers the producer saying to her and her teenage friends, "Keep smiling girls!"

Sitting in her kitchen in Mauritius many years later, she said, "I didn't have to be told to smile. I was a happy child, because my roots were deep in the islands, my paradise. My great-grandmother was born there; I made six children there. That's why they couldn't legally throw us out of our own homes; they had to terrify us into leaving or force us out. At first, they tried to starve us. The food ships stopped arriving [then] they spread rumours we would be bombed, then they turned on our dogs."

Commentary: Gingrich should learn that the poor already work hard

By Issac J.Bailey | The Myrtle Beach Sun

I wish Newt Gingrich had met Kendra Keel.

Gingrich, the Republican presidential candidate who has shot up in state polls before Saturday’s crucial S.C. primary, and Keel, a founding member of the Myrtle Beach group Mothers Against Violence, both attended Monday’s King Day breakfast and community awards banquet.
Gingrich gave a subdued, humble speech about King that morning.

Energy efficiency: still awesome, still ignored

By David Roberts

20 Jan 2012 1:21 PM 

 

 

There was a brief, heady time in the late ’00s when it seemed like energy efficiency was finally going to get the spotlight. For years — decades, really — efficiency geeks lamented that the only job-creating, money-saving, productivity-enhancing energy option available was perpetually marginalized while far more expensive options (cough*nuclear*cough) were subject to endless public discussion. Since 1970, the U.S. economy has tripled in size; in that time, 3/4 of the demand for new energy services has been met by efficiency, not new energy supply. Three-quarters! A bigger contribution than any single energy source. And yet … crickets.

But then efficiency started catching on! People started writing about it in major publications. A few glimmers of bipartisan consensus in Congress appeared. Hope abounded.

Rutgers study finds paid family leave leads to positive economic outcomes

NEW BRUNSWICK, N.J. – With a growing need for family-friendly workplace policies, a new study commissioned by the National Partnership for Women & Families, with support from the Rockefeller Foundation, concludes that providing paid family leave to workers leads to positive economic outcomes for working families, businesses and the public.


The research, conducted by the Center for Women and Work at Rutgers, the State University of New Jersey, finds that women who use paid leave are far more likely to be working nine to 12 months after a child’s birth than those who do not take any leave. These women also report increases in wages from pre- to post-birth.

Insight: Top Justice officials connected to mortgage banks

By Scot J. Paltrow | Reuters – Fri, Jan 20, 2012

(Reuters) - U.S. Attorney General Eric Holder and Lanny Breuer, head of the Justice Department's criminal division, were partners for years at a Washington law firm that represented a Who's Who of big banks and other companies at the center of alleged foreclosure fraud, a Reuters inquiry shows.

The firm, Covington & Burling, is one of Washington's biggest white shoe law firms. Law professors and other federal ethics experts said that federal conflict of interest rules required Holder and Breuer to recuse themselves from any Justice Department decisions relating to law firm clients they personally had done work for.

The Uphill Battle Against Citizens United: Tricky Legal Terrain and No Easy Fixes

By Steven Rosenfeld, AlterNet
Posted on January 19, 2012, Printed on January 21, 2012


The movement to overturn the Supreme Court’s controversial Citizens United ruling and confront the doctrine of corporate personhood stands at a perilous crossroads.

Across the country, two distinct strategies are converging on Congress. More than a million people have signed online petitions. State legislators, city and township governments, Democratic Party groups and unions have sponsored and passed measures in 23 states demanding that Congress pass a constitutional amendment to reassert and elevate the political speech of ordinary citizens and roll back the growing political speech and legal privileges of corporations. 

On US Education: It’s the Socioeconomic Segregation, Stupid

by Jim Horn

In a piece for The Nation last week, Linda Darling-Hammond demolished most of the remaining chunks of any size within the crumbling structure of corporate education’'s most ironically-titled reform ever --No Child Left Behind. NCLB is now rubble, even though many unseen victims continue to be buried beneath its mammoth pile.

Darling-Hammond, who was recruited to get Team Obama up to speed on education issues following the 2008 election, entitled her piece, "Why Is Congress Redlining Our Schools?". It should be noted that as soon as Team Obama got a lay of the edu-land in early 2009, they dismissed Darling-Hammond and brought in corporate lackey, Arne Duncan, to serve as titular head of the Education Department while the corporate foundations run the show.

5 Lessons From The SOPA/PIPA Fight

By Matthew Yglesias  |  Posted Friday, Jan. 20, 2012, at 11:12 AM ET

This looks like the end of the beginning for PIPA/SOPA, as Harry Reid tweets: "In light of recent events, I have decided to postpone Tuesday's vote on the PROTECT IP Act." I think we can learn a few lessons here, many of which illustrate the main conclusions of Baumgartner et. al.'s excellent book Lobbying and Policy Change: Why Wins, Who Loses, and Why.

1) Lobbying isn't all about money: Hollywood badly outspent Silicon Valley on this issue and still lost. This is completely typical. There's no evidence that better-funded groups systematically win policy fights.

2) But money matters a lot: That said, it's extraordinarily difficult to get on the agenda if you don't have some money to spend. The fact that Silicon Valley firms like Google now have Washington offices and are clearly capable of offering both campaign contributions and the "legislative subsidy" of policy analysis to people who champion their causes was critical to getting opposition off the ground.

Paul Krugman: Taxes at the Top

Call me peculiar, but I’m actually enjoying the spectacle of Mitt Romney doing the Dance of the Seven Veils — partly out of voyeurism, of course, but also because it’s about time that we had this discussion.

The theme of his dance, for those who haven’t been paying attention, is taxes — his own taxes. Although disclosure of tax returns is standard practice for political candidates, Mr. Romney has never done so, and, at first, he tried to stonewall the issue even in a presidential race. Then he said that he probably pays only about 15 percent of his income in taxes, and he hinted that he might release his 2011 return.


Even then, however, he will face pressure to release previous returns, too — like his father, who released 12 years of returns back when he made his presidential run. (The elder Romney, by the way, paid 37 percent of his income in taxes).

2012's Civil Liberties Apocalypse Has Already Happened

by Harvey Wasserman and Bob Fitrakis

 

In case you missed it, President Barack Obama has signed a death knell for the Bill of Rights. It's a hell of a way to begin a year many believe will mark the end of the world.

The National Defense Authorization Act (NDAA) makes a mockery of our basic civil liberties. It shreds the intent of the Founders to establish a nation where essential rights are protected. It puts us all at risk for arbitrary, indefinite incarceration with no real rights to recourse.

S&P Downgrades and Banks: Threats to Global Stability

By Nomi Prins

Standard & Poor’s likes moving on Friday nights after the markets are closed. It was on a Friday night that it downgraded U.S. debt to AA+ from AAA. And on Friday night, Jan. 13, it downgraded France and Austria from AAA to AA+ and seven other European countries too—Cyprus, Italy, Portugal and Spain by two notches, Malta, Slovakia and Slovenia by one. Portugal, Cyprus, Ireland and Greece remain at junk status. Germany’s AAA rating stayed the same.

The markets weren’t shocked by last week’s wave of pre-broadcast S&P sovereign debt downgrades. For months, the question wasn’t “if” but “when.” And true to form, just as with the U.S. downgrade, S&P’s reasoning skated the surface of prevailing wisdom: Governments have too much debt and not enough income. That’s only part of the story.

A Brief History of America's Dumb Policies Towards Iran

By Tom Engelhardt, TomDispatch.com<
Posted on January 17, 2012, Printed on January 20, 2012

These days, with a crisis atmosphere growing in the Persian Gulf, a little history lesson about the U.S. and Iran might be just what the doctor ordered.  Here, then, are a few high- (or low-) lights from their relationship over the last half-century-plus:

Summer 1953: The CIA and British intelligence hatch a plot for a coup that overthrows a democratically elected government in Iran intent on nationalizing that country’s oil industry.  In its place, they put an autocrat, the young Shah of Iran, and his soon-to-be feared secret police.  He runs the country as his repressive fiefdom for a quarter-century, becoming Washington’s “bulwark” in the Persian Gulf -- until overthrown in 1979 by a home-grown revolutionary movement, which ushers in the rule of Ayatollah Khomeini and the mullahs.  While Khomeini & Co. were hardly Washington’s men, thanks to that 1953 coup they were, in a sense, its own political offspring.  In other words, the fatal decision to overthrow a popular democratic government shaped the Iranian world Washington now loathes, and even then oil was at the bottom of things.

Jacob Hacker and Paul Pierson on Engineered Inequality

Tuesday 17 January 2012

by: Bill Moyers, Moyers & Co. | Transcript 

 

In this show segment, Moyers & Company dives into one of the most important and controversial issues of our time: How Washington and Big Business colluded to make the super-rich richer and turn their backs on the rest of us.

Bill’s guests – Jacob Hacker and Paul Pierson, authors of Winner-Take-All Politics: How Washington Made the Rich Richer — And Turned Its Back on the Middle Class, argue that America’s vast inequality is no accident, but in fact has been politically engineered.

Election Will Decide Which New Wars Will Be Waged


By William Pfaff

Now that America’s primary elections have eliminated the more implausible contenders for the Republican presidential nomination, it is possible to take a clearer look at what the electorate will be up against when the conventions are over in the fall, and when the newly elected president assumes (or resumes) command of American foreign policy.

Barring the unforeseeable, the Democratic candidate will be Barack Obama. If the polls, and the wishful thinking of old-school Republicans, are right, the Republican candidate will be Mitt Romney, who has displayed the least ignorance of foreign policy issues among the surviving primary candidates. That does not say much. His proposal that American policy in the Middle East be wholly submitted to the approval of the present government of Israel differs from the other candidates (Obama included; Ron Paul excluded) only by its degree of grovel and electoral pandering. He could, however, be elected. That is why he said it.

How Local Governments Can Fight Back Against the Foreclosure Crisis

Wednesday, 01/18/2012 - 9:52 am by Kristen Tullos

Cities can use local housing codes and land banks to push back against banks’ reckless behavior.

Since the beginning of the economic downturn, Congress has passed numerous pieces of legislation aimed at stabilizing the housing market. Their legislative efforts succeeded in stabilizing financial markets, but foreclosures have continued unabated, affecting families and neighborhoods across the country. While the foreclosure crisis continues to be a drag on the economy, its effects are felt most acutely in communities and neighborhoods.

MERS, the law, and the State

The current version of Harpers — go buy it on the newstand! — has a terrific article by Christopher Ketcham on the MERS mess, which NC has done so much to bring to the attention of the public. I’m going to excerpt and contextualize two portions of the article. First, Ketcham interviews foreclosure activist Vermont Trotter of Coeur D’Arlene, Idaho on the “clouded title” problem.

Miracle tree' substance produces clean drinking water inexpensively and sustainably

A natural substance obtained from seeds of the "miracle tree" could purify and clarify water inexpensively and sustainably in the developing world, where more than 1 billion people lack access to clean drinking water, scientists report. Research on the potential of a sustainable water-treatment process requiring only tree seeds and sand appears in ACS' journal Langmuir.

World Map of All Wars and Conflicts Happening In 2012

Aviation Week's Defense Technology International has compiled a summary of all the current and probable conflicts of 2012, so I made this map*. The only conflict that is not in this map is the incoming Obama-Romney nuclear war.

The world doesn't seem like a very nice place right now.

10 reasons the U.S. is no longer the land of the free

By Jonathan Turley, Published: January 13

 

Every year, the State Department issues reports on individual rights in other countries, monitoring the passage of restrictive laws and regulations around the world. Iran, for example, has been criticized for denying fair public trials and limiting privacy, while Russia has been taken to task for undermining due process. Other countries have been condemned for the use of secret evidence and torture.

Even as we pass judgment on countries we consider unfree, Americans remain confident that any definition of a free nation must include their own — the land of free. Yet, the laws and practices of the land should shake that confidence. In the decade since Sept. 11, 2001, this country has comprehensively reduced civil liberties in the name of an expanded security state. The most recent example of this was the National Defense Authorization Act, signed Dec. 31, which allows for the indefinite detention of citizens. At what point does the reduction of individual rights in our country change how we define ourselves?

Reexamining the myth of no-fault capitalism

By Eugene Robinson

From all evidence, the issue of economic justice isn’t going away. Break the news gently to Mitt Romney, who seems apoplectic that the whole “rich get richer, poor get poorer” thing is being discussed out loud. In front of the children, for goodness’ sake.

“You know I think it’s fine to talk about those things in quiet rooms,” he told the “Today” show’s Matt Lauer last week. “But the president has made this part of his campaign rally. Everywhere he goes we hear him talking about millionaires and billionaires and executives and Wall Street. It’s a very envy-oriented, attack-oriented approach.”

Actually, those blasts weren’t coming from President Obama. That was Romney’s competition for the Republican nomination, sounding like a speakers’ lineup at an Occupy Wall Street rally.

Virginia lawmaker: Children with disabilities are God’s punishment to women who previously had abortions.

By Amanda Terkel on Feb 22, 2010 at 1:45 pm

On Thursday, Virginia State Delegate Bob Marshall (R) spoke at a press conference against state funding for Planned Parenthood. He blasted the organization for supporting a women’s right to choose, saying that God punishes women who have had abortions by giving them disabled children:

“The number of children who are born subsequent to a first abortion with handicaps has increased dramatically. Why? Because when you abort the first born of any, nature takes its vengeance on the subsequent children,” said Marshall, a Republican.

Billionaire Funds Santorum Run

by Steven D
Tue Jan 17th, 2012 at 08:01:25 AM EST

I for one am delighted to have our elections decided by people with ungodly amounts of wealth. That way I don't have to worry about which candidates are successful and which are not. For example, now I know Rick Santorum, the man who once claimed homosexuality would lead to man on dog sex is a serious contender for the GOP nomination because the big money says he is.

Paul Krugman: How Fares the Dream?

“I have a dream,” declared Martin Luther King, in a speech that has lost none of its power to inspire. And some of that dream has come true. When King spoke in the summer of 1963, America was a nation that denied basic rights to millions of its citizens, simply because their skin was the wrong color. Today racism is no longer embedded in law. And while it has by no means been banished from the hearts of men, its grip is far weaker than once it was.

To say the obvious: to look at a photo of President Obama with his cabinet is to see a degree of racial openness — and openness to women, too — that would have seemed almost inconceivable in 1963. When we observe Martin Luther King’s Birthday, we have something very real to celebrate: the civil rights movement was one of America’s finest hours, and it made us a nation truer to its own ideals.

Yet if King could see America now, I believe that he would be disappointed, and feel that his work was nowhere near done. He dreamed of a nation in which his children “will not be judged by the color of their skin but by the content of their character.” But what we actually became is a nation that judges people not by the color of their skin — or at least not as much as in the past — but by the size of their paychecks. And in America, more than in most other wealthy nations, the size of your paycheck is strongly correlated with the size of your father’s paycheck.

Everything You Need to Know About Wall Street, in One Brief Tale

by Matt Taibbi

 

If there was ever a news story that crystallized the moral dementia of modern Wall Street in one little vignette, this is it.

Newspapers in Colorado today are reporting that the elegant Hotel Jerome in Aspen, Colorado,  will be closed to the public from today through Monday at noon.

Why? Because a local squire has apparently decided to rent out all 94 rooms of the hotel for three-plus days for his daughter’s Bat Mitzvah.

What They Don’t Want to Talk About

Ever since Newt Gingrich and Rick Perry started criticizing Mitt Romney’s actions at Bain Capital — and talking about the thousands of people laid off as a result of Bain’s investments — party leaders have essentially told them to shut up. That response is a pretty good indication of how deeply party elders fear the issue of economic inequality in the campaign to come.

“What the hell are you doing, Newt?” Rudolph Giuliani asked Thursday on Fox News. “This is what Saul Alinsky taught Barack Obama, and what you’re saying is part of the reason we’re in so much trouble right now.” 

The Myth of American Productivity

Politicians say we have the most productive workers in the world. They don't know what they're talking about.

By Michael Mandel

In 1939, when John Steinbeck completed The Grapes of Wrath—a heart-wrenching tale of a family of sharecroppers forced out of their home during the Depression— roughly one-quarter of the U.S. population still lived on farms. Today, family farms are increasingly rare, and less than 2 percent of employed Americans work in agriculture.

But rather than viewing the decline of farming jobs as a tragedy, economists almost invariably count agriculture as a shining American success—the triumph of productivity. And why not? A handful of farmers using GPS-equipped combines and sophisticated moisture sensors can grow far more food than the population of an entire rural county in 1939. Food has become so plentiful and cheap in the United States that it has been blamed for the increase in obesity. And agricultural products have become one of the country’s chief exports, totaling more than $115 billion in 2010.

An odd way of showing ‘concern for the poor’

By Steve Benen

NBC News reported yesterday that Mitt Romney made a “slight tweak to his usual campaign message” during an appearance in South Carolina yesterday.

Traditionally on the stump and in debates, Romney says the poor are “taken care of” by the country’s social safety net. Today he appeared to call for reinforcing that net, in addition to helping the middle class.
“I’m concerned about the poor in this country. We have to make sure the safety net is strong and able to help those who can’t help themselves,” Romney said, before returning to his standard remarks. “I’m not terribly worried about the very wealthiest in our society; they’re doing just fine.”

I can certainly understand why Romney would say something like this.

America, a Land Made for the 1 Percent

January 13, 2012

 

Over the past three decades, right-wing policies have diverted the wealth of America into fewer and fewer hands, and a right-wing Supreme Court has let money dominate U.S. politics like never before, challenging Woody Guthrie’s idea that “this land was made for you and me,” Bill Moyers and Michael Winship note.


By Bill Moyers and Michael Winship

The traveling medicine show known as the race for the Republican presidential nomination has moved on from Iowa and New Hampshire, and all eyes are now on South Carolina.

Well, not exactly all. At the moment, our eyes are fixed on some big news from the great state of Oklahoma, home of the legendary American folk singer Woody Guthrie, whose 100th birthday will be celebrated later this year.

The Truth About Private Equity: Politicians Need It, Taxpayers Fund It

Ignore the ‘vulture capital’ talk. Romney, Obama, and both parties rely on their support—money that comes from government-backed, taxpayer-supported pension funds.

by Nomi Prins
January 13, 2012 4:45 AM EST

GOP presidential hopeful Mitt Romney inspired a slew of commentary about the private-equity industry, following his boasts of creating 100,000 jobs during his reign at Bain Capital. Some columns claimed private equity is an important part of capitalism, so stop picking on it. Some pointed out the sector infiltrates firms, cuts jobs and expenses, and makes buckets of money in the process. Which it does. But simply examining whether private equity is inherently good or evil, and by extension whether Romney is, misses key points fundamentally related to our nation’s economic health.

First, the tax structure for private equity—and hedge-fund and venture-capital firms—gives it an unfair advantage, while encouraging excessive fee and profit extraction from flailing companies. Second, private-equity funding disproportionally comes from public pension funds. In other words, from government-backed, taxpayer-supported money.

Paul Krugman: America Isn’t a Corporation

“And greed — you mark my words — will not only save Teldar Paper, but that other malfunctioning corporation called the U.S.A.”

That’s how the fictional Gordon Gekko finished his famous “Greed is good” speech in the 1987 film “Wall Street.” In the movie, Gekko got his comeuppance. But in real life, Gekkoism triumphed, and policy based on the notion that greed is good is a major reason why income has grown so much more rapidly for the richest 1 percent than for the middle class.

Today, however, let’s focus on the rest of that sentence, which compares America to a corporation. This, too, is an idea that has been widely accepted. And it’s the main plank of Mitt Romney’s case that he should be president: In effect, he is asserting that what we need to fix our ailing economy is someone who has been successful in business.

A Federally-Funded Jobs Program? Lessons from the WPA

By John Henry, Professor of Economics at UMKC.

Lambert here: This post is an important contribution to the debate, because the history of the WPA gives the lie to the oft-heard claim that “the government can’t create jobs.” It can and it has.

* * *
In the current debates surrounding various job guarantee programs (in association with the Chartalist or Modern Money perspectives), it might prove helpful to review some aspects of the Works Progress Administration (renamed in 1939 as Work Projects Administration). While the WPA was not a “job guarantee” program, it nevertheless points to a number of issues that are under current discussion, including those of the nature of the projects undertaken, impact on the larger economy, concerns surrounding bureaucratic impediments, etc. Let’s begin with an introductory statement pertaining to the political and economic orientation of Franklin Delano Roosevelt (and his Administration).

Roosevelt was not a progressive. He ran on a balanced budget platform, and initially attempted to fulfill his campaign promise of reducing the federal budget by slashing military spending from $752 million in 1932 to $531 million in 1934, including a 40% reduction in spending for veteran’s benefits which eliminated the pensions of half-a-million veterans and widows and reduced the benefits for those remaining on the rolls. As well, federal spending on research and education was slashed and salaries of federal employees were reduced. Such programs were reversed after 1935. And one might recall that Roosevelt attempted to return to a balanced budget program in 1937, just as the economy appeared to be slowly recovering. The result was a renewed depression that began in the fall of that year and ran through 1938.

Bank of America Prepares Emergency Plans at Fed Behest, May Need to Amputate on Geographic Basis

As we’ve said repeatedly, despite bank executives braying about the need to be bigger to compete or to gain efficiencies, the evidence runs completely the other way. Every study on bank efficiency in the US has found that once banks hit a certain size level (the most commonly found one seems to be ~$5 billion in assets) banks exhibit a slightly positive cost curve, which means they are more, not less, costly to run. Any economies of scale are probably offset by diseconomies of scope.


So why do bank executives sell and act on a patently phony story? Aside from the fact that doing deals is much more fun than managing a business, the BIG reason is CEO pay is highly correlated with the size of the bank, measured in total assets.

Americans Pay Wall St. $20B for Bad Swaps

By Darrell Preston and Aaron Kuriloff - Jan 13, 2012

Seven months after Hurricane Katrina ripped holes in the Superdome’s roof in 2005, Louisiana State Bond Commission members made what they were told would be “the best of a bad situation” in financing the stadium’s renovation.

Acting against the recommendation of their staff, the commissioners voted for a Merrill Lynch & Co. plan to use debt and interest-rate swaps to pay for the job. While the deal helped keep the National Football League’s New Orleans Saints from leaving town -- and the arena got new scoreboards while 12,000 seats were converted to luxury class -- taxpayers became the losers for supporting a winning team.

Tom Donohue Pushes Civilization-Ending Pollution Agenda In Chamber Of Commerce Annual Address

By Brad Johnson on Jan 12, 2012 at 10:56 am

This morning, U.S. Chamber of Commerce President Tom Donohue argued that “free enterprise” requires a future of accelerated, unending global warming. Supporting expanded fracking, shale oil, and tar sands development including the Keystone XL pipeline, Donohue said that the United States should burn hundreds of billions of tons of fossil fuels for hundreds of years:

We have 1.4 trillion barrels of oil, enough to last at least 200 years. We have 2.7 quadrillion cubic feet of natural gas, enough to last 120 years. We have 486 billion tons of coal, enough to last more than 450 years—and we need to use more of this strategic resource cleanly and wisely here at home while selling it around the world.

The Perils of 2012

Joseph E. Stiglitz



KOLKATA – The year 2011 will be remembered as the time when many ever-optimistic Americans began to give up hope. President John F. Kennedy once said that a rising tide lifts all boats. But now, in the receding tide, Americans are beginning to see not only that those with taller masts had been lifted far higher, but also that many of the smaller boats had been dashed to pieces in their wake.

In that brief moment when the rising tide was indeed rising, millions of people believed that they might have a fair chance of realizing the “American Dream.” Now those dreams, too, are receding. By 2011, the savings of those who had lost their jobs in 2008 or 2009 had been spent. Unemployment checks had run out. Headlines announcing new hiring – still not enough to keep pace with the number of those who would normally have entered the labor force – meant little to the 50 year olds with little hope of ever holding a job again.

New research weakens case for small business tax relief

COMMENTARY | January 11, 2012

Tax breaks for upper-income brackets are unlikely to help job creators, studies find, despite all the political rhetoric.

By Martin A. Sullivan
martysullivan@comcast.net

Next to support for the troops, nothing is more sacrosanct on Capitol Hill than support for small business. As community leaders and campaign contributors, small business owners have always been near and dear to the hearts of politicians in both parties. The recession has only heightened their stature. There were no bailouts for small businesses. And since 2008 the stubborn persistence of unemployment has elevated their position even more. That's largely because the unchallenged conventional economic wisdom is that small businesses are the source of most job creation.

The National Federation of Independent Business states on its website: "Small business has created about two of every three net new jobs in the United States since at least the early 1970s." And on its website, the Small Business Administration claims, "Small firms accounted for 65 percent (or 9.8 million) of the 15 million net new jobs created between 1993 and 2009." These claims are endlessly repeated on television and in print. And both political parties are perfectly happy to leave them unchallenged. But two new strands of academic research are quietly shredding the idea that policies to support small businesses hold the key to job creation.

States Attempt to Instill 'Work Ethic' by Rolling Back Child Labor Protections

by Michelle Chen

 

It’s been a long time since the engines of American industry were driven by tiny fingers. So when Newt Gingrich recently proclaimed, “Young people ought to learn how to work,” and suggested that children could develop a strong work ethic by working as janitors in their own schools, many Americans probably missed the throwback to the early twentieth century, when hundreds of thousands of children toiled in factories. But after decades of campaigns against youth exploitation, the right is rekindling vestiges of the sweatshop era with legislation aimed at rolling back child labor laws.

While they didn’t go so far as to recruit tweens back to the factory floor, throughout 2011 state legislators pushed bills to erode regulation of youth employment. Maine Republicans sought to ease protections for young workers with amicably named legislation to “Enhance Access to the Workplace for Minors.” The original bill, introduced by State Representative David Burns, would remove some limits on working hours for teenagers and expand the number of days a youth under 20 could work for $5.25 an hour—to about half a year. That would be a bargain for employers, who pay adult Mainers a minimum wage of $7.50. Last summer, a more limited teen labor bill passed, which only eased restrictions on working hours.

James O’Keefe’s Group Appears To Commit Voter Fraud In Order To Gin Up Hysteria Over Non-Existent Fraud Problem

By Scott Keyes on Jan 11, 2012 at 4:20 pm

James O’Keefe’s latest video features surrogates appearing to commit voter fraud in yesterday’s New Hampshire primary election, all in an attempt to highlight voter fraud, a problem which is by-and-large nonexistent in the Granite State.


The undercover video shows unnamed individuals working at O’Keefe’s behest approaching polling stations throughout New Hampshire. After poll workers asked for the person’s name, O’Keefe’s agents gave the name of a voter who died within the past few weeks, before then receiving a ballot to vote. The individuals asked the poll workers if they needed ID to prove their identity, and when poll workers confirmed that they did not, O’Keefe’s men insisted on returning to their car to retrieve their ID and returned the ballot.

Have the Super Wealthy Already Seceded from the United States?

By Mike Lofgren, TruthOut.org
Posted on January 11, 2012, Printed on January 15, 2012

It was in 1993 during Congressional deliberation over the North American Free Trade Agreement. I was having lunch with a staffer for one of the rare Republican members of Congress who opposed the policy of so-called free trade. I distinctly remember something my colleague said: "The rich elites of this country have far more in common with their counterparts in London, Paris and Tokyo than with their own fellow American citizens."

That was just the beginning of the period when the realities of outsourced manufacturing, financialization of the economy and growing income disparity started to seep into the public consciousness, so at the time it seemed like a striking and novel statement.

Hedge Funds Playing Chicken With Greek Debt

By Matthew Yglesias  |  Posted Tuesday, Jan. 10, 2012, at 5:42 PM ET

The political drama has long since moved on to Italy, but the details still haven't been worked out over the question of Greek debt and hedge funds are a big part of the reason.

The issue, as you may recall, went like this. Greece was genuinely honest-to-God insolvent and couldn't cover its debts. It needed to default.

Revolving Door: From Top Futures Regulator to Top Futures Lobbyist

While America focused on New Hampshire, a classic example of revolving-door politics took place in Washington, going almost completely unnoticed. It’s a move that ranks up there with the hire of Louisiana congressman Billy Tauzin to head the pharmaceutical lobbying conglomerate PhRMA -- at a salary of over $2 million a year -- immediately after Tauzin helped ram through the Medicare Prescription Drug Bill, a huge handout to the pharmaceutical industry.

In this case, the hire involves Walter Lukken, who toward the end of the Bush years was the acting head of the Commodity Futures Trading Commission. As the chief regulator of the commodities markets, it was Lukken’s job to spot and combat speculative abuses and manipulations that might have led to artificial price hikes and other disruptions.

The long-term care challenge isn't just a fiscal problem, it's a test of our nation's character

COMMENTARY | January 09, 2012
 
When it comes to caring for the elderly and the disabled, fiscal austerity and moral imperatives come into direct conflict. So as the baby boomers enter their twilight years, a scholar at the Claude Pepper Foundation writes, the nation will have a stark choice between communal values or neoliberal ones.


By Larry Polivka
lpolivka2@fsu.edu

Over the next several years, our nation will have to confront some critical issues regarding the way we provide and pay for long-term care. Our response will not just affect the fate of millions of older and younger disabled persons; it will also be a defining moral moment for the country. Will we divide or unite around a commitment to helping those who have little capacity to meet their need for care on their own?

Most families at some point confront the need for long-term care (LTC) services, for older family members or younger disabled relatives. It is very difficult for families to anticipate and plan effectively for LTC needs, which are highly variable and must often be provided over a period of several years. The economic and emotional burdens associated with caregiving can be enormous, whether the care is provided directly by family members or through paid assistance in the form of personal care, homemaker services, adult day care, home health care, assisted living or nursing home care. These burdens will increase over the next few decades with the aging of the baby boomer generation.

CHART: How The Debt Limit Fight Hurt The Economy, Delayed Recovery

Brian Beutler, January 10, 2012, 11:36 AM

 

Last week’s surprisingly positive jobs report overshadowed another bit of good news for the economy: last November showed the biggest growth in consumer credit in 10 years. Typically that’s a sign that consumer confidence is up, banks are willing to lend, and demand is on the rise.

If you look back at recent monthly data, though, you’ll see that this particular green shoot should have poked through the ground months ago, but was stymied by the GOP’s debt ceiling hostage drama.

The Horror: What a Republican President Could Mean for the Supreme Court

If a Republican is elected, they could wreak havoc on America's federal court system.
 
January 9, 2012   |   For anyone considering the 2012 election’s importance to the future of the American judiciary, one fact stands out: next November, Ruth Bader Ginsburg will be seventy-nine years old. If a Republican wins the presidential election, he or she may have an opportunity to seat Ginsburg’s successor, replacing the Supreme Court’s most reliably liberal jurist with a conservative. That would mean that the Court—currently balanced almost elegantly between four liberals, four conservatives, and the moderate conservative Anthony Kennedy—would finally tilt decisively to the right, thereby fulfilling Edwin Meese’s dream, laid out in his famous 1985 speech before the American Bar Association, of reshaping the Court around one coherent “jurisprudence of original intention.” Meese, who was then Ronald Reagan’s attorney general, wanted nine conservative constitutional originalists on the Court. He may soon get his wish. A 2008 study by Richard Posner, a federal appeals court judge, and William Landes, a law professor at the University of Chicago, examined the voting records of seventy years of Supreme Court justices in order to rank the forty-three justices who have served on the Court since 1937. They concluded that four of the five most conservative justices to serve on the Supreme Court since 1937 sit on the Supreme Court today. Justice Clarence Thomas ranked first.

Small Companies, Big Credit Problems
How banks’ reluctance to make small-business loans is a major driver of sluggish recovery, and what to do about it.

By Matthew Yglesias | Posted Monday, Jan. 9, 2012, at 6:59 PM ET

Nobody will be surprised to learn that the past few years have been tough for small business. They’ve been tough for everyone, after all. But interesting research finalized in December from economists Burcu Duygan-Bump, Alexey Levkov, and Judit Montoriol-Garriga published by the Federal Reserve Bank of Boston indicates that the interplay of small business and the banking crisis may have played a special role in the recession. In particular, a tightening of credit standards during the high point of the fiscal crunch seems to have disproportionately impacted small firms and is continuing to hold them back during the recession.