Via Atrios, an excellent post about the recession:
[Recession is] often taken as a big deal in the simple sense that the experience of recession sucks. But, people say, there are lots of bad experiences and this is just one of them. Sometimes we have to suck it up.My argument is no, this isn’t just another bad experience. Its a failure of our most basic institutions and is leading to pure loss.
It would be as if the door to your apartment was ripped off and heat was spilling out into the atmosphere and people said “Well you know sometimes you have deal with the cold, lets talk about the ideal size of an apartment. Big ones are draftier you know. No small ones cool down too quickly”
What! No! Lets fix the fucking door. Do you understand: the door is missing. This is not the time to argue about ideal apartment size, this is the time to keep our heat from spilling out purposelessly.
I was going to say that the media has a tendency to talk about recession as something that just hurts people’s fee-fees, like the BurlingtonCoat Islamic Center, but in fact the discussion is much worse than that: when recessions hurt fee-fees, they build character — look at the Greatest Generation! — whereas the BurlingtonCoat Islamic Center is a debilitating, irreversible blow to the delicate spirit of Real Murka.
Right now, a few percent of the population is likely being doomed to a life of chronic unemployment. From the discussions politicians and elite media are having right now, I can only conclude that they just don’t give a fuck about that.
Jim C
They don’t, obviously. It won’t happen to them, or anyone like them. This is most strongly felt by the elite media, because a concentration of chronic unemployed might – just might – affect a politician’s vote totals. But probably not, otherwise they might actually be inclined to so something about the situation – thank you, Occam’s Razor.
Corner Stone
And that is where you are wrong DougJ.
For one example, the President is proposing a tax break for businesses:
“would save businesses $200 billion over two years,” “allowing companies to have more cash on hand.”
I think that speaks directly to the issue.
El Cid
How can we apartment property managers possibly go further into debt fixing a door when we have to worry about our ability to pay electrical/gas bills in the future? The soshullists like our apartment residents were the ones who took on rents that wouldn’t let them afford to replace their own doors.
WereBear
Well, journalists can get fired; unlikely, as they would have to suffer a spasm of conscience and truth telling, and those prone to such are usually weeded out before they get the Big Money.
But if and when they are? They vanish off the radar screen.
No person, no problem.
Chris
Not only do they not give a verb, many of those who can afford fancy (in some cases heated) down jackets and wool socks enjoy pointing and laughing.
bookcat
They are trying to spin a new narrative about the new normal. “Poverty! It’s good for your soul! You’ll be a better person! We’ll have that sweet simple small town America again!”
Yeah. I feel ill.
PurpleGirl
Yes, you need to tighten your belt but that only goes so far. When your benefits run out, you use all your savings and withdraw the retirement money… how do you continue to pay the rent, utilities, buy food. How? I don’t know how people are managing now but I’m expecting a lot of people going homeless (where do you store your stuff?) and falling between the cracks. I always want to write the most recent Republican who spouts off about unemployment benefits (or any safety net issue) and ask the person if I can move in with him/her when I loose my apartment.
norbizness
I hereby call for a moratorium on the use of the term “fee-fees”
DougJ
@norbizness:
It’s the only catch-phrase from here that’s caught on in the larger blogosphere recently, so I’m going to keep flogging it. Sorry.
Emily L. Hauser/ellaesther
GAH!!
So, so fucking OT, and it’s going to ultimately lead to blogpimping but GOD IN HEAVEN MARTY PERETZ IS MAKING MY HEAD CAVE IN!!!
GAH!!
http://emilylhauserinmyhead.wordpress.com/2010/09/07/muslim-life-is-cheap-wtf/
NobodySpecial
You know, in any ordinary country, now would be a good time to invest in a pitchfork-and-burning-torches dealership.
Rock
The politicians and elite media share the conviction that when something bad happens to someone it is that person’s fault. They didn’t work hard enough, they stupidly didn’t acquire marketable skills, they didn’t exercise enough to stay healthy, etc. This is a belief shared by the majority of conservatives, I believe. It has the dual uses of:
1) Making them feel safe, cause bad things won’t happen to them.
2) Removing any need for any action to be taken to help those in need, because those people brought it on themselves.
And so now instead of Jacon Riis’s photos in the NY Times we get troubling profiles of Wall Street folks that briefly needed to cut back and give up the Aspen condo.
So, no, they don’t give a fuck, because why should they? It’s not their fault that poor people made themselves poor.
NobodySpecial
@Emily L. Hauser/ellaesther: Emily, send this.
To: Marty Peretz, Plastic Jew
peej
The idiot media, collectively, has Greatest Generation envy.
el_gallo
10% unemployment isn’t a bug, it’s a feature. If the people in power can bring the unemployment level down, but they don’t, then looks to me like it’s a goal they’ve achieved, not a problem for them to fix.
DougJ
@Emily L. Hauser/ellaesther:
Yeah, I feel like we’ve reached out Peretz quota for the week here, otherwise his latest craziness would make for a good post. Ultimately, he’s just an old crackpot. You know me, the people I despise are his lackeys, serious people that they are.
Poopyman
@NobodySpecial:
Too late! The NFL season has started. Pass the chips, will ya?
Mark
Truer words have never been spoken.
My moron Senator, Dianne Feinstein had this to say:
“how long do you continue that before people just don’t go back to work at all”
“Last night for the first time I had somebody from a company tell me they’ve offered jobs to individuals and they said well, I want to not come back to work until my unemployment insurance runs out. So we need to start looking at these things. And, we need to start paying for it.”
I’m sure it never occurred to Dumb fucking Feinstein that somebody who was formerly “middle-class” is not going to give up $1200 or $1800 in monthly UI benefits to take a $9/hour job with no benefits.
She looks at this from nothing other than the businessman’s perspective: now is the time for me to capitalize on an over-supply of labor and offer the shittiest wages ever. Anyone who turns me down is a lazy dick.
Feinstein and her husband have a personal fortune somewhere in the range of a billion dollars. Perhaps we’re just being unrealistic expecting her to understand the problems of people unlike her.
Emily L. Hauser/ellaesther
@DougJ: I figured it was something like that but I just couldn’t stand it! So I did the only reasonable thing and very rudely jumped the fuck all over your thread…. (Sorry!)
Emily L. Hauser/ellaesther
@NobodySpecial: How ’bout, it man?
And how about “He has told you, O man, what is good and what the Lord requires of you: Only to do justice and to love goodness and to walk modestly with your God.” (Micah 6:8)
I mean, honest to God, the man is inciting hate crimes!
DougJ
@Emily L. Hauser/ellaesther:
No problem!
TNR just depresses me. Jon Chait is one of the few bloggers I really enjoy reading — his piece on Robert Samuelson today is pure win. But he has to suck up to a senile bigot to keep his job.
Just sad.
Stillwater
@Corner Stone: “would save businesses $200 billion over two years,” “allowing companies to have more cash on hand.”
But many companies already have lots of cash. So do banks. There’s very little job growth because investors aren’t seeing healthy enough markets to take the risk of expanding or starting up.
I think the lackadaisical attitude by our overlords wrt further government intervention reflects a concern (perhaps misguided) that you can’t stimulate your way out of the current recession.
Sue
@Mark:
Let’s not forget that these are the folks we’re targeting with tax cuts, personal and business, so they can ‘create’ all the fabulous $9/hour, no benefit jobs to tempt the lazy bums back.
NobodySpecial
@Mark: Her and her husband are war profiteers, full stop. Sympathy isn’t in them.
Martin
@Corner Stone: Actually, if you look at the proposal (what little of it there is) it seems to be a full deduction for capital expenditures, not a tax break against profits. I don’t know what the limits would be on those expenditures, but I’m not reflexively opposed to encouraging business to build infrastructure at a time when we’re screaming at the government to build infrastructure to create jobs.
Corner Stone
@NobodySpecial:
They are having a strike today in France. because they are threatening to raise the retirement age…to 62.
Zandar
Win. Thread over.
mcd410x
I think it has more to do with journalists simply being unable to grasp numbers. And, really, they can’t!
jeffreyw
@Corner Stone: Those bastards!
Emily L. Hauser/ellaesther
@DougJ: Peretz really is beginning to read as flat-out senile, isn’t he? I mean, beyond all the usual expected shit, it’s like he’s gone around some further bend.
Not unlike Dershowitz!
Zifnab
The progressives actively attempted to improve the economy. The moderately reluctantly went along, dragging their feet. The conservatives stabbed at every measure at every opportunity and killed every conceivable reform in any way they knew how.
It’s not as though Obama took office, threw up his hands and said, “Ho-hum!” and let the economy crater. The White House pitched ideas. The House pitched ideas. The Senate pitched horse shit labeled as “ideas”. Then it all came up for a vote and we’ve been in Senatorial gridlock ever since.
The real joke is how incredibly active and progressive and aggressive the ’08 House has been. We’ve had votes on Climate Change and Immigration and Health Care and multiple stimulus packages and civil rights laws and war funding. And some of these votes have gone better than others, but the legislation has been far more appealing than not.
Then all these bills line up before the Senate where they are summarily watered down, ignored, or outright rejected.
The Senate is the problem. The Senate has always been the problem. The Senate will continue to be the problem into perpetuity. Getting mad at Obama or Pelosi is absurd when 90% of the crap you have to complain about can be traced near directly to the upper house of Congress.
Villago Delenda Est
As long as the the vermin of the Village are basking in 6 to 8 figure salaries, there is no unemployment problem in this country worth mentioning.
Corner Stone
@Martin: Yes, the article indicates it goes from 50% to 100%, I’m assuming for specific purchases and cap ex needs.
I think one point that could be made is that companies are currently sitting on some $1.3T in cash. Probably for a reason.
ChrisS
@Stillwater:
There’s very little job growth because investors aren’t seeing healthy enough markets to take the risk of expanding or starting up.
And what would they be starting up? Or expanding? There isn’t much out there. Manufacturing is all overseas, retail sales are in the toilet because people lack disposable income, and new construction & real estate is in the tank for much the same reason. Being an investor sucks these days. Hoocoodanode that treating your customers like serfs would eventually fuck your business over?
The next bubble, I think will again be energy once the rest of the world economy heats back up.
Corner Stone
@el_gallo: Why would they want to manage high unemployment?
TJ
That’s how you know when you’re living in an oligarchy. When 10%+ unemployment (which if sustained is curtains for a democracy) is treated as no big deal by everyone on top.
Poopyman
@mcd410x:
True, they can’t understand numbers, as a rule. It’s their failure to understand the suffering behind the numbers that bothers me.
WereBear
That’s the ultimate irony of this situation; the Very Rich are only so as long as society keeps working as intended. Comes Thunderdome, they are arguably worse off, having no skills and no experience with adversity.
But they don’t think that far ahead; even when (ahem!) it might not be that far ahead…
Mowgli
@Zifnab: This is the truth. It also doesn’t matter for two reasons.
1) People aren’t paying attention and aren’t going to. Discussion of filibustering instantly, profoundly bores anyone who’s not a political wonk. And if if they did stay awake long enough to hear a diatribe about the rate of increased filibustering, and how it’s not really filibustering in the intended sense, they would shrug and say, “So what? What are we going to do about it?” To which the only answer is an even more byzantine discussion of filibuster reform, completely guaranteed to put them into a coma.
2) The Senate was designed as a body that would allow minority descent to block action. It was designed to be the lordly house that pushed back against the whims of the crazy commoners in the House. Bitch about it all you like, but all of this has been going on since the founding of America, with little variance. We think things are more screwed up now, only because we didn’t live through the same shit before.
slag
I watched The American this weekend and thought it was an excellent metaphor for the American worker (sorry, Dougj, but it was). In short: you’re on your own.
arguingwithsignposts
@Villago Delenda Est:
For example, While DC’s unemployment rate is about the same as the national rate, the rate for Arlington (city), Va. and Alexandria County is below 6 percent.
D. Mason
@WereBear:
This is assuming that the whole world goes Thunderdome. If only America goes shit-house those guys can afford to re-locate to a still first-world country where they already have working businesses established on the backs of American taxpayers and third world slave labor.
elm
@Corner Stone: FFS, they’re claiming that the proposed tax cuts would allow businesses to have more cash on hand?
Businesses are already sitting on plenty of cash. It’s a problem. The economy needs them to do something with that cash; invest it, disburse it as a dividend, or send it all to me.
Hopefully it’s just a clueless reporter rather than a clueless reporter plus a clueless unnamed Obama administration official.
Poopyman
@D. Mason:
Oh, you mean they’ll be joining Erik Prince in the UAE?
mai naem
How about if we offer DiFi’s hubby, say, oh, about 50 percent of what he gets off his defense contracts? BTW, I am not talking about how much his companies make so that he can roll the cuts on down to the employees, I am talking about the money he actually takes home from these deals. Wonder if DiFi would think that was worthwhile?
MikeJ
@Poopyman: If the US goes thunderdome, I’m not really sure that it would be that smart to flee to *another* place where the rich told the poor to distract themselves with religious fanaticism while the rich ran everything for them.
Suffern Ace
@WereBear: oh, they have that covered by directing anger at Mexican day laborers. You know, if we drive the poorest workers out of the country, we’ll suddenly be rich. At least if we talk about doing so. We probably won’t do anything.
If that fails, there is a tiny Muslim minority that can be driven out. After that, it’s that gay marriage. It’s been awhile, but railing on Chinese immigrants might come into fashion again soon, too. (I believe that they take an oath of loyalty to the Communists before they migrate. I heard it from Pat Buchanan years ago.) We’ll run out of those issues about the time our wages and laws are a copy of China and the last caskets come home from liberating the Georgians from Russian hegemony in the Caucuses.
Chris
@ChrisS:
Meanwhile, I read in the news that Foxconn (the company that makes the devices Apple sells, among other things, and the one that got in the news via worker suicides) is cutting back on its hiring plans, to a mere 400,000 new hires.
(compare this with the US where the entire country struggles to hire 50k…)
someguy
@elm:
I vote for confiscation, then redistribution in a stimulus package.
gene108
Businesses claim the reason they aren’t hiring is because Obama and Dems are putting in so many new regulations, they don’t know what they can and can’t do. With so much uncertainty about what laws will be passed, businesses have decided to sit on their profits and wait the recession out.
Some are probably actively looking to not hire, so Democrats and Obama get booted out and businesses can get the laws they want on the books.
It’s sort of scary, when talking to business people about how entitled they feel to be deferred to when lawmakers make policies. The concerns of the rest of us don’t matter.
Poopyman
(Edited because I’m an idiot: Independently had wandered over to Atrios and found the original at Modeled Behavior.)
Keith G
Over the last few centuries, there has been a antidote to the above: An overly abusive landed aristocracy might have its ass handed to them if the pissed off proles rise up.
While not a perfect solution, it did have its impacts. The specter of communism’s rise certainly softened some to FDR’s reforms is just one example.
Under the guise of the War on Terror, we are assembling a computer powered security/police state like few can imagine. Thomas Jefferson’s ultimate option for procuring justice may soon be impossible.
The elites really don’t feel the need to give a fuck.
JohnR
Oh, please. Nothing could be further from the truth! Why, all the Important Elites, from the tallest CEO to the lowliest Junior Assistant Anchorman, are perfectly willing, even eager, to encourage us to fill up on those yummy Peach Scones or Organic Banana Cake with our Starbucks when we run out of bread.
We may be out of work, due to our own laziness and refusal to pull ourselves up by our bootstraps like they did, but they’re only too happy to point out that a nice chunk of delicious pastry will make us feel right as rain!
wengler
You let the Capitalists loose and they will destroy everything. It is the simplest way to achieve their economic goals.
They had 150 years between 1783-1933 where they had no real rules and seemingly infinite resources and not only did they cut down all the old forests and nearly make the buffalo extinct, but the economy blew up every 15 years despite the fact that slave labor and endless immigration made wages extremely low.
Fast forward to 1980 and the US has already experienced peak oil and a general degradation of its natural resources. The Capitalists demand an end to New Deal policies and a return of low slave wage labor and they get their way. In order to facilitate this trade policies that had existed since the founding are amended to make the American worker “compete” against his slave counterpart in other parts of the world. The economy is distorted and changed to accommodate the malformed distribution of wealth, but no matter how hard people can try, the rich will never need as many of the stoves, washing machines, and cars that normal people who used to get decent pay used to buy.
Fueled by bubbles formed by the opening of formerly closed economies, a technological revolution, and a real estate run, the Capitalists reap billions on the back of a people that have seen their wealth on paper go through the roof.
And then everything comes tumbling down.
Our economy needs to be fundamentally changed to produce the things that used to made here. Trade barriers must be reimposed. The Capitalists must be sacked. None of this is happening. This goes far beyond Obama.
Arclite
A few things:
First, the politicians and media elite have jobs, so the only bothersome thing is the sound of hungry bleating sheep. Which can be so annoying.
Second, poor people don’t vote.
Third, there were no homeless people at the Applebee’s salad bar, so how bad can things be?
ChrisS
From the linked post at Modeled Behavior:
So the author then goes on a spiel without noting that manufacturing in the US isn’t hiring because people aren’t accepting drastically lower wages because they won’t be able to pay their bills with those wages (or change their lifestyle). Even if people DID accept lower wages, they still wouldn’t be able to participate in the glorious consumer economy.
As a result of direct wage competition with third world laborers, the basic standard of living is going to fall in the US and won’t happen easily. No one wakes up one morning and says, “Huh, well, I guess things change, honey pack the wagon, we’re moving in with your parents and my brother.” They hang on to their former standard tenaciously – waiting for things to kick back up. But the days of ambrosia and nectar are in the rearview mirror for most of the lower class. As the new reality sets for people, they’ll start taking those $8/hr jobs and start trying to figure out “who they better than.”
slag
Also, if you haven’t seen the excellent Slate (!?) article on income inequality, then you should. Now.
el_gallo
@Corner Stone – because an oversupply of labor drives down labor costs, and people desperate for work make fewer demands on their employers. Migrant workers are the model for what we are heading for — employees with no rights, low wages, and who are too scared to complain or work for anything better for fear that they will be thrown into total abject poverty.
Corner Stone
@el_gallo: I understand why companies would want this. But why would Democratic politicians?
Corner Stone
@gene108: Companies are not saying this. John Boehner and very, very wealthy Republican minded CEO’s are saying this.
I recently linked to a survey of businesses who when asked why they weren’t hiring responded they had nobody to sell to. They did not mention uncertainty of regulation as an issue.
aimai
@PurpleGirl:
I was talking to a friend today who does pro bono work for people who are being evicted from their apartments, public housing, section eight housing and some of *her* friends do the people who are being foreclosed on. The amount of brutal churning of people in and out of apartments/homes is astonishing to me. I’m not riffing off of the “apartment” part of Atrios’s metaphor but I see the same kind of contempt for people’s real circumstances and real suffering. In theory a person who is evicted from one kind of living situation just finds another–like in theory people who lose one job just find another–but the lag time, the opportunity costs, the financial burden, the social and psychological trauma is just huge.
My friend told me that in the banks rush to finally foreclose on properties they are ramming through evictions at an incredible clip. They know for a fact that a certain number of people they evict are actually entitled to stay in the homes–and they tell the courts (and really believe) that it “all gets straightened out eventually.” But in the long run we are all dead. A week for someone in a marginal job having to go to housing court to represent themselves? That can be the difference between hanging on to that job and losing it. A week homeless? That can be the difference between being a family that has its photos of great grandma and the family that lost all their stuff when it was put out on the curb. Some things you can’t get back. The recession is like that. Talking about the recession as though its a thing, separate from the people it is destroying, is a problem.
aimai
Jim, Foolish Literalist
@slag: Timothy Noah is an avowed atheist, rationalist, and liberal. I’m sure Saletan or Weisberg is already drafting a daring, out-of-the-box, I’m-a-liberal-but response proving that, contrary to Liberal Conventional Wisdom, Republicans are right! The wealth gap inspires those couch-potatoes to get up off the couch and go pick lettuce for $50/hr!
Nick
As some commenter on PoliticalWire put it “Life sucks”
The thing is, I could have been one of those people, part of that population, but I was able to avoid it because of my family’s wealth and privilege. I’m a perfect example of how unfair our society is.
Tax Analyst
@bookcat:
Yes, that and “adaptability” & “flexability”. Also, too. You can’t expect to have the same job your whole life, slackard. In fact, if you’re at the “right” age, say mid-50’s to 60 or so, at same point you might not be able to expect to have any job the rest of your whole life. But don’t worry, we’re going to raise the minimum age to receive Social Security so maybe you won’t be able to get any of that until you’re around 70 or so.
So, how do you feel about Mooslem temples on Ground 000 in NYC now?
Corner Stone
@elm: Well, the full quote says:
But since it’s anonymous it should be taken with a grain of salt.
Martin
@Corner Stone: That money is poorly distributed, however. Apple alone is sitting on $45B. Google, MS, Intel, those guys aren’t far off. They’ve got a minimal amount of infrastructure investment that makes sense for them to make, short of moving those factories from China to the US (which won’t happen for reasons that manufacturing populists fail to recognize).
What I’d like to see on the tax benefits is a ceiling on the size of the business. None of the Fortune 500 need an incentive to invest, but mid-caps and down would benefit quite a lot from this, and they’d make more meaningful investments because smaller companies have a completely different mindset than big. They’re growing and the key to growing is typically to add workers. Larger companies will make those capital investments to boost efficiency, which at best is job neutral, and more likely is designed to eliminate workers.
Corner Stone
@Tax Analyst:
I don’t think we’re going to have to worry about that any time soon. President Obama took SS off the table yesterday in his speech.
Corner Stone
@Martin: Looks like we’ll need more details.
WereBear
The prize is not usually to the swift; it’s to the ones who care about nothing else.
cleek
@ChrisS:
this.
those factories aren’t hiring because it’s cheaper to import the things the factories used to make from China.
i have a set of dumbbells: maybe the simplest thing that can be made out of metal. probably the only thing simpler thing to make would be rectangular ingots. this is 8th-grade metal-working stuff (though we used silver, because it melts at a lower temp). and my dumbbells were made in China. apparently it’s cheaper to dump 35 pounds of molten iron into a sand mold then ship it across the ocean than it is to make the dumbbells here. insane.
Punchy
@DougJ: But what does Sully think of that phrase? (God, I hope he hates it, so DougJ will be forced to stop using it).
Martin
@Chris: It’s a nasty problem that the US won’t be able to solve unless it starts behaving more like China.
The reason that Apple outsourced it’s manufacturing isn’t the labor cost or environmental or labor regs (those cost would be a drop in the bucket to Apple) but the time to market. Apple’s engineers go over there to tool up a new manufacturing line for something like the iPad. That line will take a number of weeks to ramp up, but they’ve got the problem of a production chain to maintain. They need processors, RAM, screens, batteries, and so on. All of those things are either made by Foxconn or by the factory next to Foxconns. There’s no transit time issues to work out when ramping up production. There’s no disruption due to weather or the like in transit. These enterprise cities in China are like gigantic factories that you pour labor and raw materials into and get product out of – and because of their scale, they’re shipping product out daily – no need to wait for that container ship to fill up. This is what made Detroit work as well as it did in the 40s, but time-to-market isn’t something that the automakers care about any more – but the tech companies live and die based on it.
For Apple to manufacture these in the US, their time to market would increase significantly. They’d have long production chains to manage, arrange for backups, and so on. There’s no reason why the US can’t do it, except having the government step in and encourage something like that to happen would be seen as an outrage to the US population. Beyond the deafening screams of “Soçialism”, 98% of Congress would be pissed that their constituents were left out of the pie, and distributing that pie among all the states completely defeats the benefits of doing it.
200 years ago we learned the lesson of ancient Greece that a unified army will easily pick off nation states one by one and established a strong federal government. We’re now failing to learn that lesson in an economic environment. China will continue to eat us alive, even beyond the point that labor there is more expensive than here because they’ve created a national infrastructure that is simply more favorable to the needs of industry than the US has, or is willing to build. There’s a big cost to that arrangement in China, one that they’ve yet to pay so it may not survive, but for now it’s kicking our ass.
Keith G
@Punchy: Spot on.
Martin
@cleek: Where do you think the iron came from? Shipping 35 pounds of iron ingots or 35 pounds of dumbbells is the same.
China produces 820M metric tons of iron. Australia (closer to China than to the US) produces 470M metric tons. The US produces 54M metric tons.
We’re one of the top iron importers in the world. If you’re going to import the stuff, you might as well import it finished – it’s probably cheaper that way overall.
Arclite
@Nick: Do you happen to wear a leather jacket, by chance?
elmo
@wengler:
Oh please. What kind of agrarian worker’s paradise are you imagining our forebears lived in before 1783?
You’re typing your words on a computer (made for a profit), connected to a global network, all of which run on electricity generated for a profit by various fuel sources that are gathered for a profit. And you want to go where? To hand-cranked pamphlets and subsistence farming?
Have you ever even killed, dressed and cooked your own meal?
Suffern Ace
@Martin: If you looked at how the auto industry worked out, and for that matter the defense industry, it became important to place as many factories in as many different congressional districts as possible to ensure that every congressman had some sort of stake in that industry. I just don’t see an industrial focus being possible. We do not choose winners very well on a national level, although we do pick losers.
If we say that we plan to keep american medical device manufacturers dominant globally, where do you place that hub?
Suffern Ace
@Martin: We are really down to 54 metric tones?
gene108
@Corner Stone: Maybe I talk to a too limited sample of people. The people I talk to are in NYC financial firms, and they are all up in arms about fin reg and the potential for every paranoid fantasy becoming law.
They figure, if the landscape was what is was in 2008, they’d do a better job of minding the store and the economy would be booming.
The companies that survived didn’t get sucked under during the housing bubble, so they don’t see a reason why they should be getting new regulations.
Free trade is the best way to bring the prosperity up for everyone on the planet. There’s not reason anyone needs to be dirt poor on this planet.
The two issues facing the U.S. right now is how to soften the impact of increased competition for workers and how to keep the U.S. economy growing fast enough, that it doesn’t become a race to the bottom for which country can provide corporations with the cheapest labor.
I really don’t know where things will settle out. The government needs to set a direction regarding labor policies for the 21st century and how American workers will fit into the global economy.
We made a huge transition in the 20th century from an agrarian economy to a high tech, manufacturing and information technology economy. I think at least 50% of the U.S. population was involved with agriculture in 1900.
Will the government be able to manage a transition for whatever will be the new economy of the 21st century? I don’t know, but the way things are going, I doubt it.
Mark S.
@slag:
I’m glad Noah’s writing about this, but man, I wish he wasn’t wasting his time shooting down theories no one with an IQ above room temperature would think were correct. If the problem is that the top ten percent are taking fifty percent of the income (and the top 1% are taking close to 25%), it probably doesn’t have to do with race or gender. Likewise, I’m not going to be too surprised when he finds out that immigration doesn’t have anything to do with it.
The answer is that unregulated, Fonzi of Freedom wet dream capitalism concentrates wealth into the hands of the very few. It’s not rocket science.
pandera
“Right now, a few percent of the population is likely being doomed to a life of chronic unemployment.” Well said – and not said nearly enough. My dad lost his job during the reagan recession and never recovered. He was 50 years old and never made more than half of what he made before, and he wasn’t pulling down a fortune to begin with. He limped his way to 65, retired and died when he was 71. This is not a sob story – just an illustration of dougj’s point. Recessions hurt, even short (and “good”) ones, and even after the recession is over the pain lingers for many of the unlucky ones. If we had a functioning media, maybe more stories about people like my dad would make a difference – but I guess stories about about hedge fund managers (and the women who love them) selling their second homes and delaying their next art acquisition take up too much space in the NY Times.
The Moar You Know
@cleek: I used to work for an importer of musical instruments, bringing in container loads of stuff from China. Ocean freight is, for all practical purposes, free. So yeah, it’s cheaper to do it there than here, plus there they can dump cadmium, lead, and any other metal scrap into your weights, have them made by 14 year old girls in “factories”, places with no ventilation or respiratory protection, with the fuel to make the weights being chopped up rubber tires or garbage or anything that burns.
It’s cheaper that way.
That will be the epitaph of the capitalist world.
Stillwater
God, what a depressing thread. Except for Nick. Always a chuckle there.
The Moar You Know
@gene108: Horseshit. “Free Trade” benefits those who trade. It has kicked the chair out from under the poorest of any society that you choose to name that has instituted it.
The most notable example being the Mexican small farm holder. NAFTA destroyed every last one of them.
Here in the US, our textile workers and low-end car manufacturers got it in the neck. So did those who built your favorite mid-priced electric guitars – an American invention by the way.
All gone, never to return.
Thanks, free trade. You are no friend of the working man, but great buddies with the moneymen dismantling our society brick by brick.
Stillwater
@gene108:
See, when you write
followed by
you should know that they’re lying sacks of shit.
ChrisS
@elmo:
There’s a difference between restricting detrimental capitalistic overreach through regulation and forcing everyone to live in a yurt as part of a commune. Especially when it comes time to pay the bills.
Yes, I’m using a computer made for profit that operates on electricity generated for profit. But I’m also sitting at a construction site cleaning up 80,000 CY of contaminated soil that resulted from generating electricity for profit. As a bonus to me, a portion of my billed electricity rate goes to paying for the clean-up. Mostly because the (probably minor) profits generated in the 1930s by dumping waste instead of disposing of waste are long fucking gone.
Capitalism gets a pretty long leash because the wealthy elite make the rules. It’s not out of the realm of possibility that we would have a pretty similar lifestyle with just a few harder checks and balances to prevent systemic exploitation that results from Capitalism as practiced in the wild.
el_gallo
@Corner Stone: that is an excellent question. FDR is spinning in his grave.
Dave Fud
@DougJ: Keep in mind that a few percent of 310 million (tits) is anywhere from 3.1 to 15.5 million (tits).
That’s a lot (of tits). “A few percent” doesn’t sound like too bad of a solution… however, the numbers in that range are catastrophic to our economy.
wengler
@elmo
Where did I state the people of America lived in an agrarian paradise? Before 1776 they lived in an economic system with various restrictions on settlement, trade, and the exploitation of natural resources so it would benefit Britain over anyone else.
You’re reacting as if I made some Luddite statement when I simply attacked the Capitalist system for the harm it has caused to our natural environment and workers’ rights. Capitalism IS waste. It holds little to no value for efficient resource management, and just drives on until everything is gone and ruined(go look at Mountaintop removal sometime).
What is with this profit-driven crap and killing, cleaning and dressing a meal? I just don’t understand it. If the internet was built with profit motive in mind we’d still be clunking around AOL “channels” and thinking that closed environment was the internet. Instead a platform was developed using open software and protocols that still has very low entrance costs.
Read some history books not written by Glenn Beck and get back to me.
gene108
@Stillwater: Maybe I should add an exception for free trade with U.S. agriculture, because of our subsidies, we’d wipe out so many other competitors.
In other areas free trade and the reduction of trade barriers can help lift countries up. India and China being two examples of countries, which started looking to attract international business and are greatly improving their economies.
As far as assuming the people I’m talking to are compulsive liars, lets just say I’ve known these guys for a very long time and I have no reason not to trust them. I didn’t have a reason to distrust them, when I was a kid, so I don’t see why I should start now.
Corner Stone
@Dave Fud:
When you put it that way…
wengler
@gene108
I will give you an example of how free trade makes things less prosperous simply using NAFTA.
1) American manufacturing in which a worker could expect to make 15-25 dollars an hour plus benefits are sent to northern Mexico. There workers are paid 5 dollars a day for a total savings of 115 dollars per day per worker. There will be a productivity loss because Americans are generally better educated and thus less loss in manufacturing. Cost savings of let’s say 80 dollars per worker per day. There will be a drop in price as many manufacturers do the same, but most of that has been recorded in corporate profits .
2) Mexican agriculture is much less mechanized and automated compared to American. It relies on many more people to work the fields to yield the same as the US. NAFTA passes and US agricultural conglomerates start dumping the Mexican staple corn on the market. Small near subsistence level farmers can’t hope to compete. A whole sector vital to a national concern(being able to produce enough food for people in the country) is decimated and the workers are thrown into the wind to either work at the super factories in the North or cross into the US illegally to find work for more money.
In these cases we have seen free trade destroy the US manufacturing economy and also destroy the Mexican agricultural economy. Where is the growing prosperity? I don’t see it. I just see a vacuum handled by the millionaires and billionaires sucking up capital from all corners of the Earth.
Mnemosyne
@wengler:
You’re looking in a different place for it than gene108 is. You’re expecting to see growing prosperity across the board, while he’s looking at the increasing income inequality and counting that at increased prosperity.
If all you’re looking at is sheer numbers, then NAFTA looks great, because the rich became immensely richer. The fact that it sucked for everyone else is, in a lot of people’s eyes, beside the point as long as the rich got richer.
John Bird
Historically, I have as little doubt that this will be viewed as a fundamental crisis of capitalism as I do that the Clinton impeachment trials will be viewed as an embarrassing and reprehensible misuse of Constitutional checks and balances.
We gave the market free reign to generate products without any regulation or oversight, and the net result was a bunch of companies who, no doubt about it, sold products designed to fail to public organizations and private investors alike. They then bet astounding sums of money that those products would fail under the auspices of ‘hedging’ when what they really did was make a calculation that under the 1999 bipartisan act, they would never be made to answer for knowingly concocting dangerous and faulty products in the first place, and in fact would be considered too important to the economy to punish for their crimes.
This, to me, doesn’t mean the free market is a bad idea, but it does mean that the path that we’ve allowed capitalism to take through the financial markets for at least the last ten years has completely undermined belief in the virtues of the free market as it exists, and rightly so.
Then again, the consensus is also that the Great Depression was a crisis of capitalism and the best evidence behind that is the USSR and Nazi Germany, but I doubt you would be able to find a Republican who would say ‘crisis of capitalism’ out loud. Finding an elected Democrat who would say the same thing would probably be slightly – SLIGHTLY – easier.
John Bird
@gene108:
Thanks for this wake-up call. This is certainly strong anecdotal evidence that people in NYC financial firms
1) don’t understand the world outside of NYC financial firms,
2) have faith-driven beliefs that don’t correspond to reality,
3) do not understand the difference between responsible action and personal gain, no doubt due to a culture that encourages borderline psychopathic behavior, and
4) simply do not possess the knowledge that they claim justifies the public paying their bonuses.
Corner Stone
@John Bird: gene108 keeps pushing this line like it’s true. It’s been pointed out time and again that it is not but somehow that does not seem to deter him.
Apparently, businesses and companies are scared to fucking death of the future. And they refuse to build new factories, hire more workers and produce more products because they’re not *quite* sure if Obama is going to start confiscating the engines they make, or the sweaters they knit, or the flanges, sprockets, widgets, etc that are all not made in the USA anymore. They think maybe he’s a darker skinned Chavez who’s going to nationalize everything.
Still haven’t figured it out but looks like gene108’s pals know something we don’t.
Nick
@Arclite: I gave it away actually.
Nately's Whore's Kid Sister
@Corner Stone: Respectfully disagree.
Businesses don’t create jobs from tax cuts. They create them from demand with reasonable projections for sustained demand. A tax cut is just another quarter-of-a-cent for the shareholders.
Corner Stone
@Nately’s Whore’s Kid Sister: I agree. Now what is your older sister doing this week?
mclaren
@ChrisS:
Bingo. Watch California, the 7th biggest economy on earth, shut down when gasoline hits $7 a gallon while unemployment cruises upwards past 12%.
And we’ve got another 4 bubbles lined up waiting to pop:
College tuitions (total college debt is now bigger than total American credit card debt)…
Health care (health insurance premiums are now zooming upwards at a rate of 50% per year — how long does that continue until no one can afford health insurance?)…
U.S. military expenditures (more than a trillion dollars per year as of 2009, and growing at 8% per year — that’s a doubling time of 9 years)…
Offshoring (now hitting high-skill high-wage white collar workers courtesy of powerful automated computerized backend systems, like computerized systems for reading X rays and diagnosing cancerous tumors, genetic algorithms that automatically design optimal antennas or cars without human intervention, etc.)…
Think the last bubble was bad?
You ain’t seen nothin’ yet, folks.
Corner Stone
@Nick: “I gave it away actually. ”
Yeah, that’s what your mom said.