Yesterday, I had one of those days where I felt like I spent about half of it on hold on my phone. The upside on that is I tend to sneak in a few more political reads than normal...
As somewhat of an introduction to any initial appearance of "a meandering (editorial) path," let's start with the White House press op du jour (in this instance, courtesy of Bloomberg), from yesterday. From there, we'll get into a "YOU-ARE-HERE" moment, which'll be followed-up by the best two graphs I've read in awhile (h/t to the folks over at Baseline Scenario for that).
"Obama Says Stimulus Helped Avert Economic Catastrophe (Update2)"
By Nicholas Johnston and Roger Runningen
Feb. 17 (Bloomberg) -- President Barack Obama said the stimulus legislation he signed a year ago helped avert an economic catastrophe as his administration undertook a concerted effort to highlight the benefits of the $862 billion package.
"It is largely thanks to the Recovery Act that a second depression is no longer a possibility," the president said. The ceremony marked the anniversary of enactment of the measure to revive growth and stem job losses after the biggest slump since the Great Depression of the 1930s.
Obama's remarks were reinforced by advisers and allies. Amid Republican criticism of the stimulus, administration officials are fanning out to more than 35 cities to promote the programs funded by the measure. The defense of the collection of tax cuts and spending programs was coordinated with congressional Democrats, such as an event in San Francisco featuring House Speaker Nancy Pelosi, labor unions and the Democratic National Committee...
Bold type is diarist's emphasis.
IMHO, we really did not avert an economic catastrophe. (We're experiencing it, right now. Many just won't acknowledge it yet.) I totally agree, however, that the stimulus helped. However, we need much more of that on Main Street, right now.
Baseline Scenario co-founder James Kwak pretty much sums up my sentiments, from very early this morning: "Did the Stimulus Help?"
Did the Stimulus Help?
By James Kwak
February 18, 2010 at 2:14 am
This could be a midsize political battle in the run-up to the midterm elections, as discussed by The New York Times. The positions on both sides are too obvious to warrant repeating. If I recall correctly, the Obama administration hurt itself by underestimating the course of future unemployment a year ago when it passed the stimulus (most people were making the same mistake at the time), so now if you compare actual unemployment against original projections it looks like the stimulus had no impact. But that was a forecasting error and has nothing in itself to do with the stimulus itself.
Menzie Chinn has an overview post on the debate in which he argues that, at least from the standpoint of economists, it's hardly a debate: the stimulus worked.
--SNIP--
Here's the money chart (originally from the Times)...
--SNIP--
Of course, none of this will matter in the end because, as someone (Barney Frank?) said, you can't get elected saying things would have been even worse without you. Unemployment will still be high in November and the Republicans will blame it on Obama. Voters aren't going to believe macroeconomic models, don't realize that unemployment is a lagging indicator, and will (with a little justification) think that Obama could have done more to create jobs.
Bold type is diarist's emphasis.
As many have noted elsewhere in recent days, with DKos' own Meteor Blades being pretty much at the forefront of exposing these inconvenient realities in this community (SEE: HERE, for instance), as far as the U.S. economy was concerned, what we witnessed was more along the lines of watching our society get both of its legs amputated. At the end of the operation, it may have been a little less painful--due to the anesthetic of an underfunded but excruciatingly necessary and successful stimulus--but when we woke up in the proverbial recovery room our legs were gone.
Other than that, "the patient's" fine.
# # #
There's no going back to what we had, at least anytime soon. The mere extent of the devastation, however, sometimes gets lost in the dialogue as some make an effort to accentuate the positive.
If we're going to prevail, we must acknowedge the problems confronting us and deal with them, head-on. Unfortunately, due to greed and political reality/expediency, we're not doing that. Understanding the extent of the problem IS half the solution. Downplaying it, even from a political perspective, is NOT.
David DeGraw, the author of, "The Economic Elite Vs. The People of the United States of America," has a short series on our economy running over at Alternet at the moment. The first installment appeared on Monday (SEE: "The Economic Elite Have Engineered an Extraordinary Coup, Threatening the Very Existence of the Middle Class"); a second section of it was posted on Wednesday (SEE: "
The Richest 1% Have Captured America's Wealth -- What's It Going to Take to Get It Back?."). In those posts, to date, I would have to say that the sheer amount of facts with which he hits us are at least as powerful as a machine gun aimed at our entire society.
That being said, please make no mistake that I'm a strict advocate of NONVIOLENT change within our society, despite the implied and inferred threats of violence made by others.
But, to even begin to ignore or downplay the devastating fallout from the ongoing Quiet Coup is just wrong, IMHO.
So, here are just SOME of the inconvenient facts (links to the substantiating data may be found within the links to the first two DeGraw's posts, linked above) conveyed in DeGraw's posts, to date. Some of the stats are a couple of month's old, but it's the collective set of facts which confirms the existence of "the catastrophe" and delivers the intent and the overwhelming truth behind both DeGraw's message, and the stark realities as they differ from the, IMHO, ill-founded concept that we're not experiencing a catastrophe, ALREADY.
As De Graw tells us, it's about the: "Casualties of Economic Terrorism, Surveying the Damage." Here are DeGraw's stats:
1.) America is the richest nation in history, yet we now have the highest poverty rate in the industrialized world...50 million Americans currently live in poverty.
2.) 50 million people need foodstamps to eat.
3.) 50% of all American children will use foodstamps at some point in their childhood.
4.) 20,000 people are being added to these totals everyday.
5.) In 2009, one out of five households didn't have enough money to buy food.
6.) In households with kids, this statistic increased to 24%.
7.) We have 50 million people living without health insurance.
8.) 1.4 million Americans filed for bankruptcy in 2009; this is an increase of 32% versus 2008.
9.) Medical bankruptcies are responsible for approximately 60% of all bankruptcies. Over 75% of all people who file bankruptcies due to midcal costs have health insurance.
10.) We have the most expensive health care system on the planet; we're forced to pay twice as much for it as other developed countries; but we rank only 37th in the world in terms of quality of care.
11.) Americans have lost approximately $5 trillion from their pensions and savings since this economic crisis began.
12.) We've lost $13 trillion in home value during this period, as well.
13.) "During the first full year of the crisis, workers between the age of 55 - 60, who have worked for 20 - 29 years, have lost an average of 25% of their 401k."
14.) Personal debt has risen from 65% of annual income in 1980 to 125% today.
15.) 5 million people have lost their homes, already.
16.) 13 million families are expected to lose their home by 2014,.
17.) Currently, 25% of all American homeowners are "under water," owing more on their homes than they're worth.
18.) Deutsche Bank predicts that 48% of U.S. homeowners will be underwater by the end of 2011.
19.) Every day, 10, 000 U.S. homes go into foreclosure.
20.) Homelessness is dramatically increasing, with over 3 million Americans currently considered homeless.
21.) The fastest growing segment of the homeless population is single parents with children.
22.) The U.S. prison population is now 2.3 million. We incarcerate more people (as a percent of our population) in the U.S. than anywhere else in the world.
23.) A recent study by the Hartford Advocate tells us that a new prison opens every week somewhere in America.
24.) Government statistics really don't tell us the entire story. Take the unemployment rate...
From DeGraw, directly...
Mass Unemployment
The government unemployment rate is deceptive on several levels. It doesn't count people who are "involuntary part-time workers," meaning workers who are working part-time but want to find full-time work. It also doesn't count "discouraged workers," meaning long-term unemployed people who have lost hope and don't consistently look for work. As time goes by, more and more people stop consistently looking for work and are discounted from the unemployment figure. For instance, in January, 1.1 million workers were eliminated from the unemployment total because they were "officially" labeled discouraged workers. So instead of the number rising, we will hear deceptive reports about unemployment leveling off.
On top of this, the Bureau of Labor Statistics recently discovered that 824,000 job losses were never accounted for due to a "modeling error" in their data. Even in their initial January data there appears to be a huge understating, with the newest report saying the economy lost 20,000 jobs. TrimTabs employment analysis, which has consistently provided more accurate data, "estimated that the U.S. economy shed 104,000 jobs in January."
When you factor in all these uncounted workers -- "involuntary part-time" and "discouraged workers" -- the unemployment rate rises from 9.7 percent to over 20 percent...
--SNIP--
...Even based on the "official" unemployment rate, just to get back to the unemployment level of 4.6 percent that we had in 2007, we need to create over 10 million new jobs, and most every serious economist will tell you that these jobs are not coming back...
25.) Millions of Americans are at a point where their unemployment benefits are now coming to an end.
26.) More workers have been out of work for a lengthier period of time than at any time since they started tracking these statistics.
27.) A record 20 million Americans qualified for unemployment insurance in 2009.
28.) Without federal intervention, 27 states would have run out--or did run out--of funds to cover these claims.
29.) 40 state unemployment programs are expected to go broke.
30.) It is projected by many that millions of Americans will remain unemployed for very extended periods of time. (They already are.)
31.) More than six people are looking for work for every job that's available.
32.) Americans are already the most productive workers on the planet; productivity increased by annualized rate of 9.5% in the third quarter of 2009, alone, but labor costs decreased by 5.2%.
33.) As a result of #32, above, some companies are now experiencing record profits. 78% of the 220 of the companies in the S&P 500 had "...'better-than-expected profits' with earnings 17 percent above expectations, 'the highest for any quarter since Thomson Reuters began tracking data.' "
34.) According to the US Department of Labor's Bureau of Labor Statistics, household income fell by 3.8% in 2008, and that was while the unemployment rate was at 5.8%
35.) "With the unemployment rate now at 10 percent, median income has been falling at a 5 percent rate and is expected to continue its decline."
And, these are just some of the selected statements from DeGraw's first post. The links to both that and his second post, from Wednesday, are located up above.
Yes, some of DeGraw's statements, above, need to be corrected, for factual/update purposes (i.e.: unemployment's currently at 9.7%). But, that's not the point of this diary. It's the TOTALITY of these mostly-accurate facts which is the focus of my post, today.
Please do NOT waste your time refuting or correcting some of these facts in the comments. (I'm sure some will, in any event. But that's not the reason why I'm posting them herein.) It's the comprehensive nature of these facts which is the subject of this post.
IT IS A CATASTROPHE. IT'S ALREADY OCCURRED. WE'RE LIVING IN IT. Could it have been worse? Certainly. To address it as anything other than a catastrophe, however, or to indicate that we've "avoided" it, as the President did earlier this week, is just INACCURATE.
# # #
SO, WE'RE TOLD WE HAVE A COUPLE OF CHOICES...
(h/t to Baseline Scenario) From interfluidity.com's
Steve Randy Waldman (I think it's quite profound)...
Can we handle the truth?
Steve Randy Waldman -- Sunday, February 14th, 2010 at 3:25 pm
Both globally and within most nations, the patterns of consumption required to sustain existing social arrangements are inconsistent with the distribution of the fruits of production. Social and economic stability, therefore, depend upon redistribution for which there is no overt legal framework or political consensus. To square this circle, the financial and government sectors have evolved means of hiding redistribution in complex, continually improvised arrangements. Unsurprisingly, massive wealth distributions arranged in this way leave much to be desired, in terms of straight corruption (the financial and government sectors redistribute a lot of wealth to themselves), justice (e.g. wealth is redistributed to those who happen to speculate early in bubbles), and sustainability (the illusion of value behind the claims of those from whom wealth is taken may prove fragile, but "loss realizations" are socially disruptive if they are not carefully paced and allocated).
Neither financial nor political reform can succeed unless we overcome the social and economic contradictions we have relied upon the financial sector to literally paper over. Off-balance-sheet liabilities that hide the impairment of savers' claims, whether in subprime mortgage-backed securities or sovereign entitlement programs are not aberrations. They are essential tools in the arsenal of social stability, the economic equivalent of military "black-ops", things that must be done but must always be denied in order to protect the American (and European, and Chinese) way of life. Unless we define overt arrangements that overcome the contradictions between the organization of production and socially desirable patterns of consumption, each scandal and reform will necessarily be followed by some new technique or trick that delivers, however unjustly or corruptly, the wealth transfers upon which our societies depend. Our choices are to overtly align the fruits of production with patterns of consumption, to continue to employ accounting fictions and magic to pretend away the contradictions, or to undergo some form of collapse.
Perhaps you'd like to comment on Waldman's observations and conclusions, down below.