The dirty little secret about debt (duh!)

[prole]

News flash, moron: Obama has been president since January. Those June unemployment numbers belong exclusively to Obama-brand class warfare. But I'm sure once Cap and Trade legislation is signed their job prospects will brighten.

 

Economists were predicting we'd hit 10% employment in '09 before Obama was even elected, you dumb cluck.

[Kimmo]

i think he gets it.

[Fairweather]

Just making sure the Obama faithful aren't eating their cake. I propose that the blinders currently rest on the nasal bridges of the president's flock who ravenously devour the bits of class-flesh he tosses out even as he (intentionally?) steers us toward the edge. One parishioner here is willing to let civilization burn for another year--and that's better than most--but I suspect the true believers are hoping for total economic collapse. Am I wrong?

 

You have a viral mistrust and lack of faith in humanity, even within your own culture. I like to assume people have good intentions even if I disagree with their process. How do you function in everyday society without totally imploding?

 

You're kidding, right? Are you saying that in order to have faith in humanity one must have faith in Obama? I have faith in the humanity of individuals, yes--but history clearly shows faith in the humanity of the masses is not often well placed. Obama is showing a tendency toward the evocation of populism. Sorry if you're too blind to see it.

[Fairweather]

News flash, moron: Obama has been president since January. Those June unemployment numbers belong exclusively to Obama-brand class warfare. But I'm sure once Cap and Trade legislation is signed their job prospects will brighten.

 

Economists were predicting we'd hit 10% employment in '09 before Obama was even elected, you dumb cluck.

 

No. Obama was predicting we'd be below 8% by summer's end.

[Fairweather]

Just making sure the Obama faithful aren't eating their cake. I propose that the blinders currently rest on the nasal bridges of the president's flock who ravenously devour the bits of class-flesh he tosses out even as he (intentionally?) steers us toward the edge. One parishioner here is willing to let civilization burn for another year--and that's better than most--but I suspect the true believers are hoping for total economic collapse. Am I wrong?

 

i'll go with the "there are no dumb questions" tack on this, and answer that of course (as you know) you are wrong. your position reeks of the paranoia that some exhibited about bush's plan to declare martial law in order to remain in office (most people don't perhaps understand that bush stayed in office! except for some (very important) changes).

 

WTF? Are you insane? Or just a poor communicator?

[Kimmo]

 

Economists were predicting we'd hit 10% employment in '09 before Obama was even elected, you dumb cluck.

 

No. Obama was predicting we'd be below 8% by summer's end.

 

as you will surely note, he said "economists were predicting", not "obama was predicting" (disregarding whether or not obama actually said that).

[Kimmo]

WTF? Are you insane? Or just a poor communicator?

 

let's assume i am both, but capable of rehabilitation.

 

 

please tell me where i gave you the impression i was either.

[j_b]

Before the last 9 mos or so, which mainstream zines have discussed the incredible change in wealth distribution and lowering of real income for most americans that have occurred starting with Reagan (actually Carter)?

 

i have read about it in the economist and wsj, time, newsweek etc. even back in the '90's.

 

You may be a particular discerning reader but the editorial line and >~98% of the articles published in these publications didn't say anyhting other than everything is fine, the economy is growing, inflation is reasonable, unemployment is at structural level, cheap credit is great, let's consume some more. I won't have you do the work but I'd be really curious to see the articles you claim discussed the decrease in real income for most americans because besides the work of academics (and Johnston in the media), I really don't see anybody doing it.

 

i just don't think it's been some great conspiracy secret that you make it out to be. i'd wager that a majority of americans know about the general changes, if not the specific numbers. it seems to be mainstream knowledge that people are working harder for less, and the rich have gotten richer.

 

It's not a secret but it certainly was not the line sold to the public by the media and politicians until quite recently.

 

i think the salient point with this is that people don't know what to do about it; do you? can you articulate the situation in a way that isn't simply the product of one ideology banging against another, with the resultant sparks constituting what passes for discourse?

 

It's rather interesting that would confuse establishing facts absent from the cultural landscape with anything else, little less ideology. What to do about it? imo it's a deep structural crisis. The real economy has been mostly dead for 40 years because it is based on a depleting resource, and rather than retool, elites have chosen to continue with geopolitical games to control the resource and dead-end consumerism. The way out of it, if there is way, is efficiency, research and development, rebuilding local economies, etc ..

 

You don't understand how most people don't even know their real wage has decreased over the last 30 years even though most have been had to used cheap credit extensively to stay afloat?

 

i just don't buy that: see above. as far as cheap credit goes, an amazing amount of it was used to fuel consumerism, not simply to "stay afloat".

 

Once most families are done with paying mortgage, healthcare, food, childcare, transportation and communication, there isn't all that much left for consumerism. I don't believe in the beamer and satellite dish in the driveway of every pauper described in the article cited in my original post.

 

I'd like to say I don't understand it either but believe it has to do with the false portrayal of economic reality and value of real-estate assets by dominant culture as orchestrated by the corporate media.

 

"dominant culture" portrayal of "economic reality"? what does that mean?

 

"dominant culture" is the message relayed by the corporate media. I assume you know what protrayal means. And "economic reality" is the sustaining of consumption (~70% of GDP) by cheap credit while real wages didn't keep up the cost of living.

 

 

 

"value of real-estate assets"? i assume you mean the ignorance of the RE bubble? the warnings were there, but EVERYONE ignored it: Gold Rush! i guess i don't smell the conspiracy....

 

Come on. Not everyone ignored the various bubbles of the last 30 years. The media and the politicains ignored them until they burst.

 

What choice? Be poor and living poorly without debt or be poor and living well fed with debt? Most people would rather bury their head in the sand than acknowledge pauperization.

 

again, refer above. easy credit fueled consumerism without a doubt. i think your scenario about the poor indebted american needing loans and credit cards to survive might apply to a small minority of people (not to be discounted), but is not the general reality.

 

The Coming Collapse of the Middle Class: Higher Risks, Lower Rewards, and a Shrinking Safety Net

http://www.uctv.tv/search-details.aspx?showID=12620

 

"Elizabeth Warren a Harvard Law professor, and author of the Two Income Trap, has been studying the middle class over an entire generation. She's been comparing spending patterns of a typical family with two kids today (data from 2005-2006) and a generation ago ie in the 1970's and is warning of the coming collapse of the Middle Class. Her presentation at UC in 2007 summarizes her research that shows that over a generation, a typical family is now spending less of their family income on clothing (down 32%), food (down 18%), per car ownership costs (down 24%) and appliances (down 52%), but is spending far more on Child Care (up 100%), Mortgage Payments (up 76%), Health Insurance (up 74%), the second or third car (up 52%) and all sorts of taxes (up 25%)"

 

[video:youtube]akVL7QY0S8A

 

 

Edited July 3, 2009 by j_b

[Fairweather]

and all sorts of taxes (up 25%)"

 

 

[j_b]

Yes, regressive taxes in the form of sales tax, nickle and dime fees and registrations, etc .. all the while republicans claimed to lower taxation. Aren't you proud of them?

[Kimmo]

does this happen often around here? pick up your chosen ideological hammer and hit each other on the head as hard as you can? and ignore points made when they are inconvenient?

 

ah heck, it was fun!

 

carry on....

[j_b]

Are you talking to me? because I don't believe I have ignored any point you made.

[Kimmo]

no jb, not you. it was good talking with you, and i'll check out that vid you posted.

[j_b]

Good. It's a little long, unfortunately.

[StevenSeagal]

You're kidding, right? Are you saying that in order to have faith in humanity one must have faith in Obama? I have faith in the humanity of individuals, yes--but history clearly shows faith in the humanity of the masses is not often well placed. Obama is showing a tendency toward the evocation of populism. Sorry if you're too blind to see it.

 

 

 

I was speaking directly to your assertion-by-question that Obama and anyone who supports his policies, or otherwise is willing to give them a chance to work, actually hopes for the economy to collapse and for everyone to be poor. Do you really think that anyone actually wants that? Even if they turn out to be wrong, I honestly think most people, Obama included, have good intentions and really think they are doing good for the country. Demonizing people because you disagree with them does a lot more harm than good in the long run.

 

No matter how it turns out, the next decade I think is sure to be a major pivotal moment in this country's history. I hope Obama gets it right. I sense from your assertions that you hope he gets it wrong, not just because you are certain he already is, but in part, so that you can be right. Am I wrong?

 

[prole]

News flash, moron: Obama has been president since January. Those June unemployment numbers belong exclusively to Obama-brand class warfare. But I'm sure once Cap and Trade legislation is signed their job prospects will brighten.

 

Economists were predicting we'd hit 10% employment in '09 before Obama was even elected, you dumb cluck.

 

No. Obama was predicting we'd be below 8% by summer's end.

 

While your dude's economic advisor (and architect of the meltdown) was telling us that it was all in our heads, that we were just "whining". Pure gold.

[Fairweather]

Even if they turn out to be wrong, I honestly think most people, Obama included, have good intentions and really think they are doing good for the country. Demonizing people because you disagree with them does a lot more harm than good in the long run.

 

 

 

Funny; I don't recall you taking this position when Bush was president.

[StevenSeagal]

Even if they turn out to be wrong, I honestly think most people, Obama included, have good intentions and really think they are doing good for the country. Demonizing people because you disagree with them does a lot more harm than good in the long run.

 

 

 

Funny; I don't recall you taking this position when Bush was president.

 

Actually, I do think Bush (and Reagan, and Bush 41 if you will) believed he was doing good throughout; I just thought he was wrong, all the while hoping it would turn out better than I expected. Cheney on the other hand- I'm fairly sure his vision for America was (is) motivated purely by self-interest and in an unquenchable will to power of him and his associates. And I think he, rather than Bush, had a lot more to do with policy than anyone else during this administration.

 

If you're still not satisfied, I think Pelosi is an arrogant douchebag. Like Cheney I've heard enough from her that she no longer gets the benefit of the doubt with me.

 

Obama- he's been in office 5 months. I heard him and everyone else, including my own intuition telling me things would get worse before they got better. I'm not surprised by the jobless figures. Like Rob said- in a year if there's no sign of a turnaround, I'll help you complain.

[KaskadskyjKozak]

Even the corporate media occasionally let the truth slip out

 

Debt is capitalism’s dirty little secret

By Ben Funnell

Financial Times

Published: June 30 2009 19:14

 

Just why is there so much debt in the Anglo-Saxon world? Bankers and regulators know well that it is in nobody’s long-term interests to have allowed borrowing to escalate to a position where the US now owes far more, as a multiple of the economy, than at the start of the Great Depression.

 

The answer is capitalism’s dirty little secret: excessive lending was the only way to maintain the living standards of the vast bulk of the population at a time when wealth was being concentrated in the hands of an elite.

 

The amount by which the elite has benefited is startling, and illustrates the problem with lightly regulated free markets: the rich get much richer while the rest do not get richer at all. According to Société Générale economists, the inflation-adjusted income of the highest-paid fifth of US earners has risen by 60 per cent since 1970, while it has fallen by more than 10 per cent for the rest. As was recently pointed out in the New York Review of Books, the Walton family, of Wal-Mart fame, is wealthier than the bottom third of the US population put together – about 100m people. These are staggering statistics, confirmed by measures such as the US and UK’s ever-rising Gini coefficients, which estimate income disparity. Another way of putting this is that the share of profits in gross domestic product is at a 100-year high, or was until very recently.

 

Put simply, the benefits of economic growth have gone into the pockets of plutocrats rather than the bulk of the population. So why has there been no revolution? Because there was a solution: debt. If you couldn’t earn it, you could borrow it. Cheap financing was made widely available. Financial innovations such as the asset-backed securities market aided this process, as did government-sponsored agencies such as Fannie Mae and Freddie Mac. Regulators welcomed it all while perhaps taking insufficient account of the moral hazard problem it posed: that ever-increasing leverage meant the authorities had to keep interest rates low, otherwise the debt burden would cripple consumption. This prompted more leverage, which exacerbated the problem.

 

A walk in any low-income area in the UK confirms this. There are BMWs in the driveways, satellite dishes on the roofs and furniture delivery vans on the streets. In both Britain and America the jobless were encouraged to buy their own homes. No one begrudges anyone else the right to own a home or buy luxury goods. The problem is that the luxuries need to be paid for out of earnings and the houses out of equity topped up with an affordable amount of debt.

 

More (with subscription): http://www.ft.com/cms/s/0/e23c6d04-659d-11de-8e34-00144feabdc0.html?nclick_check=1

 

With all your bashing of capitalism, how could anyone every think you were a fucking commie?

 

[Bosterson]

With all your bashing of capitalism, how could anyone every think you were a fucking commie?

 

Do you actually have the haircut of the dude in your avatar? Cause that would be amazing.

[j_b]

With all your bashing of capitalism, how could anyone every think you were a fucking commie?

 

If you weren't a dimwitt, you'd have noticed that 100% of my bashing is aimed at unfettered capitalism. I have no problem whatsoever with private property, entrepreneurship, etc ... but lots of problems with morons who think that having the Waltons owning as much as the bottom 100 millions americans is a sign that freedom is on the march.

[billcoe]

I have no problem whatsoever with private property, entrepreneurship, etc ... but lots of problems with morons who think that having the Waltons owning as much as the bottom 100 millions americans is a sign that freedom is on the march.

 

It appears to me that in this very post, you do.

[KaskadskyjKozak]

With all your bashing of capitalism, how could anyone every think you were a fucking commie?

 

If you weren't a dimwitt, you'd have noticed that 100% of my bashing is aimed at unfettered capitalism. I have no problem whatsoever with private property, entrepreneurship, etc ... but lots of problems with morons who think that having the Waltons owning as much as the bottom 100 millions americans is a sign that freedom is on the march.

 

1)There is nothing "unfettered" about American capitalism. Our system has quite a few bindings and restrictions. It has ebbed and flowed throughout the last 100 years for sure, but only in degree of regulation, never approaching anything close to "zero" regulation.

2)You NEVER qualify your rants against capitalism, revealing a lot more about your extreme-left leanings than you care to admit

 

[j_b]

Whatever. It's a quite a bit like having an argument with a 4th grader.

[KaskadskyjKozak]

Whatever. It's a quite a bit like having an argument with a 4th grader.

 

More like an 8th grader who's read Das Kapital and thinks he knows how the world works.