Nobel economist Joseph Stiglitz made some critically important observations in the Sunday New York Times. He pointed out that income disparity is a cause of the maddeningly slow recovery from the effects of the Great Recession, not merely a consequence of it. He drew parallels to the income disparity that predated the Great Depression. In my view he is correct, though there are persuasive opinions to the contrary.
A year and a half ago, at the Iowa State Fair, Mitt Romney told a protester, "Corporations are people, my friend." This line, ferociously derided by Democrats and weakly defended by Republicans, will likely play a significant part in the historical lore of the most recent Presidential election. The line is, on a pretty basic level, nonsensical—x is not y—and imbues corporate behemoths with a far greater beneficence than they deserve. That said, it has acquired some resonance now as John Mackey, founder and CEO of Whole Foods, is essentially making an argument for Romney's position. While on tour for his tome, Conscious Capitalism, Mackey has done a spirited job of trying to put a human face on a brutally impersonal economic system. I'm not sure he succeeds.
Anyone who has followed the creation and early life of the Consumer Financial Protection Bureau knows that conservatives in Congress have repeatedly tried to kill or weaken this agency using the power of the purse. Most recently, last spring, Republicans tried to cut the CFPB's $550 million budget by about 40 percent.
Inside of New York’s Javits Convention Center this morning, Walmart US President and CEO Bill Simon took the stage before a crowd of industry leaders to talk about how retail can play a central role in revitalizing the American economy.
A New York Timesarticle reported that Fix the Debt, the deficit hawk group which positions itself as a neutral body of wisemen, includes a number of corporate lobbyists and board members. The Times noted that many of those involved in Fix the Debt helped create the deficit problem to begin with by fighting to defend tax perks for business and the wealthy, such as the record low rates for capital gains and dividends, along with the notorious "carried interest" loophole.
Last year, in 2012, the U.S. government spent about $841 billion on security—a figure that includes defense, intelligence, war appropriations, and foreign aid. At the same time, the government collected about $1.1 trillion in individual income taxes. (And about $2.4 trillion in revenues overall if you include payroll, corporate, estate, and excise taxes.)
In other words, about 80 cents of every dollar collected in traditional federal income taxes went for security.
The new job numbers are out and, at first glance, there is nothing surprising here. Job growth continued to inch upward in December, with 155,000 new jobs added. Of course, with several million young people joining the labor force every year, numbers like these don't actually amount to growth. We are just running in place.
But here's a statistic that jumped out at me: 89,000 public sector workers lost their jobs in October, November, and December—with most of those losses, 66,000, occurring in October.
Now that the future revenue path is pretty clear for the next decade, I took another look at President Obama's 2013 budget, which projects spending and revenue through 2022 on the assumption—a correct one, it turns out—that taxes will only rise on the affluent.
The Center for Responsive Politics compiles data on the 50 top interest groups giving money to Congress. Near the top of the 2012 list are the usual suspects—finance, insurance, real estate, and Big Oil. Near the bottom are casinos and the building materials industry (along with "Women's Issues.")
But guess who's not on the list? Gun rights groups. Not only did such groups not make the list in 2012; they have never made the list. Even if you only look at the 50 interest groups supporting Republicans, the gun rights crowd doesn't make the cut.
Perhaps the most breathtakingly obscene aspect of American society is our absolute and utter refusal to deal with the murderous gun violence that lays its awful blanket of blood and sorrow across the families of thousands upon thousands of victims each and every year.
On Friday, even the presumed safe harbor of an elementary school in suburban Newtown, Connecticut, was defiled when the school was invaded by a young man armed with military-style assault weapons. Try to imagine the sudden horror of the six- and seven-year-olds in two first-grade classrooms as the gunman, who had already killed their principal, opened fire on the children themselves. He would kill a total of 26 people, including 20 children, before taking his own life.
Washington is in a fiscal panic, yet surprisingly few people are asking an obvious question: Why in the world is the Obama administration proposing to spend $8 trillion on security over the next decade? Included in that giant sum is not just Pentagon spending, but also outlays for intelligence, homeland security, foreign aid, and diplomacy abroad.
If the administration gets its way, security spending would account for a fifth of all government outlays over the next decade. Such spending would be roughly twice as great as all non-mandatory spending through 2022—a category that includes everything from NASA to Pell Grants and national parks.
The Center for American Progress (CAP) is out with a budget plan that would reduce deficits by $4.1 trillion over the next decade and, at first glance, seems to makes a good deal of sense.
Two former Treasury secretaries—Larry Summers and Robert Rubin—are listed as co-authors of the plan, along with Roger Altman, William Daley, John Podesta, Leslie Samuels, Neera Tanden, Antonio Weiss, Michael Ettlinger, Seth Hanlon, and Michael Linden. An impressive brain trust by any measure.
The financial sector provides a crucial function to society. It accommodates the movement of funds from investors to businesses, governments and individuals who use the capital for productive purposes. If the financial sector does this efficiently, the cost to the users of capital will be close to the price demanded by investors. The financial sector will have extracted amounts for providing the “capital intermediation pipeline” that are commensurate with the service provided.