This week Standard & Poor’s provoked what amounted to a non-event when it lowered its outlook on the U.S. debt from “stable” to “negative,” based on its expectation that Congress isn’t going to reach a meaningful compromise on deficit reduction in the near future. The downgrade came just days after the Senate subcommittee on Investigations released its massive report on the causes and villains of the financial crisis. The report indicted S&P, along with Moody’s, for keeping the credit ratings of mortgage-backed securities and collateralized-debt obligations artificially high, then sharply lowering them when the foreclosure rate began to skyrocket in 2007. It explains:
With more than 10,000 suppliers in China manufacturing for Wal-Mart, the great majority of its merchandize is “Made in China.” Wal-Mart is now becoming a major retail presence there as well. The company has already opened close to 200 stores in 101 Chinese cities and hopes to roll out ever more big-box emporiums across the urban Chinese landscape. What happens when the world’s biggest retailer and the world’s biggest country do business with each other?
Employees at Chicago's first Wal-Mart (AP Photo/Charles Rex Arbogast)
"Be very careful who you let into your neighborhood," Sandra Carpenter, a former Wal-Mart grocery manager from Maryland, warned New Yorkers considering whether to bring Wal-Mart to their town. "They will promise you everything under the sun," she said at a recent anti-Wal-Mart rally outside New York City Hall, "but at the end of the day, they will take it all back."
Wal-Mart's high-profile effort to expand into some major urban markets has suddenly cast a spotlight on the experiences of Wal-Mart workers like Carpenter and launched a battle that both Wal-Mart and the United Food and Commercial Workers (UFCW), the union that represents grocery workers, badly need to win.
Today, the Supreme Court heard the largest gender-discrimination case in history. In Wal-Mart v. Dukes, the Court will decide whether a class-action suit brought by 1.5 million female employees of the retail giant will be allowed to proceed with their action – or whether, as Wal-Mart argues -- the class is too big.
Victoria Pynchon at Forbes has a great piece on the importance of social science in this case, noting that the argument against Wal-Mart contains seminal testimony from sociologist William T. Bielby:
For the record, Stephen Lerner is a friend of mine. The former SEIU executive, one of the brightest organizing minds in America today, spends every waking minute thinking about what he and the rest of us can do to help working-class and poor people in America. And no, as Glenn Beck now correctly points out, Lerner's conclusion is not that we need to help Wall Street ...
A new Wall Street Journal survey is reporting that economists are split over whether the Republicans’ plan to cut $100 billion from the budget will help or hurt the economy, which is surprising after Ben Bernanke, Mark Zandi, and Goldman Sachs all agreed it would. One surveyed economist’s explanation, however, may provide some insight:
"There is no free lunch," said Dana Johnson of Comerica Bank. "Cutting spending does weaken the economy, but it is the right thing to do."
In 2008, Maria Isavel Vasquez Jimenezdied after pruning grapes for nine hours in the California heat. It was nearly 100 degrees. She was two months pregnant and 17 years old. Authorities there charged the farm supervisors in her death, accusing them of not allowing Jimenez to get water or shade. Today, the two pleaded guilty in a deal that allows them to avoid jail time.
Maria De Los Angeles Colunga, the owner of now-defunct Merced Farm Labor, pleaded guilty to a misdemeanor count of failing to provide shade. She received 40 hours of community service, serve three years of probation and pay a $370 fine.
Republicans have taken to declaring the country "broke" as justification for draconian cuts in social spending. It's a nice bit of rhetoric, but the evidence -- according to Bloomberg's David Lynch -- points to the opposite:
To repeat a point, most Americans don't really understand the deficit and its relationship to the broader economy. Insofar that the deficit is a concern, it's as a proxy issue; Americans worry about the deficit when the economy is poor, and aren't too concerned when the economy is doing well. For example, here are the results from the latest NBC News/Wall Street Journal poll:
In the poll, eight in 10 respondents say they are concerned about the growing federal deficit and the national debt, but more than 60 percent — including key swing-voter groups — are concerned that major cuts from Congress could impact their lives and their families.
The New York Timesreports today that the number of bank branches that closed in the U.S. was higher last year than the number that opened, the first time in 15 years that that's happened. Bank branches didn't shutter their doors across all communities equally, of course. Banks left low- and middle-income areas and opened new branches in areas with a median income of $100,000 or more.
Andrew Sullivanresponds to Freddie DeBoer’s post on debt, deficits, and “seriousness”:
The current math simply demands either massive tax hikes or massive benefit cuts in the future. Adjusting now will make the future, relative suffering less rather than more painful. And like Megan, I'd like to see the cuts focus on those who are most able to afford it. To use the obvious example: why should we be sending Warren Buffet a social security check?
The Obama administration released it's plan for unwinding Fannie Mae and Freddie Mac today, and offered a set of alternatives on how to replace it. But the big takeaway is that the government will basically stop promoting homeownership, and it will likely especially remove incentives for reaching low-income families who might not otherwise be able to afford one:
Taken together, these measures would directly affect borrowers, by increasing the costs of buying a home. That would also make the loans more profitable and perhaps draw new competition from private firms.