Economy

Obama's State of the Union Preview Serves Up Pretty Weak Brew

whitehouse.gov/video screenshot
whitehouse.gov screenshot President Obama delivers remarks about his new community college proposal at Pellissippi State Community College in Knoxville, Tennessee, January 9, 2015. "Make no little plans; they have no magic to stir men's blood and probably themselves will not be realized." —Daniel Burnham I recently got an email invitation from a Democratic congressional office to come to a "watch party" to view President Obama's State of the Union address. His "fourth-quarter priorities," according to the White House-inspired talking points of the message, are "home ownership, free community college, and high-paying jobs." That sounds pretty good. But if you unpack the specifics, the president is offering pretty weak tea. Free community college sounds terrific. Community college is the great American institution of the second chance. Obama proposes to have the federal government cover 75 percent of the cost, if states will participate. This could save students an average of over $3,...

Why Your Wages Are Idling in Neutral

Low-wage Americans are not the only workers affected by stagnant wages and rising inequality.

(Photo: © WillSelarep/iStock)
This article was originally published by the Economic Policy Institute as part of its " Raising America's Pay " initative. O ver the last 35 years (with the exception of the late 1990s), hourly wages of the vast majority have lagged far behind economy-wide productivity. This failure of wages to grow and rising wage inequality is the primary explanation for the rise of family income stagnation and income inequality over the past generation. Additionally, progress in closing gender and racial wage gaps throughout this period has been either nonexistent (for racial gaps) or disappointingly slow (for gender gaps). Low-wage Americans are not the only workers affected by stagnant wages and rising inequality. The middle class has also experienced stagnating hourly wages over the last generation, and even those with college degrees have seen no pay growth over the last 10 years. Since the late 1970s, wages for the bottom 70 percent of earners have been essentially stagnant, and between 2009...

Meet Austerity's Kissing Cousin: A Terrible Trade Deal

(AP Photo/Martin Meissner)
(AP Photo/Martin Meissner) People protest against the Transatlantic Trade and Investment Partnership (TTIP) at the final election party of the Christian Democratic Union (CDU) prior E.U. Parliament elections in Duesseldorf, Germany, Friday, May 23, 2014. This article originally appeared at The Huffington Post . E urope is right on the edge of another downward lurch into prolonged deflation. GDP growth is hovering right around zero. Germany, as an export powerhouse, continues to thrive, but at the expense of the rest of the continent—victims of German-imposed budget austerity demands. The euro, which keeps sinking against the U.S. dollar, is now trading at just $1.20, its lowest level in four and a half years. Unemployment outside prosperous Germany remains stuck at over 12 percent. All of this weakens the political center that supports the E.U., and increases the appeal of far-right parties. (You wonder if Europe's leaders bother to read their own history. When there is protracted...

Torn Between Two Presidents

(Official White House Photo by Pete Souza)
In the 2008 primary campaign, there was a moment when Democrats began to debate Bill Clinton's legacy. At one point, Barack Obama seemed to minimize the significance of the Clinton presidency when he said, "Ronald Reagan changed the trajectory of America in a way that Richard Nixon did not and in a way that Bill Clinton did not." Hillary Clinton and her supporters reacted with horror, accusing Obama of thinking more highly of a conservative icon than a successful Democratic president (though that of course wasn't his point). In the end, that internal discussion—just how good a president was Bill Clinton?—never proceeded too far. But with Hillary Clinton still the prohibitive favorite to be the 2016 Democratic nominee, we could well have the full debate we never quite got in 2008, and in the context of the Obama presidency now entering its final phase. Hillary Clinton, it is said, has to distance herself from her former boss to convince voters that her presidency would be more than a...

Squeezed By Austerity Imposed By Germany, Greece and Spain on Verge of Revolt

(Sipa via AP Images)
(Sipa via AP Images) Supporters of Greece's main opposition leader, Alexis Tsipras from the left-wing Syriza party, during a pre-election rally in central Athens on May 22, 2014. This article originally appeared in the Washington Post . A New Left is rising in Europe as the new year begins. And despite the fears it engenders in polite society, this New Left is less Marxian than it is—oh, the horror—Keynesian. Keynesianism is a complex economic theory, but its central insight is simple enough: If every institution stops spending, economic activity will decline. Self-evident though this may be, this insight has eluded such global economic institutions as the International Monetary Fund, as well as Europe’s economic hegemon, Germany, when dealing with the depression that has devastated southern Europe, and Greece in particular. In confronting the economic crisis that began with the 2008 implosion of Wall Street, nations such as Greece and Spain were unable to bolster their economies by...

Why Conservatives Learned Nothing From Sam Brownback's Failure

Flickr/J. Stephen Conn
Kansas governor Sam Brownback had a plan when he got elected in 2010, and it was a plan that could only be enacted in a place like Kansas: Pass huge tax cuts, then watch the state transform into a kind of economic heaven on earth. Brownback surely could never have doubted it would work, since he and those in his party have been saying for decades that tax cuts deliver economic growth, rising tax revenues, general happiness, and shinier, more manageable hair. You've probably heard the story: growth in Kansas did not, in fact, explode, but what did happen is that revenues plummeted, leading to severe cutbacks in education and other state services. Brownback nevertheless managed to get re-elected, because it was a non-presidential year and because it's Kansas. So now he's had a chance to reflect, and here's how he's looking at things , according to a Topeka newspaper: As Gov. Sam Brownback's first term comes to a close, the Republican governor has one regret — no, scratch that — one...

Intrigue: Doth Chuck Schumer Protest Too Much When Called 'Enabler' of Bad Budget Deal?

(AP Photo/Manuel Balce Ceneta)
(AP Photo/Manuel Balce Ceneta) Sen. Chuck Schumer, Democrat of New York, talks on a phone as he walks from the Senate subway on Capitol in Washington, Friday, December 12, 2014. This article originally appeared at The Huffington Post . L ast week, I wrote a piece lamenting the fact that so many Democrats had voted for a budget package that gutted a key provision of the Dodd-Frank Act. The so called swaps push-out provision, now repealed, required banks to separate their speculative business in derivatives from depository banking covered by government insurance and further protected by the Federal Reserve. The broader budget deal, technically a continuing resolution to keep the government funded through next September, also cut a lot of needed public spending and added several odious riders, including one that raises the ceiling on individual campaign contributions to party committees about tenfold. Had Democrats resolutely opposed the deal, I argued, it would have revealed Republicans...

The 10 Most Important Econ Charts of 2014 Show Ongoing Looting By the Top 1 Percent

CEO pay soars and productivity far outpaces any wage gains for regular people. Then there's the inequality tax, which is epic.

Economic Policy Institute
This article was originally published by the Economic Policy Institute at their website, epi.org , under the title "The Top 10 Charts of 2014." T his last year saw the pace of job growth pick up, a welcome development. Yet the economy remains far from healthy. In 2014 the twin issues of income inequality and stagnant wage growth for the vast majority of Americans took center stage. Better late than never. The top charts of 2014 created and compiled by the staff of the Economic Policy Institute show why addressing inequality and spurring wage growth is so necessary–and so doable. Policy choices led to these trends, and different policy choices can reverse them. The first policy choice should be based on the “do no harm” principle: the Federal Reserve should not try to slow recovery in the name of fighting inflationary pressures until wage growth is much, much stronger. After this, policymakers should support those labor standards that can restore some bargaining power to low- and...

Obama Compared to Prior Presidents On Job Creation, In Graphs

B arack Obama has some reason to crow about the direction the economy has been moving lately. As he said in his press conference on Friday, "as a country, we have every right to be proud of what we've accomplished: more jobs, more people insured, a growing economy, shrinking deficits, bustling industry, booming energy." And it's true that there are some kinds of economic data that look excellent, particularly job creation, which is what I want to focus on for the moment. We've had 50 straight months of positive job growth, since September 2010, which is pretty remarkable. Once we get the December numbers there will probably wind up being around 3 million jobs created in 2014, which would make it the best year since 1999. So how does Obama stack up against his predecessors in this department? As always, it depends how you look at it. But let's start with just the job numbers . Here's a graph showing every president since Eisenhower: A few things jump out from this graph. While we don't...

How Much Did Black-White Wealth Gap Widen During the Great Recession?

A lot, says a new study from the Pew Research Center.

© Steve Debenport/iStock.
This article originally appeared at BillMoyers.com . T he average African-American household takes home around 40 percent less income than a similar white family. The gap between non-Hispanic whites and Hispanics (who can belong to any race) is just over 30 percent ( Excel file ). But racial income inequality pales in comparison to the racial gap in net worth —in household wealth accumulated through one’s lifetime and passed from generation to generation—especially between whites and blacks. It’s the living legacy of hundreds of years of structural racism. And, according to a new study by the Pew Research Center , that wealth gap has grown significantly since Wall Street crashed the economy… The study’s authors note that while accumulated wealth dropped across the board during the crash, there has been “a stark divide in the experiences of white, black and Hispanic households during the economic recovery.” From 2010 to 2013, the median wealth of non-Hispanic white households increased...

The Great Budget Sellout of 2014: Do We Even Have a Second Party?

The Democrats not only lost this vote on issues they allegedly care about; they lost their role as a credible opposition.

(AP Photo/J. Scott Applewhite)
(AP Photo/J. Scott Applewhite) For in the great budget sellout of December 2014, fully 57 House Democrats voted with the Republicans to narrowly pass this deal. Key Senate Democrats close to Wall Street, such as Chuck Schumer of New York, shown here, were its enablers. This article originally appeared at The Huffington Post . I n principle, Saturday's vote to keep the government open should be the perfect curtain-raiser for the political debates between now and the 2016 election. As their price for averting a government shutdown, Republicans demanded and got a gutting of one of the most important provisions of the Dodd-Frank Act, preventing banks from speculating with government insured money. Agencies hated by Republicans such as the Environmental Protection Agency took big cuts, and a rider was inserted permitting "mountaintop removal" coal mining once again. Another extraneous provision demanded by conservatives permits massive increase in individual campaign contributions. The IRS...

Carnage at The New Republic and Prospects for the Liberal Press

The New Republic
A .J. Liebling, the early New Yorker ’s celebrated press critic (he invented the genre) once wrote : The pattern of a newspaperman's life is like the plot of 'Black Beauty.' Sometimes he finds a kind master who gives him a dry stall and an occasional bran mash in the form of a Christmas bonus, sometimes he falls into the hands of a mean owner who drives him in spite of spavins and expects him to live on potato peelings. You might say the same thing of magazine publishers. Political magazines are something close to public trusts—key elements of a robust democracy--but most are privately owned. Like newspapers, they are at the mercy of the whims of owners who are sometimes astute at the publishing business, and sometimes inept; sometimes kind masters, and sometimes capriciously cruel. The New Republic , where I worked for a decade, was once America’s leading liberal magazine of essay, reporting, and criticism. In the past half-century, TNR went through a convoluted odyssey. A chain of...

'All I Want For Christmas Is Justice!' A Protester's Dispatch

This is what the new civil rights movement looks like.

(AP Photo/ Joseph Kaczmarek)
(AP Photo/ Joseph Kaczmarek) Angelica Simmons, center, holds her arms up in the air while participating in a demonstration at a tree lighting ceremony, Wednesday, December 3, 2014, in Philadelphia. The crowd, protesting the deaths of two unarmed black men at the hands of police, rallied at the train station and marched through downtown before disrupting a tree lighting ceremony at City Hall. A t the National Christmas Tree Lighting ceremony, the president and his family sought a moment of lightness. It was not to be had. The street in front of the White House was filled with demonstrators, who had blocked off highly-trafficked thoroughfares after the justice system once again failed to call police to account for the killing of yet another unarmed black person: Eric Garner, who died when a New York City police officer pushed Garner to the ground, wrapped his hands around the black man’s neck, and held them there while the man gasped for air. As traditional Christmas songs blared from...

Businessmen Don't Understand Politics, Part 3,486

Flickr/Sam Graf
Yesterday, Barack Obama, who as we all know is on a mission to destroy capitalism, sat down with a group of capitalists from the Business Roundtable to hear their sage advice and answer their insightful questions about the economy and the state of the nation. During the session , Fred Smith, the CEO of Federal Express, mentioned a couple of bills floating around Congress to increase the gas tax, and asked the president, "Why not, before the Congress goes home for December, just pass a bill that takes the two bipartisan bills that I just mentioned, up, and solves the problem?" Yes, why not "just pass a bill"? Strange how nobody in Washington seems to have thought of that. It took a can-do business leader to cut through all the baloney and find the solution to the problem of crumbling infrastructure. I'm sure Smith is a smart guy in his way — I can't imagine an idiot could run a huge company like FedEx. But it's obvious that he knows nothing about politics. Yet I'm sure that like most...

A Modest Proposal: The Universal Christmas Bonus

Wikimedia Commons/Square87
L ast year, Paul Ryan passed along this made up story: This reminds me of a story I heard from Eloise Anderson. She serves in the cabinet of my buddy Governor Scott Walker. She once met a young boy from a poor family. And every day at school, he would get a free lunch from a government program. But he told Eloise he didn’t want a free lunch. He wanted his own lunch—one in a brown-paper bag just like the other kids’. He wanted one, he said, because he knew a kid with a brown-paper bag had someone who cared for him. Insofar as the point of this story is to push against free lunches in school, it's obviously a rather craven sentiment. The opponents and critics of free school lunch are an odd bunch. They seem to think it's basically alright to send over 90 percent of children to these big welfare programs called public schools, but that feeding them while they are at these welfare schools is over the line. It's not hard to see what's going on: public school is so commonplace and nearly...

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