We’re Doing Very Little in Addressing Our Economic Concerns…Even conservatives who agree with Trump’s policies &/or judge selections, if they’re actually paying attention would have to be disappointed in the chronic dishonesty & corruption coming from this White House. The prez has totally obliterated the trust & moral authority so integral to being an effective leader. Plus the GOP base should stop being deluded into thinking we have such a strong economy, since the ongoing entrenched economic concerns show no signs of abating for much of the working class. Whether it’s government employees hit hard by this silly shutdown or workers in the private sector, the story is the same for tens of millions of Americans & their families. Hard work is often not so much the path to the American Dream, but they’re living the American nightmare just fighting to stay afloat. Surveys show nearly half the population would be hard-pressed to dig up $400 for an emergency.
Barring a major breakthrough on a trade deal with China, there’s very little Trump has done so far to help our economy. All the while major corporate sectors of our society are making a killing, such as in energy, finance, insurance, high-tech & medical. Here we’re seeing the greedy drug companies taking advantage again: drugmakers-shrug-off-trump-tweets-and-kick-off-2019-with-big-price-hikes. The dominance of massive multinationals doesn’t do much to help workers pay the bills. As an alternative to taking jobs that hardly pay a livable wage, good luck starting a business without tons of seed money. This whole narrative of economic insecurity afflicting millions of workers certainly hits home with the entire family, as seen from the struggles described inside apos-feel-apos-m-failing & also these excerpts from living-paycheck-to-paycheck-is-disturbingly-common-i-see-no-way-out:
“Inescapable.” “It’s a constant stressor.” “I see no way out.” What do professors, real estate agents, farmers, business executives, computer programmers and store clerks have in common? They’re not immune to the harsh reality of living paycheck to paycheck, according to dozens of people who responded to a Washington Post inquiry on Twitter. They’re millennials, Gen Xers and baby boomers. They work in big cities and rural towns. They’ve tried to save — but rent, child care, student loans and medical bills get in the way. National data on the paycheck-to-paycheck experience is flimsy, but a recent report from the Federal Reserve spotlights the prevalence of extra-tight budgets: Four in 10 adults say they couldn’t produce $400 in an emergency without sliding into debt or selling something, according to the 2017 figures. The partial government shutdown, which began last Friday and is temporarily halting pay for some 800,000 federal workers, has touched off a heated discussion on Twitter about what it means to get by in the United States. (President Trump warned this closure could “last a very long time” if Congress doesn’t meet his demands for billions of dollars for a border wall.) Even brief income lapses can spell disaster for some households.
These and other #ShutdownStories took off online after U.S. Rep. Scott Perry (R-Pa.) suggested last week that a gap in wages wouldn’t be so bad. “Who’s living that they’re not going to make it to the next paycheck?” he asked reporters, adding that most of those impacted would qualify for back pay. According to economists: A lot of people. “It’s astronomical what people need just to make it month to month,” said Heidi Shierholz, a former chief economist at the Department of Labor who now studies how middle-class families spend their wages at the Economic Policy Institute, a Washington think tank that is funded by foundations and unions. “Given the high cost of transportation, housing, health care … There is often no wriggle room.” About 2,000 custodians, security guards, housekeepers and other federal building workers are losing money this holiday season because of the shutdown, according to 32BJ SEIU, an East Coast labor union — and because such staffers are employed by contractors, they won’t be eligible for makeup checks.
Take Trump’s Boasts with a Grain of Salt
Today’s booming jobs report actually featured an uptick in wages & participation rates, but if we’ve learned anything over the years with these monthly roller-coaster rides, we can never put too much stock in any single report (while the stock market has also become a volatile yo-yo). And those jobs reports can be misleading by glossing over the chronic structural problems bedeviling the economy. The bright shiny objects in some of the economic stats, like the low unemployment rates, belie the decay eating away at the underpinnings of our society. Please read this article inside we-are-living-in-a-new-gilded-age-2018-proves-it, where many metrics are proving we’re nowhere near the great economy that Trump boasts about.
Trump’s claims are a constant series of contradictions. He lives in a world of false realities, spinning tales that always paint him in the best possible light & where honest facts have no relevance. For example, his shifting position on interest rates in recent years are tainted by who occupies the White House at any given moment in time, explained in these excerpts from trump-fears-greatest-economy-ever-is-on-brink-of-collapse:
But you know who doesn’t have a dark view of the economy? Trump. The president has relentlessly touted the recovery as the greatest ever. If Trump is right, of course, then this soaring rocket ship of a recovery which he has overseen — or, according to Trump, single-handedly engineered through his combination of corporate tax cuts and turning over regulatory enforcement to the business lobby — could easily withstand some small interest rate hikes. Indeed, it would be prudent to raise rates now, while the economy is in the midst of the greatest recovery ever, to ensure both its continuation and to have tools on hand to revive it, whenever that becomes necessary. Oddly, that is not Trump’s position.
Equally odd, Trump’s views on monetary policy did not line up with his public assessments of the economy during the last administration, either. When Barack Obama was presiding over essentially the same economic conditions, Trump derided it as “the weakest so-called recovery since the Great Depression,” with “94.3 million Americans outside the labor force.” This dismal analysis would imply that the Federal Reserve needed the lowest possible rates to sustain the recovery on its meager trajectory. But no — Trump lambasted the Fed for leaving rates too low. Janet Yellen should be “ashamed,” he said in 2016, for leaving interest rates low. So Trump was calling for higher interest rates during the pathetically weak Obama recovery, and is now demanding low rates during the Trump boom. Obviously these wildly inconsistent views are perfectly consistent with Trump’s position that every positive development in the world is due to him, and every bad thing is the fault of somebody else. If your economy is a couple tiny interest-rate bumps from making you the next Herbert Hoover, you may not have quite as much confidence as you are attempting to project.
Decline of Manufacturing Ruins Lives
It’s why I’ve so far given Trump a pass on his trade war with China, since for decades China has manipulated various factors giving them an unfair advantage on trade. Here’s hoping a deal leveling the playing field can still be struck, but it’s a tough slog with the Chinese not sharing our American values. In many of the U.S. coastal cities & within the corridors of power in DC, there seems to be very little recognition of the depths of despair brought about by the economic collapse of factory towns, many of which are here in Northeast Ohio. The decline has been happening for decades with trends showing no signs of a turnaround: u-s-factory-activity-hits-two-year-low-casts-shadow-over-economy. Please read these next articles for a sense of the desperation & hopelessness, since for too many families these aren’t merely economic concerns, but the loss of their financial lifelines:
https://thehill.com/opinion/campaign/421877-an-agenda-for-forgotten-cities
https://www.yahoo.com/finance/news/apos-kick-stomach-apos-massive-080016323.html
https://www.cnn.com/2018/12/13/us/lordstown-letters-trnd/index.html
More Proof on the Folly of those Tax Cuts
For at least a year now we have featured in every part 3 how the Trump tax cut was really a fraud perpetrated on the American working class. This article explains it’s even worse than the other articles we’ve been reporting on: the-trump-tax-cut-even-worse-than-youve-heard. Another perspective on this comes from a millionaire who was among the chief beneficiaries of that tax bill, which we’ve posted the whole piece from republican-tax-cut-made-me-richer-and-kept-working-americans-stagnant:
One year ago, President Trump signed the Tax Cuts and Jobs Act into law, promising a “bill for the middle class and a bill for jobs” that would be “a tremendous thing for the American people.” Corporate CEOs and wealthy shareholders may be celebrating, but middle-class Americans are still waiting for their transformative tax cut. Congressional Republicans attempted to sell the bill as a deficit-neutral, pro-growth tax cut that would help every American, but from the moment details of the bill were announced, it was clear that the Republican overhaul of our tax code was designed with “the 1 percent,” not the middle class, in mind. Most of the bill’s $1.9 trillion in tax cuts targeted corporations and wealthy Americans such as me, leaving little more than crumbs for most working Americans — and the bill’s results of the last year have lived up to that initial analysis.
Trump claimed that American families would receive an average of almost $4,000 in tax cuts per year. That might be true if you averaged together the millions of families getting almost no tax cut and the few wealthy Americans who are getting hundreds of thousands of dollars in cuts, but that’s poor consolation for the middle-class families receiving an average of just $323 per year. While the direct results of the bill have been underwhelming for poor and middle-class American families, the larger economic effects are even more disappointing. To the surprise of absolutely no one with even a cursory understanding of trickle-down economics, these massive tax cuts for corporations and the wealthy have done little over the past year to help poor and middle-class Americans. Promised new jobs and higher wages, working Americans instead have watched some corporations spend nearly a trillion dollars on stock buybacks that almost exclusively benefit executives and wealthy shareholders, all while wage growth has remained flat.
Yes, unemployment is low, but the increased demand for labor hasn’t translated into wage growth. Nominal wages are going up, but so is inflation. The 2.9 percent wage increase from September 2017 to September 2018 looks a lot less impressive when you realize that, taking inflation into account, wages rose by only 0.6 percent. And while unemployment across the country is low on average, corporate tax incentives created by the tax bill have devastated small communities across the country. A few weeks ago General Motors announced that it would be cutting 14,000 jobs in the United States and Canada, leaving residents of towns with shuttered GM factories such as Hamtramck, Michigan, and Lordstown, Ohio, with few employment opportunities. GM’s decision shocked many, but it’s far from an isolated incident. Through changes in the so-called “tax reform” law, the U.S. tax code now actually gives corporations a tax cut for moving American jobs and factories overseas, so more layoffs and factory closings are sure to follow. It’s almost too absurd to believe, that the tax code could be so hostile to American workers, but when considering that this bill was built to prioritize corporate profits, it’s less surprising.
It is true that the economy (as measured by corporate profits and stock prices) is still growing well. That’s great for people such as me whose income primarily comes from ownership of stock, but it does nothing to help the vast majority of Americans who actually work for a living. Most stocks are owned by rich people — the stock market doing well just doesn’t greatly impact the lives of most Americans. The economic factors that actually affect their daily lives, wages and cost of living, have not been helped by the Republican tax bill. That means wealth inequality will worsen, which is bad for everyone — eventually even investors will not make profits if most people have little disposable income after paying for necessities. One year after its passage, the Tax Cuts and Jobs Act deserves a failing grade. It may have done what Republicans in Congress intended it to do — give billions of dollars in tax cuts to the ultra-wealthy and corporations — but it hasn’t done what this country needs. Working Americans deserve a tax code that works for them, not just those at the top. As we enter the new year and prepare to welcome the 116th Congress to Washington, it’s time for real, progressive tax reform, not more handouts to rich people.
More on the Actual Effects of that Tax Bill
For more details on the disappointing Trump/GOP tax cuts, inside sober-look-economy Rubin explains those tax cuts & what Trump has overall described as an economic miracle, that so-called miracle is a dud! This next article from republicans-are-celebrating-one-year-anniversary-trump-tax-cuts-they-shouldnt-be is also spot on, so we’ve posted the entire thing here:
Republicans have been celebrating the one-year anniversary of the Trump tax cuts with all the pomp, circumstance and fake movie trailers — seriously, they’ve made a few of those — that you’d expect of a major accomplishment. Which only leaves one question: What exactly do they think they’ve achieved? It can’t be any of the things they promised, because none of those have happened. At least not yet. Indeed, the $5 trillion that President Trump said his tax cuts would bring back into the country has, according to the Wall Street Journal, been more like $143 billion so far — or 97 percent short of his stated goal. Which is why it should be no surprise that the investment boom all this money was supposed to set off hasn’t materialized either. Not unless you think the rather anemic 0.8 percent increase in nonresidential fixed investment last quarter constituted some sort of economic miracle. No, the reality is that business investment is still going up and down more with the price of oil — spending on things such as rigs is a big part of the overall picture — than it is with the tax rate on corporate income.
It’s almost as if giving businesses more incentive to invest doesn’t matter if they don’t have a reason to invest in the first place. They’ll just buy back more of their stock instead, which, of course, they’ve been doing at a record pace the past year. And it pretty much goes without saying that, contrary to Treasury Secretary Steven Mnuchin’s empirically indefensible claims, the Trump tax cuts will not pay for themselves. They won’t even come remotely close to doing so. What’s happened instead has been so predictable that everyone else predicted it: cutting tax rates has made us collect so much less tax revenue that the budget deficit has increased substantially. It’s the first time it has ever gone up this much in the absence of a war or a recession. To sum it up, then, the Trump tax cuts have both cost more and done less than Republicans said they would. But no matter! While a less ideologically devoted party might let that get in the way of their planned festivities, Republicans still apparently think that the Trump tax cuts are worthy of a six-part video tribute. How have they managed to convince themselves of this? Well, there are three big parts to it. The first is that the unemployment rate was so low when they passed the tax cuts — just 4.1 percent — that it’s been easy for them to mistake correlation for causation if they’re so inclined. That is, they can tell themselves that things are good because of the tax cuts instead of the truth that they were already good even before the tax cuts, and haven’t improved in the ways that the tax cuts’ biggest proponents said they would.
The second is that there really were a rash of stories last year about how all the bonuses that were being handed out back then were supposedly the result of the recently-passed tax cuts. It’s something that, as you can imagine, Republicans still like to talk about to this day. The only problem, though, is that it wasn’t really true. The fact of the matter is that even if the Trump tax cuts do end up increasing wages, this isn’t the way they’d do it. That’s because they didn’t give companies an incentive to directly pay their employees more, but rather to invest more in their businesses, which, by making their workers more productive, was supposed to indirectly lead to higher pay in the long run. What happened last year, though, is that CEOs were touting bonuses they were probably going to give anyway as evidence that the tax cuts were already working — Wells Fargo, for one, originally said its raises didn’t have anything to do with the tax bill, before quickly changing its tune — to try to curry favor with the administration. But, as the left-leaning Economic Policy Institute’s Lawrence Mishel points out, you can tell that this wasn’t actually what was going on from the fact that neither salaries nor bonuses have started growing any faster since then.
Which brings us to the real reason that Republicans are so happy that they cut corporate taxes. It’s that they … cut corporate taxes. For some of them, you see, letting the rich keep more of their money is an absolute moral good. Heck, it might be the absolute moral good. That’s because they’re worried, as House Speaker Paul D. Ryan (R-Wis.) used to put it before he realized that this type of Ayn Rand-inspired rhetoric is politically toxic, that the “takers” will soon outnumber the “makers” and simply vote to give themselves other people’s money. That’s why, independent of any economic benefits, which we’re finding out may very well be ephemeral, they think that cutting taxes for top earners is good policy. For the less philosophically-inclined among them, though, letting the rich keep more of their money is still an absolute political good. It’s what their donors gave them money to do. And that’s not just a cynical interpretation of events. It’s their own interpretation of them. Republicans were quite open about the fact that they had to cut corporate taxes or their moneymen would cut them off. “The financial contributions will stop,” Sen. Lindsey O. Graham (R-S.C.) bluntly put it, if they let their tax bill get derailed like their health-care plan had. The Trump tax cuts, then, weren’t so much about the economy as the political economy — and it shows. There’s been very little bang for even 1.5 trillion bucks.
Fix It to Save It
As the world moved farther away from the post-WWII era, it would be folly to think America would continue to disproportionately benefit from the economic engines of modern-day capitalism. It’s heartening to see how some other nations embracing the capitalistic model have thrived in recent decades. But that doesn’t mean we overlook & fail to address the economic concerns inherent in our current capitalistic system. As I’ve often warned & is again revealed in the entire article below posted from coming-reckoning-capitalism-2020-presidential-election, we either find some way to soon fix capitalism for working people, or else we’re going to lose it. And I’ve heard Michael Bloomberg comment that 2020 should no longer be just about identifying with working class struggles & presenting bold (false) promises, but presidential candidates should be scrutinized as to whether their specific solutions are viable & doable:
One of the most important trends likely to drive the 2020 presidential race: A growing disillusion with capitalism as practiced, and a coming struggle over how to recast this pillar of the Western order.
The bottom line: You could hardly challenge a more basic part of who we are as Americans and Westerners.
*Gallup found this summer: “Americans aged 18 to 29 are as positive about socialism (51%) as they are about capitalism (45%).”
*That’s “a 12-point decline in young adults’ positive views of capitalism in just the past two years and a marked shift since 2010, when 68% viewed it positively.”
Why it matters: The main messengers of this coming steamroller are nowhere near the fringe. They’re mainstream thinkers with ideas like, “We must rethink the purpose of the corporation” and “The crisis of democratic capitalism” (both from Financial Times columnist Martin Wolf).
*The thinking is captured in a clutch of must-read new books by Paul Collier, Jonathan Tepper and Oren Cass; and a growing body of academic papers in the U.S. and Europe.
*What they are mostly doing is connecting the dots of what we all realize by now: Flaws in the system — including forgetting about so much of society — are largely to blame for widespread disaffection with establishment institutions, leaders and answers.
The evidence of something profoundly amiss is visible in:
*Almost four decades of largely flat wages for the vast majority of workers.
*Four decades of meager productivity gains.
*An anemic number of new startups, and relatively few IPOs.
If you remember one thing: All that bigness that you see around you — outsized cities, companies and individuals gobbling up most of the economic pie — is not normal.
*For the economic system to become more inclusive, competitive, and deliver for more people, some or a lot of that bigness may have to be broken up.
Axios’ Felix Salmon notes: The past four decades have seen massive global increases in wealth and income and productivity, thanks almost entirely to capitalism. (Look where South Korea was 40 years ago!)
*So flattened wages in the U.S. reflects the way the benefits of capitalism wound up getting spread across the globe, rather than being concentrated in the West.
*This does, of course, explain the disaffection in the West.
What’s next: In the U.S., look for this trend to be a primary battleground among Democratic presidential candidates in 2020. Each of the political parties is likely to promise that it can best reformulate the system to deliver for the vast number of Americans.
*Axios’ Dan Primack points out that this could be the dividing line in the Democratic primary: A pretty hardcore group that believes that even Sen. Elizabeth Warren is too capitalist (because she wants to reform, not replace).
Be smart: Innovative Republican candidates will also reach for many of the same issues and solutions, rather than the GOP orthodoxy of old.
More on the Competing Forces of Capitalism & Socialism
In order to restructure our economic model for recapturing access to the American Dream, we need a basic understanding of the circumstances dictating our lives & livelihoods. We can’t effectively solve our economic concerns without first having a thorough comprehension of all the relevant factors shaping them. We literally need to invent many more productive careers for people to do in line with the modern age: the-eroding-middle-work-in-the-us-heading-toward-high-and-low-skill. Also in this post-industrial economy, instead of a predisposition forshareholder capitalism as described in shareholder-capitalism-and-the-slow-death-of-u-s-manufacturing, a way must be found for employees to share in the rewards of success.
So yes, we must fix capitalism to avoid socialism. But it doesn’t need to be an either/or choice. We must strive to let free markets thrive through a proactive government having the courage & determination to take bold steps, directly targeting & tackling the real problems that have been all too painfully obvious. Workers keep getting shafted while too many industry sectors have evolved into more an oligopolistic structure, where much of the free-market competition have been squelched. But the fixes can only be made possible when the disparate political factions start working together for the nation’s greater good as is so smartly expressed inside we-dont-need-to-be-so-polarized-lets-be-pro-market-and-pro-government. As for our immediate future if Trump were so inclined, maybe he could work with the Dem House on a bipartisan basis, if he ever drummed up enough courage to leave behind his most extremist Trumpeters & echo pundits, plus ostracize the House Freedom Caucus into irrelevancy.
So again I say yes, capitalism is worth saving, but only by making drastic changes away from the current ruthless form of capitalism, restructuring that rigged system so the working class finally benefits from the rewards & opportunity: american-capitalism-neoliberalism-steven-pearlstein. Our modern economy does create tremendous wealth, but there’s a basic flaw in the system when it’s all concentrated at the very top. I know the wealthy create the jobs, but there tends to be a bell curve where once a fortune is amassed at certain amount, the rich tend to sit on their assets. Signs of that with those corporate tax cuts show vast amounts went more toward stock buybacks instead of increasing wages. The trickle down just isn’t there, along with too many would-be entrepreneurs not among the top 1% unable to garner the resources to get in the game.
Make no mistake what’s at stake. If we don’t find some way to turn things around, it’s not only capitalism we might lose, but the country itself: rome-decline-america-edward-watts-mortal-republic.
A Song Dedicated to Trump & His Inner Circle
Mark my words, 2019 will be the year all the crimes & corruption catches up with Trump world. The prez is such a bad boy, whatcha gonna do when they come for you?:
https://www.dailykos.com/stories/2019/1/2/1823115/-A-Song-dedicated-to-trump
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