Depressing and degrading - Page 2

~1~ · 07-06-2011, 09:11 AM

The final nail in the supply side coffin.

Quote:

The final nail in the supply side coffin

Broken recovery: Taxes are low and corporate profits are high, but nothing is trickling down to the American worker
By Andrew Leonard

The theory of supply-side economics tells us that if you cut taxes on rich people and corporations, the newly liberated moguls and businessmen will take their windfall and invest it, creating jobs and accelerating the rate of economic growth. The benefits of a light hand on the upper class, therefore, will "trickle down" to the working man and woman.

Ever since Ronald Reagan first attempted to make supply-side economics a reality and proceeded to inaugurate an era of persistent government deficits and growing income inequality, it has become harder and harder to make the trickle-down argument with a straight face. But we've never seen anything quite like the disaster that's playing out right now.

The Wall Street Journal reported on Tuesday that corporate profits are looking quite strong for the second quarter of 2011. Even the Journal can't sugarcoat the basic facts:

Quote:

Originally Posted by WSJ

While the U.S. economy staggers through one of its slowest recoveries since the Great Depression, American companies are poised to report strong earnings for the second quarter -- exposing a dichotomy between corporate performance and the overall health of the economy.

But that's just the tip of the nightmare. A newly released study from the Center of Labor Market Studies at Northeastern University, "The 'Jobless and Wageless' Recovery From the Great Recession of 2007- 2009," lays out some extraordinary statistics. (Hat tip: The Curious Capitalist.)

In the first quarter of 2011, aggregate U.S. GDP -- the total value of all the goods and services produced in the United States -- was higher than the peak reached before the recession began in 2007. During the six quarters since the recession technically ended in the second quarter of 2009, real national income in the U.S. increased by $528 billion. But the vast majority of that income was captured as profit by corporations that failed to pass on their happy fortunes to their workers.

Quote:

Originally Posted by The 'Jobless and Wageless' Recovery From the Great Recession of 2007- 2009,

Over this six quarter period, corporate profits captured 88% of the growth in real national income while aggregate wages and salaries accounted for only slightly more than 1% of the growth in real national income. The extraordinarily high share of national income (88%) received by corporate profits was by far the highest in the past five recoveries from national recessions ... In the first six quarters of recovery from the 1990-91 recession, corporate profits experienced no growth whatsoever, and they generated on average only 30 per cent of national income growth during the recoveries from the 1981-82 and 1973-75 recessions.

What makes this "recovery" so different? Perhaps the simplest answer is that labor has been broken as a force that can put pressure on management, so there's little incentive for employers to turn profits into wage hikes or new jobs. Instead, employers are squeezing more out of the workers that they've got, and investing in equipment upgrades and new technology instead of human assets -- labor productivity has risen sharply since the end of the recession.

Globalization also plays a potent role -- and not just as a source of cheap labor to undermine the bargaining power of American workers. The Journal notes that many companies "are benefiting from demand from emerging markets, where they are deriving an increasing share of their sales." Job creation is probably following the sources of new demand. If the Chinese and Brazilians and Indians are the ones buying American goods and services, then it makes sense to staff up overseas. But with American consumers still shellshocked by the economic crash and dutifully obsessed with paying down their debts while trying to hold on to their homes, domestic demand is hardly a force to be catered to.

Wages are moribund, unemployment is stuck at 9 percent, and the corporate bottom line is doing just fine. You could be excused for thinking that if ever there was time to put the stake through supply-side economics, it would be now. Wall Street and big corporations are doing just fine, but absolutely nothing is trickling down. And yet Republicans are still pushing the same old song and dance, passionately holding the entire creditworthiness of the United States hostage in return for even lower taxes on corporations, adamantly refusing to countenance even the slightest revenue increase to help cushion the hard times for the Americans who are getting a raw deal out of the current recovery.

Democrats come in for their share of the blame, too. The worst economic recovery for American workers in history has happened on Obama's watch, and he appears remarkably oblivious to it. He may live to regret this oversight.

Seems the folks doing the investing in America are only investing in American Corporations who don't actually do anything for Americans.

**AlteredStateGrl** · 07-06-2011, 09:25 AM

Sorry to hear you've fallen on hard times, man. The suggestion for growing your own garden are FABULOUS. Our garden is starting to go crazy now! TONS of fruits and veggies, it's SO awesome to not have to buy them at the grocery store!

The food bank is there for people in need. You're right to use it. May I suggest, when you're back on your feet again, donating a little bit of food to the bank. It's a kind, thankful thing to do, and you'll be helping out someone else in need. If you feel bad, giving back when you can, may help.

You are not alone. Many, many working families can't afford even the basics and don't qualify for assistance. Sucks ass that people who make no effort to do anything, are able to get assistance...yet, people who are working but still can't make ends meet, don't get anything. It's terrible and horribly stressful. Hang in there. You can prevail.

Bad dog · 07-06-2011, 09:36 AM

There's nothing to feel ashamed about if you are poor.
Especially if it's thru no fault of your own.
Remember that the pain you are feeling is because you are growing. Only hard times will develop your character.

There is nothing you can do about it except keep slogging on, don't give up and your luck will turn eventually.

The times that I felt most 'alive' were those when I was totally broke. I've know hunger and it is important for everyone to know it, only then can we apreciate the good things in life.

The key to surviving the present economic downturn is to learn how to live within your means. Any unneeded expenses must be dropped anything you can downsize then do it.

It will be alright, we have all been poor in our twenties and thirties at sometime or another. Life is full of ups and downs and in another 3 years or so you may have your yacht tied up next to mine in san tropez and we will be toking together amongst countless topless babes............... .........

Dr. Nick Nasty · 07-06-2011, 12:05 PM

^agree-everybody's living situations are far more precarious now with things the way they are-best not to blame yourself and to ask what your alternatives are and to make do while keeping an eye open for other opportunities.

John F. Kerry · 07-10-2011, 09:52 PM

this topic is literally the knife edge of where theory meets reality.

the key to keep in mind , imo, is that we are a free society where we all kinda have to use various methods to stand up for what we believe in . what we get is a mish mosh of actions and beliefs... but its more representative of the overall situation than anything clean and clear cut or simply explained would be...

its a good thing to keep in mind when thinking about this. we are free people, making free choices and we get ourselves into these situations (and out of them) by smashing heads and banging skulls and making policies.... not by being told what to do by some higher ups or some communist junta....

its like how people lamented the suburban sprawl that took place after ww2.... lots of people complained about various effects of it.... some even said how it was horrible... but the fact remained that no one was forced to move to levittown... it was a huge mass of free people making their free choices in pursuit of plain vanilla self interest....

So it'll be interesting to see how it turns out i guess. This is nothing new, but eternally interesting and fascinating

Bad dog · 07-11-2011, 12:20 AM

I spent almost half a year in India and Nepal as well as five years in Egypt. I recommend that all of you read a book called city of joy if you can't get out into the third world.

Only when you see just how hard life is for over half of the worlds population, can you have a sense of proportion and realize just how lucky we westerners really are.

Even our hardest times our lives are infinately better than most of the world's.

Being · 07-11-2011, 05:31 AM

dont get me wrong, i appreciate what i do have, trust on that.

but thats not the point. its just very demoralizing to be doing everything you can to succeed but still have to slump down and goto the food bank.

**AlteredStateGrl** · 07-11-2011, 07:18 AM

Now I don't think you're listening or considering what everyone has said (a lot of good shit has been said) and you're the last one at your pity party and kinda enjoying it at this point. Everyone got your point. It is what it is, and only you can change your attitude. But acting this way (^), isn't helping your situation. Especially after you've had so much help in this thread. And if you don't see any of this advice as help, you're not trying.

Bad dog · 07-11-2011, 08:33 AM

Quote:

Originally Posted by Being

dont get me wrong, i appreciate what i do have, trust on that.

but thats not the point. its just very demoralizing to be doing everything you can to succeed but still have to slump down and goto the food bank.

The universe is challenging you. You'll get through it. Concentrate on all of the wonderful things now available to you in your new world without enough money.

Enjoy all of those simple, free pleasures. Appreciate the world and people around you.
Enjoy your children. Enjoy being alive. Become a nice person.

The meek will inheret the earth.
Only the poor can be saved.

07-06-2011, 09:25 AM	#22 (permalink)
AlteredStateGrl (òÓ,)_\,,/ Join Date: Sep 2004 Posts: 10,426 Thanks: 2,181 Thanked 1,823 Times in 1,115 Posts	Sorry to hear you've fallen on hard times, man. The suggestion for growing your own garden are FABULOUS. Our garden is starting to go crazy now! TONS of fruits and veggies, it's SO awesome to not have to buy them at the grocery store! The food bank is there for people in need. You're right to use it. May I suggest, when you're back on your feet again, donating a little bit of food to the bank. It's a kind, thankful thing to do, and you'll be helping out someone else in need. If you feel bad, giving back when you can, may help. You are not alone. Many, many working families can't afford even the basics and don't qualify for assistance. Sucks ass that people who make no effort to do anything, are able to get assistance...yet, people who are working but still can't make ends meet, don't get anything. It's terrible and horribly stressful. Hang in there. You can prevail. __________________ The sweetest kittens have the sharpest claws.

07-06-2011, 12:05 PM	#24 (permalink)
Dr. Nick Nasty Reactionary Radical Join Date: Feb 2006 Location: New York/New Jersey Metro Wasteland Posts: 1,049 Blog Entries: 5 Thanks: 653 Thanked 364 Times in 232 Posts	^agree-everybody's living situations are far more precarious now with things the way they are-best not to blame yourself and to ask what your alternatives are and to make do while keeping an eye open for other opportunities. __________________ "I do not wish any mass at all, but honest men only, lovely, sweet, accomplished women only."-Emma Goldman

07-11-2011, 07:18 AM	#28 (permalink)
AlteredStateGrl (òÓ,)_\,,/ Join Date: Sep 2004 Posts: 10,426 Thanks: 2,181 Thanked 1,823 Times in 1,115 Posts	Now I don't think you're listening or considering what everyone has said (a lot of good shit has been said) and you're the last one at your pity party and kinda enjoying it at this point. Everyone got your point. It is what it is, and only you can change your attitude. But acting this way (^), isn't helping your situation. Especially after you've had so much help in this thread. And if you don't see any of this advice as help, you're not trying. __________________ The sweetest kittens have the sharpest claws.

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