http://www.huffingtonpost.com/robert-reich/obama-has-to-explain-why...

 

An excerpt from this excellent article by Robert Reich:

 

"The key reason why the recovery is so anemic is that so much income and wealth are now concentrated at the top is America's the vast middle class no longer has the purchasing power necessary to boost the economy.

 

The richest 1 percent of Americans save about half their incomes, while most of the rest of us save between 6 and 10 percent. That shouldn't be surprising. Being rich means you already have most of what you want and need. That second yacht isn't nearly as exciting as was the first.

 

It follows that when, as now, the top 1 percent rakes in more than 20 percent of total income -- at least twice the share it had 30 years ago -- there's insufficient demand for all the goods and services the economy is capable of producing at or near full employment. And without demand, the economy doesn't grow or generate nearly enough jobs.

 

Wall Street is part of the problem because it's responsible for so much of the concentration of income and wealth at the very top -- and for much of the distress still felt in the rest of the economy after the Street nearly melted down in 2008.

 

The Street has turned a significant part of the economy into a giant casino involving mammoth bets with other peoples' money. When the bets go well, the rich owners of the casino (Wall Street executives, traders, hedge-fund managers, private-equity managers) become even richer. When the bets go sour, the rest of us bear the costs."

 

Update: here's a link to an interview/discussion with Paul Krugman on the difference between supply-side economics and austerity and looking at demand and governmental policies for stimulating the economy: 

http://www.huffingtonpost.com/2012/06/01/paul-krugman-newsnight-uk-...

Views: 79

Replies to This Discussion

This is he first time I have seen this graph. It is from 2007 data, the year of the start of the collapse. 

Wow, helluva graph Joan. Talk about unfair. I think it was Bill Maher who made this pizza analogy, and I've been quoting it a lot since hearing it. He says something like, imagine a pizza divided up into 100 equal slices, and the first guy who gets there takes 43 slices. I don't know who would call that fair, so I don't know how people justify this crap in real life.

Yes, here is the graph with the missing 1% that we have been looking for. All the graphs (with an exception) showed only the tip 99% or others only the 95%, which does not tell the story that needs to be told. 

We are about to enter an election in which money plays a major part in who is heard, who listens, and what happens to dissenters. 

All those "Occupiers" and resisters faced by armed police face the reality of money power. An awfully lot of us are going to be hit up the side of the head or blasted in the face with tear gas before this is over.

If we don't won over the dominators, we will just have to go another round in later years ... that means my children and grand children and great-grand-children will have to make the fight. 

Jedi, that pizza could use a little re-distribution strategy. 

Another story: http://www.huffingtonpost.com/2012/06/11/americans-suffered-record_...

 

"The median family's net worth dropped 38.8 percent" between 2007 and 2010.

 

"The median net worth, which is the value of assets minus debt, plunged to $77.3 trillion in 2010 from $126.4 trillion in 2007. Net worth in 2010 was at levels last seen in 1992." I.e., we lost 2 decades of wealth in a 3-year span.

 

What this article fails to mention, but which another one does (link missing), "The biggest drops occurred among middle-income Americans, whose wealth was inextricably linked to the housing market boom and bust. Meanwhile, the wealthiest families actually saw their median income rise slightly."

 

Also, minorities bore the largest brunt of the losses, while whites suffered far less.

Jedi, good data! Thankfully, the message is getting out. More people begin to understand what has happened and what will happen if we don't change our basic, fundamental political and economic problems ... which are systemic problems, not caused by workers, but by speculators who use money belonging to wage earners as if they were in a casino. 

 

Modern Money Theory Summit Italy 2012 (1/18) - Paolo Barnard - Introduction

http://youtu.be/iY0wpMZFTUI

Aha, thanks for that Joan! Right, Dylan Ratigan is leaving his show (Dylan, don't go!) to "act" (how, he's completely unsure of right now!) on the perspective he's been sharing for the past three years, and the $29 TRILLION the Fed printed up and sent straight to the banks at ultra-low interest rates (and which the banks audaciously bought up US debt with higher interest rates, creating a circular transmission of the wealth from us, US taxpayers, right to the wealthy) was one of the stats he posted on his show. This video you posted shows that if that money had gone to regular Americans, we'd each be sitting on over $90k. Our currency is going to spiral downwards in value.

Well, I guess we have an education problem on our hands. Oh dear, that means more hate calls and personal emails telling me ... Oh dear! I've got a tough skin. 

I didn't quite follow you. And yes, we've got an education problem, but the education problem is only a part of the greater problems. We've got a crisis of democracy, a crisis of economic philosophy, and still broader philosophical problems about the nature of justice and goodness and even the nature of the world we live in and human nature and even the nature of reason itself. How much can we really expect from a nation full of people who have a fairy-tale understanding of humanity, reality, and our relationship to the cosmos? How much can we really expect from a nation of people who accept that faith can really bring you closer to truth, and reject reason and evidence because it conflicts with their fantastical interpretation of reality? And then we expect to be able to reason with them about economic philosophy? Not to mention the looming environmental crisis which will cause worldwide devastation within the century? I'm sorry, but I'm becoming convinced that this century will be as marked by war as the last century was, and will probably make last century pale in comparison. Then our children will look back and say what fools we were for worrying about economic philosophy when we should have been busy getting rid of religion and working together to save the planet and our fellow man.

 

Well, done ranting for the moment. Have a nice night! :-)

There is nothing like a good rant to bring issues into focus! 

When you wrote, "I didn't quite follow you." I assume you refer to the hate calls and emails. They used to cause me pain; those days are gone and I just mark it up to denial and delusions of those who think we are still in the "Leave it to Beaver" stage (which never did exist). 

OK, given that we live in a time of crisis of gigantic proportion, how does one maintain balance and equanimity in one's life? For me, I can't imagine remaining quiet or inactive, although my energy level isn't what it once was. I like asking the why, what, who, questions and seeing if I can find a reasonable answer. I suppose that is fool-hearty and a waste of time. You do make a good point about our children's view of us as they reach maturity and try to figure out how to survive and thrive. 

Your words resonate in my head with all the nonsense being accepted as justice and freedom and equality of opportunity and environmental degradation denial and the use of the word "love" in such casual ways.

You have a nice night as well!

Yeah that's why I said I didn't follow you. And I still don't. Why are you getting hate calls and email?

 

I don't think asking the important questions is fool-HARDY or a waste of time. Perhaps it is in a country that doesn't reward people for thinking, but at least then we can recognize that we are not being appreciated and try to create our own communities. I wish the 27k of us on this website would found our own town and create a truly modern society. But since that isn't likely to happen, I'll look for other alternatives.

 

Ok, off to bed for real this time! Good night!

The hate mail I receive has to do with my three favorite themes: politics, economics, and religion. Of course I am critical of all three and try to be specific about why I hold such strong feelings.

I perceive politics as under the influence of taking care of owners of capital and wealth as opposed to caring for people's thriving;

I perceive economics as under the influence of owners of capital who write the laws, secure enforcement of laws that benefit them, and caring little if at all for the suffering of people;

I perceive religion as the cause of great suffering and offer an alternative of no-deity or superhuman or spiritual being.  

There are those who do not share my opinion or vision and respond with threats to me in graphic, sexual, brutal terms, i.e. one would sodomize me with a welding torch. Of course these coward do not make such threats publicly, but are brave enough to threaten anonymously. 

That said, if I would remain quiet, not voice my opinion, then I would be effectively silenced by them ... even as I made the choice to be quiet. Therefore, I increase the scope of my contacts and the intensity of my accusations. 

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