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Archive for the ‘Economics, recession’ Category

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Friday, on the floor of the US senate, US Senator Elizabeth Warren sounded like the one and only person who should be the next United States president. She sounded like the person who is truly giving us “hope and change” in fact rather than as a political slogan, and she sounded like the person Barack Obama should have been.

Everyday she’s sounding like the new Franklin Delano Roosevelt, sounding like the next great president, and the first great president since Harry Truman, or perhaps Roosevelt himself.

In the speech above, Warren excoriated President Obama, Republicans and Democrats for a House bill that will keep funding the government, but a provision within it will force the taxpayers to increase their bailouts of bad derivative investments by wealthy investors, including all of the big investment banks, and especially Citigroup. This provision allows Citigroup and other big banks to gamble with taxpayer money without any repercussions for their investment decisions.

President Obama, some Democrats, and most of the Republican Party are completely corrupt, which is why they support this giveaway for the rich and powerful. This provision is nothing more than a massive redistribution of income from the 99 to the 1 percent. That’s precisely why the president got on the telephone on Thursday and strong-armed some House Democrats into voting for this bill. The bill passed through the house and must now go through the senate.

The provision was written by Citigroup lobbyists, which nowadays is a bank that has the power to direct the majority of the Republican Party to demand maintaining the provision in the spending bill or shutting the government down by refusing to pass it.

During the final debate over the Consumer Financial Protection Bureau in 2010, before Warren was a senator, she was asked about an attempt to weaken the unborn agency. “My first choice is a strong consumer agency. My second choice is no agency at all and plenty of blood and teeth left on the floor,” she said at the time. These comments were unsuccessfully used against her in her subsequent senate campaign.

This week, she fought to keep a major Wall Street giveaway out of a must-pass spending bill and by Friday night it was clear the fight in the House of Representatives was lost. So Warren, a Massachusetts Democrat, took the Senate floor and unleashed a powerful punch on Wall Street giant Citigroup that will leave a mark for an awfully long time, especially on the grass roots, perhaps both grassroots Democrats and Republicans. Hopefully, we are all cheering her on, while Democrats such as Wall Street Senator Ron Wyden meekly stand by (and he will side with Wall Street since he always does) and do nothing since he is a Wall Street stooge pretending to be a senator that represents the people of Oregon.

Republican Senator David Vitter of Louisiana has voiced opposition to the provision. We’ll see if he puts his vote where his mouth is, or whether he’s simply pretending to oppose Wall Street.

In the speech above, after listing the top Citigroup executives who have gone on to work in the Obama administration, Warren addressed Citibank executives directly, noting that she agreed that Wall Street reform wasn’t perfect. “I agree with you. Dodd-Frank isn’t perfect. It should have broken you into pieces,” she said.

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A flutter of fear ran through Congress yesterday, desperately searching for a Democratic spine to run up. The flutter of fear found its target as President Obama sided with Wall Street and the Republican Party against his own Democratic Party, the Democratic base, and the American public.

When this Congress works together to get something done, it’s almost always on behalf of the 0.01 percent, and it’s almost always a profoundly bad one for the 99 percent. The omnibus spending bill that the House passed last night is just about the most corrupt and dangerous piece of legislation to come out of Washington in a long time. A few spineless Wall Street Democrats caved in to Republican hostage demands to avoid a government shutdown. So did Obama, the ultimate Wall Street Democrat. He could have sent a strong message with his veto pen to the 114th Congress since any deal this bad shouldn’t have gotten his signature, regardless of a shutdown threat from Republicans.

So what’s so bad about this deal that a government shutdown is preferable besides the fact that it was written in large measure by Citicorp lobbyists? A lot of things, but one stands out more than the rest.

The Republicans have stuck a little piece of legislation in the funding bill that will force taxpayers to bail out much of Wall Street derivative losses.

Financial derivatives are bonds backed by a real assets, such as home mortgages and student loans. Currently, there are $700 trillion in outstanding derivatives in the world, while the yearly world economy produces only about $70 trillion a year. The US derivative markets has about $230 trillion outstanding, compared to an economy that produces about $16 trillion in goods and services a year.

JP Morgan and Chase Bank hold about $150 trillion of this toxic financial wasteland called the derivatives market.

Should the derivative markets take a nose dive, under the Republican proposal, US taxpayers could owe the big banks a large portion of that $230 trillion. It’s going to be bailout time when the next recession hits. Massively rich, but remarkably stupid, investors know they don’t have make smart investment decisions since the taxpayers are going to be forced to bail them out. In other words, Republicans have decided to redistribute massive amounts of cash from the American middle class for years to come to the 1 percent should their gamble on these derivatives fail. President Obama also said yes to bailing out Wall Street in the future.

President Obama has always been a servant of Wall Street. Quite naturally, he was never likely to veto this budget bill, but one can always hope the president developed a spine and became an FDR or Elizabeth Warren type of Democrat for the American people.

This is bad policy for the nation, for the world, for the middle class, and basically for just about everybody except a few rich Wall Street fat cats. No doubt, some Democrats such as Wall Street Senator Ron Wyden will fight for this bill. Others, however, such as Sherrod Brown, Elizabeth Warren and Jeff Merkley will not do as Wall Street commands.

What else did Obama and his Republican Party agree to do in this budget?

The Republican Party and President Obama and a massive portion of the Democratic Party are all about redistributing income and wealth from the 99 to the 1 percent. Now the battle will go to the senate. There is some hope there to stop this madness.

Click below for the rest of the story.

Why President Obama Should Veto This Budget and Shut Down the Government–Readersupportednews.com

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Wall Street’s US House Republican Mike Pompeo (who represents Monsanto in the US congress) last April called for a nationwide ban to label foods with genetically modified organisms in them, and the bill he sponsored is going to be aired in committee on December 10.  The bill is co-sponsored by Wall Street’s US House Representative G.K. Butterfield (a Democrat who represents Monsanto disguised as a representative of North Carolina). On November 21 of this year the editors of the Oregonian newspaper endorsed the ban, effectively calling for suppressing the votes of people nationwide.

In Oregon, Ballot Measure 92 called for the labeling of foods that contained GMOs. The people voted on it November 4. It’s now in the process of being recounted since the vote was so close. There are hints that the yes votes in some counties were under-counted, as reported by local news media, which is not the same as the corporate news media, which is what the Oregonian newspaper is.

Ballot Measure 92 had strong support among local businesses, such as the Whole Foods and New Seasons Food Store chains. Those opposed to the measure were out-of-state companies such as Pepsico and Monsanto. The editors of the Oregonian newspaper were against Measure 92, which shows how important the national corporate agenda to wipe out democracy for the middle class is to the editors when they can defy local advertisers on behalf of out-of-state multinational corporations.

Ballot Measure 92 was a product of signatures, and a process called an initiative. Under this system, citizens can write a possible law, get enough voter signatures, and the proposal gets on the ballot. Then citizens vote yes or no on the thing. Notice bio-tech corporations and food corporations that poison people by putting GMOs in their food products can’t vote on these initiatives. Which brings us to an important point.

There is no such thing as an initiative process on the national level. In other words, Pompeo, Butterfield, and the editors of the Oregonian newspaper, are proposing to wipe out the initiative process on the state and local levels when it comes to GMOs. In other words, they are planning to steal your right to vote by going through congress. Nice scam, huh?

Most of the Republican Party, a large chunk of the Democratic Party, and most of the corporate propaganda machine disguised as news outlets are moving to destroy your voting rights to make the nation safe for the poisons known as GMOs.

The editors of the Oregonian newspaper insist there are no serious studies that show GMO’s are harmful to human health. Any such studies are under dispute, or so they’ve written in the past. Here’s what they haven’t mentioned; those studies are under dispute only by the GMO corporations and organizations funded by GMO corporations. The plot thickens, doesn’t it?

While there are numerous independent studies showing likely harmful effects by GMOs to humans, there are also two studies we know of that demonstrate possible human health problems with GMOs underwritten by GMO giant Syngenta. Both were kept secret by Syngenta. The editors of the Oregonian have kept us ignorant of these studies. Check out the reports on them below.

The honesty of GMO corporate leadership on this issue, and the honesty of the editors and reporters of the Oregonian newspaper, are similar to the honesty of the leaders of the tobacco corporations when they told us for decades that the use of tobacco had no harmful impacts on humans, and they suppressed their own studies on this issue showing the opposite was true. In other words, they lied. And we’re supposed to trust the GMO corporations?

The editors of the Oregonian, Pompeo and Butterfield know this too, yet they support the same tactics for GMO corporations as the tobacco industry once used. That’s how they keep us ignorant, and allow the 1 percent to roll over us. That is their job.

Syngenta charged with lying over cattle deaths–GM Watch

A Valuable Reputation–the New Yorker

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The Democrats in congress are mostly against the Keystone Pipeline, which will transport crude oil from Canada to the Gulf of Mexico, if approved by congress and not vetoed by President Obama. The Republican senators and representatives are, by and large, for this potential environmental disaster.

If the pipeline doesn’t make it past a veto the Republicans will blame environmentalists that supposedly influence the Democratic members of congress and President Obama. However, one can rightly suspect that there is something more to this than meets the eye.

Perhaps the Democratic position has something to do with billionaire investor Warren Buffett doling out $15 billion to purchase the Burlington Northern Santa Fe railroad earlier this year, the largest railroad shipper of crude oil in the nation, according to its website. Buffett is a big financial supporter of the Democrats, but he financially dabbles a little bit with some Republicans.

Buffett heads Berkshire Hathaway, one the largest hedge funds in the world. Its stock price is currently over $200,000 per share. A hedge fund is nothing more than an unregulated investment firm that buys and sells stocks and bonds, sort of like a Goldman Sachs without any rules.

The Keystone Pipeline will transport oil from Canada and the United States to the Gulf of Mexico for export elsewhere. If completed, the pipeline may take a lot of business from Burlington Northern Santa Fe. In which case, the share price of Burlington Northern Santa Fe will likely drop as its profits decline. The profits from Burlington that Berkshire Hathaway receives will also fall, which could put downward pressure on its stock price. The result would be less money for all of those Democratic politicians who count on that money.

The billionaire Koch Brothers are a major financial player behind the building of the Keystone Pipeline. They invest billions in the Republican party and its candidates. They stand to make billions from building the pipeline, and the pipeline will service one of their Texas oil refineries.

Quite naturally, the pipeline represents a conduit of future cash for Republican Party candidates, whereas Burlington and Berkshire Hathaway represent a stream of cash for Democratic Party candidates.

There are other perks candidates of both parties receive from big contributors, such as vacations in Scotland and cushy jobs that make them rich after they leave office.

Notice none of the major corporate news media is mentioning issues such as these. That’s because the job of reporters and editors of the corporate news media is to keep you ignorant, and biased against the political party you don’t like.

In government, in legislation, in negotiating trade treaties, the Democrats represent a fraction of the 0.01 percent richest Americans, the Republicans represent another fraction of the 0.01 percent wealthiest Americans, and a third fraction of the richest Americans play both sides, such as Goldman Sachs and JP Morgan, both of which are corporations whose primary interests are to increase the amount of income and wealth of the 1 percent at the expense of the 99 percent.

When the president vetoes the legislation approving the Keystone Pipeline, and the Republicans won’t have sufficient votes to override that veto, the press will dutifully quote Republican Party leaders about the alleged jobs lost due to not building the pipeline. They will, conveniently, not mention the jobs that might have been lost because of a decline in Burlington Northern Santa Fe profits had the pipeline been approved.

They will blame the environmentalists, and turn that word into an epithet. Naturally, the environmentalists will have played no role in the failure of government to approve of the pipeline because it’s all about who gets the money. Follow the money folks!

Republican and Democratic Party leaders don’t want the 99 percent to know that the real political battles in Washington D.C., and in state capitals across the nation, are being fought between a small group of billionaires at the expense of everyone else. And the corporate news media will continue to ensure that the debate over this issue is vigorous, but limited enough to deceive the American public. In other words, the corporate media intends to keep us in the dark over this issue, and then lie to us and point their fingers at the environmentalists for the failure of government to approve the Keystone Pipeline.

The battle over the Keystone Pipeline is all about money, and keeping us ignorant of this fact. Because once you know this fact, then you’ll begin to understand how the political and economic games, and the games the corporate media plays with information, are all rigged against the 99 percent.

One last note, the second job of the corporate news media is to keep the 99 percent divided over social issues, such as abortion, gun rights, the war against Christmas, red vs. blue state, gay marriage, and immigration, among many others, while keeping our eyes off the things that really matter, and that is what’s in your wallet. The corporate news media has done a marvelous in this respect.

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On Thursday, November 20, 2014, President Obama announced that he was taking executive action that will allow up to five million undocumented immigrants to stay in the United States. The president promised these immigrants that they will not be deported, that they can seek work legally in the United States, on certain conditions, such as paying taxes.

Much of the news media of the 1 percent are claiming this is good for the economy, that everybody will prosper because of the president’s action.

For example, a study released by the Center for American Progress says, “Once they (undocumented immigrants) attain legal status, immigrants will be able to contribute to the increased consumption of goods and services that boosts business sales and raises the earnings of all Americans. They will pay taxes on their higher wages and increase the gross state product (GSP). Additionally, immigrants will be able to use their new legal status by integrating their skill set and education into creating jobs and raising productivity.”

Common sense, however, tells us that once undocumented immigrants receive legal status, they will consume approximately what they consume today. It is possible that with higher wages they will consume more. That will be offset, however, because the rest of us will be consuming less, according to an analysis of a similar congressional measure by the non-partisan Congressional Budget Office (CBO). According to the CBO, everybody’s wages and job opportunities will decline with the deal, except for the newly legalized immigrants. That means the impact of immigration reform will have little, or no, or perhaps even negative, net impact on the consumption of goods and services. It could even result in a decline of GNP. How could the consumption of goods and services go up if everybody’s wages and salaries are going down? They can’t and so the claim by the Center for American Progress is patently wrong.

According to the CBO, a senate bill similar to President Obama’s executive action which failed in committee last year would have depressed wages of all workers for the next twelve years, “raise the unemployment rate,” and “result in higher interest rates.” Notice the corporate news media hasn’t reported these things to you.

The president’s action will also push the unemployment rate higher than it would otherwise be through 2031. Currently, the real unemployment is somewhere between 10 and 13 percent, which is higher than the official rate of 7 percent. The executive action will force more and more people to compete for a smaller number of jobs, and this will drive wages down.

According to the Pew Hispanic Research Center, 80 percent of undocumented immigrants work under the table, that is without paying income taxes. Most of these people are expected to move into better paying jobs in the legal job market, creating greater labor competition, and driving wages down.

This same process also occurred after the amnesty granted undocumented immigrants in December 1986. Real wages immediately began to plummet for the next six years and didn’t recover to their 1986 level until 11 years later. Check out the graph below from the Bureau of Labor Statistics website. You’ll see a big dip in real wages for everybody beginning in December 1986.

EES00500049_882127_1416709266790 - Copy

The CBO also reported, “Capital investment would rise primarily because the return that investors would earn on a given amount of investment would be higher under the legislation than under current law.” The rationale for this is given with economic jargon, but basically it boils down to this; lower wages will increase profit margins, and so members of the 1 percent will purchase more corporate stocks, bonds and politicians.

In other words, the president’s executive action ensures the 1 percent benefit by pushing down wages, salaries and other compensation and redistributing the difference between the old rates and the new lower rates into the hands of the 1 percent. Nice scam, but it gets worse.

The president’s action comes at a time of real declining average wages for all American citizens, and so things are now going to become worse for us. On top of this, the 1 percent has been stealing 95 percent of all income growth for the last four years. Now it might grow as high as 96 percent. We are in an economy heading for disaster.

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