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Posts Tagged ‘Barack Obama’


How badly are US citizens financially struggling this late in an economic expansion?

In early January 2016, the US Department of Education announced the rate of people defaulting on their student loans had dropped from 11.8 percent in 2015 to 11.2 percent in 2016. Back in 2013, the default rate had nearly hit 15 percent.

In 2015, the Obama white house issued a report which stated, “The cohort default rate published by the Education Department is “‘susceptible to artificial manipulation.’” The report stated that the share of student borrowers paying down their loans more accurately reflects what is occurring than default rates alone. The report noted that a rising number of students are unable to make payments on their loans, but manage to avoid defaulting. Because of this, the report stated the actual default rate plus those former student loan borrowers out of school who are not paying down the balances on their loans stood at 25 percent.

However, it turns out the White House report understated the numbers by quite a lot. Leaked documents in early January 2016 showed only 46 percent of students out of school three years or more are paying down their student loan principal. This means 54 percent are not paying down their loans.

However, on closer inspection, something else is terribly amiss, as well. To be among the 46 percent, you cannot be in default, and you must have paid down the principal of your loan by at least one dollar. So if somebody who has owed $30,000 in student loans since they graduated from college ten years ago paid a dollar on the principal of their loan eight years ago, they have officially paid down their loan and are among the 46 percent. If somebody borrowed $16,000 twenty-five years ago, paid off a dollar on their balance, and haven’t paid a dime since, and have incurred tens of thousands of dollars of penalties and late fees, they, too, are among the 46 percent.

The bar for those who have not defaulted and are paying down their loans are about as low as one can get. The actual crisis, therefore, is even greater than we have been led to believe. This suggests a number of things.

One is that the number of people failing to pay on their student loan balances is significantly less than 46 percent if we raise the bar to $2 or higher. Second, the US economy is historically weak enough that tens of millions of student loan borrowers are unable to pay down their balances (There are roughly 42 million people who have student loan balances).

This suggests the economy is historically weak, and the consequences of this weakness will spread throughout the United States when the economy begins to tank this summer. This suggests defaults will be historically high on home mortgages, car loans, credit card debt, and much more. All of which, strongly suggests this next recession will be worst for the 99 percent than the Great Recession of 2007-09.

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Rexnord Corporation is closing its ball bearings plant in Indiana, laying off its 350 workers, and exporting those jobs to Mexico. In addition, as part of its US workers severance package, many of those workers are training their Mexican replacements, who will $3 an hour with no benefits. John Feltner is a machinist earning $25 an hour in the Indianapolis, Indiana plant. He resents having to train his replacement, but he’ll lose his severance package of $5,000 if he refuses.

Most of the difference in pay between US and Mexican workers will go straight into the pockets of wealthy shareholders. Rexnord’s share price peaked at $30.82 in April 2014. It’s been dropping ever since. It hit a low of $14.72 on January 15 2016, rose a tad, and has stayed stagnant since, hovering around $22. No doubt CEO Todd Adams is hoping that exporting jobs to Mexico will increase its bottom line and attract investors to bid up the share price and his compensation. His CEO pay is tied to the share price thanks to legislation signed by then President Bill Clinton.

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Exporting jobs and CEO pay tied to corporate share price are two of the biggest factors in the widening gulf between the 1 percent and everybody else because they redistribute income and wealth from one group to the other. Currently, six individuals own more wealth than the bottom 50 percent of humanity, while the 1000 richest individuals own more wealth than the bottom 70 percent. Currently, in the USA, the 1 percent steal 35 percent of all income every year, compared to 8 percent in 1980, thanks to their ownership of such politicians as the Clinton’s, Wyden, Mitch McConnell and Orrin Hatch.

John Feltner and his 350 fellow workers lost their jobs thanks to Bill Clinton, who signed legislation deregulating Wall Street, as well putting his signature on the North America Free Trade Agreement (NAFTA. NAFTA was negotiated by Clinton’s representatives with an eye to getting US corporations to export US jobs to Mexico in order to boost their bottom lines. After he left the presidency, Wall Street rewarded the Clinton’s for their service to the tune of tens of millions of dollars. The Clinton’s are still faithful servants of Wall Street in their war against the middle class, such as the workers at the Rexnord plant.

We also can’t forget Democratic Wall Street Senator Ron Wyden has continuously supported redistributing the income of the middle class to billionaires. The Democratic Party is corrupted to the core by big money, though maybe a bit less than the Republican Party. But then again, maybe not.

“The big picture is that American jobs are leaving this country to exploit cheap labor,” Feltner said. “When you start taking away the middle class, what do you have left?”

This is the sentiment that President Donald Trump played to so effectively during the 2016 presidential campaign. It spoke to John Feltner somewhere down deep.”

“He’d been a loyal union man for years, been raised on the notion Democrats were the party of the working man and made calls for Democrats from union phone banks. But after the trade agreements that Bill Clinton and Barack Obama signed, and after Trump spoke to the plight of workers at places such as Carrier, John Feltner broke ranks.

With the layoff fresh on his mind, he cast his November vote for Trump. He says most of his rank-and-file union members did the same.”

And what were those workers supposed to do? Support Hillary Clinton who aspired to export millions of US jobs to China via the Trans Pacific Partnership (TPP), which was being negotiated on behalf of Wall Street by then President Barack Obama?

Feltner and his fellow employees don’t know what they’re going to do once their jobs are gone. Thank you Bill Clinton. Thank you Barack Obama.

For more on this story, click the following link, Rexnord’s Indiana Plant Exported to Mexico–USA Today

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The economic and political game is clearly rigged in favor of wealthy, and its getting worse. This is a recipe for economic disaster, and which has been closely followed by major Wall Street politicians, such as Ron Wyden, Barack Obama, Mitch McConnell, Orrin Hatch, and George W. Bush.

The richest are getting richer, and their doing so quickly, and at the expense of the rest of us. For the most part, control of the levers of political power is how they have gained their money. It’s that simple. The rich control the Republican and Democratic parties, and with them, they control all three branches of the federal government, as well as most state and local governments. And that’s just in the USA.

In early 2016 Oxfam reported that just 62 individuals had the same wealth as the bottom half of humanity. About a year later Oxfam reported that just eight men had the same wealth as the world’s bottom half. Based on the same methodology and data sources used by Oxfam, that number is now down to six.

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There is a reason why the rich, and in particular the super rich, continue to get richer. The politicians of both major political parties work as agents on behalf of their billionaire benefactors, whether its Republicans such as Mitch McConnell, or Democrats like Ron Wyden.

This is why the poorest half (and more) of the world has continued to lose wealth; and the very richest individuals—especially the top thousand or so—continue to add billions of dollars to their massive fortunes. Inequality deniers and apologists say the Oxfam methodology is flawed, but they’re missing the big picture. Whether it’s six individuals or 62 or 1,000 doesn’t really matter. The data from the Credit Suisse Global Wealth Databook (GWD) and the Forbes Billionaire List provide the best available tools to make it clear that inequality is extreme and pathological and getting worse every year.

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As of Feb. 17 of 2017, the world’s six richest individuals (all men) had $412 billion. Just a year ago, on March 1, 2016, the world’s six richest men had $343 billion. They’re the same men today, although slightly rearranged as they play “king of the hill”: Bill Gates, Warren Buffett, Jeff Bezos, Amancio Ortega, Mark Zuckerberg, Carlos Slim Helu (with Larry Ellison jockeying for position). The wealth of these six men increased by $69 billion in just one year.

According to a new report, which can be accessed below, the poorest 50 percent of the population has seen their share of wealth decline. And the richest 500 people own more wealth that the bottom 70 percent.

Six Men Own More Wealth Than the Bottom 50 Percent of the World’s Population–EcoWatch.org

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20150224_problemThe financial collapse of 2008 was the worst recession since the Great Depression. Give President Obama and his administration credit for saving the economy from the depredations of Wall Street despite massive Republic resistance to resuscitating it, which they did solely for political gain. However, this historically weak recovery masks a startling reality.

Only one perpetrator of Wall Street crimes was ever brought to justice, and he wasn’t a big figure in the massive corruption going on. In March 2009, Obama met with Wall Street leaders and said, “I stand between you and the pitchforks. I am on your side and I will protect you.”

Only one banker from that era was prosecuted. That was Bernie Madoff, and the only reason he was carted off to prison was because he stole from rich people. And not one other Wall Street criminal executive went to jail after stealing billions via fraud, money laundering of Mexican drug cartel profits, and numerous other crimes. Many became his financial advisers, which meant Obama pursued policies to redistribute income from the 99 to the 1 percent for eight long years.

At all times, Obama refused to bite the hand that funded his past, present and future, as well as funding much of the Republican and Democratic Parties. In other words, Obama was largely, if not completely, in the back pocket of Wall Street as were President Bill Clinton, both President’s Bush, Ronald Reagan, Hillary Clinton, Mitt Romney, Wall Street Senator’s Ron Wyden, Mitch McConnell and Orrin Hatch.

Obama operated in a cesspool corruption. He was part of the problem, not the solution.

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There are actions and then there are inaction’s. There is biting the hands that feed you now and in the future, and then there are the decisions one makes to not bite the hands that feed you, now and in the future.

First there was the illegal torture program of President George W. Bush. Bush is the only former US president who couldn’t visit Switzerland and numerous other nations after his terms in office. Bush would be arrested and charged with war crimes should he or several other members of his administration, including Vice President Dick Cheney, ever step foot into those nations. Obama called the torturers “patriots” and those who demanded justice “sanctimonious.”

When a judge in Spain began to pursue war crimes charges against Bush, Obama successfully began a diplomatic initiative to quash the charges.

Obama went out of his way to ensure that nobody of political and financial significance suffered the consequences of their actions.

Not one single person was charged with war crimes, torture or murder. Forget US laws, forget the US Constitution, and forget international laws the US had signed on to.

Perhaps Obama decided not to pursue charges, or quash prospective charges, because much of the torture was done by publicly traded corporate contractors. In other words, torture was to a large degree about profits; the more torture victims, the more profits.

Virginia-based CACI Premier Technology corporation is a military contractor that was a major US torturer at Abu Ghraib prison in Iraq. The company made millions upon millions of dollars torturing people on behalf of President George W. Bush.

CACI’s share price hovered around $13 a share when Bush became president. Thanks to the torture contracts the company received from the US government, the share price increased more than five fold to $65+ by the summer of 2005. Under Obama, CACI’s share price rose to $122.25 the day before he left office, in part because of government contracts.

Why is it that a person can commit torture to somebody else and not be convicted of a crime? If anybody else not under contract to the US government kidnapped and tortured somebody they would be charged with crimes, but if the US government pays you for breaking national and international laws, then you will face no charges. That does not make a whole lot of sense.

No doubt Wall Street liked the torture program a lot because it fed into the pockets of the billionaires and millionaire investors of Wall Street, as well as Wall Streets large investment corporations, and Obama had to protect his financial benefactors, so justice could never be served, otherwise the financial spigot watering, seeding and fertilizing the corruption of government at all levels would have been turned off, and Obama could never have tolerated that.

 

 

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This is the third part in a series. So now we’re getting into some debatable stuff, but here goes.

  1. Obama brought the federal budget deficit down from the  more than $1.4 trillion a year he inherited from bumbling, corrupt and incompetent George W. Bush to $587 billion in 2016.
  2. Obama presided over one of the biggest stock market bubbles in world history, and did nothing about it. The hangover from this bubble is going to last quite a long time, but many of his rich supporters got richer because of it.
  3. The president presided over one of the biggest housing bubbles in US history, and did nothing about it. This bubble redistributed trillions of dollars from working folks to Wall Street executives and billionaires that have always been his financial supporters. The big banks illegally conspired to withhold 3.4 million houses off the market (over 50 percent of all vacant houses in the USA) in order to drive up housing prices, and Obama made certain not to let his justice department do anything about this. See The Big Banks Are Manipulating the Housing Market–JohnHively.Wordpress.com
  4. Obama presided over the largest redistribution of income in US history, and did nothing about it. From 2009 to 2013 the 1 percent stole all of the US income growth, and they stole over 50 percent in 2014 and 2015.
  5. In other words, Obama presided over an economy driven by bubbles and redistributing income from the 99 to the 1 percent. Good job!
  6. Obama called rising income inequality “the defining issue of our time.” When his Wall Street financial masters objected to this subject, Obama never mentioned it again. Guess who was really in charge of the white house? Hint. The big investment banks, along with other Wall Street executives and billionaires.
  7. All of the above suggests the next recession is going to be worst than the last one, and it is on its way. We’re at or near the peak of this weak economic expansion. Once we’ve reached that peak, the only place to go is down. Some of Obama’s better known accomplishments (or notoriously known depending on your point of view) include the Affordable Care Act and getting us out of Iraq. These were included in President Obama’s Top Accomplishments, and His Worst–JohnHively.Wordpress.com. Part two included normalizing relations with Cuba. That list can be found here.

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Official portrait of President Barack Obama in the Oval Office, Dec. 6, 2012. (Official White House Photo by Pete Souza) This official White House photograph is being made available only for publication by news organizations and/or for personal use printing by the subject(s) of the photograph. The photograph may not be manipulated in any way and may not be used in commercial or political materials, advertisements, emails, products, promotions that in any way suggests approval or endorsement of the President, the First Family, or the White House.

Official portrait of President Barack Obama in the Oval Office, Dec. 6, 2012. (Official White House Photo by Pete Souza)

This is the second in a series of the accomplishments and the worst of President Obama. Click here for Part 1.

1. Obama normalized relations with Cuba after sixty years of trade embargo. Now Cuba can upgrade its economy, and the US has a new trading partner. There are a ton of people who opposed this move, but those are the same corporate hacks who support exporting US jobs to Mexico, China, Vietnam and elsewhere. I had a friend a long time ago who said he opposed the Vietnam War. This was back in 1980 or so. “If we hadn’t gone in there,” he said, “they’d be capitalists by now.”

2. Obama authorized the raid that killed Osama Bin Laden. He announced the terrorist leader’s death in a live speech to the country saying, “Last week, I determined that we had enough intelligence to take action and authorized an operation to get Osama Bin Laden and bring him to justice.” The Republican president before Obama was such an incompetent he couldn’t figure out where Bin Laden was, much less kill him.

3. He helped stimulate the auto industry after the financial crisis. Chrysler and GM have created 250,000 jobs since then. Of course, many of these new jobs are in Mexico.

4. He signed the Dodd-Frank Act, which holds Wall Street accountable a little bit in the event of another financial crisis. In reality, the Dodd-Frank Act doesn’t regulate hedge funds even a little, and the act was heavily watered down by Wall Street lobbyists. So Dodd-Frank wasn’t much of anything, except that it included a provision for the establishment of the Consumer Protection Agency, which Wall Street executives and billionaire investors feared because it meant they couldn’t cheat and lie to the common folk as easily as before.

5. Obama backed down like a whipped dog when Wall Street billionaires and executives demanded he not appoint Elizabeth Warren to head the new Consumer Protection Agency. This turned out to be a good thing, even if by accident. Warren later became a US senator and is likely to be the next president of the United States in 2020.

Among Obama’s worst decisions:

He appointed Arne Duncan to be US Secretary of Education. Duncan is a firm believer in using every child possible to enhance the profits of the testing industry, especially Pearson Limited, a long time financial sponsor of the Democratic Party. When Duncan announced his resignation the president of the AFT teachers union said, “there’s no question that the Department of Education’s fixation on charter schools and high-stakes testing has not worked.” US K-12 public education students are the most tested in the world, and by a wide margin. It’s all about the money folks, that’s what US educational reform means. Obama’s education policy was a complete, or nearly complete, failure.

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