American Motors and Nash have long-since disappeared. But if the auto industry could build that kind of fuel-efficient, gas-powered engine in the 1950s, why did it stop and why is the Volt such a big deal?
The New Employment Numbers: Things are Worsening More Slowly
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So let’s be grateful that the economy is getting worse more slowly than it was. But don’t be lured into thinking we’re ever going back to where we were. Most of the jobs that have been lost are never coming back.
The Wall Street Rally: Watch Your Wallets
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Keep your eye on the real economy, where unemployment and underemployment keep rising. It’s not as much fun as cheering and investing right now, but it’s far safer.
Goldman and JPMorgan — The Two Winners When The Rest of America is Losing
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Antitrust law was designed to prevent just this sort of market power and political heft. The Justice Department or the Federal Trade Commission should investigate the new-found dominance of Goldman and JP — and, if warranted, break them up.
Goldman’s Back, and Why We Should Be Worried
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So the fact that Goldman has reverted to its old ways in the market suggests it has every reason to believe it can revert to its old ways in politics, should its market strategies backfire once again — leaving the rest of us once again to pick up the pieces.
A Tax That Could Benefit California
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Each Californian consumes roughly 60 pounds of HFCS each year. A “sin tax” on HFCS would add to the state’s coffers without adversely affecting California industry.
When Will The Recovery Begin? Never.
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So instead of asking when the recovery will start, we should be asking when and how the new economy will begin.
Schwarzenegger and the Republicans Cost California $7 Billion
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The California State Senate adjourned at midnight, unable to pass three stopgap bills that would have saved the state $7 billion. To appease Governor Arnold Schwarzenegger, the Democratic leaders of the state legislature hastily drew up the three complicated bills to try to stave off fiscal collapse and the necessity to begin issuing IOUs. All [...]
Schwarzenegger’s Budget Battle II: Another Bad Sequel
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Franklin Delano Roosevelt declared that the test of our nation was “not whether we add more to the abundance of those who have much; it is whether we provide enough for those who have too little.” California Governor Arnold Schwarzenegger might be married to a Kennedy but his governing philosophy is pure George W. Bush [...]
Does the Obama Plan for Reforming Wall Street Measure Up?
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In a word: No. The plan doesn’t stop stop bankers from making huge, risky bets with other peoples’ money. It does increase capital requirements and oversight, but it doesn’t require bankers to take their pay in long-term stock options or warrants, and it doesn’t even hint that banks should go back to being partnerships instead [...]
California Democrats: “Spreading the Pain” from Sacramento
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When his term mercifully expires next year, California Governor Arnold Schwarzenegger will be leaving the Golden State in the worst condition than at any time its history. If Schwarzenegger and his right-wing Republican co-conspirators get their way (as they always seem to do), they’ll gut every social program and educational institution in the state in [...]
The Italian Job: Border Police Seize $134 Billion in US Government Securities
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Although the story is being widely reported across Europe and Asia, it’s received scant media coverage in the US. AsiaNews along with other major media outlets outside the US are reporting that Italy’s financial police, the Guardia Italiana di Finanza, seized US government bonds worth $134.5 billion from two Japanese nationals at Chiasso, located less [...]
Beyond Unemployment Insurance in the Face of Structural Job Loss: Whoever Said It Would Be Easy?
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“The long memory is the most radical idea in America.” –Utah Phillips, as recalled by Amy Goodman I was reminded of Utah Phillips’ observation as I sat down to write this essay on how we approach public policy for dealing with unemployment during a time of mass unemployment. I intended to start off the essay [...]
The Three Essentials of Financial Reform
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As the White House unveils its long-awaited proposals to prevent another Wall Street meltdown in the future, keep a lookout for three essentials. Without them the Street will revert to its old ways as soon as the coast clears. In fact, now that the government has bailed out the Street, the biggest banks will take [...]
The Great Debt Scare: Why Has It Returned?
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It’s the kind of thing I expect to hear from deficit hawks and chicken littles — from the self-described “fiscally responsible” right, from the scolds Ross Perot and Pete Peterson, from my former cabinet colleague Bob Rubin. But yesterday I was shown slides developed by the putatively liberal Center for American Progress intended to make [...]
“You Are Now the Owner of a Brand New Car (Company)!”
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We now own a major stake in the largest auto company in the world. With the General Motors Corporation filing the second-largest industrial bankruptcy in world history, the US government has stepped in to take a 60% stake in the company and the autoworkers’ healthcare fund taking ownership of 17.5%. In a reversal of Aesop’s [...]
The Future of Manufacturing, GM, and American Workers (Part III)
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As president of General Motors when Eisenhower tapped him to become secretary of defense in 1953, “Engine Charlie” Wilson voiced at his Senate confirmation hearing what was then the conventional view. When asked whether he could make a decision in the interest of the US that was adverse to the interest of GM, he said [...]
The Future of Manufacturing, GM, and American Workers (Part II)
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Symbolic analysts have been hit by the current downturn, just as everyone else has. But over the long term, symbolic analysts will do just fine – as long as they stay away from job functions that are becoming routinized. They will continue to benefit from economic change. Computer technology gives them more tools for thinking, [...]
The Future of Manufacturing, GM, and American Workers (Part I)
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What’s the Administration’s specific aim in bailing out GM? I’ll give you my theory later. For now, though, some background. First and most broadly, it doesn’t make sense for America to try to maintain or enlarge manufacturing as a portion of the economy. Even if the U.S. were to seal its borders and bar any [...]
Intellectual Monopoly Is an Unnecessary Evil
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In a rush to stimulate the economy, the Obama administration is touting various “visionary” plans to make the American economy more progressive, more innovative, and more forward-looking by subsidizing politically-motivated projects like “green” technology. These hands-on policies will be ineffective. Recent research suggests that a much more effective way to accomplish the same goals would [...]
A Modest Plan for Paying College Costs
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I’m just about to head off to a commencement here at University of Califonria, Berkeley. The news that keeps banging around in my head is that the state has just announced a whopping 9% increase in fees for next academic year, the third fee increase in three years. The average young person now graduating from [...]
The Truth Behind the Social Security and Medicare Alarm Bells
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What are we to make of yesterday’s report from the trustees of the Social Security and Medicare trust funds that Social Security will run out of assets in 2037, four years sooner than previously forecast, and Medicare’s hospital fund will be exhausted by 2017, two years earlier than predicted a year ago? Reports of these [...]
Sorry Folks: Happy Days Are Not Here Again
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“Demonizing the bankers as if they and they alone created the financial meltdown is both inaccurate and short-sighted,” Citigroup chairman Richard Parsons told reporters recently. “Everybody participated in pumping up this balloon and now that the balloon has deflated, everybody has some part in the blame.” Oh no we don’t. Talk about dissembling. The truth [...]
Obama and Pragmatism: Thinking Through Values
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I keep hearing the White House staff describe the President as a pragmatist. David Axelrod, one of his chief advisors whom I admire enormously, recently called him a “ruthless pragmatist.” Soon, I expect, he’ll be called a “take-no-prisoners pragmatist,” or perhaps a “remorseless, merciless, and unrelenting pragmatist.” I’m relieved the President is a pragmatist, but [...]
The President’s American Recovery & Reinvestment Act: What We Don’t Know Can Hurt Us
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One of the first things President Barack Obama did as our nation’s Chief Executive was to urge Congress to pass, then sign, the American Recovery & Reinvestment Act (ARRA), better known as the nation’s “economic stimulus” package. The $787 billion bill, the largest taxpayer footed bill ever passed, was viewed as the primary vehicle to [...]
Connecting the Offshore Dots
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Rachel Maddow’s example on MSNBC was a simple enough explanation of how $21 billion dollars in annual tax revenue disappears from US coffers through legal loopholes that create tax shell corporations. Mr. Bill Hypothetical, based in Texas, earns $50,000 annually and pays a 25% tax rate. KBR’s profits, also based in Texas (a military contractor [...]
Why Obama is Taking on Corporate Tax Havens
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Why, one may ask, is Obama taking on yet another huge fight by taking aim at foreign tax havens? Yes, it’s unfair that multinationals pay an average tax rate of only 2 percent on their foreign revenues, and it’s unfair that some wealthy Americans are avoiding taxes altogether by parking their fortunes abroad. But, hey, [...]
The Auto Bailout Is Going Off the Road
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GM just announced it was laying of 21,000 more of its workers, as a means of assuring the Treasury Department the company is worthy of more bailout money. A Treasury official was quoted as saying approvingly that the goal is a “slimmed-down” GM. What? Having General Motors or Chrysler cut tens of thousands of jobs [...]
Will Ken Lewis Get Canned, and Will Americans Have a Say in the Corporations We Now Own?
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I don’t know whether Bank of America shareholders will oust Ken Lewis from his chairmanship this week. I don’t know if Treasury Secretary Timothy Geithner will eventually do it, either. What really worries me is I don’t know who would actually be responsible for doing the deed, or by what criteria. When it comes to [...]
How Obama Can Succeed in the Next Hundred Days and Beyond
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Before Inauguration Day, President-elect Barack Obama said he wanted to hit the ground running. Instead, he hit the ground sprinting and hasn’t stopped. Consider: A $787 billion stimulus package. A 10-year budget including universal health insurance and a cap-and-trade system to combat global warming. Subsidies to help distressed homeowners stay in their homes. Public-private partnerships [...]
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