Dec 2 2012

It’s the economy, stupid! Is it about to crash?

Kal @ 19:35

In this post Our Collapsing Economy and Currency we learn:

Is the “fiscal cliff” real or just another hoax? The answer is that the fiscal cliff is real, but it is a result, not a cause. The hoax is the way the fiscal cliff is being used.

And a bit later:

The US economy has two serious diseases, and neither one is too much welfare spending.

One disease is the offshoring of US middle class jobs, both manufacturing jobs and professional service jobs such as engineering, research, design, and information technology, jobs that formerly were filled by US university graduates, but which today are sent abroad or are filled by foreigners brought in on H-1B work visas at two-thirds of the salary.

The other disease is the deregulation, especially the financial deregulation, that caused the ongoing financial crisis and created banks too big to fail, which has prevented capitalism from working and closing down insolvent corporations.

And finally:

The Republicans are determined to continue the gratuitous wars and to make the 99 percent pay for the neoconservatives’ Wars of Hegemony while protecting the 1 percent from tax increases.

The Democrats are little different.

No one in the White House and no more than one dozen members of the 535 member US Congress represents the American people. This is the reason that despite obvious remedies nothing can be done. America is going to crash big time.

Tags:

Category: Accounting | Conventional Economics | Economics | Recession

Apr 11 2010

Permanent High Unemployment – Time to change the game

Kal @ 11:34

In the US somewhere between 10% and 20% of the working age adults are out of work and there are no realistic prospects of this changing any time soon. Many other parts of the world have way higher unemployment rates.

How it works now

To the unemployed individual this is devastating. At first, for the lucky few, there is unemployment insurance providing some fraction of the person’s former wage. After unemployment insurance runs out there is some form of charity, either from the community of from the family.

The unemployed person has had a change of status and in most cases a sever change in the amount of available resources, but these unfortunates do not go away. Many have families dependent on them for support and these support needs continue whether or not the person is working. Someone has to pay the rent and supply the food and other necessities of life.

In times of near full employment the unemployment insurance system works relatively well. The newly unemployed gets enough to get by but not so much as to be too comfortable while finding a new job. Jobs are easy to find and the earnest applicant finds one quickly with only a small disruption to life.

In times like these unemployment insurance really does not work at all. For every available job there are hundreds of over qualified applicants. The government keeps extending the unemployment insurance period, but nothing changes to make finding employment more likely. The working resent those looking for work and those looking can clearly see that the system is not treating them fairly.

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Tags:

Category: Conventional Economics | Guaranteed Wage | Politics | Recession | Sustainability

Nov 5 2009

It is not possible to continue infinite consumption and infinite population growth on a finite planet

Kal @ 09:15

There is a new movie out, “Collapse” – staring Mike Ruppert. It got a review in The Wall Street Journal.

The Wall Street Journal: What is the central message of your movie?

Mr. Ruppert: It is not possible to continue infinite consumption and infinite population growth on a finite planet.

Duh!

Tags:

Category: Sustainability | Steady-State Economics | Resource Depletion | Recession | Population | Peak Oil | Economics | Climate Change

Nov 4 2009

Congress pay got your knickers in a knot?

Kal @ 19:48

Or just another excuse to bitch about the government in Washington.

There are too many mistakes in this wingnut e-mail to be sure I have them all, but the first two I checked were false. Also, congress persons get about $175,000 per year, which is not very much compared with the going rate for top level people in business and entertainment. In spite of this false diatribe, it is not really about pay.

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Tags:

Category: wingnuttery | Recession | Politics

Jul 9 2009

Unemployment is too low

Kal @ 13:37

Last week the official US unemployment rate reached 9.5%. Of course, this includes only those "actively seeking work." Or another way to think about it is those with remaining unemployment insurance benefits to collect. The actual number of unemployed is thought to be between 16% and 20%, and rising.

Given the common belief in "full employment is a good thing", these numbers are pretty depressing and way too high. But that is not the only possible perspective.

From the point of view that mostly those persons engaged in the basics of life should be employed, then perhaps the number should be around 50%. The basics: Food, Shelter, Transportation, Communication, and Security. Of course, there are other important things, but generally speaking they are luxuries. Some people should clearly be working on luxuries, but it is unreasonable to expect all of our excess labor to be so employed.

The main problem comes about because we have coupled the notion that it is necessary to have a job to have a life. As things stand now, to be unemployed is almost a disgrace. Well, maybe for a few weeks but then folks start to see you a bit as if you had the swine flue. Don't get too close, it might be catching. And nasty things start happening to you, your car and house payments come delinquent and soon you are walking on the street. Or maybe lucky enough to have relatives who can help and you are driving an old wreck and living back at home.

But it does not have to be like that. All of the folks who live here have to be supported in one way or another. Even the tea-baggers mostly agree with that. Why not do it with dignity and relieve the pressure on the planet to keep everyone running at full blast just to keep up a decent lifestyle?

Of course, those folks who go to work every day should get more than those who get to go fishing. Maybe we can even find a way to share the fishing time as well as the work time. But do we really want to put our family, friends, and neighbors on the street just because the economy is winding down a bit to a more rational level?

Tags:

Category: Economics | Employment | Guaranteed Wage | Politics | Recession | Steady-State Economics | Sustainability

Jul 3 2009

Time to recall some republicans in Sacramento

Kal @ 21:00

A small minority in the California legislature, in cooperation with Arnold Schwarzenegger are trying to dismantle California. The model seems to be Calcutta.

If there is not enough revenue to pay for needed programs, the answer is simple, raise taxes.

I wonder how many we would have to recall to break the impass?

Tags:

Category: Economics | Morals | Politics | Recession | wingnuttery

Jun 8 2009

Food Not Lawns

Kal @ 12:00

Yesterday as I was driving here in Santa Cruz, there was a large banner on a wall with the slogan, Food Not Lawns.

This is not exactly a new concept, after all, there is now an organic vegetable garden on the White House lawn. And thoughtful people everywhere are planting a bit more in their home gardens this summer. But what if the front lawn fell out of fashion? What could be done with all that sunshine, fertilizer, and water?

I found an article in the Orange County Register written by Cindy McNatt: Cities and businesses, how about losing the lawn?

We've been asked as homeowners to cut back on water use, lose the lawn, get greener, reduce green waste and go organic. The California Friendly Garden Contest acknowledges some of these efforts.

I'm not sticking up for front lawns here, but think about this: Many homeowners use their lawns for family fun and entertainment. For possibly half the population of people who keep a lawn, it serves a function —- at least in the backyard where games are played and canines romp.

Compare the family lawn to the acres of grass planted around commercial buildings, public medians and retail stores. No children playing kick ball, no dogs rolling in the sun, no one catching a nap or picnicking under a shady tree.

Nick Mrvos of the Irvine Ranch Water District tells homeowner groups, "If the only feet that make contact with grass are the guys that mow it, it might be time to consider alternatives."

It doesn't matter how large or small the commercial landscape is, you will no doubt find a strip of grass that needs to be mowed each week. Some swaths we saw were so large they might equal 25 or more typical homeowner lawns. Others were so small they didn't even make sense.

I doubt there is a way to measure how many acres of "silly strips" are planted in grass, but if you spend any time in HOA neighborhoods, or the commercial areas of your town, or even drive through the local takeout restaurant and notice the stupid strip of grass in the planter, you wonder how it adds up in resources. 

Greenbelts are not "green" anymore. Tom Larson, adviser to the Metropolitan Water District said these parkways were designed on the East Coast in the 1800s for storing excess snow. Don't you think it's time to move on?

Commercial building owners could save thousands a year in maintenance fees if they lost their lawns. Ditto for homeowner associations where shrubs and ground covers could be maintained once a month instead of weekly. Cities that need to cut back expenses could lose the grass in purposeless places.

Ron Vanderhoff said, "These greenbelts are from a bygone era. Water, chemicals, runoff, excess fertilizer, green waste, herbicides, air pollution, fossil fuels used all add up to a big mistake in today's era of using less resources and protecting the resources that we do have."

So how 'bout it then? Can cities, HOAs, and commercial property owners pitch in?  [emphasis is mine]

Let's use this estimate, half the population of people who keep a lawn, and try to guess how much productive land could be freed up.

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Tags:

Category: Employment | Morals | Recession | Steady-State Economics | Sustainability

May 19 2009

The Price of Being Poor

Kal @ 09:55

Think about it.  This is by Ian Welsh.

Washington Post hits on how much it costs to be poor - the way that the poor are forced to pay more, not less, for virtually everything; if not in money, then in time.

A friend of mine put it most simply.  Poor people spend time to save money.  Well off people spend money to save time.  That’s how you know where you are, assuming you aren’t living beyond your means.

The WP article isn’t bad, but it doesn’t really get the full flavor of poverty.  When you look poor, and if you’re poor long enough you will, you just get treated worse by virtually everyone.  They know you don’t have money, know you don’t have power, and thus know they can push you around, disrespect you or just ignore you.

My favorite story along this line is when I was barely making ends meet by doing odd jobs helping people move, doing yard work and painting houses.  One day after painting a garage, I walk into a bank with the check from the day’s work (this is in the eighties).  I’m disheveled, covered in dried paint, and look awful.  The teller wants to hold the check for two weeks.  I can’t wait that long, I need the money for rent.  I walk out of the bank.

I go back to the rooming house I’m living in. I shower, shave and comb my hair.  Then I go find my last set of good clothes - gray flannels, dress shirt, blazer, tie.  I put them all on, and I head back down to the bank.

Unlike a lot of people who are poor, I haven’t always been poor.  I went to one of the most elite private schools in Canada (ranked second at the time, after Upper Canada College).

I wait in line, and irony of ironies, I get the same teller.

She cashes the check.

Yeah…

But I don’t say anything, because I know she could capriciously change her mind.  I just walk out.

A couple years later, during the same extended period of poverty, I get to the point where I can’t even pretend to be middle or upper class.  And on occasion I get rousted because, while I’m clean, I look pasty, my clothes are threadbare and my glasses are literally taped up.  One time a security guard throws me off the property of a hotel I went into to use a pay phone.  In another case, I get tossed off the University of Ottawa campus: I’m beyond the point where I can fake being a student, even though I’m the right age, and was one just a few years before.

In the last ten years, since I ascended back into the middle class, I’ve never had any such situation come up.

Odd that.

The worst thing about being poor is the way you are treated.  There is no rule more iron, in my experience, that the less you get paid, for example, the worse you will be treated at work.  Clerks in stores treat you worse.  Government bureaucrats can often barely conceal their contempt.  And so on.

The upside, I suppose, is that people show you who they are.  The rare person who treats you exactly the same as they do everyone else is revealed as the shining gem they are.  In particular the friends who stick by you even when you’re down and out show themselves to be real friends, as opposed to those who follow the rule given in so many self-help books to cut off less successful friends, and thus reveal their complete moral bankruptcy to the world.

You learn who you can actually trust, who actually cares about you, and who is actually a decent human being who doesn’t enjoy being able to kick down on someone they figure can’t kick back.

It changes how you see people.  Oddly, before I was poor I thought practically everyone was scum (I was a cynical teenager).  Being poor convinced me that there were some truly good people in the world–people who would help you, be kind to you, or just treat you respectfully, even when there was nothing in it for them.

In ugliness and deprivation, beauty and kindness are much much more obvious.  All the more so, because so few meet this test and pass.

Tags:

Category: Conventional Economics | Economics | Employment | Guaranteed Wage | Morals | Politics | Recession

Mar 6 2009

Follow The Money

Kal @ 22:28

"Follow the money" was the key to unraveling the Watergate conspiracy. And it seems to be to be good advice for the banking crisis also.

By many accounts there are outstanding over 60 trillion dollars in outstanding Credit Default Swaps and other derivatives. [Update: That number is seriously short. I did a correction post Derivatives Revisited] The US Treasury and Federal Reserve keep pouring money into failing banks and AIG. Where will it stop? Do they intend to pay the full 60 531 trillion dollars?

Yesterday the Federal Reserve Official assured us that the financial system will collapse if the names of the "Counter Parties" to these quasi insurance policies are exposed. I am not so interested in the names as in the classes of counter parties. And I would like to know the total exposure from all of the various insurance companies and banks and anyone else we are bailing out.

It does not seem to much to ask, how much total will we be expected to pay? Big round numbers would do just fine.

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Tags:

Category: Conventional Economics | Economics | Politics | Recession | Sustainability

Feb 26 2009

Unemployment Or Redeployment?

Kal @ 23:49

The DOL reports on weekly unemployment insurance claims:

In the week ending Feb. 21, the advance figure for seasonally adjusted initial claims was 667,000, an increase of 36,000 from the previous week's revised figure of 631,000. The 4-week moving average was 639,000, an increase of 19,000 from the previous week's revised average of 620,000.
...
The advance number for seasonally adjusted insured unemployment during the week ending Feb. 14 was 5,112,000, an increase of 114,000 from the preceding week's revised level of 4,998,000.

That is over 5,000,000 previously employed persons who have not yet given up on finding a job. Those who have given up are no longer counted.

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Tags:

Category: Guaranteed Wage | Politics | Recession | Sustainability