Tuesday, February 15, 2011

Why Does Boehner Not Care About Unemployment: We’re Broke or Just Stupid?

Ed O’Keefe gets the facts right. Federal employment in 2010 was 2.65 million as compared to 2.63 million in 2002. As he notes, Federal employment per 1000 in US population actually fell from 9.1 to 8.4. It was 13.3 in 1962:

Still others noted that the size of the federal workforce compared to the overall U.S. population has dropped steadily since the 1960s, thanks to a booming population and cutbacks made during the Reagan and Clinton years.

Brian Beutler reports the latest from the Speaker of the House:

If House Republicans succeed in cutting tens of billions of dollars in discretionary spending over the next six months, some of the most immediate victims will be federal employees, many of whose jobs will be slashed as their agencies pare back. At a press conference in the lobby of RNC headquarters Tuesday morning, House Speaker John Boehner (R-OH) shrugged this off as collateral damage. "In the last two years, under President Obama, the federal government has added 200,000 new federal jobs," Boehner said. "If some of those jobs are lost so be it. We're broke." ... Boehner didn't cite a source for the claim that Obama had added 200,000 employees to the federal payroll.

We truly are ruled by idiots!


Myrtle Blackwood said...

Re: "..House Speaker John Boehner ...shrugged this off as collateral damage. "In the last two years, under President Obama, the federal government has added 200,000 new federal jobs," Boehner said. "If some of those jobs are lost so be it. We're broke." "

WHO is 'broke'?

US household's net contributions to their financial assets - Going into the negative.
[See: Americans Dipping Into Savings, by Mark Whitehouse - Wall Street Journal ]

The real price of food and commodities is rising dramatically around the world, with food stamp participation in the US climbing dramatically since early 2007. “Close to half of all humans are either perpetually hungry and malnourished or suffering from varying degrees of food insecurity.

(i) Is this the end of cheap food?
By Anthony Mirhaydari, MSN Money
(ii) 30 years of gold prices.
Broke and Hungry: This Chart Says It All. Author: Mac Slavo, January 11th, 2011
Agriculture and Food in Crisis - An Overview
Fred Magdoff and Brian Tokar. Monthly Review. July-August 2009
http://www.monthlyreview.org/090701magdoff-tokar.php ]

However, US consumer expenditures as a Percent of GDP have increased sharply in the past 30 years


WHO has been doing the spending?

The richest 20% of households, in 2007, accounted for 40% of consumer spending in America.

Slowing Economy Proves Fitzgerald Wrong: Rich Aren't Different
By Matthew Benjamin and Rich Miller. 19th November 2007. Bloomberg]

Austerity isn't a new phenomenon. Why?

Andy Xie, the former Morgan Stanley chief Asian economist points out, multinational companies can invest anywhere in the world and that means that they respond to an increase in (effective) demand in one nation's economy by boosting production elsewhere. That is, not in the local economy. Demand is local but supply is global.

"...This is why the old assumptions on stimulus are no longer reliable.
Xie argues that this means that whenever the US Federal Reserve or the European Central Bank adopts a stimulatory monetary policy, “they are actually stimulating the global economy as a whole”. Indeed, he says, most of the stimulus will be felt in regions with low costs, and with healthy banking systems. “If you believe this logic, the actions of the Fed and the ECB fuel inflation and asset bubbles in emerging economies rather than stimulate growth at home.”

An emerging stimulus disaster
Karen Maley. Business Spectator, Tuesday, August 24, 2010]

Myrtle Blackwood said...

John Barry has produced a beautiful summation of what all this global austerity is about:

Austerity driven responses to the financial mess is nothing short of simply 'displacing' private loses into public debt. What we're witnessing is a socialism of the rich - we're seeing the 'socialisation of risk' (through this displacement, now copper fastened by the European Commission's decision as you indicate in your post. But we're not seeing the socialisation of profit or benefit - that's still privatised! The transformation of private/banksters debt into sovereign debt is perhaps the nearest we have seen to a process of political economic alchemy – turning the dross /worthlessness of private losses into a publicly (tax-payer) backed but still privately owned income/capital stream.

The alchemy of modern political economy - turning private debt into public debt and austerity
Wednesday, 22 December 2010