Tuesday, October 19, 2010

The Perfect Storm? Real Insanity! How Democracy Dies: Lessons From a Master - Shadow Class War of 2010 - Blame Employers for Unemployment Crisis!

(EXTRA! EXTRA! Obama's October Surprise? Is it a possibility that with the gays totally on board there are enough votes to upend the plans of the thugs on November 2? We'll see. I know this news will make my poll watching a lot more interesting.

The Defense Department said Tuesday that it is accepting openly gay recruits, but is warning applicants they might not be allowed to stick around for long. Following last week's court ruling that struck down a 1993 law banning gays from serving openly, the military has suspended enforcement of the rule known as "don't ask, don't tell." The Justice Department is appealing the decision and has asked the courts for a temporary stay on the ruling.

The Defense Department said it would comply with the law and had frozen any discharge cases. But at least one case was reported of a man being turned away from an Army recruiting office in Austin, Texas. Pentagon spokeswoman Cynthia Smith on Tuesday confirmed that recruiters had been given top-level guidance to accept applicants who say they are gay.)

Robert Reich says it's a perfect storm for the democratic form of government we've thought we were enjoying in the USA (at least prior to the Rethuglican Raygun Assault in the early 80's and the tax cut agenda and Supreme Court appointees who have flowed from this venal political takeover). I can't differ with him here. (Bet you didn't know I had read almost all the Greek tragedies, did you? Or does it show? Speaking of Greek tragedies, I viewed the unnecessary dot-com bomb as exactly that. See below for those wanting to outsource labor's very good reasons to have caused it. Yeah. I know. It's your fault you have no job. Not that those who do it get a very nice Bush/Cheney-funded tax break.) (Emphasis marks added - Ed.)

It's a perfect storm. And I'm not talking about the impending dangers facing Democrats. I'm talking about the dangers facing our democracy.

First, income in America is now more concentrated in fewer hands than it's been in 80 years. Almost a quarter of total income generated in the United States is going to the top 1 percent of Americans.

The top one-tenth of one percent of Americans now earn as much as the bottom 120 million of us.

Who are these people? With the exception of a few entrepreneurs like Bill Gates, they're top executives of big corporations and Wall Street, hedge-fund managers, and private equity managers.

They include the Koch brothers, whose wealth increased by billions last year, and who are now funding tea party candidates across the nation.

Which gets us to the second part of the perfect storm. A relatively few Americans are buying our democracy as never before. And they're doing it completely in secret.

Hundreds of millions of dollars are pouring into advertisements for and against candidates - without a trace of where the dollars are coming from.

They're laundered through a handful of groups. Fred Maleck, whom you may remember as deputy director of Richard Nixon's notorious Committee to Reelect the President (dubbed Creep in the Watergate scandal), is running one of them. Republican operative Karl Rove runs another. The U.S. Chamber of Commerce, a third.

The Supreme Court's Citizens United vs. the Federal Election Commission made it possible. The Federal Election Commission says only 32 percent of groups paying for election ads are disclosing the names of their donors. By comparison, in the 2006 midterm, 97 percent disclosed; in 2008, almost half disclosed.

We're back to the late 19th century when the lackeys of robber barons literally deposited sacks of cash on the desks of friendly legislators. The public never knew who was bribing whom.

Just before it recessed the House passed a bill that would require that the names of all such donors be publicly disclosed. But it couldn't get through the Senate. Every Republican voted against it. (To see how far the GOP has come, nearly ten years ago campaign disclosure was supported by 48 of 54 Republican senators.)

Here's the third part of the perfect storm. Most Americans are in trouble. Their jobs, incomes, savings, and even homes are on the line. They need a government that's working for them, not for the privileged and the powerful.

Yet their state and local taxes are rising. And their services are being cut. Teachers and firefighters are being laid off. The roads and bridges they count on are crumbling, pipelines are leaking, schools are dilapidated, and public libraries are being shut.

There's no jobs bill to speak of. No WPA to hire those who can't find jobs in the private sector. Unemployment insurance doesn't reach half of the unemployed. Washington says nothing can be done. There's no money left.

No money? The marginal income tax rate on the very rich is the lowest it's been in more than 80 years. Under President Dwight Eisenhower (who no one would have accused of being a radical) it was 91 percent. Now it's 36 percent. Congress is even fighting over whether to end the temporary Bush tax cut for the rich and return them to the Clinton top tax of 39 percent.

Much of the income of the highest earners is treated as capital gains, anyway - subject to a 15 percent tax. The typical hedge-fund and private-equity manager paid only 17 percent last year. Their earnings were not exactly modest. The top 15 hedge-fund managers earned an average of $1 billion.

Congress won't even return to the estate tax in place during the Clinton administration – which applied only to those in the top 2 percent of incomes.

It won't limit the tax deductions of the very rich, which include interest payments on multi-million dollar mortgages. (Yet Wall Street refuses to allow homeowners who can't meet mortgage payments to include their primary residence in personal bankruptcy.)

There's plenty of money to help stranded Americans, just not the political will to raise it. And at the rate secret money is flooding our political system, even less political will in the future.

The perfect storm: An unprecedented concentration of income and wealth at the top; a record amount of secret money flooding our democracy; and a public becoming increasingly angry and cynical about a government that's raising its taxes, reducing its services, and unable to get it back to work.

We're losing our democracy to a different system. It's called plutocracy. Robert Reich is Professor of Public Policy at the University of California at Berkeley. He has served in three national administrations, most recently as secretary of labor under President Bill Clinton. He has written twelve books, including The Work of Nations, Locked in the Cabinet, Supercapitalism and his latest book, "AFTERSHOCK: The Next Economy and America's Future." His 'Marketplace' commentaries can be found on publicradio.com and iTunes.

Enjoy how real moderate progressives like Reich have now changed their thinking? Listen to ex-moderate E.J. Dionne below. I'm actually surprised that the Washington Post published this (emphasis marks added - Ed.).
The Shadow Class War of 2010

The 2010 election is turning into a class war. The wealthy and the powerful started it. This is a strange development. President Barack Obama, after all, has been working overtime to save capitalism. Wall Street is doing just fine and the rich are getting richer again. The financial reform bill passed by Congress was moderate, not radical.

Nonetheless, corporations and affluent individuals are pouring tens of millions of dollars into attack ads aimed almost exclusively at Democrats. One of the biggest political players, the U.S. Chamber of Commerce, accepts money from foreign sources.

The Chamber piously insists that none of the cash from abroad is going into its ad campaigns. But without full disclosure, there’s no way of knowing if that’s true or simply an accounting trick. And the Chamber is just one of many groups engaged in an election-year spending spree.

This extraordinary state of affairs was facilitated by the U.S. Supreme Court’s scandalous Citizens United decision, which swept away decades of restrictions on corporate spending to influence elections.

The Republicans’ success in blocking legislation that would at least have required the big spenders to disclose the sources of their money means voters have to operate in the dark.

The “logic” behind Citizens United is that third-party spending can’t possibly be corrupting. The five-justice majority declared that “this court now concludes that independent expenditures, including those made by corporations, do not give rise to corruption or the appearance of corruption. That speakers may have influence over or access to elected officials does not mean that those officials are corrupt. And the appearance of influence or access will not cause the electorate to lose faith in this democracy.”

You can decide what’s more stunning about this statement, its naivete or its arrogance.

If one side in the debate can overwhelm the political system with clandestine cash, which is what’s now happening, is there any doubt that the side in question will buy itself a lot of influence? If that’s not corruption, what exactly is it?

And how can five justices, who purport not to be political, sweep aside what elected officials themselves long ago concluded on the subject and claim to know what will or will not “cause the electorate to lose faith in this democracy”?

Could anything undermine trust in the system more than secret contributions to shadowy groups spending the money on nasty ads?

Please read the rest here. Chris Hedges rounds out the party with some well-chosen remarks on the history about how democracy has died previously. Don't believe that this is just ancient history, friends. (Emphasis marks added - Ed.)

How Democracy Dies: Lessons From a Master

The ancient Greek playwright Aristophanes spent his life battling the assault on democracy by tyrants. It is disheartening to be reminded that he lost. But he understood that the hardest struggle for humankind is often stating and understanding the obvious. Aristophanes, who had the temerity to portray the ruling Greek tyrant, Cleon, as a dog, is the perfect playwright to turn to in trying to grasp the danger posed to us by movements from the tea party to militias to the Christian right, as well as the bankrupt and corrupt power elite that no longer concerns itself with the needs of its citizens. He saw the same corruption 2,400 years ago. He feared correctly that it would extinguish Athenian democracy. And he struggled in vain to rouse Athenians from their slumber. There is a yearning by tens of millions of Americans, lumped into a diffuse and fractious movement, to destroy the intellectual and scientific rigor of the Enlightenment. They seek out of ignorance and desperation to create a utopian society based on “biblical law.” They want to transform America’s secular state into a tyrannical theocracy.

These radicals, rather than the terrorists who oppose us, are the gravest threat to our open society. They have, with the backing of hundreds of millions of dollars in corporate money, gained tremendous power. They peddle pseudoscience such as “Intelligent Design” in our schools. They keep us locked into endless and futile wars of imperialism. They mount bigoted crusades against gays, immigrants, liberals and Muslims. They turn our judiciary, in the name of conservative values, over to corporations. They have transformed our liberal class into hand puppets for corporate power. And we remain meek and supine. They want to transform America’s secular state into a tyrannical theocracy.

The huge amount of taxpayer money doled out to Wall Street, investment banks, the oil and natural gas industry and the defense industry, along with the dismantling of our manufacturing sector, is why we are impoverished. It is why our houses are being foreclosed on. It is why some 45 million Americans are denied medical care. It is why our infrastructure, from public schools to bridges, is rotting. It is why many of us cannot find jobs. We are being fleeced. The flagrant theft of public funds and rise of an obscenely rich oligarchic class is masked by the tough talk of demagogues, themselves millionaires, who use fear and bombast to keep us afraid, confused and enslaved.

Aristophanes saw the same psychological and political manipulation undermine the democratic state in ancient Athens. He repeatedly warned Athenians in plays such as “The Clouds,” “The Wasps,” “The Birds,” “The Frogs” and “Lysistrata” that permitting political leaders who shout “I shall never betray the Athenian!” or “I shall keep up the fight in defense of the people forever!” to get their hands on state funds and power would end with the citizens enslaved.

"The truth is, they want you, you see, to be poor,” Aristophanes wrote in his play “The Wasps.” “If you don’t know the reason, I’ll tell you. It’s to train you to know who your tamer is. Then, whenever he gives you a whistle and sets you against an opponent of his, you jump out and tear them to pieces.

Our democracy, through years of war, theft and corruption, is also being diminished.

But the example Aristophanes offers is not a hopeful one. He held up the same corruption to his fellow Greeks. He repeatedly chided them for not rising up and fighting back. He warned, ominously, that by the time most citizens awoke it would be too late. And he was right.

The appearance of normality lulls us into a false hope and submission. Those who shout most loudly in defense of the ideals of the founding fathers, the sacredness of Constitution and the values of the Christian religion are those who most actively seek to subvert the principles they claim to champion. They hold up the icons and language of traditional patriotism, the rule of law and Christian charity to demolish the belief systems that give them cultural and political legitimacy. And those who should defend these beliefs are cowed and silent.

“For a considerable length of time the normality of the normal world is the most efficient protection against disclosure of totalitarian mass crimes,” Hannah Arendt wrote in “The Origins of Totalitarianism.”

“Normal men don’t know that everything is possible, refuse to believe their eyes and ears in the face of the monstrous. ... The reason why the totalitarian regimes can get so far toward realizing a fictitious, topsy-turvy world is that the outside non-totalitarian world, which always comprises a great part of the population of the totalitarian country itself, indulges in wishful thinking and shirks reality in the face of real insanity. ...”

All ideological, theological and political debates with the representatives of the corporate state, including the feckless and weak Barack Obama, are useless. They cannot be reached. They do not want a dialogue. They care nothing for real reform or participatory democracy. They use the tricks and mirages of public relations to mask a steadily growing assault on our civil liberties, our inability to make a living and the loss of basic services from education to health care. Our gutless liberal class placates the enemies of democracy, hoping desperately to remain part of the ruling elite, rather than resist. And, in many ways, liberals, because they serve as a cover for these corporate extremists, are our greatest traitors.

Aristophanes too lived in a time of endless war. He knew that war always empowered anti-democratic forces. He saw how war ate away at the insides of a democratic state until it was hollowed out. His play “Lysistrata,” written after Athens had spent 21 years consumed by the Peloponnesian War, is a satire in which the young women refuse to have sex with their men until the war ends and the older women seize the Acropolis, where the funds for war are stored. The play called on Athenians to consider radical acts of civil disobedience to halt a war that was ravaging the state. The play’s heroine, Lysistrata, whose name means “Disbander of Armies,” was the playwright’s mouthpiece for the folly and self-destructiveness of war. But Athens, which would lose the war, did not listen.

The tragedy is that liberals and secularists, like Obama, are not viewed as competitors by the corporate forces that hold power, but as contaminates that must be eliminated. They have sought to work with forces that will never be placated. They have abandoned the most basic values of the liberal class to play a game that in the end will mean their political and cultural extinction.

There will be no swastikas this time but seas of red, white and blue flags and Christian crosses. There will be no stiff-armed salutes, but recitations of the Pledge of Allegiance. There will be no brown shirts but nocturnal visits from Homeland Security. The fear, rage and hatred of our dispossessed and confused working class are being channeled into currents that are undermining the last vestiges of the democratic state. These dangerous emotions, directed against a liberal class that as in ancient Athens betrayed the population, have a strong appeal. And unless we adopt the radicalism held by Aristophanes, unless we begin to hinder the functioning of the corporate state through acts of civil disobedience, we are finished.

Let us not stand at the open gates of the city meekly waiting for the barbarians. They are coming. They are slouching towards Bethlehem. Let us, if nothing else, like Aristophanes, begin to call our tyranny by its name.

Call me foolish and a lover of true old-time values like truth and justice, but I believe it too.

And I have no doubt that you can "Blame Employers for the Jobs Crisis," which Robert Oak documents below (emphasis marks added - Ed.).
Did you know 72% of all employers claim they cannot find qualified candidates to fill positions? I kid you not!

Do these statements have any validity? The claim that there is a skills shortage in America? No. Firstly we have never ending horror stories on employers and their discrimination tricks: A surprising number of Craigslist job ads are automatically disqualifying the long-term jobless by including the stipulations, "Must be currently employed," "No unemployed candidates will be considered," or "must have been employed within the last 6 months."

Other job postings specify that if an applicant is recently unemployed, he or she should include a "good reason" for his or her layoff along with a resumé. Right there, employers are out of the box rejecting people needing a job, because....they need a job.

The reality is job losses are across the board. Below is an animation of the percentages different industries make up of the total job market. Across 12 sectors, the animation moves from September 2006 to September 2010.

Notice while construction has shrunk (blue), originally it wasn't that large of the labor market in the first place. Manufacturing on the other hand, (bright red), has shrunk significantly. Notice that the skills of the future, information (pink), has shrunk this recession. Most industries associated with trade have shrunk. The point of this animation is to show, in terms of percentages, there really is not any major structural change to the labor market and types of jobs. There just ain't any jobs. Boston Federal Reserve President, Eric Rosengren, gave a speech speaking directly to the state of the job market today. He says the problem is a demand one. In rather stark contrast, the most recent recession is far less a reflection of dislocation in a few industries but rather reflects a general decline in almost all industries.

As the chart [reproduced below] shows, in this recession there has been a peak to trough loss of employment of 5 percent or greater in construction, manufacturing, retail trade, wholesale trade, transportation, information technology, financial activities, and professional and business services. To me, this does not suggest that the driver is structural change in the economy increasing job mismatches – although no doubt some of that exists – but instead I see here a widespread decline in demand across most industries. While we have Pundits and even former Presidents claiming there is a skills shortage, from Rosengren's speech, we have proof positive companies are not having a hard time finding the right type of skills. Below is a graph, from the Boston Federal Reserve, showing the current difficulty reported from businesses on finding workers. Notice it's at record lows.

Of course it is absurd to claim America has a skills shortage. We have sky high unemployment rates, across the board, relative to their past rates, with highly skilled and educated people. Below is a graph from Rosengren's speech which shows industry structural jobs change during this recession, along with past recessions.

Notice how information and manufacturing started to be decimated with the China trade agreement and advances in telecommunications. This is when the great offshore outsourcing of jobs started, in 2001. Below is the graph for the lowest unemployment rate (official), college graduates. It is over double what it was at the beginning of this decade and this is for people with some work experience.

Rosengren makes this observation (read his whole speech here):

The first year of the recovery has an employment pattern similar to shallow recessions, indicating just how weak the recovery has been so far. While the NBER claims this is a recovery cycle, most notice the job market hasn't quite got the message. Could this be similar to 2001, where labor arbitrage was enabled on steroids?

2.4 million jobs were lost to China from 2001-2008 alone and the tech related people in Silicon valley numbers dropped by 50%. These people were pushed entirely out of the field, their jobs offshore outsourced, under the excuse of the dot con bust. While Boston Fed's speech is on the total labor market and further action recommendations for the Federal Reserve, the claim there is a skills shortage is simply insult to injury. EPI estimates half a million jobs will be lost to China in this year alone. Offshore outsourcing companies are seeing double digit growth:

India's big three software outsourcing firms are set to regain double-digit growth rates during the second quarter, as customers in the US and Europe revive technology spending for addressing new markets and start offshoring their IT and back office projects to halve their costs. Tata Consultancy Services, Infosys Technologies and Wipro, which count Citibank, Dow Chemicals, JP Morgan and BP among their top customers, are expected to grow their quarter to September revenues by around 20% compared to the same period last year, at least five analysts tracking the sector told ET.

"We are getting 'large deals' , but maybe not as large as we would like. We are getting discretionary and transformation deals. In some sense, it's business as usual in the short term but we have to wait and watch over medium to long term," said S 'Kris' Gopalakrishnan , chief executive of Infosys. He added that Infosys has started adding customers in US and Europe. "We traditionally define large deals as $100 million-plus for outsourcing deals and $50 million-plus for transformational deals — it's lower than that at this point," said Mr Gopalakrishnan.

Public citizen gives us a new layoff tracker, showing job losses directly related to trade and offshore outsourcing. The AFL-CIO has put together a new website and database, which allows you to see who is exporting jobs by zip code. Those of us in STEM know what skills shortage really means. It means enabling more outsourcing, more foreign guest workers and more immigration.

The evidence is overwhelming these techniques labor arbitrage Americans and give a strong disincentive to even bother with difficult subject areas such as engineering. Why bother to bust your butt on difficult topics when your career won't even start or be gone due to labor arbitrage and discrimination in 10 years?

There is no skills shortage, there never was a skill shortage. There is a shortage of good employers who do not discriminate, age discriminate, ship jobs to India, China, Brazil and treat their workers like cannon fodder. There also is a shortage of jobs, pure and simple.

Put U.S. workers first. Demand these employers quit their inane, harsh, wage repressing, discriminatory labor practices. Put a few of of these traitorous employers in jail and sue 'em. Deal with trade and offshore outsourcing, invest in America and Americans.

Then and only then will we might actually get somewhere to putting people back to work. Stop the bubble mentality and get America back to producing things again.

Real goods, real services, not Dutch Tulip bulbs, financial fiction or quarterly cost reductions. During WWII and throughout the history of the United States, employers trained their own workers. At the height of the depression, employers trained their workers. They even sent them to college.

Nowadays large corporations want prefab workers for $10/hr that they can dispose of like a fast food wrapper. This mentality must change and it could by passing legislation as well as enforcing current labor law. Government must force employers, particularly large, multinational corporations, to hire America. It is their patriotic duty as well as vital to our economic future for employers to provide jobs to all Americans.

Sounds like a fantasy doesn't it? I know it does to me.

And if the multimillionaires get to buy the new definition of democracy (see Citizens United vs. the Federal Election Commission), our nightmares have just begun.

Suzan _________________


True Blue Texan said...

Thank you for the link.

These are frightening times we live in and we need to name the forces of destruction that are gathered all around us.

I've thought more than once that our current state as a nation is very reminiscent of Rome before the fall.

Suzan said...

So, true, True Blue,

So true.

We await the descent of the Vandals.

And they are coming.

It's great to find your blog and link to you.