Friday, August 19, 2011

Plight of Low Income people in Western World

Germany looks a lot like the U.S.
"While the top net income for middle- to higher-income Germans, generally defined as those earning 3,400 euros a month, or $4,870, rose slightly in real terms from 2000 to 2010, net incomes for low-wage earners, or those earning 960 euros a month or less, have fallen 10 percent, according to a new study by Markus Grabka, an economist at the DIW German Institute for Economic Research." NYT
Germany and the US are following a low wage policy, obstensibly to keep jobs from moving to low wage countries. Must labor be beaten down to the level of the world's poor? The better off will not escape from a low wage economy as it is wages that drive consumer demand, and it is consumer demand that keeps business profitable in the long run. Germany does not have a minimum wage, but it does have generous programs for low-income people. My own thinking is that we need a generous minimum wage so that everyone working can live decently.

Friday, August 12, 2011

The Big Casino

If you are looking for evidence that the stock market is one big casino, note the yo-yo pattern of the markets this week. Up 600 points, down 600, and repeat. If this casino were isolated from the real economy, no one would care, but it is not. To reduce this problem, four European countries have banned negative bets against financial stocks--selling securities that you do not own in hope of buying them back later for less. This is a pure gamble not unlike betting on the horses.
Another casino dealing in petroleum futures accounts for a similar yo-yo pattern in gas prices at the pump. Our lives seem to be at the mercy of gamblers' whims.

Sunday, August 7, 2011

Taxes & Jobs

The following recent letter to the LSJ expresses my sentiments exactly:
Question for Speaker Boehner:
"The Bush tax cuts have just had their 10th birhtday, and acording to the conservative Washington Post, have cost us over $2.8 trillion. These tax cuts have benefited the top one percent, or a Boehner and his allies like to call them, 'the job creators.'
Speaker Boehner, I ask you, 'Where are the jobs?' "
signed, John Bethell, Grand Ledge MI

If low taxes for the rich were going to do the task, they should have worked by now! The fact is that our corporatons have huge cash reserves that they are not investing in plant and equipment, but rather buying up each other. Increasing their cash piles even more will do little for jobs. We have been sold a slogan despite the facts.

Monday, August 1, 2011

National Security

The police department of the city of Pontiac, Michigan, with 58,000 residents, has been closed for lack of funds. Still the Congress will not cut military spending in the name of national security. As long as many people are obsessed and have their attention diverted by slogans like "National Security", hate gays, and same sex marriage, we will have these insanities.

Debt Ceiling

The radical Republicans have held the country hostage and won. They have protected the tax cuts for the rich and the military-industrial complex. Of course, the debt ceiling was a bogus concept from the beginning.