Poor Us: The Great Depression 2.0

April 23, 2009

The “D” Word Heard Around the World (Clue: It’s Not Daffodil)

by Mike Luckovich via TruthdigWhile Wall Street dicks around trying to figure out how to by give back the TARP money (so they can keep their bonuses) and manipulate Obama’s Public/Private Partnership plan to buy up toxic assets (so they can make an illicit killing for themselves on the taxpayer’s dime), global grownups are urging them to get a grip.  It’s no longer a matter of beating around the Bush; pros from the IMF to Harvard are now calling this economic clusterfuck by its right name—a Depression

Here’s how they’re using it in context:

Global recession worst since Depression, IMF says

The International Monetary Fund declared Wednesday, for what it said was "by far the deepest global recession since the Great Depression."

Even with many countries taking bold steps to turn things around, the global economy will shrink 1.3 percent this year, the IMF predicted in its dour forecast.

"We can be fairly confident that in 2010 or even 2011, economies will not be back to normal," said IMF chief economist Olivier Blanchard. "Which means that governments should today basically think at least about contingent plans for infrastructure spending. … Next year will be too late."

(read on)

Via AP

Harvard Economic Historian Says, "We’re in a depression."

Two big-time economic thinkers …  Jeff Madrick, a Senior Fellow at the New School’s Schwartz Center for Economic Policy Analysis, faced Niall Ferguson, Laurence A. Tisch Professor of History at Harvard University and William Ziegler Professor of Business Administration at Harvard Business School. Moderator Brian Lehrer, host of the Brian Lehrer Show, asked tough questions about the economic crisis.

Ferguson took the question first. “We’re not in a recession,” he said. “We’re in a depression. I would say it’s a slight depression, rather than a Great Depression, but we’re looking at five years of subprime growth.” . (read on)

via Recessionwire

Recession has features of a depression: California unemployment rate reaches 11.2%

Unemployment in California shot to 11.2% in March, the highest level since the state began keeping records. What’s more, the number of people out of work for almost a year rose by 9.4%, and has now doubled in the last 12 months.

An average of 211,000 Californians have been unemployed for more than 47 weeks over the last year, the state reported. These people now account for about 14% of California’s approximately 1.5 million jobless.

“This recession has features of a depression,” said Nelson Lichtenstein, a labor historian at UC Santa Barbara. “We get these very long-time people being out of work. They sort of disappear to a never-never land.”

  Los Angeles Times   via G.O.O.D.


April 22, 2009

Oligarchs Rule! (But Not In A Good Way)

Crushing  the American Dream by discogangsta via DeviantArt.com

“President Bush announced his new economic plan. The centerpiece was a proposed repeal of the dividend tax on stocks, a boon that could be worth millions of dollars to average Americans. Well, average stock-owning Americans. Technically, Americans who own a significant amount of shares in dividend-dealing companies. Well, rich people, that’s what I’m trying to say. They’re going to do really well with this.” Jon Stewart, The Daily Show

Yesterday we learned (and isn’t it ironic?) that many of the really rich people at the pin-head-tiny top of the economic pyramid, the top 1% of US income getters, just happen to work for the banks and financial institutions whose Three-Card-Monty investment schemes wrought this fresh hell in which we now find ourselves.

Who are these privileged few? Some call them oligarchs, running the world with their cabal of elites.  Others say they’re plutocrats, the lucky few whose wealth gives them near total control.

One thing is clear, they think small d-democracy is a sucker’s game. One of the angry bankers Poor Us talked about yesterday complained about Obama’s tax increase, ranting that he already “supported 20 poor families” with his tax dollars. He’s absolutely convinced he’s not only entitled to a salary (plus bonuses!) big enough to maintain an entire village of serfs while allowing him to live like a king (a really rich king), he thinks the serfs are exploiting him. Whoa! Maybe he’s just an asshole.

Whatever you  want to call them, they are a breed most  serfers didn’t know too much about. Until they crashed the economy, that is.  Now, we’re obliged to get acquainted with these self-anointed Masters of the Universe so we won’t get fooled again. And your re-education starts here with the Poor Us Better-Know-Your-Oligarch Primer.  Coming soon: The Peasant’s Guide to Getting Even:

The Pirate Pose by Tom Wolfe, Portfolio Magazine, May 2007

Twenty years after The Bonfire of the Vanities, the author checks in on the new masters of the universe and finds them even coarser and ruder than their predecessors could have ever.

First, they have more money, infinitely more, than any of the various waves of new money that preceded them, with the possible exception of robber barons on the order of John D. Rockefeller, who, incidentally, was regarded as a rude Pocantico hillbilly Baptist by society in New York a hundred years ago. Hedge funds have what investment managers call “the greatest business plan of all time,” known as “2 and 20.” Each year the typical fund takes 20 percent of the return plus 2 percent of the

total investments. Some of the hottest managers, such as Icahn and Stevie Cohen, reportedly take 50 percent of the profits.  (read on)

The Quiet Coup by Simon Johnson, The Atlantic, May 2009

Johnson is a former economist with the International Monetary Fund, now writes the Baseline Scenario blog, is a contributor to NPR’s Planet Money and the New York Times.

American financial industry gained political power by amassing a kind of cultural capital—a belief system. Once, perhaps, what was good for General Motors was good for the country. Over the past decade, the attitude took hold that what was good for Wall Street was good for the country. The banking-and-securities industry has become one of the top contributors to political campaigns, but at the peak of its influence, it did not have to buy favors the way, for example, the tobacco companies or military contractors might have to. Instead, it benefited from the fact that Washington insiders already believed that large financial institutions and free-flowing capital markets were crucial to America’s position in the world. (read on)

The Big Takeover by Matt Taibbi, Rolling Stone Magazine, April 2009

So it’s time to admit it: We’re fools, protagonists in a kind of gruesome comedy about the marriage of greed and stupidity. And the worst part about it is that we’re still in denial — we still think this is some kind of unfortunate accident, not something that was created by the group of psychopaths on Wall Street whom we allowed to gang-rape the American Dream. (read on)

The Dirty Dozen, Rolling Stone Magazine, April 2009

Meet the bankers and brokers responsible for the financial crisis – and the officials who let them get away with it. (read on)

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