The world of the worker remains stark, as each month a quarter million jobs are lost and nearly that many new foreclosures are filed against homeowners. The unemployment rate, at 9.8 percent, is expected to rise, even as six people compete for every current job opening. By contrast, Wall Street is booming. Banks bailed out a year ago with federal tax dollars are reporting huge profits, spending millions to lobby Congress not to regulate them and paying out big bonuses again. What should be done to turn around Main Street America?

 

 

 

 

Punish Corporations that Flee Overseas

“Trickle Down” has been a total failure for two decades.  Instead of handouts to save banks and corporations, the government should be looking into creating jobs through public works projects (it worked before) and other means of putting money into the hands of working class people.  When average Americans have enough money to do more than just pay the monthly bills – housing, food, utilities, etc. – they will then be able to start saving and investing.  A successful economy involves millions of people saving and investing – not millionaire getting more millions.

Labor needs to start running our own candidates at all levels.  There needs to be more Sherrod Brown and Barney Frank-type legislators.  These people understand that the American version of capitalism is a total failure.  It perpetuates greed at the expense of the public and the nation.  We need our friends in Congress to start introducing legislation that penalizes corporations that flee to the southern states (just to save on labor costs) or leave to foreign production sites. 

Former USW President George Becker told me once that he was a true believer in the old Mineworker adage – “There are no neutrals here – you’re on our side or you’re on the wrong side.” We should start challenging elected officials that can’t seem to get off the fence – even if it means electing a Republican or losing currently-held seats.  We have been fighting a “rear guard” action for over 25 years.  It’s time to go on the offensive – from school, park and library boards, to aldermen and mayors, to state legislators and all the way to the top.  Perhaps with Rich Trumka leading the AFL-CIO we may see some of this come to pass.

Gary Gaines
Granite City, Ill. 
SOAR 7-34-2 Rapid Response Coordinator

 

Limit CEO Pay

Federal law should prohibit total CEO compensation, including bonuses, to exceed four times the highest worker’s pay.

Richard A. Bolster
Northbrook, Ill. 

 

More Regulation Essential

I believe that legislation should be passed to tightly regulate the financial institutions, insurance companies and corporations so they do not have an adverse impact on the economy.
The economy will struggle to recover as long as these institutions continue to maximize their profits at the expense of consumers and workers. Congress should revisit their credit card legislation and limit interest rates. Rates being charged used to be usury. Credit card holders faced with high rates that have no relationship to those that corporations pay are preventing consumers from buying extras or even essentials – purchases that could be stimulating the economy.
I also believe that more must be done by the U.S. Congress to stimulate job creation as President Franklin D. Roosevelt did during the Great Depression. Congress approved billions of dollars for the Iraq war which helped create an enormous deficit and now they are so “fiscally responsible” that stimulating job growth or taxing the very rich is abhorrent to them.
Unions should be at the forefront in promoting new congressional members that are not beholden to corporate lobbyist. The 2010 Congressional elections will be more important to this country than the next presidential election in 2012.

Vincent Guadagnino,
Lake Forest, Calif. 

 

Tax the Wealthy

Our lawmakers and President should create laws taxing the wealthy, everyone making more than $500,000 a year, 75% or more, for the next 20 years.  The wealthy owe us this because they’ve been stealing from us for the past 30 years.  Our leaders must also pass the Employee Free Choice Act. 

 Theresa Duperon, Esq.
Los Angeles, Calif.

 

Start a Strong Economy with Citizens

We workers have turned our back on Main Street and have fallen for the bigger-is-better (and cheaper) mentality of the Wal-Marts and Home Depots.  And we have accepted the “global” shift as necessary as businesses take our jobs overseas but still expect us to be consumers to the world market.  We need to see a shift to a consumer development mentality by the business community.

We also need to rethink our economic “brewing” techniques. If you are a coffee drinker you will know what I’m saying.  As an economy we have fallen into the “dripalator,” trickle-down approach, while I still believe that a percolator makes a better cup of coffee because it starts from the bottom of the pot and develops the flavor from there. If we want to develop a strong “cup” of economic coffee, we need to start from the bottom of the pot (every day citizens) and let the flavor rise.

Terry Havener
Johnstown, Pa.

 

Jobs, jobs and more jobs

A major union matter now is jobs. FDR gave us the 3 Cs, the Civilian Conservation Corps. It worked. We need trains, new sources of energy, not dirty coal, not Saudi Arabian oil, not nuclear energy with the waste stored under Yucca Flats in Nevada. Jobs, jobs, and more jobs.

 Eugene Blank
Portland, Ore. 

 

To Turn Around Main Street America:

1. Stop the wars

2. Rebuild our infrastructure

3. Enable local communities through their schools to train residents for jobs and work skills 

4. If a corporation is too big to fail, it is too big to exist – stop the monopolization – retake anti-trust legislation.

John and Carolee Monroe
Retired teachers and former members of CTA/NEA
Claremont, Calif.

  

Bail Out Main Street

Wall Street has been bailed out, and we have been told that this benefits Main Street.

It’s time to bail out Main Street, which, by expanding the domestic market, will benefit Wall Street.

Apart from passing a health care reform with a strong public option, there are two critical actions that need to be taken.

First, there has to be real, not piddling, foreclosure relief. That would involve some combination of a 6-month nation-wide moratorium on all foreclosures involving mortgages under $500,000; a mandatory federal purchase at 50 cents to the dollar of all troubled mortgages, replacing them with low-interest, fixed-rate, pre-payable 30-year mortgages; and roll-back of interest rates of all mortgages under $500,000 from their current level to the their average level of the last 5 years.

Second, there has to be real change, real reform in the income tax code. Zero tax on the first $50,000 of income, 90% tax on income after $1,000,000, 95% tax on income after $10,000,000, regardless of deductions.

David Arnow
Brooklyn, N.Y.

  

Pay for Single-Payer with Tariffs

We need single-payer universal health care.  This will accomplish two things.  For one thing the middle class would not have to worry about paying for health care themselves.  For another thing it would take a burden off small businesses so that they could hire more workers and focus on doing what they do best. 

To pay for single-payer health care, we should reinstate tariffs on goods produced by cheap overseas labor.  This would discourage outsourcing, further bringing jobs here to the middle class who needs them.  In addition, we should also invest in the green economy, obtaining energy from sources like solar and wind, and we should focus on making hybrids, plug-in hybrids and electric cars as well as improving access to mass transit.  This will further add to the number of jobs.

Michael Karsh
Martinez, Calif.

 

Control Banks; Reinvest Locally

The number one item that should be done to turn around Main Street is capping  all executive salaries, bonuses, “golden parachutes,” including stock options, IRA’s, and the like.  No one, I repeat, no one, is worth more than a million dollars a year in salary. 

The second, and certainly not less important, item that should be done is reinvestment in local businesses — the “Mom and Pop” businesses that contribute a huge portion of tax revenue to individual communities.  This is money that stays within the communities and keeps them alive.  Likewise, these local businesses should look at the vast number of unemployed in their own backyards and hire those who need jobs desperately so they have disposable income to spend in their communities.  These are people who may be close enough to walk to work thus clearing the air and improving their own health.

Third, mortgage companies need to be put on notice; more needs to be done to not only correct but also punish predatory lenders.  The federal, state, and municipal governments should step in and not just require, but force lenders to totally disclose their accounts, employee salaries including retirement packages and bonuses.  Then, since We-the-People are now the owners of so many lending businesses, we should demand repayment of our loans with their profits, executive bonuses, and overpriced resort conference centers.  Stockholders should then be put in control of how much executives receive in salaries and bonuses, and the federal government should have more control of how banks spend money since We-the-People now own them.  

Bonnie K. Long
Goshen, Ind. 

 

Promote Unions to Improve Main Street

Enactment of the bill in Congress to make it easier for employees to form a union would be a big step.

Ronnie Young
Waynesville, N.C. 

 

Invest in Small Business and Worker Training

For years now, we have been on a trend to solidify and consolidate American businesses.

The result has been more big boxes, more big banks, and fewer industries, including the health care industries, that dictate our economic wealth. The bailout for working Americans should include more supplements to diversification and small business as well as a real nationwide infrastructure program and worker training programs in emerging technology and green jobs.  

Susan Maroko
International Staff Representative
USW-District 7, Sub-District 1
Bridgeview, Ill. 

  

Second Stimulus Needed

Progressive Democrats of America went on record in support of a second stimulus with its May 18 publication of my assessment of the financial and economic crisis and a plan to address it.  The idea was not original — I got it from Robert Reich. And Paul Krugman and James K. Galbraith also supported it — but it was hardly part of mainstream discussion, despite Reich’s calculation that a projected $350 billion in state budget cuts and tax hikes would predictably negate nearly half the impact of the $787 billion first federal stimulus. 

Over the summer, that snowball became at least a small avalanche:  On June 29, the Financial Times reported that Christina Romer, chair of the White House Council of Economic Advisers, said the administration would be open to further stimulus if needed, acknowledging that cutbacks by states facing budget crises would push in the opposite direction.  Laura Tyson of the president’s Economic Recovery Advisory Board came out in favor the following week.  Even the Financial Times called for a second stimulus, specifically targeting the states, on the condition that the money be spent quickly.

As the so-called “jobless” recovery proceeds, the White House has begun looking for ways to help Wall Street without calling its measures a second stimulus.  But something quite substantial is still critical as a holding action, to keep us from going over the cliff.  Obama should recognize and level with the public about the dimensions and severity of the problem, and return to Congress for a second stimulus to help the states maintain vital services and avoid tax increases. And Congress should heed the request.

Robert Roth
Eugene, Oregon,

 

Jobs for Main Street; Reform Wall Street

Wall and Main Streets are the two basic economic systems.  Wall Street is comprised of financial capitalist owners who hire technical personnel, e.g. administrators, lawyers, engineers, and statisticians, to run their enterprises.  Main Street is comprised of small businesses and farms, industrial capitalist, entrepreneurs, etc., who produce products that most people want or that people want most.  This system is controlled by the market; whereas, Wall Street, being concerned mainly with growth, has no controls, is unstable, and causes most of our economic crashes.  Nearly all inventions and innovations come from Main Street; whereas, Wall Street concerns itself with growth policies, e.g. planned obsolescence fins on fenders, two tone paint, etc.

Producing jobs for Main Street and reforming Wall Street are the keys to ending  economic collapse.  FDR’s 3 R’s — Relief, Recovery, and Reform — are applicable, including, respectively, CCC and WPA, PWA, and NRA and AAA.  Reinstituting the draft would get young people off the streets and prepare them for useful employment.  We do not have great dams (TVA, HOOVER), or bridges (Golden Gate), or highways (US 40) to build.  But we can repair our crumbling interstate highway system, maintain our highway bridges, rebuild our infrastructure, and make money available for Main Street businesses, etc., to lend and borrow.  And we can develop new industries in our country such as renewable energy, fast trains, and national health.  And if Detroit cannot produce an efficient automobile, then the Government can.  After all, we put a man on the Moon.

Recovery projects take more time to get positive results than Relief because specifications have to be developed, bids have to be made and awarded, and workers hired. The secondary effects of putting people to work does not happen immediately either, for hired workers who have been unemployed are reluctant to spend their pay until they get back on their feet.

Robert K. Leavitt
Upland, Calif. 

  

Make American Corporations Employ Americans

American corporations should be required to pay their U.S. taxes, and they should be required to have at least a majority of their employees working on U.S. soil.  If not, they shouldn’t have the privilege of operating as American corporations!

John Latta
Richland, Wash.

 

Follow President Roosevelt

The plan we should be following is the same one President Roosevelt did. Put people to work rebuilding the infrastructure, the parks, the cities and education. Abolish military Keynesianism and reintroduce Glass-Steagall legislation. End state corporatism.

Frank Cannonito
Retired mathematics professor
Irvine, Calif.

 

Worker Ownership

I think more of the corporations should be owned by the workers rather than a privileged class of stockholders.

When a company goes into bankruptcy or just closes, there should be a law and federal loans and guidance available so that the workers can buy the building and corporate assets at a fair price and then continue production with the workers as the owners and shareholders.  When people quit or leave, their shares would be bought back and given to new workers. The longer you work at such a place, the more shares you would have.

For example, that window manufacturing plant that closed in Illinois a while back where the workers staged a sit-in — there should be a federal legal procedure for the workers to buy the assets and continue manufacturing with the workers as owners.

Of course this would require simultaneous tariffs to protect the industries we choose to keep in the U S.  Tariffs worked great for a long time until the free trade corporate types started having us all drink the Kool Aid. There was no debate about free trade. It was just forced on us before we knew what was happening. 

The result is that the U.S. is manufacturing little anymore, throwing millions out of work and threatening our security. We cannot depend on other countries to manufacture our steel, airplanes, tanks, tires etc. That is a security threat as well as a loss of jobs here at home.

Diminish the corporate elite gradually by workers buying up plants that move to third world countries and then protecting them with by fair trade or tariffs. The results of that work.

Pat Flierl
Clovis, Calif.
 

Create New Businesses

The federal government can do some things like providing tax credits for businesses that create new jobs, and grants or other assistance for new businesses. The government can even provide ideas and motivation for some new businesses by mandating fuel economy, environmentally favorable architecture, conservation projects and other things.  Beyond that, we cannot and must not depend on the government to pull us out of the current quagmire.  There is room for each of us, drawing on our unique experiences, to enter the arena and find and implement innovative ideas that will help. 
 
In the marketplace today, money is in short supply for things like home maintenance and renovations.  So a handyman or an interior decorator, finding business a bit slow, might start a new line of service providing training and supervision so customers can do most of the work themselves.  Training groups of customers to do their own renovations can be as profitable as time spent doing the work for them.  It may even be more profitable, but it costs the customers less because they are sharing the costs.  And saving the cost of labor, by doing the work themselves, may enable people to afford renovations they could not otherwise afford. 
 
If you think you have a workable idea for a new business or a new approach to solving problems in the marketplace, you can find help if you need it.  If your idea entails starting a new business, the SBA (Small Business Administration), can help you start at this link: http://www.sba.gov/
 
And if you would like to come up with an idea but you don’t know where to begin, you might try visiting http://www.grants.gov/ where you can browse through listings of federal grants to see what products and services the government feels are needed.
 
I hope reading this inspires you to start thinking about how you can contribute to
the recovery, rather than waiting for the government to
throw you a bone.   Good hunting!        

 

Go To Six-Hour Work Day

 I propose two remedies for the skewed wealth in this country. First, we should win the six-hour day (with no loss in pay). It would put people to work since there would be four shifts per day instead of three. It would also give individuals more time to spend with their loved ones and to serve in the community. The wages would be paid by the corporations and their financiers, the banks. 

The second activity that would create jobs is supporting the development of Personal Rapid Transit (PRT). That transportation technology would put people to work building the rails, modules, elevators, etc., and working on the computers and maintenance. It is the only thing that can get people out of their cars, so it is a green technology. 

Margaret R. Beegle
Associate Member of the Steelworkers,
formerly AFSCME member
Golden Valley, Minn.

 

  

Yell at Congress

Pester Congress to stop these trade deals that import foreign goods that Americans can make. For instance, sheets, bedspreads, towels, clothes, were once made in North Carolina. I loved everything I ever bought that said MADE IN THE USA. I still have many of those items. They are still usable after 25 years!!! Yeah, 25 years. 

I’m a 79 year old widow, and I don’t buy much anymore. My best furniture was made in the hills of North Carolina. Today’s crap is fiberboard, back nailed or stapled on, not screwed, no dovetails or mortise. I have 55 year old furniture that is still beautiful. I have all leather American-made shoes that are gorgeous, beautiful shoes came from New England, not this crap from Brazil or where ever. The dye from foreign-made shoes bleeds all over your feet! They only make wides, and I have skinny feet!

I could go on and on. It is hopeless no matter who is President. Greed is the name of the game. Robber barons with 2-13 houses, 12 cars, millions in jewels, clothes and only God knows what else they have stashed someplace.  How many damn dresses can a woman wear or shoes or underwear? And how much can their kids own? How many cars do they need? No CEO should make more than 10-15x as much as the lowest paid worker in his business!

I am fed up with the mind set of management. They think of themselves and their families as GODS.  False gods, as Jesus would call them! If I were only younger and healthier, I would march and yell at Congress!

Gloria J. O’Reilly
Melbourne, Fla. 

 

Hold Our Money Hostage

We should all withdraw all of our money from every bank until they change their ways. We get no interest worth mentioning anyway.  We should start a real workers’ party, which will give us what we deserve: public option, honorable government, better control of Wall Street and banks.

 Elsa Lewin
Great Neck, N.Y.

  

Too Few People Have Too Much Money

 The problem is simple. Too few people have too much money. Here are some proposals.

We need to get health care reform passed immediately. We need a public option – or better, just let people or their employers buy their health insurance from Medicare. Private health insurance companies are robbing the public blind. They are planning to raise rates even without health care reform because 2010 is an election year and the health insurance industry needs money to bribe politicians. (Bi-partisan = buy-partisan.)

We need to proceed full speed to a green technology. You can read the articles on the Apollo Alliance website for details.

We need to restore all the regulations on the banking industry that the Reagan Administration eliminated. We need to abolish APR’s and permit only fixed-rate mortgages. The deregulated banking industry has simply created a casino economy.

We are fighting a war, but the rich are not paying the same tax rate they paid during World War II. We need to pass an emergency tax rate on the rich – 88 to 91% of their income. We can use that to balance the budget and to invest in green technology.

Conservatives like to claim that World War II really ended the Great Depression. But what they don’t tell us is that World War II involved massive government expenditures. The draft took care of the unemployment problem – which might be a good reason for expanding governmnet public work projects. Some government work projects should be designed to provide jobs for college graduates who have degrees but no jobs (and student loans to pay off.) We can lower the tax rate on the rich when everybody has decent jobs and when we’ve gotten rid of the wars in Iraq and Afghanistan.

William Joseph Miller
Los Angeles, Calif.

 

Don’t Be Treated Like a Second-Class Citizen 

When our founding fathers founded this country, they did not give the vote to blacks, and women, and the Indians were not treated so well.  In the great bail-out, Congress is taking care of Wall Street. Wall Street has given members of Congress millions of dollars toward their campaigns, and it appears Congress has not forgotten by giving billions in bail-out.  We can not match the money Wall Street is giving, but we need not let ourselves be treated like second class citizens. Join unions and progressive groups such as those online.  Give what you can.  We must be heard.

Stan Rowe
Newport, Ore.

 

March on Washington

The answer is not in Washington, D.C. The only beneficiaries of the stimulus money so far have been the banks and Wall Street. Nothing much has changed. The world of the worker remains stark.

You remember the millions who marched for immigration reform across the country? Remember the millions who marched on Washington following MLK for civil rights? Those marches surprised everyone who didn’t expect the turnout. Scared the pants off Washington for a while.

Well, I think a million man/woman march on Washington by Main Street America demanding jobs, an end to foreclosures, and the rebuilding of America is the only “noise” Washington will pay attention to. As longs as we continue sending e-mails, donating money and doing those kinds of passive actions that Washington is used to, they will win in the end, and we will end up with a half a loaf, cut up and divided by the corporations.

Angel Rodriguez
A former copper miner from Morenci, Ariz.
Glendale, Ariz. 

 

Unions Matter to Main Street

It is important Unions do change the current union organization laws so there is a level playing field for organizing workers to promote Main Street. This will provide workers such as those at Wal-Mart, Target, Sears, motels, restaurant chains, high tech companies, with livable wages to raise a family.

Wal-Mart is now the largest employer in Pennsylvania, and there is no reason why they should not permit their employees to organize throughout the nation.

What people have to understand is that these businesses if they want to be part of the America Dream should not avoid a livable wage with benefits for our community employees. They will not be able to move overseas and abandon the very people they always say comes first.

Union pension funds have provided many Wall Street investment firms, community banks, and financial planners with good paying jobs on the dimes of the workers. Banks have benefited by investing such pension funds, and reinvesting the money into small businesses and innovative entrepreneurs.  

Unions do look out for their members first and foremost. One did not see union pension funds becoming victims of Madoff-type rip offs. My Union Plus credit card provides me with the lowest finance charge and is understanding when it comes to a late payment.

Small business owners, lawyers, doctors, bankers, dentists, real estate firms, restaurant owners, and all professions and local businesses prosper when union workers flourish within a community

The American union model must be expanded in America to encompass as many workers as possible and then adopted in the Global Economy in every nation on earth.

This is why Unions matter; it has been proven they provide a far fairer and equal work environment and benefit for everyone not just their own members. If you want to help Main Street, then back Union organizing because unions do not just protect Main Street they promote Main Street!

Joseph Janos
Aliquippa, Pa.

 

Go Green to Turn Around Main Street

Go for a “Green Economy,” expand solar power, wind power etc., refurbish infrastructure, clean up polluted waterways and land areas. There’s plenty of work to be done.

Guy D’Angelo
Center Moriches, N.Y.

  

Re-regulate the Markets

 In order to make a determination of what should be done to turn around Main Street America, we first must understand what brought about our current financial crisis. Wall Street’s investment bankers regularly utilized risky investments and engaged in predatory lending habits in an unconscionable effort to produce huge, short term profits. In doing so, they sheltered risk with public funds. These efforts ultimately led to dire consequences when those loans proved not payable. Additionally, they created, maintained and justified a housing bubble which eventually led to the worst economic conditions the United States has experienced since the Great Depression.

American citizens must demand accountability in order to not only maintain the integrity of the marketplace, but also to restore our democracy. Corporate officials acted with reckless abandon at the expense of stockholders and taxpayers. They should be prosecuted and sentenced for their ruthless behavior in much the same way that we hold common criminals and street thugs accountable for illegal activity. Theft is theft no matter the circumstances!

It is time for our legislators in Washington D.C. to intervene. Recent government intervention was necessary within the past year in order to save banks and insurance companies from financial collapse. By the same token it is also appropriate that the government intervene to ensure such institutions are held accountable.

Make no mistake about it, financial deregulation led directly to the economic meltdown in America. The post-Depression regulatory system instituted during Franklin D. Roosevelt’s administration has systematically been set aside, leaving only Wall Street’s “fox” to guard the proverbial henhouse.

Even today, Wall Street continues to defend the very same practices that resulted in the financial collapse. If Wall Street has its way, they will continue to remove public controls over their operations. We cannot and must not allow this travesty to continue. We must concentrate on returning to the days of strict regulations of the financial markets. That in turn will stimulate our economy by creating and maintaining high paying American jobs.

John Patrick
Assistant to the Director
USW, District 13
Baytown, Texas

 

Start a National Bank

The first thing that must be done is to rid ourselves of banking tyranny. We have to start our own national bank and put banking at the service of the people and not the other way around. What we have in this country is a massive system of fraud where the banks have used our tax dollars to steal billions of dollars with the active connivance of Geithner, Sommers and an inner circle of thieves and gangsters that inhabit the treasury system.

Paul Bennett
New York, N.Y. 

 

Create Public Jobs

Jobs, jobs, and more jobs.  Push Obama to update the Works Progress Administration WPA and Civilian Conservation Corps to create jobs for all the unemployed. They could rebuild the infrastructure using green standards, adding more trains, streetcars and bikeways. They could retrofit houses, produce renewable energy resources, rebuild New Orleans and surrounding areas, heal the people, educate kids, restore the commons.   Whatever needs doing for the people, they could get done.

Tax the very rich to pay for it.  They used the commons at a bargain price in their climb to wealth.  Now is the time for them to pay their share.

Wren Osborn
El Cajon, Calif. 

 

Inflate to Deflate to Confiscate

Having bought the government, exempted themselves from any legal or ethical restraint and XZ@&$*#&@ the peasants to the point where their lives are stressed and shortened by loss of jobs, community, homes, pensions, “investments,” savings and ability to obtain pricey corporate pill and procedure pushing that passes for health care and then, by God, maneuvered to insure the dead peasants so that they are worth more dead than alive  . . . they now turn to the next generation, who are “counseled” to take student loans that simple calculation would show to be likely too impoverishing to repay, never mind ruinous fine print late fees and interest penalties and the clever exempting of such loans from the relief of bankruptcy, to get college degrees to prepare for jobs that are gone to other peasants worldwide who have perhaps as little as the equivalent of eighth grade education in the school of hard knocks but who can do most remaining productive jobs passably but ephemerally.  

John Bland
Canandaigua, N.Y. 

 

Organize and Take Action

First get everyone to see Michael Moore’s latest on corporations, a love affair. Then get everyone to talk about it. Then get organized into groups to do something, anything.

Call the White House to tell them what you want, and don’t want: 202-456-1111.  It’s a free call. All members should have this number.

Now get organized to rally in protests wherever your group decides, at banks, at foreclosures, at plant layoffs. Have Photo-ops.

Think about joining independent parties, Greens, etc.  I am a Green and voted for Nader.

Call your representatives in Congress — also a free call:  202-224-3121.

Organize, organize.  That’s what unions do best.  We all know what is right, now make the President do that and not let them make us afraid.

Best to us all.  No one is going to save us but us.

Jean Snyder
Member, United Steel Workers
Greenbelt, Md.

 

Working Americans Unite

To turn around Main Street, working Americans must unite across racial, ethnic, religious, gender, political and social classes against the insidious concentration of wealth on Wall Street and the unprecedented takeover of our Democracy by multi-national corporate interests.

 We must be united in our recognition, support and encouragement of those true champions of working Americans such as labor leaders Leo Gerard and Richard Trumka; muckrakers Michael Moore and Jim Hightower; media personalities Thom Hartmann and Keith Olbermann; and progressive lawmakers Bernie Sanders, Alan Grayson and Sheldon Whitehouse.

Similarly we must be united in the identification, acknowledgment, resistance and condemnation of the true enemies and adversaries of working Americans who are the Wall Street billionaires; the multi-national corporate lobbyists; conservative and neo-liberal economic policies; privatization of government services; unfair and exploitive trade policies; bought and paid for corporate judges and politicians at the local, state and federal level; and plutocratic propagandists Rush Limbaugh and Rupert Murdoch.

Finally we must be united in a tireless campaign to promote and establish collective bargaining units throughout our country and world at all levels of skill, education and social occupations.  And we must never, ever waste a single one of our precious votes on a candidate who holds the interests of capital superior to those of their hard working constituents.

John O’Connor
North Smithfield, R.I. 

 

Place High Tariffs on Imported Goods

The USA cannot economically re-industrialize without tariffs that are sufficiently high enough to prohibit most all imported products from entering the USA. We should impose extremely high import taxes so that these U.S. made products are always less expensive to the consumer than the same imported product. Without extremely high tariffs, U.S. workers must compete with foreign workers at very low foreign wage scales and degraded environmental conditions.

The US government should borrow U.S. dollars back from the industrial nations and use that money to build manufacturing plants to make various consumer products in sequence one product at a time, i.e. refrigerators, washing machines, clothing, TV’s, electronics, tires, auto parts, hand tools, power tools, machine tools, appliances, etc.  Eventually all of the consumer goods that we import could be made in the USA.

These plants should periodically be for sale based upon open public competitive bidding, but at a minimum sale price at least equal to as much as the government investment, and with terms of cash only without any creative financing.

The US government must also pass laws to prohibit the export of service jobs such as accounting, telemarketing, customer service, computer aided drafting, engineering, etc. that are now provided by workers overseas through the internet.

The management should know about making the products, not creative accounting and/or creative financing.

U.S. citizens must stop selling the U.S. national wealth that was created by previous generations of agriculture, mining and manufacturing sectors of our economy during and after World War II to pay for our non-producing but high consumptive lifestyle of today.

Paying people to rake leaves, pave roads, build infrastructure, plant trees, dig holes then refill the same holes, clean up the environment, write poems, paint pictures, bailout financial investment failures, etc. with U.S. dollars borrowed from industrialized nations is nice, but these jobs will not be useful or contribute anything to correcting the basic U.S. economic foundation problem which is borrowing U.S. dollars back from foreign industrialized nations to pay for the foreign trade deficit and the federal government spending deficit. 

Gerald R. Spencer, P.E., President
Spencer Engineers, Inc.
Houston, Texas

 

 

By Dean Baker
Co-Director, Center for Economic and Policy Research

Kenneth Feinberg, President Obama’s compensation czar for bailed out banks, appears to have taken some genuine steps to rein in excessive executive compensation at the basket case banks that received the most TARP money. He cut cash salaries by 90 percent in some cases and reduced overall compensation for the top executives at the seven institutions that received the most government money.

This is a good first step, but it is only a first step. The pay caps involve only a relatively small number of people in an industry where hugely bloated salaries are the norm. Even in these cases it is too early to know that the pay caps will actually prove to be binding. After all, Wall Street’s main craft is evading regulations and taxes. It is entirely possible that those clever Wall Street boys will find a way to get around whatever pay restrictions Mr. Feinberg puts in place.

Whatever happens to the pay of this small group of executives the real problem goes much deeper. The Wall Street folks view the wreckage from last year as a minor distraction and are eager to get back to business as usual. This attitude was best expressed by “a person close to A.I.G.’s board,” who said of plans to restrict pay at the AIG division that wrecked the company to $200,000: “that’s insulting … why wouldn’t anybody quit?”

Of course, this “insulting” pay package would still give our AIG executives more pay than 99 percent of the work force. They would be getting more than three times as much as the average teacher, firefighter, or nurse. They would be getting more than five times as much as the average factor worker and more than ten times as much as minimum wage worker.

Furthermore, if anyone among these other groups of workers mess up so badly that they bring down their employer, they lose their job. They don’t get to go somewhere else because a $200,000 paycheck is “insulting.”

Wall Street badly needs fixing. Fortunately we have the tool to do the job. It’s called a financial transactions tax (FTT) – a modest tax on trades of stock, futures, options and other financial instruments. Such a tax could easily raise $100 billion a year, while cutting the financial sector down to a manageable size.

An FTT is not an alien concept. We actually had a tax on stock trades until 1964. The United Kingdom still has a 0.25 percent tax on stock trades that, relative to the size of its economy, raises the equivalent of $40 billion a year in the United States.

If we follow the lead of the UK, we will a great revenue source that will barely touch most of the population. Investors who buy and hold stock for 10 years will barely be affected, as is the case of a farmer hedging her wheat crop. However, someone who buys stock at 2:00 with the intention of selling at 3:00 would pay a substantial price.

There are many other good arguments for an FTT, including that it is the fairest way to fix the damage to the budget caused by the recession and the bailout, but an FTT will not get an airing in a Congress where the banks continue to wield enormous power. Congress will only consider an FTT, as opposed to more regressive proposals like a national sales tax, if the public demands it.

The public will have an opportunity to express their outrage at the banks and the need to rein them in at the Showdown in Chicago beginning on October 25. If this protest proves successful, and there are hundreds more like it around the country, then Congress may start thinking more clearly about measures to change Wall Street culture and to get back our money.

***

Dean Baker is the author of the new book, “Plunder and Blunder: The Rise and Fall of the Bubble Economy.”

*** 

This piece was first published on Huffington Post.

By Robert Reich
Former U.S. Secretary of Labor, Professor at Berkeley

At a conference in London, a Goldman Sachs international adviser, Brian Griffiths, praised inequality. As his company was putting aside $16.7 billion for compensation and benefits in the first nine months of 2009, up 46 percent from a year earlier, Griffiths told us not to worry. “We have to tolerate the inequality as a way to achieve greater prosperity and opportunity for all,” he said.

Eight months ago it looked as if Wall Street was in store for strong financial regulation — oversight of derivative trading, pay linked to long-term performance, much higher capital requirements, an end to conflicts of interest (i.e. credit rating agencies being paid by the very companies whose securities they’re rating), and even resurrection of the Glass-Steagall Act separating commercial from investment banking.

Today, Congress is struggling to produce the tiniest shards of regulation that would at least give the appearance of doing something to rein in the Street.

What happened in the intervening months? Two things. First, America’s attention wandered. We’re now focusing on health care, Letterman’s frolics, and little boys who hide in attics rather than balloons. And, hey, the Dow is up again. The politicians who put off Wall Street regulation for ten months knew that the public would probably lose interest by now.

Second, the banks keep paying off Congress. The big guns on Wall Street increased their political donations last month after increasing their lobbying muscle. Morgan Stanley’s Political Action Committee donated $110,000 in September, for example, of which Democrats got $43,000.

Official Wall Street PAC donations are piddling compared to the tens of millions of dollars that Wall Street executives dole out to candidates on their own (or with a gentle nudge from their firms). Remember — the Street is where the money is. Executives and traders on the Street have become the single biggest sources of money for Democrats as well as Republicans. And with mid-term elections looming next year, you can bet every member of Congress has a glint in his or her eye directed at the Street.

That’s why the President went to Wall Street to raise money Tuesday night, gleaning about $2 million for the effort. He politely asked the crowd to cooperate with reform — “If there are members of the financial industry in the audience today, I would ask that you join us in passing necessary reforms” — but those were hardly fighting words. It’s hard to fight people you’re trying to squeeze money out of.

Which is the essential problem.

Ken Feinberg, the President’s “pay czar” came down hard on executive pay yesterday, for those banks still collecting money under TARP, as well he should. But Feinberg isn’t trying to pass new financial reform legislation, and TARP no longer covers several of the biggest banks with the highest pay and bonuses — although they’re still getting subsidized by the government with low-interest loans.

Wall Street and the Treasury want us to believe that the TARP money will be repaid to taxpayers, but Neil Barofsky, the special inspector general keeping watch over TARP, said yesterday that just 17 percent of the TARP money has been repaid, and “[i]t’s extremely unlikely that taxpayers will see a full return on their investment.” Later he told a reporter that it’s unlikely “we’ll get a lot of our money back at all.”

Brian Griffiths, the Goldman international adviser who told us inequality is good for us, doesn’t know what he’s talking about. America is lurching toward inequality once again, led by the financial industry. The Street is back to where it was in 2007, but most of the rest of us are poorer than we were then — largely due to the meltdown that occurred because Wall Street overreached. The oddity is that we bailed out the Street, including Griffiths and his colleagues, but apparently won’t even be repaid.

And now that Griffiths et al, knows his firm and the other big ones on the Street are too big to fail, he and his colleagues will make even bigger gambles in the future with our money.

***

Cross-posted from Robert Reich’s Blog

***

Robert Reich served as the nation’s 22nd Secretary of Labor and now is a professor of public policy at the University of California at Berkeley. His latest book, “Supercapitalism,” is out in paperback. For copies of his articles, books, and public radio commentaries, go to www.robertreich.org. 

By Leo W. Gerard
USW International President

In New York, the oldest and snobbiest financial and advising ventures are called “white shoe” firms.

This, they say, arose from the days when their hoity-toity employees wore white bucks to work. 

These days, white shoe firms bear names notorious outside New York, like Goldman Sachs and Morgan Stanley. That’s because their arrogance, risky investments and confounding dealing in derivatives caused last fall’s Wall Street meltdown, slaughtered white shoe firms like Lehman Brothers, froze credit nationwide, and threw the rest of us into the Great Recession. 

Now unemployment is up to 9.8 percent, a 26-year high. Banks repossessed 88,000 homes in September and filed foreclosure notices on another 344,000, according to RealtyTrac. Suicide hotlines report increases in calls, and a study released in July by researchers at several universities including the University of California documented the connection between unemployment, suicide and murder. Each percent increase in unemployment raised suicide rates by .8 percent and homicide rates by .8 percent, the research team found.

There’s blood on those white bucks. But the guys wearing them don’t seem to notice.

When bankers’ backs were up against the wall, the taxpayers of the United States bailed them out to the tune of $700 billion. Some, like Bank of America, took the welfare then repaid that generosity by doling out billions in bonuses. BofA got $45 billion from taxpayers, then gave $3.6 billion in bonuses to Merrill Lynch workers, just as BofA bought Merrill — which lost $25 billion in 2008. 

Banksters always argue that they must pay massive bonuses to reward and retain their best and brightest. Yet the best and brightest had managed to undermine Wall Street and lose $100 billion at the nine firms that received government welfare in 2008.  Realistically, finding lower-cost replacements for them shouldn’t be a problem since lots of unemployed bankers are pounding New York streets. The New York City Office of Management and Budget determined that Wall Street banks cut 30,000 jobs in 2008.

Still, Wall Street continues to reward incompetence. Morgan Stanley, for example, increased the proportion of its revenues to be paid as compensation and benefits – to total a whopping $6 billion by September — despite three straight losing quarters this year. This is how the London Telegraph characterized the decision in an Oct. 21 story:

“Investment bank Morgan Stanley has more than doubled the share of revenues it will hand out in pay and bonuses to its 62,000-strong army of bankers and brokers despite a 91 pc drop in profits last quarter.”

Right now, they’d each get $96,774, but Morgan Stanley has another quarter to add to that pool of pay.

Investment house Goldman Sachs has set aside $11.4 billion so far for compensation, setting a pace for an average Goldman worker to get $773,000. That would more than double last year’s earnings for the average Goldie.

Contrast that with the U.S. Census report that the typical worker nationwide lost $1,860 for a reduced wage of $50,303. Or compare it to the experience of the woman in the Oct. 21 New York Times story who competed with 500 other applicants for one $13-an-hour clerk job opening at an Indiana trucking company.

When America’s median income workers paid to bail out those white shoe swells, they thought something would change. “There is some failure in the finance industry to appreciate the level of public antagonism toward whatever Wall Street symbolizes,” Orin Kramer, a Democratic fund-raiser who is a partner in an investment firm, told the New York Times’ David D. Kirkpatrick earlier this month.

Dr. Daniel E. Fass, who was chairing a Democratic fundraising event with Kramer, told the Times’ Kirpatrick, “The investment community feels very put-upon. They feel there is no reason why they shouldn’t earn $1 million to $200 million a year, and they don’t want to be held responsible for the global financial meltdown.”

And, indeed, they’re acting like it never happened. JPMorgan Chase & Co. went out this year and made billions doing exactly what caused the crash last year – trading like crazy in derivatives. 

So a parent figure had to step in. The Obama Administration acted this week. The Federal Reserve announced it would crack down on pay packages at the nation’s 28 largest banking companies in ways intended to discourage risky practices. And the Treasury Department announced that it will order pay cuts and perk limitations for top officials at the firms still on welfare. They are Citigroup, Bank of America, American International Group, General Motors, Chrysler and the automakers’ financing agencies.

This new lifestyle will be devastating for some of those on welfare. Their perks could be limited to $25,000 – only half of a typical American worker’s annual salary. And the cash portion of their salaries could be slashed by 90 percent and replaced by stock that cannot be sold for years. The point is to align their personal interests to the firm’s long-term financial health.  It is an attempt to discourage risky investments that seemed profitable for the purpose of immediate bonus payments but later exploded like the AIG derivatives scandal. 

The white shoe crowd, failing to understand that the president was trying to help them clean up the mess at their feet, immediately started whining and complaining. It just wouldn’t work, they said, because pay-pinched executives would run to firms unrestricted by the government. That’s all for the good because, again, there are 30,000 Wall Streeters searching for jobs.

The pay restrictions will set a proper tone. Perhaps Wall Street will hear it before, as the New York Times described it, “populist animosity toward Wall Street and corporate America” grows too great.

If that happened, the blood on their white bucks might be their own.

Robert L. Borosage
Co-Director Campaign for America’s Future

They are popping the bubbly on Wall Street. Million dollar bonuses; the Dow at 10,000; the casino is open again. Forget President Obama who says we can’t go back to an economy where finance pockets 40% of the profits. We’re already headed there.

The current account deficit is down as Americans have cut back spending. But the deficit with China is hitting new records; companies are still shipping manufacturing jobs over there. The dollar is down, but not against the Chinese currency. Forget about Federal Reserve Chair Ben Bernanke who warns against going back to the unsustainable trade imbalances that led us over the cliff. The old patterns are coming back.

Bernanke has announced that the recession is over, the recovery has begun. But to date, we are looking at a reversion, not a recovery. We’ve stopped the free fall, but we haven’t changed direction. There can be no recovery to the old economy that crashed when the housing bubble burst. That economy depended on Americans spending more than they earned, borrowing ever greater amounts, treating their homes like at ATM machine, while the Chinese lent us the money to keep interest rates down so we could buy the goods our companies made with the jobs they shipped over there.

Now that old economy didn’t work very well when it was growing. We lost high wage manufacturing jobs during the supposed “recovery” under Bush. Most Americans lost ground even while the economy was expanding. Household debts reached new highs. Inequality soared to Gilded Age extremes.

But now we can’t even get back to that performance. Americans have lost some $13 trillion in assets. They are tightening belts, trying to pay down debts, terrified as jobs are lost, hours cut, benefits slashed. Consumers won’t drive the US economy, much less the world’s. And businesses aren’t investing because consumers are cutting back. They are increasing profits by laying off workers and cutting back expenses. States and localities are headed into severe layoffs of teachers and police. The economy isn’t going to be buoyed by soaring exports to a world in recession. The only thing holding the economy up now is the deficit financed stimulus plan and the automatic stabilizers like food stamps and unemployment benefits.

Where will the jobs come from? Wall Street can produce another bubble, but that won’t put the 15 million without jobs to work, one third of which have been out of work for at least six months.

Recovery requires fundamental reform of America’s economic strategy. The old shibboleths of the conservative era – small government, cut top end taxes, free multinationals to move jobs abroad, deregulate finance, war on labor unions, trade deficits don’t matter – have failed ignominiously. They must be discarded, like yesterday’s rotted fruit.

Fundamental changes are needed. Trickle down should be supplanted by public investment led growth – large scale public investments in areas vital to our future like infrastructure, research and development, education and training. These investments should be deficit funded until the economy actually starts putting people back to work, and then sustained and paid for through progressive tax reform. Tax speculative security transactions, generating $100 billion a year in revenue to invest in a 21st century infrastructure that would put people to work and make the economy more productive. Raise top end taxes, reduce inequality, and invest in making college affordable or exploring the green technologies of the future.

We’ve pursued tax cuts, promising private investments would flourish. But much of the productive investment and lavish consumption went abroad. In reality, public investment would be far more effective. We have a staggering public investment deficit that must be met for a world efficient economy. Public investment is more likely to be invested, more likely to be spent here, more likely to create good jobs here, and far more likely to generate new technologies and productive private investments.

We need to complement this with a bold manufacturing strategy to make certain that we help lead the inevitable green industrial revolution, so the new technologies will be created and made in America. Shed the notion that we’ll benefit by importing windmills and solar cells and electric cars subsidized by China so that they are cheaper to us. We can’t exchange dependence on foreign oil with dependence on foreign made windmills. Make the public commitment to transition, and then use our purchasing power to invite the companies with the best technology to bid on contracts so long as they make it here in America. Not simply a timid buy America policy satisfied with the final assembly of parts and technologies made elsewhere, but moving entire supply chains so that our workers and engineers and entrepreneurs are familiar with cutting edge technologies that our inventors can soon surpass.

Complement this with a new global trade strategy. We can’t go back to current account deficits over 6% of GDP, financed by borrowing from abroad. China, now some ¾ of our manufactured goods deficit, is by far the hub of the problem. The President has wisely called on the international community to adjust cooperatively, challenging the Chinese and other mercantilist nations to expand domestic demand and reduce their reliance on exports, while the US exports more and buys less. But that isn’t going to happen so long as the Chinese are free to manipulate their currency, subsidize their exports, savage their workers and environment, and mandate global corporations transfer jobs and technology to them. So we’ll need to show some bite. A bold manufacturing policy around new energy will encourage companies, including Chinese companies, to make things here. But we should be debating putting a lid on our deficits, and announcing that we will move slowly to balance our trade. If all adjust, we can have more trade, not less, but we can’t go back to the old imbalances no matter what they do.

These must be complemented by financial reform that curbs the gambling and forces banks to make loans to Main Street again, and by a high wage policy – empowering workers, lifting the minimum wage, extending the public social contract. Finally, our economic policy – both monetary and fiscal – must be targeted at sustaining full employment as a priority, without letting inflation get completely out of control.

These ideas – heresies in the old conservative times – are but the beginning towards defining a new course. They will face fierce resistance from entrenched interests. But perhaps the biggest obstacle is the encrusted hold of old, bad ideas that should already have been discarded. You can see that in the calls for balancing the budget and cutting spending while unemployment is reaching new heights. Or the Republican chorus about cutting taxes, as if they had learned nothing. Or conservative Democrats railing against limited buy American policies. Or the administration proclaiming its opposition to industrial policy. Or conservatives railing against excessive regulation.

Inertia and interest drive us to revert, not reform. Only it won’t work. The old standards don’t play anymore. Sure, Wall Street can generate another bubble or two. But there is no recovery on that old path – only stagnation, crushing long term unemployment, growing inequality, a devastated middle class and a social tinderbox increasingly ready to explode. Eventually, we’ll have to change our course – the only question is how much pain we have to endure before we actually learn our lessons.

 

By Stewart Acuff
Special Assistant to the President, AFL-CIO

It is more and more fun to read the newspaper stories, articles, blog
posts, and the rest about the demise of conservatism and/or the
Republican Party.

It is no wonder there is so much speculation. Just watch John Boehner
or Mitch McConnell or the nightly news or catch a clip of Rush
Limbaugh ranting on “Morning Joe.” The leaders of the Republican Party
and the ideologues of Conservatism have no answers for any of the
problems of our Country and our people are trying to deal with.

Recently, I saw an opinion piece of Steven Hayward of the American
Enterprise Institute in the Washington Post. His piece was headlined
“Is Conservatism Dead?”

Hayward’s point was that, of course, Conservatism isn’t dead but that
the ideology needed a balance between rightwing populism and
intellectual heft. He noted the success of William F. Buckley as a
public intellectual.

Shockingly, Hayward lifted up Fox News’ Glenn Beck as a thoughtful
conservative who bridges the gap between rightwing populism and
intellectual heft. To hold Glenn Beck up as either the future or
savior of conservatives is laughable on its face. Beck doesn’t even
take himself seriously. And Beck’s open, ugly visceral hatred for
those he disagrees with will hardly draw thoughtful young people or
independents to his ideology.

Hayward then criticizes Progressives for the “belief in political
solutions for everything…” This is one of the Right’s scariest
notions, because politics is how free people in democracies solve
social problems.

Conservatism’s illness has other symptoms. For one thing, rightwing
ideologues now call themselves conservatives. Folks like Glenn Beck
and Rush Limbaugh and Karl Rove are hardly conservatives. They want to
continue to transfer power and wealth from the great majority of
Americans to those who already have too much and who’ve brought on the
greatest economic crisis in 80 years. Just the other night I was on
Fox Business debating these rightwing nutcases about health care
reform and the public health care plan. One of them admitted that they
thought of Canada as a socialist country. I said that is just how
bizarre their thinking is.

That kind of bizarre rightwing (conservative thinking) has brought us
30 years of declining wages, 15-18% unemployment, 50 million Americans
without health care, CEOs making 400 times that of the average worker,
increasing poverty, a shrinking and stressed middle class, a falling
standard or living, a government that lied to take us into an
unnecessary and disastrous war, the worst economic crisis in 80 years,
a business-government ethos that produced obscene greed and gluttony
at the highest levels, ballooning debt, a coarsening of our culture
and political discourse, and a shredding of any notion of our Nation’s
common good.

Maybe conservatism is dead.

 

By Dean Baker
Co-Director, Center for Economic and Policy Research

Most of the economists and pundits who could not see an $8 trillion housing bubble are telling us that the United States desperately needs for the Chinese government to keep buying its debt. This crew of failed analysts argues that without the support of the Chinese government, interest rates in the United States will rise, choking off the recovery. In reality, the decision by China to stop buying U.S. government debt may not harm the economy’s recovery, but it could be devastating to the recovery efforts at Citigroup and other basket case banks.

The basic logic is simple. China’s central bank has been buying up huge amounts of dollar-based assets for the last decade. Their purchases include short and long-term government debt, mortgage backed securities and to a lesser extent private assets.

The Chinese central bank’s purchases have two effects. First, they help to keep interest rates low. This supports economic growth by keeping down the interest rate on mortgages, car loans and other borrowing that boosts demand.

The other effect of China’s purchase of dollar-based assets is that it keeps down the value of its currency against the dollar. This is the famed currency “manipulation,” that draws frequent complaints from politicians. Of course, it is not exactly manipulation. China has an explicit policy of keeping down the value of its currency against the dollar. It is not buying up hundreds of billions of dollars of U.S. assets in the dark of night. It does it in broad daylight in order to keep its currency at the targeted rate.

Suppose China stopped buying up U.S. government debt. Interest rates in the U.S. would rise, which would have some negative impact on growth. Of course, the Fed could try to offset this rise in rates by simply buying more debt itself. It has already been buying debt and it could simply buy enough to replace the lost demand from China. This would leave interest rates largely unchanged.

Suppose that the Fed doesn’t intervene and lets interest rates rise. This will have some negative impact on growth, but there will also be a very positive side from China’s decision to stop buying dollars. The dollar would fall in value against China’s currency. This would make Chinese goods more expensive in the United States, leading U.S. consumers to purchases fewer imports from China and more domestically produced goods.

A lower-valued dollar would also make our exports cheaper in China. That would allow us to export more to China.

The net effect would be an improvement in our trade balance, bringing back some of the 5.5 million jobs that we’ve lost in manufacturing over the last decade. In fact, since nearly all economists agree that the current trade deficit can’t persist for long, China would be helping the country bring about a necessary adjustment if it stopped buying up dollars.

Even the rise in interest rates would have a positive effect since it would allow for the completion of the deflation of the housing bubble, with house prices finally settling back to their trend levels. This drop in house prices will be a painful adjustment, but there is no way to avoid it. Bubbles cannot be sustained indefinitely and we are better off allowing the housing market to return to normal so we can get back to a path of sustainable growth.

While decision of the Chinese to stop buying dollars might be good for the economy, it is likely to be disastrous for Citigroup and the rest of the basket case banks. If interest rates rose, then the value of the government bonds they hold would plummet. If the interest rate on 10-year Treasury bonds goes from the current 3.5 percent to a still low 4.5 percent, then the banks will have lost 8 percent on their holdings. At a 5.5 percent interest rate, a rate that would still be far below the average for the 90s, the loss would be 15 percent. Citi and the other basket cases could not endure these losses in their current financial state.

This could be why we see shrill pronouncements from the likes of the Washington Post editors, and other “experts” who couldn’t see an $8 trillion housing bubble, that we need the Chinese government to keep buying up our debt. We absolutely do not need the Chinese government to keep buying U.S. debt and would almost certainly be better off if it stopped tomorrow. Citigroup and the other big banks do need the Chinese government to keep the money flowing if they are to have a chance of getting back on their feet. And, we know where the sympathies of the Washington Post’s editors and other “experts” lie.

***

Dean Baker is the author of the new book, “Plunder and Blunder: The Rise and Fall of the Bubble Economy.”

This piece was first published on Huffington Post.

By Leo W. Gerard
USW International President

The meeting got testy. Voices rose last Thursday among Democrats over differences in the Senate Finance and Health committee versions of insurance reform.

Max Baucus defended his committee’s bill, voted out last week with one Republican, but lacking a public option and burdening the middle class. He said, according to reports by Sen. Evan Bayh:

“We are doing the best we can.”

Maybe Baucus is doing the best he can, considering the fact that his committee, in search of Republican support, has been kissing elephant trunk so long it doesn’t know which end is up.     

Democrats must stop appeasing elephants whose intent, frankly, is to squash health care reform. Dems have a supermajority in the Senate. They have the support of the American people for health insurance reform – with the latest polls showing more than 60 percent back the public option. And the power of opponents is waning, as last week’s failed attempt by the insurance lobbying organization America’s Health Insurance Plans (AHIP) to scuttle the Senate Finance Committee bill showed.

On Tuesday, as the Senate Finance Committee moved toward a vote, Baucus admonished:

“Colleagues, this is our opportunity to make history. Our actions here will determine whether we extend coverage to more Americans . . . Now is the time to get this done.”            

That’s all true. Except there’s one more thing: it must be done right. There’s no “best we can” when Democrats have a supermajority in the Senate and massive popular support for reform.

Right includes a public option. This is crucial to lower costs. Don’t take my word for it. Take that of Nobel Prize winning economist Paul Krugman. He noted in his Oct. 16 column in the New York Times that AHIP objected to the public option because public plan officials would negotiate for better prices. “Isn’t that an argument for, not against, such a plan?” Krugman asked. The public option, which is offered in the Senate Health Committee bill and House versions of reform, would create competition where there is none. Competition would drive down costs, which have risen exponentially, inexorably and annually – prompting too many companies to drop coverage for workers or increase fees and co-pays to the point where coverage is unaffordable.

The right way means passing reform without burdening the middle class. The Baucus bill smacks a 40 percent tax beginning in 2013 on plans valued at $8,000 for individuals or $21,000 for families, with some adjustments. The Congressional Joint Committee on Taxation estimated that this would quickly affect 40 percent of all plans. Officially, this tax would be levied on insurers, but there’s no question that they would pass that cost forward to the insured– further hiking up the price of insurance. The House legislation offers a much better approach – a surcharge on millionaires. They’ve gotten eight years of huge tax breaks under the Bush administration. It’s time for them to give a little back. 

The right way also means that all employers must pay their share of costs. More than 160 million Americans receive health insurance as a benefit at work, but more than $1,000 of the cost of those family plan premiums goes to cover the cost of the uninsured. And those uninsured are mostly people whose employers fail to provide health insurance. The only way to apportion these costs fairly is to require employers to provide health insurance or, alternatively, contribute a meaningful sum toward the cost of workers’ coverage.

The right way to reform does not penalize individuals who cannot afford to obtain coverage more than employers. Health care reform must ease the burden on workers and families, not worsen it.

Baucus is correct about one thing. This is an historic moment. But the “best we can” must include the public option. It must mandate that employers pay their fair share of costs. And it must not further burden workers. Forget the elephants and serve the Americans desperate for real health insurance reform.

 

By David Sirota
Political journalist, best-selling author and syndicated newspaper columnist

I don’t get it.

I know that’s the simplistic refrain of every 10-year-old, but I’m 33 and I mean it: I just don’t get it.

Specifically, I don’t get why Maine Sen. Olympia Snowe (R) — or any Republican senator, for that matter — is attracting so much attention.

In the last few months, Democratic senators eliminated the public option and substantially weakened their health care proposals in order to buy insurance industry acquiescence and, thus, Snowe’s vote. Now, based on the deafening media noise, all of American politics is focused on this unaccomplished backbencher and whether or not she will endorse the final bill. It is as if Republicans control Congress — as if Snowe, not Barack Obama, won the biggest presidential landslide since Ronald Reagan.

This is bizarre for what should be obvious reasons.

First of all, Snowe’s much-celebrated initial vote this week for an embarrassingly flaccid health care initiative wasn’t necessary to pass the bill — Democrats had enough votes to move the legislation out of the Senate Finance Committee without her approval. That’s a mathematical fact, as is the fact that Democrats control the 60 votes to overcome a filibuster with or without Snowe; as is the fact that Democrats have the 51 votes to enact health care reform through a parliamentary procedure called reconciliation — again, with or without Snowe.

So the notion that Snowe’s vote — or any GOP vote — is inherently pivotal to health care reform is a fantasy created by the Beltway media and the Democratic congressional leadership. The former is desperately trying to manufacture headline-grabbing drama; the latter is looking for a Republican excuse to water down the bill and protect corporate interests — all while absolving Democrats of legislative responsibility.

Second, the idea that Snowe’s support will result in the final legislation being called “bipartisan” — and that such billing will politically protect Democrats — is absurd. How do we know this? Because Democrats themselves taught us that via the Iraq War.

Recall that with solid Democratic and Republican backing, the 2002 Iraq resolution was far more “bipartisan” than any health care bill will ever be. Yet, Democrats turned right around and used the Iraq War to criticize Republicans — and because the conflict was so wildly unpopular, Americans in 2006 and 2008 were willing to overlook the contradiction and vote for the only major party echoing any semblance of an antiwar message.

On health care, it will be the same in reverse: The GOP will invariably attempt to turn any bill into an electoral cudgel against Democrats — regardless of how many Republicans end up voting for it.

The lesson, then, is simple: If Democrats’ hypocritical Iraq criticism only worked because the war was such a disaster, then the GOP’s inevitable health care attacks — however hypocritical — can only be thwarted by making health care reform the opposite of Iraq (i.e., a major success). For Democrats, in other words, good health care policy is great politics, and bad policy is the worst politics.

Whether passed by one congressional vote or 50, real reform that improves the system (i.e., a bill with a public option, tough insurance regulation and universal coverage) will transform the Democratic Party into an election-winning force forever known as “the generous protector of middle-class interests,” as GOP strategist William Kristol admits. Conversely, even if passed unanimously, bad legislation that makes the system worse (i.e., a bill empowering insurance companies, preventing a public option and leaving millions uncovered) will make GOP criticism of Democrats extremely effective.

That’s a truism, no matter if Snowe or any other Republicans add their support to a health care bill that doesn’t actually need it in the first place.

***

David Sirota is the author of the best-selling books “Hostile Takeover” and “The Uprising.” He hosts the morning show on AM760 in Colorado and blogs at OpenLeft.com. E-mail him at ds@davidsirota.com.

  

 By Richard Trumka
President, AFL-CIO

Unions are popularly known as “the folks who brought you the weekend.” In contrast, the U.S. Chamber of Commerce has the distinction of trying to take away the weekend–along with overtime pay, the minimum wage, Buy America rules, workers’ freedom to form unions, child labor standards….The list is long and ugly.

So it’s farcical that today the Chamber launched a campaign estimated to run in the tens of millions of dollars to promote job creation.

The Chamber’s campaign originally started out as an attack against financial regulation–until the Chamber found out how strongly U.S. taxpayers support reigning in Big Banks and the financial industry’s widespread shady practices. So the Chamber conveniently changed the packaging to purportedly focus on jobs, which in fact the American people desperately need.

Look at who accompanied the Chamber suits while they were announcing their Orweillian-named “free enterprise campaign.” As Sam Stein reported here:

Many of the individuals featured on Wednesday are long-standing donors to Republican candidates and groups that have fought efforts to enhance regulation. And, in one case, the business leader appearing alongside [Thomas] Donohue to decry the interference of government in the market place received business through the benefit of government contracts.

Yet, while millions of America’s workers struggle to find jobs in an economy where there are more than six workers searching for every one job, the Chamber repeatedly opposed extending unemployment insurance. Can’t have government interference in the marketplace, after all. Or aid to jobless workers. The same workers the Chamber’s smoke-and-mirrors campaign is supposed to be all about.

The Chamber also is joining with Big Banks and financial giants to try and kill a proposed agency that would protect U.S. consumers from being preyed upon by unscrupulous banks, mortgage lenders and many of the same financial institutions that helped create our nation’s economic disaster. The Obama administration’s proposed Consumer Financial Protection Agency, which this week is being considered in the House Financial Services Committee, would regulate products such as credit cards and home loans, while ensuring the U.S. Securities and Exchange Commission oversaw the $450 trillion “derivatives” market that sunk the world economy.

The Chamber is spending $2 million in attack ads, claiming that the new agency would hamstring even your local butcher from extending you credit for a week. It’s the same sorry effort at deception and outright lies that the health insurance industry now is trying to pull in the debate over health care reform. Tell enough lies and hope someone believes you.

As President Obama said in response to the Chamber’s distortion:

“We’ve made clear that only businesses that offer financial services would be affected by this agency. I don’t know how many of your butchers are offering financial services,” Obama said to laughter.

The Chamber is so twisted up in deception it seems unable to even provide accurate membership numbers. Writing in Mother Jones this week, David Corn points to a big discrepancy between the Chamber’s public membership numbers and reality.

In testimony before Congress, statements to the press, and on its website, the Chamber claims to represent “3 million businesses of all sizes, sectors, and regions.” In reality, the number is probably closer to 200,000.

Not sure if the 200,000 includes Apple Inc., Pacific Gas & Electric and the other giant corporations that recently have pulled their membership from the Chamber because of its draconian stand on climate change.

The Chamber’s so-called “free enterprise” campaign has been tried before. After World War II, the National Association of Manufacturers led a similar such effort. That campaign to sell capitalism to U.S. consumers incurred the derision of no less than the editors of Fortune magazine, who found similar sentiments among business executives represented on the boards of the business associations that supposedly represented them.

In dismissing the campaign as ludicrous, one such executive described it this way:

The best way we can demonstrate the importance of Free Enterprise is to make it work.

It’s clearly not working now. And although the Chamber may try to wrap itself in the shiny trappings of a feel-good campaign, its repeated attacks on consumers and workers demonstrate who the Chamber stands for: Wall Street not Main Street.