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Soflasnapper
08-22-2011, 03:53 PM
<div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body"> Can We Fix the Economy?

—By Kevin Drum
| Mon Aug. 22, 2011 9:36 AM PDT

I don't really have anywhere to go with this post, but I've been musing for the past few days over all the theories floating around that imply — or are used by others to imply — that we really can't do much of anything to help the economy recover. Here's a brief list:

The basic Rogoff/Reinhart observation that financial collapses due to asset bubbles just take a long time to work through. Given the size of the 2008 collapse, historical evidence suggests that it's going to take five or six years to recover, and that's that.

The Tyler Cowen "Great Stagnation" hypothesis. We've picked through all the low-hanging economic fruit over the past century, and like it or not, we're now entering an extended period of low productivity growth because we're not inventing lots of cool new stuff.

The related (I think) investment drought hypothesis. Ben Bernanke famously ascribed the housing bubble partly to a "savings glut" from overseas, and the flip side of that is an investment drought. The reason financial assets became so popular is that, even with all that money sloshing around the system, there simply weren't very many high-quality investment opportunities available in firms that make real-world goods and services, and that hasn't changed.

The peak oil theory. Production of oil has pretty much maxed out, which means that every time the economy gets moving it will create a spike in oil prices, which will send the global economy back into recession. We're now in a continual oil-fueled boom/bust cycle that limits our long-term growth rate.

The Michael Mandel contention that increased consumption simply leaks out of the economy to China and other countries. Stimulating consumption in the U.S. just won't do much for the American economy if all those extra dollars mostly get spent on overseas goods and services.

Various structural explanations that suggest the United States has an increasing number of workers who flatly don't have the skills to do anything useful in the modern economy — a problem that was temporarily masked by the housing bubble and was only fully exposed when the economy collapsed. This takes various forms, both weak (workers can be retrained but it will take a while) and strong (forget it, they're simply useless).

The self-serving group of partisan hack theories: regulatory uncertainty is the real problem, taxes are too high, the EPA is strangling America, hyperinflation is just around the corner, markets are cowering in fear of future deficits, etc. etc.

Please note that I don't mean to suggest that Reinhart, Rogoff, Cowen, or Mandel are themselves arguing that fiscal and monetary policy are pointless. I'm just using their names for some of these ideas because they're the ones most associated with them.

Anyway, as I said, I'm not really going anywhere with this right now. I'm just collecting theories. Any others to add to the list?</div></div>

I think some of these may be true. If more than one IS true, then we may have a much longer time to reach what would begin to look like a real recovery than anyone might think.

cushioncrawler
08-22-2011, 05:02 PM
Krappynomix iz deadly. Like giving poizon to the sick. Throwing an anchor to the drowning.

And the global stuff iz a part of krappynomix too -- alltho this chapter iz a latecomer and iz fostered by corporations.

Recovery??? -- there iz no recovery. What krappynomicysts call recovery iz like a person being well enuff to get around in a wheelchair -- thats their idea of recovery.

Over the last 150years theusofa haz spent allmost az much time lying in intensive care in hospital (ie allbeit getting fed poizon) az it haz spent outside of hospital (ie allbeit in a wheelchair).
mac.

LWW
08-23-2011, 03:38 AM
Gangster gubmint is the problem.

Most of our job growth has been from small business, and we currently have an administration practicing stupidonomics ... in which small enterprises are subsidized to not hire new workers, and often rewarded to reduce employee head counts.

Soflasnapper
08-23-2011, 09:37 AM
The MARKETPLACE rewards companies who shed employees.

Announcements of layoffs of workers often spike up the stock price, because fewer workers = more profit. It is among the easiest ways for a CEO to boost the value of his compensation as to his stock shares (or options or warrants).

Nothing to do with the federal policies.

LWW
08-23-2011, 11:21 AM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Soflasnapper</div><div class="ubbcode-body">The MARKETPLACE rewards companies who shed employees.
</div></div>

Sometimes yes ... sometimes no.

And, are you seriously claiming that the federal gubmint doesn't have taxes and regulations that don't apply to companies which employ 50 or fewer employees?

Gayle in MD
08-23-2011, 11:41 AM
The peak oil theory. Production of oil has pretty much maxed out, which means that every time the economy gets moving it will create a spike in oil prices, which will send the global economy back into recession. We're now in a continual oil-fueled boom/bust cycle that limits our long-term growth rate.

<span style='font-size: 11pt'>The grand Oil Party prevented us from facing and solving our dependence on foreign oil.

Had we been able to follow President Carter's prophetic warnings, back when he cut our foreign oil consumption nearly in half, instead of the having the mess RR made for us, there is no telloing how many more manufacturing jobs would already be part of our economy, from conservation to Renewable fuels, the problem all along has beenn Repiglicans in bed with foreign oil, and particularly the Bush/Cheney types. </span>


The self-serving group of partisan hack theories: regulatory uncertainty is the real problem, taxes are too high, the EPA is strangling America, hyperinflation is just around the corner, markets are cowering in fear of future deficits, etc. etc.


<div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body"> <span style='font-size: 11pt'>All of these RW talking points are are ridiculous, of course, they are just more propaganda designed to take the attention off the failed Repiglicann policies, which reward corrupt industries, for outsourcing our jobs, and allow the wealthy to abuse tax loopholes, hide their money offshore, outsource American Jobs, annd buy more RW nutjuobs who are equally corrupt, to do their bidding, which also leads to more pollution, corruption, and a lack of professionalism and patriotism in American Business.

When one percent owns so much of the wealth, we are not able to create enough demand for products.

When corporations are allowed to offshore jobs, and pay no taxes, yet buy elections, annd pollute the air and water, the oceans and tributaries, our food annd products, full of poisons, as Health costs rise unsustainably, and go unhampered by legislation to prevent such immoral practices, always protected by the Repiglicans, and a RW supreme Court, legalizes the corruption of the democratic process, basically destroying the whole philosophy of one man one vote, our only hope is to vote Repiglicans out of office, invest in jobs which we need here right now, to re-build our infrastructure, and invest in renewable, clean fuels, conservation products, and close the loopholes, and corruption which allows hoarding, by the wealthy, and hidden money, pff shore, and outsourcing to avoid paying taxes, there would be nothing wrong with our country right now.

We have to take the profit our of corruption, and greed, annd the only way to do that is to increase regulations, not destroy them, and invest in those jobs which solve pressing problems which we face right here. </span> </div></div>



Announcements of layoffs of workers often spike up the stock price, because fewer workers = more profit. It is among the easiest ways for a CEO to boost the value of his compensation as to his stock shares (or options or warrants).


<span style='font-size: 11pt'>Exactly what Reagan awarded, and also exactly what Romney did to fill his pockets after he bilked people without his money, and power, out of more of their money.

Too much money in too few hands, and too much unchecked greed and corruption, makes for a weak economy.

Our only hope now, is to recall the Repiglican governors, and vote the thieving Pigs out of office, they are the ones who borrowed us into impotence to address any emergencies, and they are the ones who blocked our efforst to remove our dependence on foreign oil, which had a tremendously negative impact on our economy.


Health Costs, energy costs, Pharmaceutical costs, subsidies and loopholes for corporations that hurt our economy, by outsourcingpour jobs, and hoarding their money offshore, as they pollute the earth making moore annd more ill.

That's the whole crux of the problem, and it became ann emergency problem, due to Repiglican policies, which encourage and allow more and more fraud, GREED and Corruption!</span>


G.

LWW
08-23-2011, 04:24 PM
The Carter Energy Plan:

1 - Drill baby drill.

2 - Burn more coal.

Sourced from the reich wing PBS (http://www.pbs.org/wgbh/americanexperience/features/primary-resources/carter-energy/) ...

llotter
08-24-2011, 09:59 AM
Everything's up to date in Kansas City, they gone about as far as they can go.

Losers always come up with excuses about why they are such incompetent boobs. That is the only thing at which they are always a total success. Toss in some esoteric jargon and the entire boob clan falls into line.

sack316
08-24-2011, 10:48 AM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Soflasnapper</div><div class="ubbcode-body">The MARKETPLACE rewards companies who shed employees.

Announcements of layoffs of workers often spike up the stock price, because fewer workers = more profit. It is among the easiest ways for a CEO to boost the value of his compensation as to his stock shares (or options or warrants).

Nothing to do with the federal policies. </div></div>

Oddly, if we study up on this that is a commonly accepted myth. When comparing similar companies and peers that have recently undergone layoffs versus those that stay the same or even add more workers over the same time frame--- the fluctuation of stock prices remain relatively equivalent among those companies.

But it easy to assume showing that "we are trimming the fat" would have such an impact as you describe, the data just doesn't show it (I was actually surprised to learn this recently myself).

Obviously there will be some exceptions, such as in the case of companies teetering towards going under who activate a retrenchment plan in order to survive... but by and large, a cut in labor costs generally doesn't do anything special in terms of stock price for a company in comparison to its peers.

Reasoning? My assumption is that investors are 'smarter' than we would think. Often times cutting workers costs more in direct and indirect costs than keeping them on does (severance pay; paying out accrued vacation and sick pay; outplacement costs; higher unemployment-insurance taxes; the cost of rehiring employees when business improves; low morale and risk-averse survivors; potential lawsuits, sabotage, or even workplace violence from aggrieved employees or former employees; loss of institutional memory and knowledge; diminished trust in management; and reduced productivity--- some examples according to U of Colorado).

Unfortunately many companies and higher ups don't seem to know this, and look to labor as the first and easiest cut to make. Obviously sometimes it is a necessary step, but far too often companies look to this as a first step without weighing the actual impact of the actions.

Sack

Soflasnapper
08-24-2011, 03:25 PM
I have seen and agree with the studies that show no LONG TERM improvement in company profit or earning performance, over time, if they had engaged in down-sizing the workforce, relative to companies that didn't do this. So, eventually, as the lack of greater profits or earnings occurs, the stock prices trend back to the pack.

However, over and over again, we still find the marketplace rewarding the job-cutting CEOs and their companies with a higher instant stock price, and it lasts for a period of time as the market ASSUMES (I guess) that it will have a good effect, and it takes a quarter or more of earnings/profit reports for this to be clear.

Unfortunately, many CEOs take a quarter by quarter short term strategy, and can profit personally if the stock price is up for a quarter or two before subsiding down to trend.

In the longer term, the market tends to get it right. In the short term, the market is an idiot, often.

LWW
08-24-2011, 05:05 PM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Chairman of the US House of Representatives Small Business Committee</div><div class="ubbcode-body">
Small businesses are America's job creators - responsible for creating seven of every 10 new jobs in the United States. But Obamacare's job-destroying regulations and taxes are strangling businesses and, along with them, millions of quality American jobs.

<span style='font-size: 11pt'>To make matters worse, small-business employers and entrepreneurs must comply with a slew of mandates that will only serve to cripple growth. One provision will impose a $2,000 tax per employee on businesses with more than 50 employees that fail to offer health insurance. Businesses that cannot afford the fine won't hire a 51st employee. Reports have shown that these types of employer mandates alone could lead to the elimination of 1.6 million jobs, with 66 percent of those coming from small businesses.</span> </div></div>

OH DEAR! (http://smallbusiness.house.gov/News/DocumentSingle.aspx?DocumentID=230520)

I personally know 2 small business owners who could use a few extra employees, but won't hire because #51 costs them a $102K penalty.

sack316
08-25-2011, 12:03 PM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Soflasnapper</div><div class="ubbcode-body">
In the longer term, the market tends to get it right. In the short term, the market is an idiot, often. </div></div>

No argument from me there!

Also agree with your mention of CEO attitudes. Quite often they simply don't consider the macro effect of their actions either (to add to what you said).

Sack

Soflasnapper
08-25-2011, 07:04 PM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: LWW</div><div class="ubbcode-body"><div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Chairman of the US House of Representatives Small Business Committee</div><div class="ubbcode-body">
Small businesses are America's job creators - responsible for creating seven of every 10 new jobs in the United States. But Obamacare's job-destroying regulations and taxes are strangling businesses and, along with them, millions of quality American jobs.

<span style='font-size: 11pt'>To make matters worse, small-business employers and entrepreneurs must comply with a slew of mandates that will only serve to cripple growth. One provision will impose a $2,000 tax per employee on businesses with more than 50 employees that fail to offer health insurance. Businesses that cannot afford the fine won't hire a 51st employee. Reports have shown that these types of employer mandates alone could lead to the elimination of 1.6 million jobs, with 66 percent of those coming from small businesses.</span> </div></div>

OH DEAR! (http://smallbusiness.house.gov/News/DocumentSingle.aspx?DocumentID=230520)

I personally know 2 small business owners who could use a few extra employees, but won't hire because #51 costs them a $102K penalty. </div></div>

Actually, no it doesn't.

<div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body"> The President’s proposal does not require that small businesses provide coverage to their employees. Instead, the President’s proposal provides tens of billions of dollars in new tax-credits to small businesses to make it easier for them to provide coverage if they choose to do so.
Today, small businesses pay up to 18 percent more than large firms for the same health insurance policy. The independent and non-partisan Congressional Budget Office found that with health insurance reform, premiums for small businesses will go down.
In addition, you will be protected from sudden, arbitrary rate hikes because a worker get sick; because insurance companies will no longer be permitted to base the cost of coverage on health status.
<span style='font-size: 14pt'>Starting in 2014, only large businesses <span style='font-size: 17pt'>who have employees receiving taxpayer-funded health assistance</span> will pay an assessment to help offset the cost of those subsidies to the American taxpayer. Companies whose employees are receiving taxpayer assistance will have to pay $2,000 per full-time worker.</span> (This is less than half of the annual cost of providing health insurance to a full-time worker today). <span style='font-size: 14pt'>A business is defined as “large” if it has more than 50 full-time equivalent workers, not counting seasonal workers. The first 30 workers would be subtracted from the total when calculating the total amount of the assessment. We estimate that fewer than 2 per cent of large businesses will be likely to pay these penalties.</span>
</div></div>

So, according to this explanation, those people would be looking at a 60% less bill than this claim, or $42k. And that's only the case if their employees receive federal subsidies to buy private insurance (because they're being paid so little).

Note as well that part-timers and seasonally added workers don't count in terms of whether there are 50 workers or more (although several part-timers might be added together to make up 1 full-time employee).

Considering that this measure is not implemented until the beginning of 2014, adding the 51st worker, even if that makes for 51 full-time employees equivalents, will not cost anything the balance of this year, and next year, and the year after that.

After the next 2 years and 4 months, that will still only be true if both a) they don't offer insurance benefits, and b) some employees get a taxpayer subsidy to buy what the company isn't offering.

So the people in business who are telling you this is the reason they will not hire a worker that they need now, which they'll earn profits on from their work production, are either very misinformed, stupid, or lying.

Or perhaps you made that up, as business people generally know what affects their bottom lines much better than what you portray.

Still, it could be that they have been grossly misinformed, by the likes of you and the chairman you've quoted, Fox News, hate radio jocks, and etc.

Personally, I've provided group plan health insurance for my employees (with a 50-50 split of premium costs for an employee, and they pay any extra required for spouses or family) when we had less than 50 employees, and when we've had 3 times that number.

Gayle in MD
08-25-2011, 07:32 PM
<div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body">So the people in business who are telling you this is the reason they will not hire a worker that they need now, which they'll earn profits on from their work production, are either very misinformed, stupid, or lying.

</div></div>

Absolutely, and, IMO, the same could be said about the Repubs who keep insisting that the economy, and/or job recovery, is lagging because the corporate CEO's are feeling "Insecure" about hiring, a load of crap, if I ever heard one.

They aren't hiring because they can so readily draw blood out of their current employees, and work them into the ground, and still manage to stuff more money into their own pockets.

Hence, part of the reason for the attacks against the right to Unionize and implement their right to bargain for decent wages, working conditions, etc....

They want slaves, not employees.

G.

LWW
08-26-2011, 03:30 AM
You are aware you just proved my point?

Soflasnapper
08-26-2011, 05:24 PM
That you know stupid business-owners who get their information from Fox and will forgo the profits another worker can provide them for over 2 years because they think they'll incur 2-1/2 times the eventual amount they MAY owe as soon as they do it now?

Yes, I guess I did prove that point, didn't I?

LWW
08-26-2011, 06:43 PM
No, but you proved mine ... again.

Gayle in MD
09-14-2011, 10:03 AM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Soflasnapper</div><div class="ubbcode-body"> <div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body"> Can We Fix the Economy?

—By Kevin Drum
| Mon Aug. 22, 2011 9:36 AM PDT

I don't really have anywhere to go with this post, but I've been musing for the past few days over all the theories floating around that imply — or are used by others to imply — that we really can't do much of anything to help the economy recover. Here's a brief list:

The basic Rogoff/Reinhart observation that financial collapses due to asset bubbles just take a long time to work through. Given the size of the 2008 collapse, historical evidence suggests that it's going to take five or six years to recover, and that's that.

The Tyler Cowen "Great Stagnation" hypothesis. We've picked through all the low-hanging economic fruit over the past century, and like it or not, we're now entering an extended period of low productivity growth because we're not inventing lots of cool new stuff.

The related (I think) investment drought hypothesis. Ben Bernanke famously ascribed the housing bubble partly to a "savings glut" from overseas, and the flip side of that is an investment drought. The reason financial assets became so popular is that, even with all that money sloshing around the system, there simply weren't very many high-quality investment opportunities available in firms that make real-world goods and services, and that hasn't changed.

The peak oil theory. Production of oil has pretty much maxed out, which means that every time the economy gets moving it will create a spike in oil prices, which will send the global economy back into recession. We're now in a continual oil-fueled boom/bust cycle that limits our long-term growth rate.

The Michael Mandel contention that increased consumption simply leaks out of the economy to China and other countries. Stimulating consumption in the U.S. just won't do much for the American economy if all those extra dollars mostly get spent on overseas goods and services.

Various structural explanations that suggest the United States has an increasing number of workers who flatly don't have the skills to do anything useful in the modern economy — a problem that was temporarily masked by the housing bubble and was only fully exposed when the economy collapsed. This takes various forms, both weak (workers can be retrained but it will take a while) and strong (forget it, they're simply useless).

The self-serving group of partisan hack theories: regulatory uncertainty is the real problem, taxes are too high, the EPA is strangling America, hyperinflation is just around the corner, markets are cowering in fear of future deficits, etc. etc.

Please note that I don't mean to suggest that Reinhart, Rogoff, Cowen, or Mandel are themselves arguing that fiscal and monetary policy are pointless. I'm just using their names for some of these ideas because they're the ones most associated with them.

Anyway, as I said, I'm not really going anywhere with this right now. I'm just collecting theories. Any others to add to the list?</div></div>

I think some of these may be true. If more than one IS true, then we may have a much longer time to reach what would begin to look like a real recovery than anyone might think. </div></div>


<span style='font-size: 20pt'>We must destroy Repiglican Fascism before it's too late! </span>