Tag Archives: Economy

Social inequality and American politics

By Andre Damon
June 8, 2015
World Socialist Web Site

 

Last week the New York Times released the results of an opinion poll, conducted in collaboration with CBS News, showing overwhelming and growing popular opposition to social inequality in the United States.

The details of the poll are striking. Asked whether “In today’s economy, everyone has a fair chance to get ahead in the long run,” for example, 61 percent of participants said that “just a few people at the top have a chance to get ahead,” compared to 35 percent who said that “anyone can get ahead.” Significantly, the percentage of people who chose the latter response has fallen by 17 percentage points since a similar poll conducted in early 2014.

Even more strikingly, 66 percent of participants said that “the distribution of money and wealth in this country… should be more equal,” compared with only 27 percent who said it was fair. The margin between the two responses was 39 percentage points.

When the question was put a different way, the results were even more pronounced. Asked whether social inequality is a “problem that needs to be addressed now, a problem but one that does not need to be addressed now or not a problem,” only 17 percent of respondents said that social inequality was “not a problem.”

Similarly, 68 percent of those polled said they favored raising taxes on people who earn more than $1 million a year, and 71 percent of respondents said they favored raising the federal minimum wage. Eighty percent favored requiring employers to offer paid leave to parents of new children and employees caring for sick family members, and 85 percent favored requiring employers to offer paid sick leave.

Polls such as the one carried out by the Times are always an imperfect reflection of the actual state of public opinion. Moreover, other surveys have consistently found that Americans significantly underestimate the actual level of social inequality. If anything, therefore, the results understate the overwhelming hostility of the population to the essential feature of American and indeed world capitalism: social inequality.

The widespread opposition to social inequality in the United States stands in sharp contradiction to the policies pursued by the entire political establishment. Indeed, the presidency of Barack Obama, who presented himself in the 2008 election as the champion of the “middle class,” has seen one of the most precipitous increases in social inequality in US history.

During only the first four years of the Obama presidency, the top 0.1 percent of the population increased their share of US wealth from 19 percent to 22 percent, while the top 1 percent of income earners in the US took in 95 percent of all income gains since 2009.

The enrichment of the financial elite has paralleled an enormous decline in US median household income, which has fallen by 12 percent, with a typical household earning $6,400 less per year in 2013 than it did in 2007.

The immense growth of social inequality over this period has been the direct result of the policies pursued by the Obama administration, which has sought to make the working class pay for the financial crisis that erupted in 2008 while protecting and expanding the wealth of the financial oligarchy.

The concerns within the ruling class over the implications of its policies can be seen in efforts to promote figures such as Vermont Senator Bernie Sanders, a self-proclaimed “democratic socialist” running as a Democrat in the 2016 election. Sanders, who rhetorically denounces social inequality, is in fact a thoroughly conventional bourgeois politician.

The stated opposition of Sanders to social inequality is entirely of the same character of that of Obama: i.e., purely rhetorical. His candidacy is merely an attempt to keep the growing opposition to social inequality and the capitalist system within the confines of the Democratic Party.

Whatever the rhetoric of figures such as Sanders, Senator Elizabeth Warren, and New York Mayor Bill de Blasio, there exists no section of the political establishment that supports any genuine reduction in social inequality. The most telling example is perhaps de Blasio, promoted as a champion of “progressivism” within the Democratic Party, who last month announced a series of measures hiking housing fees for low-income New York City residents while moving to privatize sections of public housing.

What none of these figures can acknowledge is that the growth of social inequality and the unprecedented concentration of wealth is a product of the capitalist system that they all defend, a system that is based on the subordination of all aspects of life to a financial aristocracy that controls the entire political system.

In contrast to the pseudo-left defenders of the Democratic Party, who have sought to present race and gender as the most important social categories, the International Committee of the Fourth International (ICFI) has insisted that the growth of social inequity is the central political issue in contemporary society. The ICFI has insisted that social inequality is itself the expression of the division of society into two great classes; the working class, the vast majority of the population, and the ruling class.

The opposition to social inequality expressed in the New York Times poll is a product of both the objective reality of world capitalism and the experiences that the American working class has made over the past eight years.

But this spontaneous sentiment must be given a conscious political program, based on the understanding that the fight against social inequality is a revolutionary question that is inextricably tied to the independent political mobilization of the working class against capitalism. The creation of a genuinely egalitarian society means the overthrow of the capitalist system and its replacement with socialism and the democratic control over economic life.

 

 

Obama’s “No Growth, No Jobs, No Recovery” Economy Gives Up The Ghost

By Mike Whitney
May 2, 2015
CounterPunch, April 30, 2015

 

Stock Market DropThe world’s biggest economy ground to a standstill in the first quarter of 2015 wracked by massive job losses in the oil sector, falling personal consumption, weak exports and droopy fixed investment. Real gross domestic product (GDP), the value of the production of goods and services in the US, increased at an abysmal annual rate of just 0.2 percent in Q1 ’15 according to the Bureau of Economic Analysis demonstrating conclusively that 6 years of zero rates and Large-Scale Asset Purchases (LSAP)– which have enriched stock speculators, inflated the largest asset-price bubble in history, and exacerbated inequality to levels not seen since the Gilded Age– have done nothing to improve the real economy, boost demand or reduce unemployment. As the BEA data illustrates, the US economy is basically DOA, a victim of criminal congressional negligence and Central Bank chicanery.

From the BEA release:

“The deceleration in real GDP growth in the first quarter reflected a deceleration in PCE, downturns in exports, in nonresidential fixed investment, and in state and local government spending, and a deceleration in residential fixed investment that were partly offset by a deceleration in imports and upturns in private inventory investment and in federal government spending.”

Translation: The economy is in the shi**er. Consumers aren’t spending because the crap-ass jobs they landed after the crisis pay half as much as the jobs they lost when Wall Street blew up the financial system. Personal savings are up and spending is down because households face an uncertain future where pensions are being trimmed and Social Security is under attack. Also, spending is impacted by the historic low (employment) participation rate which indicates that joblessness is much higher than the government’s phony numbers suggest. When workers are unemployed they don’t spend, activity drops, and the economy tanks. It’s that simple. Today’s data just confirms what most people already know, that the economy stinks and that they’re being ripped off by a voracious oligarchy that’s stacked the deck in their favor.

The US economy is stuck in the mud because our bought-and-paid-for congress has relinquished all authority and handed over the management of the economy to the industry-controlled Federal Reserve. Whereas our current budget deficits are in the range of 2 percent per annum, the government should be spending a lot more to compensate for the slowdown in private sector spending and investment. In the past, the congress and president would initiate sensible Keynesian fiscal stimulus programs to keep the economy sputtering along while households repaired their balance sheets or businesses struggled with weak demand. Those tried-and-true remedies have been jettisoned for the new monetarist orthodoxy that requires that all the nation’s wealth be filtered through the Wall Street casino so that the pampered thieves who destroyed the country with their mortgage-securities-Ponzi-scam be further rewarded for their insatiable greed.

Manufacturing, retail sales, MBA purchase applications, business investment etc, are all in the toilet. There’s a very good chance the economy is already in recession which will undoubtedly send stocks even higher since every proclamation of bad news generates a buying frenzy by clever speculators who anticipate that the Fed will continue to extend the zero rates and easy money to infinity.

It’s worth noting that the economy had been hanging on by the skin of its teeth mainly do to strong activity in the oil patch where credit expansion, intensive corporate investment, and high-paying jobs (which supported 4 additional jobs in the local economy!) contributed more than $200 billion per year to GDP. Now domestic oil production is in deep distress. Layoffs recently surpassed the 100,000 milestone (See: Oil Layoffs Hit 100,000 and Counting, Wall Street Journal) and borrowing has dried up. Economist Warren Mosler explains the impact the cutbacks in domestic oil have had on GDP in this video from RT that I have transcribed:

“The price drop in oil has turned out to be the unambiguous negative that we had talked about before….where income saved by the consumer, is lost by another consumer. For every dollar not spend by one consumer, another doesn’t get it. ..so you’re just left with the collapse in capital expenditures. (business investment) It turns out, there was about $150 borrowed in the sector last year, driving what modest growth we had last year. Since that disappeared, all the numbers have been going straight down. Unless something steps up to the plate to replace the lost borrowing-to-spend from chasing $100 oil, I see no hope whatsoever.” (Warren Mosler Interview, RT)

Economic recovery requires credit expansion, business investment and jobs. All three of these were severely impacted by the Obama’s goofy plan to push down oil prices in order to destroy the Russian economy. Here’s a brief summary:

“John Kerry, the US Secretary of State, allegedly struck a deal with King Abdullah in September under which the Saudis would sell crude at below the prevailing market price. That would help explain why the price has been falling at a time when, given the turmoil in Iraq and Syria caused by Islamic State, it would normally have been rising.” (Stakes are high as US plays the oil card against Iran and Russia, Larry Eliot, Guardian)

As indicated by today’s ghastly GDP data, Obama not only shot himself in the foot, he might have blown off his whole leg. Aside from the colossal growth in private inventories–which will be a drag on future growth–todays report was nothing short of a disaster.

Mike Whitney lives in Washington state. He is a contributor to Hopeless: Barack Obama and the Politics of Illusion (AK Press). Hopeless is also available in a Kindle edition. He can be reached at fergiewhitney@msn.com.

TRUTH – THE CURE FOR COGNITIVE DISSONANCE

By JimQ
April 13, 2015
Washington’s Blog

 

“In a time of deceit telling the truth is a revolutionary act.” George Orwell

Every time the BLS puts out their monthly propaganda report on the wonderful state of the U.S. jobs market and states with a straight face the unemployment rate is a measly 5.5%, their corporate mouthpieces in the mainstream cheerleader media regurgitate the fake numbers and urge you to buy stocks. The millionaire talking heads on CNBC and the corrupt bought off politicians in D.C. make broad sweeping declarations about economic recovery, strong job growth, GDP advancement, record highs in the stock market, and soaring consumer confidence.

The people living in the real world know otherwise, but they want to believe the “experts” and “leaders”. This dichotomy between reality and what they are being told is causing a tremendous amount of mental stress. This cognitive dissonance of attempting to reconcile what they are experiencing in their every day existence and the propaganda being peddled at them on a daily basis from big media, big bankers, corporate titans, and captured politicians pulling the strings and running the show, is causing psychological discomfort. Most people want their lives to get better, so to reduce their cognitive dissonance they choose to believe the government and media reports about economic improvement.

It is only a small minority who want to know the unvarnished truth. They are drawn to alternative media websites, which the the captured corporate media refers to as doom sites. These critical thinking individuals understand the facts. The Deep State propaganda has no impact on these people because they have no cognitive dissonance. They know things are far worse than what is reported by the government and their media whores. Knowing the truth and seeing how the majority remain willfully ignorant results in rising anger among truth seekers. Huxley was right.

“You shall know the truth and the truth shall make you mad.” Aldous Huxley

When the BLS reports their monthly unemployment BS showing a 5.5% unemployment rate and Obama holds a press conference to pat himself on the back for the 10 million jobs he has created since 2009, the critical thinking truth seekers focus on the big lies in the numbers. The 10 million jobs added has been surpassed by the 13 million people who supposedly willingly left the workforce. The 148 million employed Americans is only 2 million more than were employed in 2008, but the government wants you to believe the unemployment rate is the same as it was in 2008 despite the fact the working age population has grown by 16 million people.

The truth is the labor participation rate has fallen dramatically since 2008 and now sits at a 38 year low of 62.7%. The rate consistently remained between 66% and 67% from 1988 through 2008. There are 250 million working age Americans and only 148 million Americans working and the powers that be expect you to believe only 8.5 million of the 102 million non-working Americans are actually unemployed. When the critical thinking doom websites point out the record low participation rate, the immediate response from the Wall Street propaganda machine is Baby Boomers retiring. Their co-conspirators in misdirection and misinformation in the media unquestioningly perpetuate this lie without an iota of journalistic credibility.

The Boomer retirement meme is obliterated by the data in the chart below. The labor force participation rate of those over 65 is at an all-time high and has grown by over 50% since 2000. Those in their prime working years between 25 and 64 have seen their labor force participation rate decline since 2000. The labor force participation rate decline has absolutely nothing to do with Boomers retiring. It is solely driven by younger workers unable or unwilling to work. The truthful labor participation rate should be 66%. That would force the BLS to admit at least another 9 million Americans are unemployed, pushing the unemployment rate to at least 10.7%.

The blatant perpetuation of the big lie began in earnest after the 2008 Wall Street created financial crisis. The number of jobs for those 54 years old and younger is still 1.2 million below 2007, while the number of jobs for those 55 and older is up by 6 million. Those over 55 working today stands at 33.1 million, an all-time high. This figure has doubled since 2000. The Boomer dream of a long luxurious retirement, living off their interest income, lying on a beach and drinking pina coladas has devolved into being forced to work as Wal-Mart greeters and McDonalds counter help until they die. Retirement isn’t an option after two Federal Reserve created bubbles burst, six years of zero interest rates, and three simultaneous bubbles on the verge of bursting.

The falsity of the jobs recovery meme is unequivocally proven by the fact real median household income is still 4.5% lower than it was at the 2001 and 2008 peaks. And this is using the ridiculously understated CPI figure. Using a true inflation rate would show real median household income to be 20% below 2000 levels. The last time I checked, workers live in households. How could the unemployment rate plunge from 10% in 2009 to 5.5% today with real median household income falling? Maybe the 21% decrease in manufacturing jobs since 2000 and the proliferation of low paying part-time service jobs, along with Federal Reserve created inflation, have resulted in the death of the middle class. Real people living in the real world have seen their standard of living steadily decline for the last 25 years. And they know it, deep inside, despite the propaganda echoing from their boob tubes.

There is a reason retail sales continue to stagnate. There is a reason credit card debt continues to decline. There is a reason you don’t hear your friends, family or neighbors talk about the improving economy. If you don’t hob nob with the ruling elite at Manhattan cocktail parties or summer at the Hamptons, you know the truth. Your real wages are lower than they were in 1989. The expenses you incur to live your everyday life like food, rent, transportation, health insurance, and tuition are rising at 5% to 10%, not the 1.7% reported by your government keepers. You own little or no financial stocks, so the record stock market highs have no impact on your financial well being. You may have money in a savings account, money market or CDs. Eight years ago you could earn 5%. Today you earn .15%, thanks to Bernanke, Yellen and their Federal Reserve cohorts. But at least you still get to pay the Wall Street banks 15% on your credit card balance.

The only way to relieve the tremendous mental stress caused by the conflict between what you know you are experiencing in your everyday life and what you are being told by bankers, politicians, government apparatchiks, and the corporate media, is to accept the truth and free yourself from the tyranny of the Deep State. Propaganda is a powerful tool in the hands of rich powerful psychopathic men bent on accumulating wealth, power and control over the bourgeois. Secrecy, censorship, data manipulation, and media messaging to mislead have worked for decades. Very little in the way of coercive techniques have been required, as the Bernays method of conscious and intelligent manipulation of the organized habits and opinions of the masses has worked wonderfully to hoodwink and bamboozle the average person.

The mood of society in general continues to darken. War drums are beating around the globe. The imperial American Empire is fraying at the edges and using military force, intrigue, surveillance, and secrecy in an attempt to retain its power domestically and internationally. The truth is being suppressed, but the internet and proliferation of websites revealing the lies of those in power is slowly opening the eyes of more and more people whose cognitive dissonance has caused them too much discomfort. The Deep State is worried. Their wealth, power and control are in danger. The attempts to control the internet, the un-Constitutional surveillance of citizens, and the militarization of police forces across the land are a futile attempt to control us. But the truth will set us free. As Robert Heinlein describes, no amount of force can control a man who mind is free.

“Secrecy is the keystone to all tyranny. Not force, but secrecy and censorship. When any government or church for that matter, undertakes to say to its subjects, “This you may not read, this you must not know,” the end result is tyranny and oppression, no matter how holy the motives. Mighty little force is needed to control a man who has been hoodwinked in this fashion; contrariwise, no amount of force can control a free man, whose mind is free. No, not the rack nor the atomic bomb, not anything. You can’t conquer a free man; the most you can do is kill him.” – Robert A. Heinlein

It won’t take a majority to prevail. If we continue to set brush fires of truth, freedom and reason among the increasingly disillusioned masses, a tipping point will be reached and a revolution of truth will sweep across the land. So, if you have the opportunity to speak the truth to someone today….

http://www.theburningplatform.com/2015/04/12/truth-the-cure-for-cognitive-dissonance/

US layoffs mount amid signs of economic slowdown

By Andre Damon
March 28, 2015
World Socialist Web Site

 

US corporations announced thousands of layoffs this week amid a series of plant closures, mergers and consolidations and signs of declining economic growth.

On Wednesday, US Steel announced 2,080 layoffs at its Granite City Works in Illinois. The Pittsburgh-based steelmaker plans to lay off over 4,500 employees nationwide, including over 1,800 workers in Alabama. Job cuts are also planned in Minnesota and Texas.

The same day, steelmaker Worthington Industries of Columbus, Ohio announced plans to lay off 555 employees nationwide. Of these, 310 are to lose their jobs as a result of the closure of a plant in Florence, South Carolina.

On Thursday, Ohio-based Republic Steel announced 200 layoffs at its Lorain, Ohio plant.

The steel companies said the layoffs were a response to a fall in demand stemming from the drop in oil prices and appreciation of the dollar, which have led to a reduction in international orders.

Also on Wednesday, HJ Heinz announced plans to buy Kraft Foods Group in a $36.6 billion deal that, according to one analyst, could lead to 5,000 job cuts, affecting nearly one quarter of Kraft’s North American work force.

The fate of tens of thousands of RadioShack workers and their families hung in the balance Friday as lenders and hedge funds wrangled at auction over the remains of the bankrupt consumer electronics chain, which presently employs 27,000 people at more than 4,000 locations nationwide.

Salus Capital Partners said Friday that it had outbid its nearest competitor, hedge fund Standard General, offering $271 million in cash as part of a plan that would completely dismantle the company, laying off all employees and selling off inventory and fixtures. Standard General had offered $16 million in a plan that would have kept 1,740 stores open, saving 7,500 jobs, but still laying off nearly 20,000 workers.

Office supply retailer Staples, which announced plans to merge with Office Depot in February, filed documents with the Securities and Exchange Commission showing that it intends to pay CEO Roland Smith $46.78 million for 16 months of work if the deal goes through. The merger would entail the closure of up to 1,000 stores and the potential layoff of tens of thousands of workers.

The plant closures and layoffs came as figures from the Commerce Department confirmed that the US economy slowed significantly in the fourth quarter of last year. The economy grew at an annual rate of 2.2 percent in the final three months of 2014, down from an initial estimate of 2.6 percent released in January.

The fourth quarter marked a significant slowdown compared with the second quarter, in which the economy grew at a 5 percent rate, and the third quarter, which had a growth rate of 4.6 percent. Analysts had expected the economy to grow at a 2.4 percent annual rate in the final quarter of last year.

Business investment on equipment in the fourth quarter was revised downward to show a 0.6 percent increase, down from a previously reported 0.9 percent. Reuters reported that the slowdown in investment likely reflected “the impact of the strong dollar and lower crude oil prices, which have caused a drop in drilling and exploration activity.”

Government spending contracted at a rate of 1.9 percent, led by cuts to federal spending.

Even the anemic pace of economic growth in the last quarter of 2014 was significantly higher than what is expected in the first quarter of this year, which ends next week. Economists from JPMorgan Chase, Macroeconomic Advisers and Goldman Sachs recently cut their estimates for first-quarter economic growth, all of them forecasting a rate of 1.4 percent to 1.5 percent. The Federal Reserve Bank of Atlanta is predicting even worse results, with a first-quarter GDP growth rate of just 0.2 percent.

A number of recently released economic figures underscore this gloomy outlook. The Commerce Department said Wednesday that orders for durable goods fell by 1.4 percent in February compared with a month earlier. The report also showed that non-defense capital goods orders fell for the sixth straight week.

The University of Michigan’s survey of consumer sentiment fell to 93.0 in March, down from 95.4 in February. Richard Curtin, chief economist at the University of Michigan’s Surveys of Consumers, told the Wall Street Journal that, “most of the recent variation was among lower-income households, whose budgets are more sensitive to higher utility costs and disruptions in work hours.”

The significant appreciation of the dollar, which hit 0.95 euros earlier this month, up from 0.75 euros a year ago, has had a negative impact on the US trade balance and US corporate earnings.

Corporate profits fell 1.4 percent in the previous quarter, according to figures released by the Commerce Department on Friday. For the whole of 2014, corporate profits were down by 0.8 percent, the first annual fall in US corporate profits since 2008.

US corporations have responded to the appreciation of the dollar and falling profits with the demand that the Federal Reserve delay its plans to begin raising interest rates this year. Last week, Fed Chairwoman Janet Yellen hinted that the US central bank might begin raising rates later than it had previously indicated, and the Fed issued interest rate projections for 2015 and beyond showing a slower pace of rate hikes than previously predicted once the increases begin.

Yellen reinforced this message in remarks at the Federal Reserve Bank of San Francisco on Friday, declaring that she expected the “level of the federal funds rate to be normalized only gradually” and warning of raising rates “too quickly.”

The continued influx of cash from the Federal Reserve has led the Dow Jones Industrial Average to nearly triple over the course of the past six years, while allowing Wall Street bonuses to hit the highest levels since 2008. Average CEO pay in the US is higher than ever.

The response of the corporate-financial aristocracy to the renewed slowdown in the US economy will no doubt be an intensification of the policies that have characterized official economic policy since the 2008 crash: virtually unlimited amounts of cash for the financial markets coupled with a relentless offensive against the jobs, wages and living standards of working people.

Russia’s Remarkable Renaissance

By F. William Engdahl
March9, 2015
New Eastern Outlook

 

kremlinSomething remarkable is taking place in Russia, and it’s quite different from what we might expect. Rather than feel humiliated and depressed Russia is undergoing what I would call a kind of renaissance, a rebirth as a nation. This despite or in fact because the West, led by the so-called neo-conservatives in Washington, is trying everything including war on her doorstep in Ukraine, to collapse the Russian economy, humiliate Putin and paint Russians generally as bad. In the process, Russia is discovering positive attributes about her culture, her people, her land that had long been forgotten or suppressed.

My first of many visits to Russia was more than twenty years ago, in May, 1994. I was invited by a Moscow economics think-tank to deliver critical remarks about the IMF. My impressions then were of a once-great people who were being humiliated to the last ounce of their life energy. Mafia gangsters sped along the wide boulevards of Moscow in sparkling new Mercedes 600 limousines with dark windows and without license plates. Lawlessness was the order of the day, from the US-backed Yeltsin Kremlin to the streets. “Harvard boys” like Jeffrey Sachs or Sweden’s Anders Aaslund or George Soros were swarming over the city figuring new ways to rape and pillage Russia under the logo “shock therapy” and “market-oriented reform” another word for “give us your crown jewels.”

The human toll of that trauma of the total collapse of life in Russia after November 1989 was staggering. I could see it in the eyes of everyday Russians on the streets of Moscow, taxi-drivers, mothers shopping, normal Russians.

Today, some two decades later, Russia is again confronted by a western enemy, NATO, that seeks to not just humiliate her, but to actually destroy her as a functioning state because Russia is uniquely able to throw a giant monkey wrench into plans of those western elites behind the wars in Ukraine, in Syria, Libya, Iraq and well beyond to Afghanistan, Africa and South America.

Rather than depression, in my recent visits to Russia in the past year as well as in numerous discussions with a variety of Russian acquaintances, I sense a new feeling of pride, of determination, a kind of rebirth of something long buried.

Sanctions Boomerang

Take the sanctions war that the Obama administration has forced Germany, France and other unwilling EU states to join. The US Treasury financial warfare unit has targeted the Ruble. The morally corrupt and Washington-influenced Wall Street credit rating agencies have downgraded Russian state debt to “junk” status. The Saudis, in cahoots with Washington, have caused a free-fall in oil prices. The chaos in Ukraine and EU sabotage of the Russian South Stream gas pipeline to the EU, all this should have brought a terrified Russia to her knees. It hasn’t.

As we have earlier detailed, Putin and an increasing number of influential Russian industrialists, some of the same who a few years ago would have fled to their posh London townhouses, have decided to stand and fight for the future of Russia as a sovereign state. Oops! That wasn’t supposed to happen in a world of globalization, of dissolution of the nation-state. National pride was supposed to be a relic like gold. Not in Russia today.

On the first anniversary of the blatant US coup in Kiev that installed a hand-picked regime of self-professed Neonazis, criminals, and an alleged Scientologist Prime Minister Andriy Yansenyuk, hand-picked by the US State Department, there was a demonstration in downtown Moscow on February 22. An estimated 35,000 to 50,000 people showed up—students, teachers, pensioners, even pro-Kremlin bikers. They protested not against Putin for causing the economic sanctions by his intransigence against Washington and EU demands. They protested the blatant US and EU intervention into Ukraine. They called the protest “Anti-Maidan.” It was organized by one of many spontaneous citizen reactions to the atrocities they see on their borders. Internet satirical political blogs are making fun of the ridiculous Jan Paski, until last week the fumbling US State Department Press Spokesperson.

Not even an evident False Flag attempt in the London Financial Times and Western controlled media to blame Putin for “creating the climate of paranoia that caused” Boris Nemtsov’s murder is being taken seriously. Western “tricks” don’t work in today’s Russia.

And look at US and EU sanctions. Rather than weakening Putin’s popularity, sanctions have caused previously apolitical ordinary Russians to rally around the president, who still enjoys popularity ratings over 80%. A recent survey by the independent Levada Center found 81 percent of Russians feel negatively about the United States, the highest figure since the early 1990s “shock therapy” Yeltsin era. And 71 percent feel negatively about the European Union.

The renaissance I detect is evident in more than protests or polls, however. The US-instigated war in Ukraine since March 2014 has caused a humanitarian catastrophe, one which the US-steered German and other western media have blocked out of their coverage. More than one million Ukrainian citizens, losing their homes or in fear of being destroyed in the insane US-instigated carnage that is sweeping across Ukraine, have sought asylum in Russia. They have been welcomed as brothers according to all reports. That is a human response that has untold resonances among ordinary Russians. Because of the wonders of YouTube and smart phone videos, Russians are fully aware of the truth of the US war in eastern Ukraine. Russians are becoming politically sensitive for the first time in years as they realize that some circles in the West simply want to destroy them because they resist becoming a vassal of a Washington gone berserk.

Rather than bow to the US Treasury’s Ruble currency war and the threat that Russian banks will be frozen out of the SWIFT (Society for Worldwide Interbank Financial Telecommunication) international interbank clearing system, something likened to an act of war, on February 16, the Russian government announced that it had completed its own banking clearing network in which some 91 domestic credit institutions have been incorporated. The system allows Russian banks to communicate seamlessly through the Central Bank of Russia.

That is inside Russia among banks that otherwise were vulnerable even domestically to a SWIFT cut. Russia joined the Brussels-based private SWIFT system as the Berlin Wall crumbled in 1989. Today her banks are the second largest users of SWIFT. The new system is inside Russia. Necessary, but not sufficient, to protect against SWIFT cutoff. The next step in discussion is joint Russia-China interbank clearing independent of SWIFT and Washington. That is also coming.

The following day after Russia’s “SWIFT” alternative was announced as operational, Chinese Vice Foreign Minister Cheng Guoping said China will build up its strategic partnership with Russia in finance, space and aircraft building and “raise trade cooperation to a new level.” He added that China plans to cooperate more with Russia in the financial area and in January Russia’s First Deputy Prime Minister Igor Shuvalov said that payments in national currencies, de-dollarization, were being negotiated with China. China realizes that if Russia collapses, China is next. Failing empires try desperate measures to survive.

Russians also realize that their leaders are moving in unprecedented ways to build an alternative to what they see as a morally decadent and bankrupt American world. For most Russians the disastrous decade of poverty, chaos and deprivation of the Yeltsin era in the 1990’s was reminder enough what awaits should Russia’s leaders again prostitute themselves to American banks and corporations for takeover, Hillary Clinton’s infamous “reset” of US-Russian relations she attempted when Medvedev was President. Russians see what the US has done in neighboring Ukraine where even the Finance Minister, Natalia Jaresko, is an American, a former State Department person.

Russia and its leaders are hardly trembling behind Kremlin walls. They are forging the skeleton of a new international economic order that has the potential to transform the world from the present bankruptcy of the Dollar System. Moscow and Beijing recently announced, as I discussed in a previous posting, their project to create a joint alternative to the US credit rating monopoly of Moody’s, S&P and Fitch. President Putin’s travel agenda in the past year has been mind-boggling. Far from being the international paraiah Washington and Victoria Nuland hoped for, Russia is emerging as the land which has the courage to “just say No!” to Washington.

Russia’s president has been in Cyprus where possible basing for the Russian navy was discussed, in Egypt where General al-Sisi warmly welcomed the Russian leader and discussed significant economic and other joint cooperation. Late last year Russia and the BRICS states agreed to form a $100 billion infrastructure bank that makes the US-controlled World Bank irrelevant. The list grows virtually every day.

The special human side

For me, however, the most heartening feature of this Russian renaissance is in the generation which is today in their late thirties to early forties—young, highly intelligent and having experience of both the depravity of Soviet communist bureaucracy but as well of the hollow world of US-led so-called “free market capitalism.” I share some examples from the many Russians I have come to know in recent years.

What is unique in my mind about this generation is that they are the hybrid generation. The education they received in the schools and universities was still largely dominated by the classical Russian science. That classical Russian science, as I have verified from many discussion with Russian scientist friends over the years, was of a quality almost unknown in the pragmatic West. An American Physics professor from MIT who taught in Moscow universities in the early 1990s told me, “When a Russian science student enters first year university, he or she already has behind them 4 years of biology, 4 of chemistry, of physics, both integral and differential calculus, geometry…they are starting university study at a level comparable to an American post-doctoral student.”

They grew up in a Russia where it was common for young girls to learn classical ballet or dance, for all children to learn to play piano or learn a musical instrument, to do sports, to paint, as in classical Greek education of the time of Socrates or Germany in the 1800s. Those basics which were also there in American schools until the 1950s, were all but abandoned during the 1980s. American industry wanted docile “dumbed-down” workers who asked no questions.

Russian biology, Russian math, Russian physics, Russian astrophysics, Russian geophysics—all disciplines approached their subject with a quality that had long before disappeared from American science. I know, as I grew up during the late 1950’s during the “Sputnik Shock,” where we were told as high school pupils we had to work doubly hard to “catch up to the Russians.” There was a kernel of truth, but the difference was not lack of American students working hard. In those days we worked and studied pretty hard. It was the quality of Russian scientific education that was so superior.

Teaching of the sciences especially, in Russia or the Soviet Union, had been strongly influenced by the German education system of the 1800s, the so-called Humboldt Reforms of Alexander von Humboldt and others.

The strong ties in Russian education with classical 19th Century German culture and science went deep, going back to the time under Czar Alexander II who freed the serfs in 1861, following the example of his friend, Abraham Lincoln. The ties were deepened to German classical culture later under Czar Alexander II prior to the 1905 Russo-Japanese War when the brilliant Sergei Witte was Transport Minister, then Finance Minister and finally Prime Minister before western intrigues forced his resignation. Witte translated the works of the German national economist Friederich List, the brilliant opponent of England’s Adam Smith, into Russian. Before foreign and domestic intrigues manipulated the Czar into the disastrous Anglo-Russian Entente of 1907 against Germany a pact which made England’s war in 1914 possible, the Russian state recognized the German classical system as superior to British empiricism and reductionism.

Many times I have asked Russians of the 1980s generation why they came back to Russia to work after living in the USA. Always the reply more or less, “The US education was so boring, no challenge…the American students were so shallow, no idea of anything outside the United States…for all its problems, I decided to come home and help build a new Russia…”

Some personal examples illustrate what I have found: Irina went with her parents to Oregon in the early 1990s. Her father was a high-ranking military figure in the USSR. After the collapse he retired and wanted to get away from Russia, memories of wars, to live his last years peacefully in Oregon. His daughter grew up there, went to college there and ultimately realized she could be so much more herself back in Russia where today as a famous journalist covering US-instigated wars in Syria and elsewhere including Ukraine, she is making a courageous contribution to world peace.

Konstantin went to the USA to work as a young broadcast journalist, did a master’s degree in New York in film and decided to return to Russia where he is making valuable TV documentaries on dangers of GMO and other important themes. Anton stayed in Russia, went into scientific and business publishing and used his facility with IT to found his own publishing house. Dmitry who taught physics at a respected German university, returned to his home St Petersburg to become a professor and his wife also a physicist, translates and manages a Russian language internet site as well as translating into Russian several of my own books.

What all these Russian acquaintances, now in their late 30s or forties share is that they were born when the remnants of the old Soviet Russia were still very visible, for better and for worse, but grew to maturity after 1991. This generation has a sense of development, progress, of change in their lives that is now proving invaluable to shape Russia’s future. They are also, through their families and even early childhood, rooted in the old Russia, like Vladimir Putin, and realize the reality of both old and new.

Now because of the brazen open savagery of Washington policies against Russia, this generation is looking at what was valuable. They realize that the stultifying bureaucratic deadness of the Soviet Stalin heritage was deadly in the USSR years. And they realize they have a unique chance to shape a new, dynamic Russia of the 21st Century not based on the bankrupt model of the now-dying American Century of Henry Luce and FD Roosevelt.

This for me is the heart of an emerging renaissance of the spirit among Russians that gives me more than hope for the future. And, a final note, it has been policy among the so-called Gods of Money, the bankers of London and New York, since at least the assassination in 1881 of Czar Alexander II, to prevent a peaceful growing alliance between Germany and Russia. A prime aim of Victoria Nuland’s Ukraine war has been to rupture that growing Russo-German economic cooperation. A vital question for the future of Germany and of Europe will be whether Germany’s politicians continue to kneel to the throne of Obama or his successor or define their true interests in closer cooperation with the emerging Eurasian economic renaissance that is being shaped by President Putin’s Russia and by President Xi’s China.

Ironically, Washington’s and now de facto NATO’s “undeclared war” against Russia has sparked this remarkable renaissance of the Russian spirit. For the first time in many years Russians are starting to feel good about themselves and to feel they are good in a world of some very bad people. It may be the factor that saves our world from a one world dictatorship of the bankers and their military.

F. William Engdahl is strategic risk consultant and lecturer, he holds a degree in politics from Princeton University and is a best-selling author on oil and geopolitics, exclusively for the online magazine “New Eastern Outlook”.

 

Behind the US jobs report: Low wages and persistent mass unemployment

By Gabriel Black
March 8, 2015
World Socialist Web Site

 

The US economy created 295,000 new jobs in February, according to a Bureau of Labor Statistics (BLS) report released Friday. The percentage of the population officially unemployed shrank by 0.2 percentage points to 5.5 percent.

The report sent tremors throughout Wall Street, with the Dow Jones Industrial Average falling 1.5 percent. Investors fear that any slacking of the jobs crisis could lead the Federal Reserve to scale back on its policy of ultra-low interest rates that has formed the basis of financial speculation in recent years.

Media outlets have celebrated the jobs report as a sign of the US economy’s growing strength. However, some have been confused with the question, voiced by the New York Times, “So Why Aren’t Wages Rising More?”

Behind the headline figures of February’s report lie two underreported facts. First, the fall in the official unemployment rate is largely fictional. Second, new jobs are concentrated in lower-paying sectors, while the overall wages of workers throughout the economy are under sustained attack.

While February was the 60th straight month of job growth in the private sector, it was also the 11th straight month in a row that the labor participation rate—a more accurate measure of unemployment—remained below 63 percent. The figure fell 0.1 percentage points to 62.8 in February, the lowest level since 1978. The contrast between the extremely low labor participation rate and the ostensibly recovering official unemployment rate arises from the fact that millions of unaccounted laborers in the official statistics cannot find suitable work.

Indeed, more than two-thirds of the drop in the jobless rate was due to workers leaving the workforce, not workers finding jobs. In February the number of people reported as being unemployed shrank by 274,000. Of those, 178,000 left the work force and 96,000 gained jobs.

According to the Economic Policy Institute (EPI), there were 5,970,000 unemployed workers missing from the official statistics in this month’s job report. Were they to be added to the unemployment rate, it would stand at 9 percent. These missing workers “are people who would be either working or looking for work if job opportunities were significantly stronger.” The EPI notes that more than half of these missing workers are in their prime age of working, between the ages of 25 and 54.

There are several signs that the jobs market is entering a renewed downturn. The number of Americans who filed new claims for unemployment benefits rose sharply last week, by 7,000, to a seasonally adjusted 320,000.

Meanwhile, Challenger, Gray & Christmas, the consultancy firm that tracks mass layoffs, reported yesterday that US employers announced 103,620 planned layoffs in the first two months of 2015, up nearly 20 percent from the same period last year.

As for wages, they remained stagnant for non-supervisory and production workers, the bulk of the workforce. Wages for all workers rose slightly, by $0.03.

One commentator on National Public Radio noted, “We’re adding most of our jobs at or slightly above minimum wage, and as long as that’s the case, you’re not going to get a whole lot of upward pressure on wages.”

A report released last April by the National Employment Law Project, “The Low-Wage Recovery,” found that unlike previous recessions and post-recession recoveries, the current “recovery” has been dominated by low-wage growth. The authors wrote, “We find that low-wage job creation was not simply a characteristic of the first phase of the recovery, but rather a pattern that has persisted for more than four years now. Deep into the recovery, job growth is still heavily concentrated in lower-wage industries.”

The largest industry to gain workers in February was in “food services and drinking places,” which saw 59,000 new jobs, or about a fifth of all gains. Professional and business services increased by 51,000 jobs, retail by 31,000, construction by 29,000 and health care by 24,000. Part-time workers stood unchanged at 6.6 million people.

The Obama administration’s “recovery,” characterized by high stock prices for the rich, stagnating or declining wages for the majority, and long-term unemployment, is not a policy accident. Starting with the bailout of the auto companies, which cut in half the wages for new hires, the administration has led the charge in “wage restructuring” and “downsizing” in order to make American workers more easily exploitable. Meanwhile, the bailout of the banks and Federal Reserve’s quantitative easing program have ensured record profits and stock prices for the super-rich.

World Misses Its Potential by Excluding 50 Percent of Its People

Ahead of global summit, experts note progress made on equity for women is not outweighed by the enormous gaps that remain

By Thalif Deen, IPS News
Common Dreams
March 6, 2015

 

Photo: Advocacy Project/flickr/cc)

 

UNITED NATIONS – The meeting is billed as one of the biggest single gatherings of women activists under one roof.

According to the United Nations, over 1,100 non-governmental organisations (NGOs) and more than 8,600 representatives have registered to participate in this year’s session of the Commission on the Status of Women (CSW).

Described as the primary intergovernmental body mandated to promote gender equality and the empowerment of women, the 45-member CSW will hold its 59th sessions Mar. 9-20.

About 200 side events, hosted by governments and U.N. agencies, are planned alongside official meetings of the CSW, plus an additional 450 parallel events by civil society organisations (CSOs), both in and outside the United Nations.

Their primary mission: to take stock of the successes and failures of the 20-year Platform for Action adopted at the historic 1995 Women’s Conference in Beijing. The achievements are limited, say CSOs and U.N. officials, but the unfulfilled promises are countless.

The reason is simple, warns Secretary-General Ban Ki-moon: “We cannot fulfill 100 percent of the world’s potential by excluding 50 percent (read: women) of the world’s people.”

U.N. High Commissioner for Human Rights Zeid Ra’ad Al Hussein says the U.N.’s 193 member states have to go beyond “paying lip service” towards gender equality.

They should “genuinely challenge and dismantle the power structures and dynamics which perpetuate discrimination against women.”

But will they?

Yasmeen Hassan, global executive director of Equality Now, told IPS in the Beijing Platform for Action, 189 governments pledged to “revoke any remaining laws that discriminate on the basis of sex”.

Twenty years later, just over half of the sex discriminatory laws highlighted in three successive Equality Now reports have been revised, appealed or amended, she said.

“Although we applaud the governments that took positive action, we are concerned that so many sex discriminatory laws remain on the books around the world,” Hassan noted.

Mavic Cabrera-Balleza, international coordinator at Global Network of Women Peacebuilders, a programme partner of the International Civil Society Action Network, told IPS she was happy to see the latest draft of the Beijing + 20 Political Declaration, presented by the Bureau of the CSW, expressing “concern that progress has been slow and uneven and that major gaps and obstacles remain in the implementation of the 12 critical areas of concern of the Beijing Platform for Action.”

“And it [has] recognized that 20 years after the Fourth World Conference on Women [in Beijing], no country has achieved equality for women and girls; and that significant levels of inequality between women and men persist, and that some women and girls experience increased vulnerability and marginalization due to multiple and intersecting forms of discrimination.”

“This is a reality check on the part of the member states, which is welcomed by the Global Network of Women Peacebuilders and the rest of civil society,” she added.

Speaking specifically on reproductive health, Joseph Chamie, a former director of the U.N. Population Division, told IPS the work of the CSW is important and it has contributed to improving women’s lives.

Pointing out the important areas of health and mortality, he said, when the CSW was established seven decades ago, the average life expectancy at birth for a baby girl was about 45 years; today it is 72 years, which, by any standards, is a remarkable achievement.

With respect to reproductive health, he said, great strides have been achieved.

In addition to improved overall health and lower maternal mortality rates, most women today can decide on the number, timing and spacing of their children.

“Simply focusing attention, policies and programmes on the inequalities and biases that women and girls encounter, while largely ignoring those facing men and boys, will obstruct and delay efforts to attain true gender equality and the needed socio-economic development for everyone,” Chamie warned.

According to U.N. Women, only one in five parliamentarians is a woman.

Approximately 50 per cent of women worldwide are in paid employment, an increase from 40 per cent more than 20 years ago, with wage inequality persistent.

At the present rate of progress, said U.N. Women, it will take 81 years for women to achieve parity in employment.

In 2000, the groundbreaking Security Council resolution 1325 on women, peace and security recognised the need to increase women’s role in peacebuilding in post-conflict countries. Yet, from 1992 to 2011 only 4 per cent of signatories to peace agreements and nine per cent of negotiators at peace tables were women.

Hassan told IPS there are still laws that restrict women’s rights in marriage (women not allowed to enter and exist marriages on the same basis as men; appointing men as the head of a household; requiring wife obedience; allowing polygamy; setting different ages of marriage for girls and boys).

There are also laws that give women a lower personal status and less rights as citizens (women not being able to transmit their nationality to husbands and children; women’s evidence not equal to that of a man; restriction on women traveling).

And women being treated as economically unequal to men (less rights to inheritance or property ownership; restrictions on employment); and laws that promote violence against women (giving men the right to rape their wives; exempting rapists from punishment for marrying their victims; allowing men to chastise their wives).

“The fact that these laws continue to exist shows that many governments do not consider women to be full citizens and as such it is not possible to make progress on the goals set 20 years ago,” Hassan said.

Cabrera-Balleza told IPS the CSW political declaration also states that member states reaffirm their “political will and firmly commit to tackle critical remaining gaps and challenges and pledge to take concrete further actions to transform discriminatory social norms and gender stereotypes,” among other very good promises.

This is where the crux of the matter lies, she said.

“We’ve heard these promises many times before from past CSW sessions and yet recent data, such as those from the World Health Organisation (WHO), indicate the following:

– 35 percent of women worldwide have experienced either intimate partner violence or non-partner sexual violence in their lifetime;

– on average, 30 percent of women who have been in a relationship report that they have experienced some form of physical or sexual violence by their partner.”

Globally, she said, as many as 38 percent of murders of women are committed by an intimate partner.

She predicted that issues of sexual and reproductive health and rights, including lesbian, gay, bisexual and transgender (LGBT) rights will remain contentious in this CSW, as in previous years.

“It also worries me that while thousands of women have died and many more continue to suffer because of ongoing conflicts as well as violent extremism around the world, none of this is addressed in the political declaration.”

Sadly, the U.N. continues to operate in silos, she said. The Security Council remains disconnected with the Economic and Social Council (ECOSOC) under which the CSW functions.

“Having said all of this, I want us, in civil society, to push the envelope as far as possible in this 59th CSW session,” she added.

China cuts growth forecast, warning of “deep-seated” economic problems

By Nick Beams
March 6, 2015
World Socialist Web Site

 

Stock Market DropThe Chinese government has lowered its official projection for economic growth this year to “approximately 7 percent” following a year that saw the lowest economic expansion in a quarter of a century.

Chinese Premier Li Kequiang announced the target in his opening address to the annual National People’s Congress which began in Beijing yesterday.

Presenting a gloomy outlook for the world’s second largest economy, he said: “The downward pressure on China’s economy is intensifying. Deep-seated problems in the country’s economic development are becoming more obvious. The difficulties we are facing this year could be bigger than last year. The next year is a crucial year for deepening all-round reforms.”

In a further sign of economic problems, Li said the government planned this year to run its biggest deficit since the global financial crisis. The deficit will rise to 2.3 percent of gross domestic product this year, compared to 2.1 percent last year. Some of the additional money will be spent on railway, water and agricultural projects, but the chairman of the government’s economic planning agency Xu Shaoshi said it should not be seen as a “massive stimulus.”

Li said the new growth target was what was needed and what was possible, adding that China’s growth model was inefficient and that “difficult structural adjustments” were necessary in order to absorb the effects of previous stimulus measures.

As part of “restructuring,” the government is pushing ahead with measures to reduce its control of the giant state-owned enterprises that dominate much of the economy. It also plans to further open the country’s financial system. This is certain to intensify conflicts within the ruling elite. Significant economic and political power brokers, resting on state-owned enterprises, are the target of a corruption purge led by President Xi Jinping.

The new target of just 7 percent growth is considered by many commentators to be inflated, with real growth probably around 2 or 3 percentage points lower. It is politically significant given that the government has stated in the past that growth of at least 8 percent is needed to maintain “social stability.” The government fears that slowing growth and the consequent increase in unemployment will bring about major struggles by the working class.

Li alluded to these fears, at least obliquely, saying that in order to “defuse problems and risks” China relied on development that required an “appropriate growth rate.” However, at the same time, he continued, “China’s economic development has entered a ‘new normal.’”

The new target is also a reflection of major problems in the world economy as a whole. It underscores the fact that the massive quantitative easing programs of the world’s central banks, which will be further extended when the European Central Bank begins a bond-purchasing program next week, have done nothing to boost real growth. They have served only to fuel parasitism, currency wars and speculation.

Furthermore, it shows that far from providing a new platform for economic expansion, the Chinese economy is being afflicted by the same tendencies that have emerged on a global scale, expressed most sharply in deflationary pressures. Li said that the government was lowering its inflation target to around 3 percent from 3.5 percent in 2015.

Last weekend, in announcing a further cut in official interest rates, the second reduction in three months, the People’s Bank of China said that it was responding to a “deflationary risk” as well as to falling property prices. And in a sign of the growing excess capacity in the economy, factory gate prices of commodities showed a year-on-year decline of 4.3 percent in January.

A product of the deepening global malaise, the Chinese slowdown is, in turn, adding to it. This week iron, which comprise a major component of exports for countries such as Brazil and Australia, fell below $60 per tonne, just one third of the peak it reached four years ago. This fall parallels a similar slide in oil prices.

The Chinese economy is also being severely impacted by the fall in the value of the currencies of its major trading partners. Loosely tied to the rising US dollar, the yuan has risen 60 percent against the Japanese yen and 90 percent against Brazil’s real since the middle of 2012. In the past year it has risen 27 percent against the euro.

Any effort by China to push down the value of the yuan will intensify the incipient global currency war as major countries try to lower the value of their currencies to try to improve their competitive position internationally.

In response to the global financial crisis of 2008–2009, the Chinese government initiated a massive expansion of credit—an amount equivalent to the entire US banking system—in order to boost the economy after 23 million jobs were lost in 2009. Since then, Chinese growth has not been fuelled by expanding exports, as it was in the 1990s and in the years leading up to the financial crisis, but by investment in property and infrastructure financed by credit.

However, this road is now closed. Besides creating a potentially dangerous credit bubble, the additional growth generated by each yuan of new loans is estimated to be a ratio of just 0.2 percent, compared to 0.8 percent before 2008. Most of the additional credit is not being used to finance new investment projects, but rather to rollover existing debts owed by banks and local government authorities. They are being hit hard by the fall in inflation, which increases the real value of their debt exposure.

The revenues of both the central government and local authorities are contracting because of the slowdown in real estate developments, with land revenues reported to have fallen by 21 percent in the fourth quarter of 2014.

The ending of the credit-property bubble threatens major economic consequences. The Japanese finance house Nomura has warned investors that relying on the government to always provide a stimulus where needed could prove dangerous.

Nomura financial analyst Rob Subbaraman told the British Daily Telegraph: “We assign a one-in-three chance of a hard landing—growth averaging 5 percent or less over four quarters—starting within the next two years.”

Such a fall would not only have major consequences in China but would send a shock wave through the global economy and could set off a major financial crisis.

US economy in deflation and slump

By Andre Damon
February 28, 2015
World Socialist Web Site

 

Stock Market DropThe US Commerce Department said Friday that Gross Domestic Product, the broadest measure of economic output, grew by only 2.2 percent in the fourth quarter of last year, down from an earlier estimate of 2.6 percent and a sharp fall from earlier quarters.

This followed the announcement by the Labor Department on Thursday that consumer prices fell by 0.7 percent, the largest fall since December 2008. Over the past 12 months, prices have fallen by 0.1 percent, the first annual deflation figure posted since October 2009.

These figures belie official claims that the US is an economically healthy counterbalance to the overall slump and deflation that now encompasses most of the world. In fact, US economic growth, hampered by an enormous impoverishment of the working class in the years following the financial crisis, remains far below pervious historical averages.

On Tuesday, Standard and Poor’s said that it’s Case-Shiller Index showed that home prices grew by 4.6 percent over the past year, the slowest housing price increase since 2011. “The housing recovery is faltering,” David Blitzer, chairman of the index committee at S&P Dow Jones, told the Los Angeles Times. “Before the recession, anytime housing starts were at their current level… the economy was in a recession.”

Meanwhile the number of people in the US newly filing for jobless benefits jumped by 31,000 to 313,000 last week, in the largest increase since December 2013, reflecting a series of mass layoffs and business closures announced this month.

On February 4, office supply retailer Staples announced plans to buy its rival Office Depot, which would result in the closure of up to a thousand stores and tens of thousands of layoffs. The next day, electronics retailer RadioShack filed for bankruptcy, saying it plans to close up to 3,500 stores.

Mass layoffs have also been announced at online marketplace eBay, credit card company American Express, the oilfield services companies Schlumberger and Baker Hughes, as well as the retailers J.C. Penney and Macy’s.

These disastrous economic developments come even as the Dow Jones Industrial Average hit an all-time record of 18,140 on Wednesday, though it retreated slightly later in the week. Worldwide, the FTSE All-World Index is near its highest level in history.

The rise in global stock indices reflects the satisfaction of global financial markets with the pledge by the Syriza-led Greek government to impose austerity measures dictated by the EU, as well as indications by Federal Reserve Chairwoman Janet Yellen in congressional testimony this week that the US central bank is likely to delay raising the federal funds rate in response to recent negative economic figures.

The US federal funds rate has been at essentially zero since the beginning of 2009. Together with the central bank’s multi-trillion-dollar “quantitative easing” program, this has helped to inflate a massive stock market bubble that has seen the NASDAQ triple in value since 2009.

This enormous growth in asset values has taken place despite the relatively depressed state of the US economy, which grew at an annual rate of 2.4 percent in 2014. During the entire economic “recovery” since 2010, the US economy has grown at an average rate of 2.2 percent. By comparison, the US economy grew at an average rate of 3.2 percent in the 1990s and 4.2 percent in the 1950s.

The ongoing stock market bubble has led to a vast enrichment of the financial elite: the number of billionaires in the US has nearly doubled since 2009. The financial oligarchy, however, has not used its ever-growing wealth for productive investment, as shown by the decline in business spending in in the fourth quarter of last year. Instead, it has either hoarded it or used it to buy real estate, art and luxury goods.

On Thursday, Bloomberg reported that global sales of “ultra-premium” vehicles, costing $100,000 or more, surged by 154 percent, compared with a 36 percent increase in global vehicle sales overall. The report noted, “Rolls-Royce registrations have risen almost five-fold. Almost 10,000 new Bentleys cruised onto the streets last year, a 122 percent increase over 2009, while Lamborghini rode a 50 percent increase to pass the 2,000 vehicle mark.”

Meanwhile, the number of people in poverty in the US remains at record levels. In January, the Southern Education Foundation reported that, for the first time in at least half a century, low-income children make up the majority of students enrolled in American public schools.

To the extent that jobs are being created in the US, they are largely part-time, contingent and low-wage, replacing higher-wage jobs eliminated during the 2008 crash. A report published last year by the National Employment Law Project found that while American companies have added 1.85 million low-wage jobs since 2009, they have eliminated 1.83 million medium-wage and high-wage jobs.

Earlier this month, Jim Clifton, head of the Gallup polling agency, denounced claims that the US unemployment rate has returned to “normal” levels. “There’s no other way to say this,” he wrote. “The official unemployment rate, which cruelly overlooks the suffering of the long-term and often permanently unemployed as well as the depressingly underemployed, amounts to a Big Lie.”

“Gallup defines a good job as 30+ hours per week for an organization that provides a regular paycheck. Right now, the US is delivering at a staggeringly low rate of 44%, which is the number of full-time jobs as a percent of the adult population, 18 years and older.”

Clifton added, “I hear all the time that ‘unemployment is greatly reduced, but the people aren’t feeling it.’ When the media, talking heads, the White House and Wall Street start reporting the truth—the percent of Americans in good jobs; jobs that are full time and real—then we will quit wondering why Americans aren’t ‘feeling’ something that doesn’t remotely reflect the reality in their lives.”

The Cost of NSA Spying On the U.S. Economy Is “Incalculable”

Spying Is Destroying the U.S. Economy

WashingtonsBlog
February 26, 2015
Washington’s Blog

 

We’ve thoroughly documented that unnecessary spying by the U.S. government is costing the American tech sector many billions of dollars … and the U.S. economy as a whole hundreds of billions of dollars.

Things just got a lot worse …

ZDNet notes today:

China is no longer using high-profile US technology brands for state purchases, amid ongoing revelations about mass surveillance and hacking by the US government.

A new report confirmed key brands, including Cisco, Apple, Intel, and McAfee — among others — have been dropped from the Chinese government’s list of authorized brands, a Reuters report said Wednesday.

***

Some reports have attempted to pin a multi-billion dollar figure on the impact of the leaks.

In reality, the figure could be incalculable.

The report confirms what many US technology companies have been saying for the past year: the activities by the NSA are harming their businesses in crucial growth markets, including China.

Mass spying is making a handful of insiders rich … but everyone else is getting poorer.