Diane just called to see if we need our carpet professionally steam cleaned. She calls a lot. She calls from 360-322-6184.
I keep a land line because I do radio shows, and because so manylegacy accounts have that as the reference number. But lately that line is just SLAMMED with telemarketing calls! “Do you need your carpet cleaned”
And the ones where you pick it up and there’s no one there, and just as you are hanging up you hear them coming on so you hang up faster… Do those robodialing systems actually trap anyone into waiting until someone comes on?
I thought this stuff was finally illegal.
Republicans believe that a bad economy works for them at election time. The thinking is that the public will turn on Democrats for not making things better. So they do what they can to make the economy bad. But maybe they went too far this time. This hostage-taking episode has done real, serious, lasting damage to the economy on top of the ongoing damage Republicans have been doing. Will the public still blame Democrats, or will they finally see what is going on here?
The Damage Last Time
Look what happened the last time (2011) Republicans threatened to force the country to default on its debts.
The 2011 hostage-taking hit jobs. In Debt-Ceiling Deja Vu Could Sink Economy Bloomberg reported that, “Growth in nonfarm payrolls decelerated to an average 88,000 a month during the three months of the debt-ceiling impasse, compared with an average of 176,000 in the first five months of 2011.” Consumer confidence plunged to a 31-year low. The Conference Board’s consumer confidence index fell from 59.2 to 44.5.
In November, 2012, the Bipartisan Policy Center released a “Debt Limit Analysis” estimating the costs of the 2011 hostage-taking:
The Government Accountability Office (GAO) issued a report detailing additional costs to taxpayers as a result of the 2011 debt limit increase
- A substantial cost to taxpayers stemmed from elevated interest rates on U.S. securities issued in 2011 prior to when the debt limit was increased in August
- GAO conducted an economic analysis to estimate the resulting change in interest rates
- For Fiscal Year 2011, GAO estimated additional interest costs to taxpayers of $1.3 billion
The cost of the event to the federal government, however, continues to accrue because many of the bonds issued during that period remain outstanding
- BPC extended GAO’s methodology to analyze the long-term cost to taxpayers stemming from the elevated interest rates
- Estimate of the ten-year cost to taxpayers of the 2011 debt limit standoff = $18.9 billion
- To put this in perspective, the Congressional Budget Office (CBO) estimates that the “Doc Fix” to prevent the scheduled 27% cut to Medicare physician payments for 2012 cost $18 billion over ten years
That is serious damage. And, of course, the 2011 fight resulted in a downgrading of the US credit rating.
(See also: Think Progress, CHARTS: How The Debt Ceiling Debacle Hurt The Economy)
The Damage This Time
In this hostage fight the immediate damage is much worse than 2011. Consumer confidence, for example, has plunged even more dramatically than during the last debt-ceiling hostage-taking. But these measurements were taken only a week into the fight.
Standard & Poor’s ratings agency has done some early calculations of the damage and says, “the shutdown has shaved at least 0.6% off of annualized fourth-quarter 2013 GDP growth, or taken $24 billion out of the economy.” Note the words “at least.” This is an early estimate and does not count direct costs to government and costs to government contractors.
The NY Times today, in Gridlock Has Cost U.S. Billions, and the Meter Is Still Running, reports,
Containers of goods idling at ports. Reduced sales at sandwich shops in downtown Washington. Canceled vacations to national parks and to destinations abroad. Reduced corporate earnings forecasts. Higher interest payments on short-term debt.
Even with the shutdown of the United States government and the threat of a default coming to an end, the cost of Congress’s gridlock has already run well into the billions, economists estimate. And the total will continue to grow even after the shutdown ends, partly because of uncertainty about whether lawmakers might reach another deadlock early next year.
The Damage From Cutting Instead Of Investing
Republicans have forced the country into an austerity mode, instead of an invest and job-creation mode. Everything is being cut, so that the billionaires and their giant corporations can have lower taxes. Aside from the sequester cuts there have been trillions in other cuts.
Paul Krugman writes about this ongoing damage today in a blog post, What A Drag, estimating that just two of the cuts we have experienced (not counting other cuts and the sequester) have cut “about $200 billion of fiscal contraction at an annual rate, or 1.25 percent of GDP, probably with a significant multiplier effect.”
That’s just those two pieces of Republican damage to our economy. Looking at the overall effect of austerity on our economy,
“Add this to the effects of sharp cuts in discretionary spending and the effects of economic uncertainty, however measured, and I don’t think it’s unreasonable to suggest that extortion tactics may have shaved as much as 4 percent off GDP and added 2 points to the unemployment rate.”
Damage: 4% off GDP and 2% added to unemployment.
The Sequester Damage
Then there is the ongoing economic damage done by the sequester cuts. Republicans hail the sequester’s cuts as a great victory, an accomplishment in their ongoing fight to destroy government, but in reality the cuts are costing jobs and hitting the economy.
These job-loss and slow-growth numbers do not include the ripple effect into the larger economy, nor the longer-term cost to our economy from the cuts to scientific research, education, child nutrition and other cuts.
And these cuts don’t even save the government money! One example of the costs of the sequester cuts comes from the effect of cuts in the Meals On Wheels program. Because of the cuts, many elderly end up in hospitals with malnutrition-related problems, and/or are forced into nursing homes because they can no longer live at home. Aside fromt he cruelty and resulting human suffering (not considered a “cost”) this costs money from government services including Medicare and Medicaid.
The Ongoing Damage From Obstruction
Republicans have been obstructing … everything. The ongoing economic damage has been just incredible but because it gradually worsens things the public is not as aware as they should be. There are two obstructions taking place. In the Senate Republicans have been filibustering every bill, every nominee … everything. In the House the “Hastert Rule” prevents the majority of the Congress from being able to vote. By preventing bills from coming up for a vote if they might be passed by a majority that includes Democrats and some “RINO” Republicans, anything that could help the country and economy is blocked.
So along with the series of manufactured crises there is a constant, ongoing drag because people have come to believe government will generally continue to hamper rather than boost economic progress. They see no jobs programs coning down the pike, see the infrastructure crumbling, and see the corporate/billionaire-favoring trade deals killing jobs.
Krugman again, from his blog post, What A Drag,
The now widely-cited Macroeconomic Advisers report estimated the cost of crisis-driven fiscal policy at 1 percentage point off the growth rate for three years, or roughly 3 percent now. More than half of this estimated cost comes from the “fiscal drag” of falling discretionary spending, with the rest coming from a (shaky) estimate of the impacts of fiscal uncertainty on borrowing costs.
The Damage Next Time
So what will the damage be next time, and how can we fight it? Yesterday’s “deal” only puts off the fight for a few months. With more of this on the horizon companies will be hesitant to hire or invest. Consumers will remain wary and distrustful.
Republicans still have one power: the power to destroy. And they will use that power until we take it away from them.
I have a post up at AlterNet today, 6 Absurd Right-Wing Lies About Food Stamps,
In the middle of the worst economy and job situation in decades Republicans in the House voted to cut $40 billion from food stamps. This will kick 3.8 million people out of the program by 2014, 3 million more each year after.
Republicans in Congress have blocked every effort to help the economy. They block bills to create jobs by fixing our crumbling infrastructure because it’s “government spending.” At the same time, right-wing outlets (accurately) complain that the economy is so weak that millions are hurting. And then the same Republicans who blocked efforts to help the economy cut assistance to the people who are hurting, claiming they don’t really need the help. No shame.
In the months leading up to this vote, right-wing outlets such as Fox News, Rush Limbaugh, RedState and the rest of the far-right propaganda machine invented a number of justifications for cutting the program. Here is a takedown of some of those myths and lies.
Myth #1: Food stamps are “growing exponentially” because of waste and fraud.
Click through to read 6 Absurd Right-Wing Lies About Food Stamps.
Republicans are pointing to “glitches” in the new Obamacare websites as justification for shutting down the government. (PS looks like those “glitches” may have had some help.)
I’m writing this at a coffee shop. I parked on the street and went to the device that you use to purchase parking time, and the little LCD screen had a problem — the wrong words were showing up. SHUT DOWN THE GOVERNMENT!!!
Here’s a TPM video of Fox News playing up the website problems yesterday:
width="620" height="414" classid="clsid:d27cdb6e-ae6d-11cf-96b8-444553540000" style="visibility: visible;">
allowNetworking="all" allowScriptAccess="always" allowFullScreen="true" wmode="transparent"
I mean, seriously. Shut down the entire government because you don’t like a law that lets people with pre-existing conditions purchase health insurance? Because of a law that says insurance companies have to stop coming up with reasons not to pay for care when people get sick?
With one in seven Americans experiencing “food insecurity,” Republicans yesterday passed a terrible and cruel cut in Food Stamps. This shows us just who they are.
The corporate push to get Congress to approve the Trans-Pacific Partnership (TPP) trade agreement is about to begin. Again and again we have been promised that these trade agreements “create jobs” and grow the economy. So do they?
Proponents of current corporate-negotiated trade agreements claim that the agreements increase jobs and boost economies. For example Time today has a column, Voters Won’t Like It, but We Have to Bring Back Free Trade, by Michael Schuman. Schuman claims that these agreements are “beneficial for economies overall — boosting exports, enhancing efficiency and reducing prices for consumers.”
Is this what actually happens? Let’s look at what has happened as a result of past agreements.
Negotiated by the George HW Bush administration and pushed by President Clinton, the North American Free Trade Agreement (NAFTA) went into effect January 1, 1994.
Ross Perot famously said we would hear a “giant sucking sound” as NAFTA took jobs from the US and he was right. According to the Economic Policy Institute (EPI) briefing paper Heading South: U.S.-Mexico trade and job displacement after NAFTA, “As of 2010, U.S. trade deficits with Mexico totaling $97.2 billion had displaced 682,900 U.S. jobs.” (That is net jobs, taking into account jobs gained.)
The EPI study did not look into NAFTA’s effect on US wages (but a 2001 EPI study found wage decreases). Clearly, however, NAFTA enabled companies to close American factories and move production to low-wage factories, putting downward pressure on everyone’s wages.
Public Citizen’s document, NAFTA’s Broken Promises 1994-2013: Outcomes of the North American Free Trade Agreement points out that over one million Mexican campesino farmers were driven out of business (and likely driven north to the US) by subsidized US corn from our giant industrialized farms.
China became a member of the World Trade Organization (WTO) in 2001. Americans were promised this would expand market opportunities for U.S. companies, thereby increasing jobs and American prosperity. How has this worked out?
In August, 2012 EPI estimated that the US lost 2.7 million jobs as a result of the U.S.-China trade deficit between 2001 and 2011, 2.1 million of them in manufacturing. Aside from job losses wages US wages fell due to the competition with cheap Chinese labor costing a typical household with two wage-earners around $2,500 per year.
Last month our country’s humongous trade deficit with China was $30.1 billion. That translates to a yearly deficit of more than $360 billion drained straight out of our economy.
In spite of the obvious problems with these trade agreements, the US approved an agreement with Korea that took effect March 15, 2012.
EPI reported in July, 2013 that the US-Korea free trade agreement had already cost the US 40,000 jobs and increased our trade deficit by $5.8 billion. According to EPI,
The tendency to distort trade model results was evident in the Obama administration’s insistence that increasing exports under KORUS would support 70,000 U.S. jobs. The administration neglected to consider jobs lost from the increasing imports and a growing bilateral trade deficit. In the year after KORUS took effect, the U.S. trade deficit with South Korea increased by $5.8 billion, costing more than 40,000 U.S. jobs. Most of the 40,000 jobs lost were good jobs in manufacturing.
So How Did They Work Out?
Again and again these trade agreements resulted in loss of jobs, particularly in higher-wage sectors of our economy like manufacturing, and big increases in the trade deficit. Yes, exports increased adding jobs in some sectors but imports increased more, costing more jobs than those gained. And the sectors that lost jobs tended to be higher-wage, like manufacturing.
While honest and fair trade is a good thing, these trade agreements are written to promote the interests of the giant and powerful multinational corporations over the interests of working people, smaller competing corporations, citizens groups, democracy and the environment. These “free-trade” deals increase unemployment, drive down wages and harm the environment while dramatically increasing the wealth and power of the 1%.
Again, fair trade is great. But trade deals written of by and for a few giant, multinational corporations are good for those corporations and the billionaires behind them — and only those corporations and the billionaires behind them.
The Worst Effect: Widespread Job Fear
When our government just lets companies close a factory here and move production to a country where people have few rights and can’t do anything to make their situation better, what do you think that will do to wages and rights here? When your boss can threaten to lay you off and move your job out of the country, what are you going to say? Are you going to complain about the job and demand a raise?
Job fear is rampant in today’s economy, so everything is sold as a promise to create jobs. Heck if eating bugs will “create jobs” I’ll try it. And you can be sure that the fried bug industry lobbyists are going to promise just that.
So these giant-corporate-promoting trade deals are sold with the promise that they will “create jobs” even though we see again and again that the opposite occurs. Ironically, the job fear so many of us experience is the result of these trade agreements that enabled corporations to close factories here, ship the equipment out of the country, make the same stuff there and bring it back here to sell in the same stores to the same customers. (For some reason that is called “trade.”)
These Agreements Reign In Our Democracy
Now the giant corporations are working on the Trans-Pacific Partnership (TPP). Only a small part of this agreement covers “trade.” Much of it is about “investor rights.” This means that countries that enter into the agreement will not be able to do things that limit the profits of corporations. This includes trying to enforce environmental regulations, trying to get low-cost medicine to sick people, etc. It won’t matter if we call ourselves a sovereign country and a democracy — we will not be allowed to pass the laws that we want to if they interfere with the “rights” of the owners of the giant corporations.
These trade agreements are negotiated by giant multinational corporations along with government officials who understand they will get lucrative jobs with those corporations. They benefit only the 1% and the billionaires behind these corporations. They have not helped our economy and have not increased jobs. In fact they have led to massive trade deficits that are draining our economy, massive job loss and wage loss, and job fear for those still working.
We must insist that trade from now on agreements be negotiated with all of the stakeholders at the table in a process that guarantees their interests have equal weight with the interests of the giant corporations. Representatives of environmental organizations, human rights groups, labor groups, consumer groups and all other stakeholders must be included in these negotiations.
We must also insist that existing agreements be renegotiated so that We the People benefit, instead of just the billionaires behind the giant corporations.
I’ve been writing about how the Republican site Drudge Report has been getting more and more racist. They have story after story about black people attacking white people, black mobs running around beating whites, etc.
Today, for example:
Woman brutally beaten by group of teens says attack was racially motivated…
‘Was so animalistic. So violent’..
Well this is what they have up today. (Today is 50th anniversary of the March for Jobs and Justice and the “I Have A Dream” speech…)
PS someone pointed out this was one of the performers today. I suspect cultural advancement was not the motivation of Drudge, and is not the reception the photo is getting from Drudge’s audience.
The other day I noticed that the Drudge Report was over-the-top, entering “out-and-out KKK territory.” It has only gotten worse. This morning:
RNC Speaker Tells Blacks: Gays, Immigrants Prioritized Over You…
HAD A DREAM: Black lawmakers lament flaring of racial tensions under Obama…
POLL: Just 1 in 4 blacks say situation better…
UPDATE: ‘Homeland Security’ employee behind racist website placed on PAID leave…
SHOCK: Pre-teen black kids bully 3-year-old white girl…
VIDEO: ‘When white people piss black people off’…
COPS: Black teen girls assault white woman; charged with ‘ethnic intimidation’…
PAPER: Black man attacks elderly white male, tells him he ‘shouldn’t be in his park’…
Report: SC restaurant refused to seat black patrons…
SCHOOL: Black student sent racist texts to himself…
And a new Nazi theme, flag included:
Student posts Nazi flags around liberal college campus as ‘joke’…
Nazi-themed wines come under fire…
Trial reveals secret life of ‘Nazi bride’…