SmartRemarks

And now, a brief interlude from all the Sherlockiana for a bit of politics and economics. After hearing a radio interview today about a fascinating new book, I’ve done a bit of digging and realized I may have come a bit late to the game, for—at least in England—this book has been gathering serious attention for the better part of a year now. It deserves to do the same here in the U.S.

The interview was with Prof. Richard Wilkinson of Nottingham University, co-author (with Kate Pickett of York University) of The Spirit Level: Why Greater Equality Makes Societies Stronger. (The title is perhaps a bit less than apt; the authors apparently wanted to call it “Evidence-Based Politics,” which to my ear would have been superior.) Wilkinson and Pickett, epidemiologists both, started out studying data on public health outcomes and wound up with a project much larger than they had originally envisioned. Their data demonstrate beyond any reasonable doubt that economic inequality within a society, regardless of overall wealth, is the single biggest predictor of a wide range of other social ills, from life expectancy to violent crime and far, far more.

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Tags: books, economy, government, health care, inequality, Kate Pickett, Richard Wilkinson, The Spirit Level

Personal anecdote time here. Unemployment is much in the news these days. And as I’ve mentioned once or twice, I’ve been on the job market for a while now, looking for full-time work in the nonprofit sector. I try not to dwell on it. I did a little tallying-up today, though, and determined that since last Labor Day—not quite eight months, just before I started this blog and (coincidentally) the economic meltdown began in earnest—I have applied for 78 different jobs. Out of that, I’ve had a grand total of seven interviews. And no offers.

Anyone who’s lucky enough not to have been on the market recently simply has no idea how competitive it is out there. Not long ago I interviewed for a management position at a prison reform organization. The Board members I spoke with were effusive about what a great candidate I was—both before and after they rejected me. I lost out on that one to a Pulitzer-winning former editor from a major Chicago newspaper, someone who had led investigative series covering the prison system… but who had recently been laid off, and was accepting a substantial salary decrease to work at this nonprofit organization.

That’s what it’s like these days.

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Tags: Depression, economy, Republicans, unemployment

I don’t necessarily buy the notion that public discontent with the recent AIG retention bonuses, or with Wall Street’s role in the economic meltdown overall, is a signpost of resurgent populist feeling. (It takes more than fleeting moods to swing public sentiment in lasting ways.) Nevertheless, a lot of people apparently do, across the political spectrum… or at least find it convenient to say they do. The right wing, in particular, has familiar anti-populist memes ready and waiting.

This week’s Newsweek attempts to cover every possible point of view on the subject in nine separate essays, but they’re all wrapped in a cover that frames things in terms of “POPULIST RAGE,” in a big scary headline. In the conservative American Thinker, Richard Baehr expresses things more baldly, in a piece entitled “Class War In America”:
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Tags: conservatism, economy, Obama, populism

There’s been a lot of interesting political commentary going on this past week (just check out the industrious writers on my blogroll), but I admit that I haven’t felt inspired to chime in on it. Sometimes the weight of public affairs just seems overwhelming, and it helps to step back and focus on personal matters. However, there is one political meme that keeps recurring lately, in the public discourse and thus, also, in the back of my mind. It’s ubiquitous in the establishment press and on the internet; it came up repeatedly last week in Obama’s second press conference, and again today on NPR’s Talk of the Nation. And it’s certainly prominent in Congress.

Here’s the meme:  that Obama’s budget is too ambitious, since it dramatically increases the national debt (by what the CBO projects to be $9.3 trillion over ten years, as has been widely reported). That we’re all “fiscal conservatives” who naturally agree that deficit spending is A Bad Thing, and therefore that Congress clearly needs to scale spending back from what Obama has proposed.

There’s a simple question going unasked here:  why? Nothing about this meme is as self-evident as those who echo it seem to assume. 

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Tags: conservatism, Depression, economy, FDR, federal budget, financial crisis, Galbraith, history, Obama

Treasury Secretary Tim Geithner today announced a new plan that will allegedly help stabilize the financial markets, restore institutions’ balance sheets, and thus ease the credit crunch with all its attendant ripple effects. It’s an unwieldy construct with multiple parts, but ultimately a lot of it comes down to using taxpayer money to help purchase “toxic assets.” (E.g., CDOs backed by MBSs, the stuff hedged by all those CDSs. Isn’t it fun to play with the new lingo we’ve all learned these last few months?)

The stock market seems to love the plan, seeing as how it surged several hundred points today. But does that mean it’s a good thing? 

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Tags: bailout, banking, economy, financial crisis, mark-to-market, Obama, Paul Krugman, Timothy Geithner

First things first:  after what we’ve suffered through in recent years, merely being able to say “Governor Pat Quinn” is almost as delightful as being able to say “President Barack Obama.” 8-) 

After a mere seven weeks in office, Illinois’ new governor has a budget proposal ready, and he gave a formal address in Springfield yesterday announcing it. I listened to the whole thing on Chicago Public Radio, unfiltered and uninterrupted, no sound bites, no spin. (Who doesn’t love public radio?) Anyone who missed it can listen here, or read the full text here (courtesy of  the Tribune’s Eric Zorn).

It was a strong speech, and it sounds like a courageous budget—tackling some issues that state government has been dodging for years. There will nevertheless be a great reactionary hue and cry (as the comment thread on the Trib’s initial article demonstrates) because it includes a small income tax increase.

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Tags: budget proposal, Chicago, economy, Illinois, Mike Madigan, Pat Quinn, taxes

Just going from the press coverage, of course. I haven’t read the actual FY 2010 federal budget the administration presented to Congress. (Have you ever tried to read a federal budget? Even in outline form, they’re large. And arcane. The legislators themselves don’t usually bother. They have staff lobbyists for that sort of thing…)

Anyway, I’m going to tackle this one in bullet-point format, starting with the largest category:

Good Things About Obama’s Budget

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Tags: climate, Congress, economy, education, energy, environment, federal budget, health care, Obama, taxes

Wall Street. A term that designates not only a physical place, but a symbol, a way of thinking. It’s the capital of investing (embodied in the stock market), the capital of high finance (embodied in the banking system), the capital of… capital. It’s the hub of the economy, domestically and internationally.

And it’s the single biggest stumbling block in the Obama administration’s attempt to get the economy back on track.

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Tags: Alan Greenspan, banking, economy, financial crisis, nationalization, Obama, Paul Krugman, Timothy Geithner

In fact, I’d go so far as to say that Obama’s address tonight may well have been the first presidential speech I’ve ever seen that genuinely lived up to the full meaning of the word “presidential.” The first time in my life we’ve had real, effective leadership in Washington. So this is what it looks and sounds like!

It’s sincerely heartening these days, of course, just to hear a presidential speech delivered in complete, grammatical sentences, shorn of angry fearmongering and brazen paralogia. But Obama had to achieve far more than that. He had a tightrope to walk, having to avoid being too doom-n-gloomy (and thereby get accused of talking down the economy) but also avoid making unrealistically rosy promises (and thereby get accused of empty politicking). The times we are in are indeed, as he phrased it, “difficult and perilous,” yet he had to make clear that they are not insurmountably so.

He pulled it off.

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Tags: Bill Kristol, economy, education, energy, financial crisis, George Lakoff, health care, media, Obama, polling, Rachel Maddow, Republicans, State of the Union

I’ve already alluded to the right wing’s attempts to spread misinformation about the New Deal and the Great Depression. The mass media echo chamber has been full of them lately, and I’ve linked to a couple of items that have been rowing against the tide. I have perhaps been too casual about assuming that everyone is familiar with the real story, however. A careful look at some empirical truth is called for here, if we are to learn the correct lessons applicable to our current situation.

So let’s revisit those two links in greater detail. A few diligent scholars and journalists have done their homework so you and I don’t have to.

First, from economist Charles McMillion’s essay entitled “The ‘FDR Failed’ Myth” (emph. mine):

[I]t is imperative to expose a dangerous popular myth regarding the efficacy of President Roosevelt’s actions: that it was not the programs of the New Deal, but only the placing of the nation on a wartime footing years later, that restored the health of the nation’s economy.

This belief, though widely held, cannot stand up to even the most basic economic analysis. Yet the mainstream corporate media, which abound with anti-government ideology, seek to reinforce this myth. Just this past Sunday, The Washington Post featured on Page One of its Outlook section an article by Amity Shlaes headlined “FDR Was a Great Leader, But His Economic Plan Isn’t One to Follow.” …

The basic economic facts from the 1930s—according to the Department of Commerce, the Federal Reserve, and other official sources—are fundamentally different from the unsupported claims put forward by Shlaes and prominent in popular myth. The monthly data for industrial production show a near three-year collapse under President Hoover, ending when FDR came to office in March 1933. Production rocketed by 44 percent in the first three months of the New Deal and, by December 1936, had completely recovered to surpass its 1929 peak.

GDP, only available as annual averages, plunged 25.6 percent from 1929-1932, including by 13.0 percent in 1932. It stabilized in 1933, and then soared by 10.8 percent, 8.9 percent and 12.0 percent, respectively, in 1934, 1935 and 1936. Real GDP surpassed its 1929 peak in 1936 and never again fell below it. After-tax personal income, consumer spending, real private investment and jobs all reached or surpassed their 1929 peaks by late 1936.

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Tags: Depression, economy, FDR, history