Liberals’ Strange Retreat on Government Spending
A Weak Defense
[Guest post by John Judis] READ MORE >>
Why Democrats Should Kill the Bill
When Barack Obama announced his presidential candidacy on February 10, 2007, he did it in Springfield, Illinois, in the same place where Abraham Lincoln had made his historic challenge to slavery in June 1858. “A house divided against itself cannot stand,” Lincoln had declared, conveying his conviction that the union could no longer countenance the existence of a slave-owning South. READ MORE >>
The Dangerous Flaw in Obama’s Debt Ceiling Speech
Barack Obama’s speech Monday night about the debt ceiling will help him politically by painting the Republican opposition as heartless and intransigent and his own approach—to use the word of the night—as “balanced.” Obama even framed the choice in somewhat populist terms by portraying the Republicans as unwilling to ask big business and the wealthy to make the sacrifices they want to exact from the rest of society. That’s all to the good. READ MORE >>
Obama Has No Reason to Advocate for Cutting Spending
I have to admit that I haven’t followed the ins and outs of the negotiations over raising debt ceiling. But, since they began, I haven’t seen a single proposal that wouldn’t do more harm than good to the country. And, from what I’ve read—from the original Biden proposals down to President Obama’s attempt to mollify the Tea Party—the plans have actually gotten worse, not better, as far as the country is concerned. What would I have the politicians do? Here are my guidelines: READ MORE >>
Amazon.com: Terrible Corporate Citizen
I’m a longtime customer of Amazon—everything from books, eBooks, and two Kindles to tennis balls and baseball caps—but I’m looking for an alternative. I’m not unhappy with Amazon’s service, but with its politics. Amazon is waging an aggressive campaign to prevent revenue-starved California from collecting sales taxes from the company’s customers. And that’s only its most recent effort to prevent states from levying sales taxes on online purchases. READ MORE >>
Stop Blaming Wall Street
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Stop Blaming Wall Street
As the U.S. economy fails to recover, there is a growing fear that the United States has entered a phase of long-term decline. Conservatives blame “big government” for throttling entrepreneurship; liberals tend to take aim at Wall Street. Rolling Stone writer Matt Taibbi memorably described Goldman Sachs as “a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money.” Among less inventive critics, the term in vogue is “financialization.” According to author Kevin Phillips, who popularized this notion, financialization is “a process whereby financial services, broadly construed, take over the dominant economic, cultural and political role in a national economy.”Elements of this thesis can be found in scores of books, articles, and blog posts on the state of the U.S. economy. Phillips blames financialization not just for the “Great Recession,” but for “excessive debt, great disparity between rich and poor, and unfolding economic decline.” In their book, 13 Bankers, former International Monetary Fund (IMF) chief economist Simon Johnson and James Kwak blame financial factors for the “anemic growth” in the overall economy prior to the crash. And, in an influential essay—titled “WHAT GOOD IS WALL STREET?”—The New Yorker economics writer John Cassidy pointedly contrasts the period when regulators restrained the growth of the finance sector (when wages, investment, and productivity grew, lifting “tens of millions of working Americans into the middle class”) with the period of growth experienced by the finance sector since the early ’80s (when “financial blowups have proliferated and living standards have stagnated”). One thing is clear: Financialization, in some form, has taken place. In 1947, manufacturing accounted for 25.6 percent of GDP, while finance (including insurance and real estate) made up only 10.4 percent. By 2009, manufacturing accounted for 11.2 percent and finance had risen to 21.5 percent—an almost exact reversal, which was reflected in a rise in financial-sector employment and a drop in manufacturing jobs. It is also clear that high-risk speculation and fraud in the financial sector contributed to the depth of the Great Recession. But Phillips, Johnson, and the others go one step further: They claim that financialization is the overriding cause of the recent slump and a deeper economic decline. This notion is as oversimplified, and almost as misleading, as the conservative attack on the evils of big government. READ MORE >>
