Tuesday, June 8, 2010

Massive Unemployment and Political Irresponsibility Continue To Cripple the Nation



As political columnist Bob Herbert points out in his excellent article on the dismal state of national unemployment and general economic despair throughout the U.S. the appalling lack of progressive political leadership from not only the braindead and incompetent Obama administration but the massive irresponsibility and criminality of Congress --as well as a ruthless and rapacious financial and corporate system --have combined to destroy the lives of millions of workers and potential workers while we as a nation generally continue to sleepwalk our way through this huge national disaster and refuse to demand specific alternatives. What happened to "Change We Can Believe In"? At present all it is is just another empty and deceptive advertising slogan used by arrogant self serving politicians who value personal ambition and power over any larger socially transformative principles and values. Meanwhile, we all continue to suffer mightily for the blatant lack of accountability and speaking truth to power by not only our so-called "leaders" but ourselves...



‘A Very Deep Hole’

June 7, 2010
New York Times

I know the president has a lot on his mind, but the No. 1 problem facing the U.S. continues to fester, and that problem is unemployment.

Bob Herbert

The jobs report for May, released on Friday by the Labor Department, was grim. President Obama tried to put the best face on it, but it was undeniably bad news, which is why the stock markets tanked. The private sector created just 41,000 jobs in May, a dismal performance. The government hired 411,000 workers to help with the census, but those jobs are temporary and will vanish in a few months.

Unemployment is crushing families and stifling the prospects of young people. Given that reality, President Obama’s take on the May numbers seemed oddly out of touch. “This report,” he said, “is a sign that our economy is getting stronger by the day.”

The economy is sick, and all efforts to revive it that do not directly confront the staggering levels of joblessness are doomed. Even the meager job growth in the private sector last month was composed mostly of temporary work. Lawrence Mishel, the president of the Economic Policy Institute, had the right take when he said, “These new data do not present a picture of a healthy private sector and offer nothing even closely resembling the job growth we need to dig us out of a very deep hole.”

More than 15 million Americans are out of work, and nearly half have been jobless for six months or longer. New college graduates are having a terrible time finding work, and many are taking jobs that require only a high school education. Teachers are facing the worst employment market since the Depression.

Entire communities are going under. A remarkable article in The Times last week detailed what has happened in Memphis, where a majority of the residents are black. It said the city epitomizes “how rising unemployment and growing foreclosures in the recession have combined to destroy black wealth and income and erase two decades of slow progress.”

The median income of black homeowners in Memphis has dropped to a level below that of 1990.

It’s impossible to overstate the threat that this crisis of unemployment poses to the well-being of the United States. With so many people out of work and so much of the rest of the population deeply in debt, where is the spending going to come from to power a true economic recovery? The deficit hawks are forecasting Armageddon, but how is anyone going to get a handle on the federal deficits if we don’t get millions of people back to work and paying taxes?

Some inner-city neighborhoods, where joblessness is off the charts, are becoming islands of despair. Rural communities and rust belt cities and towns are experiencing their own economic nightmares.

There is no plan that I can see to get us out of this fix. Drastic cuts in government spending would only compound the crisis. State and local governments, for example, are shedding workers as we speak.

Policy makers have acted as if they are unaware of the magnitude of this crisis. They have behaved as though somehow, through some economic magic perhaps, or the power of prayer, this ocean of joblessness will just disappear. That’s a pipe dream.

Even if we somehow experienced a sudden, extraordinary surge in job growth (which no one is expecting), it would take a very long time just to get back to the level of employment that we had when the recession started in late-2007.

Heidi Shierholz, an economist with the Economic Policy Institute, addressed this. “In the boom of the late-1990s,” she said, “the fastest year of employment growth was 2.6 percent, in 1998. If, in the event we have that extremely strong level of growth from here on out, we would still not get down to pre-recession unemployment rates until January 2015.”

For all the money that has been spent so far, the Obama administration and Congress have not made the kinds of investments that would put large numbers of Americans back to work and lead to robust economic growth. What is needed are the same things that have been needed all along: a vast program of infrastructure repair and renewal; an enormous national investment in clean energy aimed at transforming the way we develop and use energy in this country; and a transformation of the public schools to guarantee every child a first-rate education in a first-rate facility.

This would be a staggeringly expensive and difficult undertaking and would entail a great deal of shared sacrifice. (It would also require an end to our insane waste of resources on mindless and endless warfare.) The benefits over the long term would be enormous.

Bold and effective leadership would have put us on this road to a sustainable future. Instead, we’re approaching a dead end.

Monday, June 7, 2010

The Real Crisis Facing the Obama Presidency And What Must Be Done About It



As usual Frank Rich--by far the finest and most insightful "mainstream" political journalist in the country--gets it 100% correct. If the President doesn't seriously listen to what he and millions of others are now saying about him and his administration in the wake of one massive crisis after another in this country then he is a much bigger fool than even his most profound and incisive critics already think he is. The relative 'success' or gigantic failure of Obama's presidency (and far more importantly our collective fate as citizens in a society being systematically destroyed and ravaged by a merciless corporate capitalism) hangs in the balance. Thus the old admonition about leadership still holds more than ever in Obama's case: LEAD, FOLLOW, OR GET OUT OF THE WAY...



Don’t Get Mad, Mr. President. Get Even.

Published: June 4, 2010
New York Times

IT turns out there is something harder to find than a fix for BP’s leak: Barack Obama’s boiling point.

The frantic and fruitless nationwide search for the president’s temper is now our sole dependable comic relief from the tragedy in the gulf. Only The Onion could have imagined the White House briefing last week where a CBS News correspondent asked the press secretary, Robert Gibbs, if he had “really seen rage from the president” and to “describe it.” Gibbs came up with Obama’s “clenched jaw” and his order to “plug the damn hole.” (Thank God he hadn’t settled for “darn.”) This evidence did not persuade anyone, least of all Spike Lee, who could be found on CNN the next night begging the president, “One time, go off!”

Not going to happen. Obama will never unleash the anger of the antagonists in “Do the Right Thing” or match James Carville’s rebooted “ragin’ Cajun” shtick. That’s not who Obama is. If he tried to go off, he’d look ridiculous. But the debate over how to raise the president’s emotional thermostat is not an entirely innocuous distraction. It allows Obama to duck the more serious doubts about his leadership that have resurfaced along with BP’s oil.

Unlike his unflappable temperament, his lingering failings should and could be corrected. And they must be if his presidency is not just to rise above the 24/7 Spill-cam but to credibly seize the narrative that Americans have craved ever since he was elected during the most punishing economic downturn of our lifetime. We still want to believe that Obama is on our side, willing to fight those bad corporate actors who cut corners and gambled recklessly while regulators slept, Congress raked in contributions, and we got stuck with the wreckage and the bills. But his leadership style keeps sowing confusion about his loyalties, puncturing holes in the powerful tale he could tell.

His most conspicuous flaw is his unshakeable confidence in the collective management brilliance of the best and the brightest he selected for his White House team — “his abiding faith in the judgment of experts,” as Joshua Green of The Atlantic has put it. At his gulf-centric press conference 10 days ago, the president said he had “probably had more meetings on this issue than just about any issue since we did our Afghan review.” This was meant to be reassuring but it was not. The plugging of an uncontrollable oil leak, like the pacification of an intractable Afghanistan, may be beyond the reach of marathon brainstorming by brainiacs, even if the energy secretary is a Nobel laureate. Obama has yet to find a sensible middle course between blind faith in his own Ivy League kind and his predecessor’s go-with-the-gut bravado.

By now, he also should have learned that the best and the brightest can get it wrong — and do. His economic advisers predicted that without the stimulus the unemployment rate might reach 9 percent — a projection that was quickly exceeded even with the stimulus and that has haunted the administration ever since. Other White House geniuses persuaded the president to make his fateful claim in early April that “oil rigs today generally don’t cause spills” — a particularly specious (indeed false) plank in the argument for his spectacularly ill-timed expansion of offshore oil drilling. The Times reported last week that at the administration meetings leading to this new drilling policy the subject of the vast dysfunction at the Minerals Management Service, the agency charged with regulating the drilling, never even came up.

Obama’s excessive trust in his own heady team is all too often matched by his inherent deference to the smartest guys in the boardroom in the private sector. His default assumption seems to be that his peers are always as well-intentioned as he is. The single biggest mistake he has made in managing the gulf disaster was his failure to challenge BP’s version of events from the start. The company consistently understated the spill’s severity, overestimated the progress of the repair operation and low-balled the environmental damage. Yet the White House’s designated point man in the crisis, Adm. Thad Allen of the Coast Guard, was still publicly reaffirming his trust in the BP chief executive, Tony Hayward, as recently as two weeks ago, more than a month after the rig exploded.

This is baffling, and then some, given BP’s atrocious record prior to this catastrophe. In the last three years, according to the Center for Public Integrity, BP accounted for “97 percent of all flagrant violations found in the refining industry by government safety inspectors” — including 760 citations for “egregious, willful” violations (compared with only eight at the two oil companies that tied for second place). Hayward’s predecessor at BP, ousted in a sex-and-blackmail scandal in 2007, had placed cost-cutting (and ever more obscene profits) over safety, culminating in the BP Texas City refinery explosion that killed 15 and injured 170 in 2005. Last October The Times uncovered documents revealing that BP had still failed to address hundreds of safety hazards at that refinery in the four years after the explosion, prompting the largest fine in the history of the Occupational Safety and Health Administration. (The fine, $87 million, was no doubt regarded as petty cash by a company whose profit reached nearly $17 billion last year.)

No high-powered White House meetings or risk analyses were needed to discern how treacherous it was to trust BP this time. An intern could have figured it out. But the credulous attitude toward BP is no anomaly for the administration. Lloyd Blankfein of Goldman Sachs was praised by the president as a “savvy” businessman two months before the Securities and Exchange Commission sued Goldman. Well before then, there had been a flood of journalistic indicators that Goldman under Blankfein may have gamed the crash and the bailout.

It’s this misplaced trust in elites both outside the White House and within it that seems to prevent Obama from realizing the moment that history has handed to him. Americans are still seething at the bonus-grabbing titans of the bubble and at the public and private institutions that failed to police them. But rather than embrace a unifying vision that could ignite his presidency, Obama shies away from connecting the dots as forcefully and relentlessly as the facts and Americans’ anger demand.

BP’s recklessness is just the latest variation on a story we know by heart. The company’s heedless disregard of risk and lack of safeguards at Deepwater Horizon are all too reminiscent of the failures at Lehman Brothers, Citigroup and A.I.G., where the richly rewarded top executives often didn’t even understand the toxic financial products that would pollute and nearly topple the nation’s economy. BP’s reliance on bought-off politicians and lax, industry-captured regulators at the M.M.S. mirrors Wall Street’s cozy relationship with its indulgent overseers at the S.E.C., Federal Reserve and New York Fed — not to mention Massey Energy’s dependence on somnolent supervision from the Mine Safety and Health Administration.

Given Toyota’s recent game of Russian roulette with Americans’ safety and Anthem Blue Cross’s unconscionable insurance-rate increases in California, Obama shouldn’t have any problem riveting the country’s attention to this sorry saga. He has the field to himself, thanks to a political opposition whose hottest new star, Rand Paul, and most beloved gulf-state governor, Haley Barbour of Mississippi, both leapt to BP’s defense right after the rig exploded. The Wall Street Journal editorial page perfectly set forth the conservative establishment’s party line on May 26: “There is zero evidence so far that this blowout resulted from lax regulation or shoddy practices.” Or as BP’s Hayward asked indignantly, “What the hell did we do to deserve this?”

If Obama is to have a truly transformative presidency, there could be no better catalyst than oil. Standard Oil jump-started Progressive Era trust-busting. Sinclair Oil’s kickback-induced leases of Wyoming’s Teapot Dome oilfields in the 1920s led to the first conviction and imprisonment of a presidential cabinet member (Harding’s interior secretary) for a crime committed while in the cabinet. The Arab oil embargo of the early 1970s and the Exxon Valdez spill of 1989 sped the conservation movement and search for alternative fuels. The Enron scandal prompted accounting reforms and (short-lived) scrutiny of corporate Ponzi schemes.

This all adds up to a Teddy Roosevelt pivot-point for Obama, who shares many of that president’s moral and intellectual convictions. But Obama can’t embrace his inner T.R. as long as he’s too in thrall to the supposed wisdom of the nation’s meritocracy, too willing to settle for incremental pragmatism as a goal, and too inhibited by the fine points of Washington policy debates to embrace bold words and bold action. If he is to wield the big stick of reform against BP and the other powerful interests that have ripped us off, he will have to tell the big story with no holds barred.

That doesn’t require a temper tantrum. Nor does it require him to plug the damn hole, which he can’t do anyway. What he does have the power to fix is his presidency. Should he do so, and soon, he’ll still have a real chance to mend a broken country as well.