President Obama Was Just Too Busy to Visit Wisconsin

Asked why he didn’t visit Wisconsin to support efforts to recall Republican Governor Scott Walker for his legislative attacks on unions, President Obama said he was too busy.

“I have a lot of responsibilities,” he told WBAY, the CBS affiliate in Green Bay in one of eight local interviews he conducted Monday to launch a White House initiative that will direct $2 billion to rural communities from the Small Business Administration.

Obama has been criticized by Democratic activists for not helping Milwaukee Mayor Tom Barrett’s unsuccessful effort to unseat Republican Gov. Scott Walker in last week’s vote.

“I would have loved to have seen a different result,” he said.

Too busy to keep his promise to stand with and defend unions but not too busy to attend fundraisers held by the president of a private equity firm, the same kinds of private equity firms that Obama says don’t hold American values.

 

Oh yeah, let’s not forget about that broken promise to raise the minimum wage too

Advertisements

The ever shrinking middle class…

Middle class incomes have been stagnant for at least a generation, while the wealthiest Americans have seen their income surge ahead at warp speed.

In 1988, the income of an average American taxpayer was $33,400, adjusted for inflation. 20 years later not much had changed, the average income was still just $33,000 in 2008, according to IRS data. During that same time the richest 1%, those making $380,000 or more,  of the country have seen their incomes grow 33%.

One of the causes for wage stagnation that experts point to is the decline of unions and other labor protections, said Bill Rodgers, a former chief economist for the Labor Department, now a professor at Rutgers University. Through deals struck by way of collective bargaining, union workers have traditionally earned 15% to 20% more than their non-union counterparts, Rodgers said.

But union membership has declined rapidly over the past 30 years. In 1983, union workers made up about 20% of the workforce. In 2010, they represented less than 12%.

“The erosion of collective bargaining is a key factor to explain why low-wage workers and middle income workers have seen their wages not stay up with inflation,” Rodgers said.

Without collective bargaining pushing up wages, especially for blue-collar workers, average incomes have remained flat.

International competition is another factor. While globalization has lifted millions out of poverty in developing nations, it has had a negative affect on middle class workers in the U.S.

Factory workers have seen many of their jobs shipped to other countries where labor is cheaper, putting more downward pressure on American wages.

“As we became more connected to China, that poses the question of whether our wages are being set in Beijing,” Rodgers said.

Finding it harder to compete with cheaper manufacturing costs abroad, the U.S. has emerged as primarily a services-producing economy. That trend has created a cultural shift in the job skills American employers are looking for. 50 years ago, there were plenty of blue collar opportunities for workers who had only high school diploma, now employers seek “soft skills” that are typically honed in college, Rodgers said.

While the average American was losing ground in the economy, the wealthiest were capitalizing on these issues.

Globalization has been a major issue for the countries labor force, but it’s also been a major win for corporations who’ve used new global channels to reduce costs and increase profits. New markets around the world have also created greater demand for their products.

“With a global economy, people who have extraordinary skills… whether they be in financial services, technology, entertainment or media, have a bigger place to play and be rewarded from,” said Alan Johnson, a Wall Street compensation consultant.

As a result, the disparity between the wages for college educated workers versus high school grads has widened significantly since the 1980s. In 1980, workers with a high school diploma earned about 71% of what college-educated workers made. In 2010, it was 55%.

Another driver of the rich has been the stock market. The S&P 500 has gained more than 1,300% since 1970, which has helped the American economy grow but the benefits have been disproportionately reaped by the wealthy.

Over the last 30 years regulation of the financial industry has been on the decline. President Regean was very much anti-regulation, but it was during the Clinton years in which barriers between commercial and investment banks, enacted during the post-Depression era, were removed. In 2000 the Commodity Futures Modernization Act also weakened the government’s oversight of complex securities, allowing financial innovations to take off, creating unprecedented amounts of wealth both for the overall economy, and for those directly involved in the financial sector. Tax cuts enacted by the Bush administration and extended by President Obama have also been a major windfall for the wealthy. Former Federal Reserve chairman Alan Greenspan brought interest rates down to new lows during the last decade and the housing market experienced explosive growth.

“We were all drinking the Kool-aid, Greenspan was tending bar, Bernanke and the academic establishment were supplying the liquor,” Deutsche Bank managing director Ajay Kapur wrote in a research report in 2009.

We all know what was the end result of these economic policies. The worst economic crash since the great depression.

The unemployment rate is still higher than 9% and the real estate market is showing few signs of rebounding, meanwhile corporate profits are at historic levels and the stock market continues to charge ahead. The wealthiest people continue to eclipse their middle-class counterparts.

“I think it’s a terrible dilemma, because what we’re obviously heading toward is some kind of class warfare,” Johnson said.

Anyone still having a hard time figuring out what Occupy Wall st. is all about?

Update: Congress goes on vacation while 4,000 FAA employees get laid off…

Congress has gone into recess while the Federal Aviation Administration has been shutdown, indefinitely delaying airport construction projects, causing the government to lose more than $1 billion in uncollected ticket taxes.

Senate Majority Leader Harry Reid, D-Nev., initially told reporters that he was open to a House Republican bill to restore the FAA’s operating authority along with cuts in subsidies for rural air service. But he later reversed course after a possible deal with House Republicans fell through.

“Republicans are playing reckless games with airline safety,” Reid said in a statement. “We should not let ideology interfere with making sure that Americans’ air travel runs as smoothly and safely as possible.”

Nearly 4,000 FAA employees have been laid off and stop work orders issued for more than 200 construction projects. Air traffic controllers have remained on the job, and Transportation Secretary Ray LaHood has vowed that safety won’t be compromised and travelers won’t be inconvenienced.

Republicans say the shutdown is the Democrats fault for not accepting minor cuts to a rural air services program deemed to be wasteful spending.  Democrats said the air services cuts were being used as leverage to force them to give in to the House on a labor provision in a separate, long-term FAA funding bill that would make it more difficult for airline workers to unionize.

The FAA’s operating authority expired on July 23, as well as the authority of airlines to collect about $30 million a day in ticket taxes, meaning the government will be unable to collect an estimated $1.2 billion in taxes if the shutdown continues until lawmakers return to work next month.

Obama implored Congress to settle the dispute before lawmakers leave Washington for the August recess, describing the situation as “another Washington-inflicted wound on America.”

With House Republicans gone, the only way Senate Democrats could end the shutdown was to accept a previously passed House bill that includes a provision eliminating $16.5 million in air service subsidies for 13 rural communities.

The extension bill was necessary because the FAA’s long-term operating authority expired in 2007. Since then, Congress has been unable to agree on a long-term funding plan. The agency has continued to operate under a series of 20 short-term extensions.

The labor provision would overturn a National Mediation Board rule approved last year that allows airline and railroad employees to form a union by a simple majority of those voting. Under the old rule, workers who didn’t vote were treated as “no” votes.

Republicans are complaining that the new rule favors labor unions. Democrats and union officials say the change puts airline and railroad elections under the same democratic rules required for unionizing all other companies.

Obama said he would veto an FAA bill containing the labor provision.

Update: Congress ended the shut down of the FAA, for the time being, get ready for this to happen all over again come September.

Where did all the money go!?

America is broke, or so they say. While the country has been going through it’s most difficult time economically since the great depression, with the unemployment rate looking like it will hoover around 9% for the foreseeable future, corporations have managed to figure out a way to actually make record profits.

If you wanted you could probably argue that high unemployment combined with low taxes have driven down the Federal Government’s revenue, but no one is making that argument. The argument that is being made by newly elected governors all across the country and numerous “pundits” and talking heads is that the real cause of our economic woes are the greedy bloodsucking teachers. You know the ones with their platinum plated pencil sharpeners, milking the poor taxpayers. It’s been repeated on some news outlets ad nauseam that teachers make on average a whooping 50k a year with a budget busting 40k worth of benefits. These teachers and their money grubbing unions, you know the ones we trust with educating our children, are clearly the reason in some people’s eyes why we’re broke. All public union members are now starting to have the spotlight shined on them as the cause for our problems, such taxpayer shafting public workers like mailmen, sanitation workers, police officers and firefighters.

So, is that where the money went? This is where we go back to those record profits that corporations are making. G.E., the world’s largest corporation, made $5.1 billion from it’s  U.S. operations and $14.2 billion worldwide last year. Wow, now that’s a lot of paper. The Fed must have made a pretty penny taxing those profits, right? Actually, no, G.E. paid absolutely zero dollars last year in taxes. You read that right, ZERO! As a matter of fact  a majority of corporations pay zero taxes despite raking in trillions in profits. 60 years ago the taxes paid by corporations made up 30% of the governments revenue, and even though these companies make more money now than anything anyone could have ever dreamed of back then, the taxes collected from companies now only makes up around 6% of the governments revenue.

It isn’t difficult to figure out yet so many people seem to not get it. A myriad of tax breaks given to those who already don’t pay taxes yet make trillions of dollars off of hard working middle class families, only to turn around and see those profits moved out of the country to overseas tax havens instead of being used for reinvestment will spell doom for any country’s economy.

Everyone should be asking themselves right before they ask their elected representative, how can the country be broke if U.S. companies are making more money now than ever before? You might not like his politics, but I think Mr. Moore answered the question quite brilliantly.