Tuesday, May 31, 2011

Whatever Shall We Do About The Unemployment Problem?

Oh. Have you noticed? The issue du jour is the persistent unemployment abroad in the land, indeed, abroad abroad as well (it is one of the chronic issues driving protests in Europe and North Africa). The Rs have a Solution: cut taxes on business and corporations and the rich and remove regulations that protect air, water, and lives of workers as well as requiring employers to pay a bare minimum wage to their workers. Oh, and require them to actually pay it, too.

Both Robert Reich and Paul Krugman have come out full-bore on the topic and the blogosphere is all atwitter over it, so it must be important somehow.

Now they notice.

You know, I've been banging the drum on this topic for years, since the Endless Recession got underway in earnest with massive job losses. Forcing unemployment and keeping unemployment rates high is what it's all about for the Ruling Class. The current situation for the struggling masses -- now entering its fourth year -- is not accidental. The lovely thing for the High and the Mighty is that high unemployment rates force down wages and benefits for those who can manage to get a job or stay employed. It's a wonderful profit center for those on top of the heap, and they know it.

Commentators, though, either have ignored the problem (because they have other interests) or have been sorely confused about why the Government (let alone Industry) does nothing about the persistently high unemployment rate and squabbles over the high cost of unemployment benefits instead. This is frankly insane, but it is so confusing to the nation's commentariat.

Shouldn't the Government be doing something? Shouldn't they have been doing something all along? Why haven't they?

I attribute it to a deep-seated Hooverite belief system and ideology implanted in the White House and especially in the beliefs of the President of the United States of America, Barack Hussein Obama.

You might want to take a look at this commentary by Jared Bernstein regarding the White House's continuing lack of interest in doing something about unemployment:

There will be no WPA-type programs in our near future. There was no appetite for them in the Obama admin in the midst of the worst recession since the Great Depression and there’s a lot less now. The reasons for that are interesting and I’ll speak to them another day. But it ain’t happening.

And please don’t accuse me of “negotiating with myself” here. I stressed above the importance of making those arguments, and I frequently made them myself as a member of the President’s economics team.

It’s also congenitally hard for politicians to get behind “a serious program of mortgage modification.” Those who advocate for this (the NYT editorial page, e.g.) are right, but they’re also downplaying a very binding constraint. The politics of this idea are deeply wound up in moral hazard. People forget, but it was precisely this action—giving mortgage relief to someone at risk of default and not to someone who was struggling to keep up their payments—that birthed the Tea Party.

This is a straight out statement by Joe Biden's former chief economic advisor about what was going on in the White House and -- apparently -- in the President's mind about these matters.

He simply does not believe that the Government's role should be to interfere in the labor market by directly employing the vast armies of the unemployed. Instead, like Hoover, he believes (I think sincerely) that the issue of lack of employment must be dealt with in the private sector -- with the encouragement and "help" of Government where necessary -- but without direct Government intervention on behalf of labor.

At the same time, I've been hammering the issue of the crushing burden of debt the masses are under for years, debt which is crippling the economic recovery for ordinary people, and I proposed long ago that the answer to it was a debt relief program that was driven from the bottom up -- instead of paying off bankers' and financiers' gambling debts straightaway (which is what the Government has been doing) pay households an amount to lower their debt, and watch the economy recover immediately. The banksters will get their cut anon, for the money would "trickle up" (and BTW multiply on the way up), but no. Couldn't even consider it. "Moral hazard" and all that, you know.

Whereas paying off the banksters' gambling debts straight out of the Treasury has no "moral hazard?" I see. Then there was the Rick Santelli rant on the teevee, and that just made everything hard.

Yes. Well.

It's all such a load of utter horseshit, isn't it?

It's probably not too late to correct this situation, but it will require concerted and persistent action on the part of the People to get it done.

The Krugman and Reich considerations (and in the case of Krugman, the mea culpa) are coming out at a time when Democrats are recognizing that they "should be talking more about" unemployment more than they have been. So they're "talking about it more."

They are not doing anything about it, any more than the Rs are, and any more than they have been since the beginning of the Endless Recession.

"Doing something about unemployment" is contrary to Ruling Class Doctrine as is relieving the debts of the Lesser People. Doctrine requires those Lesser People to endure untold hardship so as to ensure the comfort and convenience of Their Betters.

So. What can We the People do about it, since our rulers refuse to do anything of substance for the masses, but instead insist on chipping away at whatever slim benefits remain to the unwashed?

How do we who have nothing put people back to work and keep them working? And if we can figure out how to do it, how do we prevent the benefits from increased economic activity from being Hoovered up by the Overclass?

The key, certainly, is to start small, start locally, combine skills and resources to accomplish what needs to be done. Basically what you do is form a cooperative alternative to government and its sponsors to provide for the needs of the People. Ultimately, it becomes a kind of parallel government and economy, and if it is successful, it will in time replace them.

Every Utopian project in the nation's history has started this way and some have flourished at least for a while, and the Mormons have become an extremely powerful political and economic player in local, state and national affairs.

There is a reason why. And it is not necessarily because of Divine Favor.

It wouldn't hurt to study how they did it... And Demand Better!

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