HallSlug.com

Archive for the ‘Unemployment’ Category

Why Can America Afford Tax Cuts for the Rich, But Not Aid to the Unemployed?

The unsavory task of explaining why America apparently can’t afford to help the unemployed but can afford tax cuts for the rich fell to Rep. Mike Pence (R-Ind.) on Sunday.

“Republicans, me included, have supported numerous extensions of unemployment benefits and we’re anxious to do so again,” the Indiana Republican told interviewer Chris Wallace on “Fox News Sunday.” “The deficit this year is a trillion dollars for the second year in a row … The American people have had it with runaway federal spending, deficits and debt, and they want to see men and women in Washington, D.C. make the hard choices.”

Polls released last week showed that despite anxiety about spending, registered voters actually favor helping the unemployed even if it adds to the deficit.

Since extended benefits lapsed at the beginning of June, some 2.5 million people prematurely stopped receiving checks. Senate Majority Leader Harry Reid (D-Nev.) has called for another vote to reauthorize the benefits on Tuesday, after the replacement for the late Sen. Robert Byrd (D-W.Va.) has been sworn in. He will presumably give Democrats the 60th vote they need to break the GOP’s filibuster. People who missed checks will be paid retroactively if the bill is approved.

Looting Main Street

If you want to know what life in the Third World is like, just ask Lisa Pack, an administrative assistant who works in the roads and transportation department in Jefferson County, Alabama. Pack got rudely introduced to life in post-crisis America last August, when word came down that she and 1,000 of her fellow public employees would have to take a little unpaid vacation for a while.

The county, it turned out, was more than $5 billion in debt — meaning that courthouses, jails and sheriff’s precincts had to be closed so that Wall Street banks could be paid.

As public services in and around Birmingham were stripped to the bone, Pack struggled to support her family on a weekly unemployment check of $260. Nearly a fourth of that went to pay for her health insurance, which the county no longer covered.

She also fielded calls from laid-off co-workers who had it even tougher. “I’d be on the phone sometimes until two in the morning,” she says. “I had to talk more than one person out of suicide. For some of the men supporting families, it was so hard — foreclosure, bankruptcy. I’d go to bed at night, and I’d be in tears.”

Homes stood empty, businesses were boarded up, and parts of already-blighted Birmingham began to take on the feel of a ghost town. There were also a few bills that were unique to the area — like the $64 sewer bill that Pack and her family paid each month. “Yeah, it went up about 400 percent just over the past few years,” she says.

The sewer bill, in fact, is what cost Pack and her co-workers their jobs. In 1996, the average monthly sewer bill for a family of four in Birmingham was only $14.71 — but that was before the county decided to build an elaborate new sewer system with the help of out-of-state financial wizards with names like Bear Stearns, Lehman Brothers, Goldman Sachs and JP Morgan Chase.

The result was a monstrous pile of borrowed money that the county used to build, in essence, the world’s grandest toilet — “the Taj Mahal of sewer-treatment plants” is how one county worker put it. What happened here in Jefferson County would turn out to be the perfect metaphor for the peculiar alchemy of modern oligarchical capitalism: A mob of corrupt local officials and morally absent financiers got together to build a giant device that converted human shit into billions of dollars of profit for Wall Street — and misery for people like Lisa Pack.

Blue Collar Workers Hanging By a Thread

They arrive for work at 7:25 a.m. and many of their cars are rusting buckets of crud. Except for the boss’s. He drives a Volvo.

Walk in the door at Schaefer Screw Products and there is the enemy — the clock. The oil vapors and solvents are overwhelming. The yellow light is dispiriting. The workers don’t want to be here. The liquor bottles in the weedy lot out back tell part of the story. The graffiti in the bathroom — profanely denouncing “hard workers” — tells the rest.

The workers punch the clock at precisely 7:30 a.m., not a minute later since they would be docked 14 minutes and nobody in America works 14 minutes for free. A quiet resignation settles over them as the roar of the screw grinding machines rev up. Want it or not, they need to be here. After this place, there is no place. Not in today’s America.

This machine shop may be the next wobbling domino in the collapse of the American manufacturing sector and the struggles of its blue-collar workers. There are at least seven shops nearby that are available for lease.

NAFTA, the North American Free Trade Agreement, created a free trade block beginning in 1994. But that is only part of the story. The World Trade Organization (WTO) began quietly in 1995, encouraging a sort of worldwide NAFTA that all but eliminated international trade barriers. China was admitted in November 2001 and since then Michigan has lost nearly 400,000 manufacturing jobs or nearly 50 percent of its industrial work force.

For workers here, their boss is the closest they will come to THE MAN. And by THE MAN they mean the bozos in Washington, D.C., who voted for the trade agreements and the bank deregulations that let the jobs slip away and money disappear into thin air.

When they say THE MAN, they mean the wolves on Wall Street who amplified the housing bubble and nearly took the world economy down. Instead of paying the price and going out of business and collecting their own unemployment checks, the Wall Street wizards got a multibillion-dollar bailout and bonuses.

Goldman Sachs, which was a heartbeat away from failure in 2008 and received $40 billion in federal aid, paid out $16 billion in bonuses and compensation in 2009 — an average of nearly $500,000 per employee. The bank paid just $14 million in taxes.

At the same time, Deutsche Bank forecasts that a quarter of homeowners are underwater and RealtyTrac.com reported 315,000 foreclosures in January, the most for that month on record. Many economists are predicting a bleak year in the housing market if wages and unemployment don’t improve.

“You feel the whole thing’s a swindle,” says Cindi Borbi, the 59-year-old account manager behind a desk in a cloud of cigarette smoke. Her husband took his life last year after being let go from his auto supply firm. He left his wife a broken heart, a mound of debt and a house she can’t pay for. “I’m looking for a basement if you’ve got one.”

Senate Passes Unemployment Benefit Extension

The Senate voted Tuesday to pass a $10 billion measure to extend benefits for unemployed workers and fund road projects after Sen. Jim Bunning agreed to end his filibuster.

The 78-19 vote on the 30-day extension known as H.R. 4691 came minutes after the Kentucky Republican made a final plea on the floor of the Senate for his colleagues not to borrow the money.

President Obama praised the effort after signing the bill late Tuesday.

“The bill passed tonight by the Senate will extend access to health care benefits for workers who have lost their jobs, help small businesses get loans so they can grow and hire, and extend unemployment insurance benefits for millions of Americans who are looking for work,” Obama said. “I’m grateful to the members of the Senate on both sides of the aisle who worked to end this roadblock to relief for America’s working families,” the statement said.

Unemployment Extensions to Millions Still Locked Up in Political Games

Jobless benefits suddenly ended for some laid-off workers, Medicare payments to doctors were delayed and 2,000 federal transportation workers were sent home Monday in a spending dispute tinged with election-year politics.

Adding its voice to the flap, the White House said it was trying to “shame” Republican Sen. Jim Bunning of Kentucky for single-handedly blocking the $10 billion extension. Bunning said he opposed the extension because it would add to the budget deficit, already projected to hit a record $1.56 trillion this year.

Most laid-off workers receiving unemployment benefits won’t be affected — unless the impasse drags on — but those seeking payment extensions won’t be able to obtain them.

With the nation’s highest unemployment rate at 14.6 percent in December, Michigan’s jobless ranks far outstrip the nation, which has an average 9.7 percent jobless rate.

“We have the highest unemployment rate in the country, and middle-class families are struggling to put food on the table as workers continue searching for new jobs and train for new careers,” Sen. Debbie Stabenow, D-Lansing, said in a statement. “These workers and their families cannot afford to wait for help.”

Obama is no FDR, We’re no Mass Movement.

It’s open season on Obama whom so many hoped would lead us out of the neo-liberal wilderness. He once was a community organizer and ought to know how working people have suffered through a generation of tax breaks for the rich, Wall Street deregulation, and unfair competition.

When the economy crashed he was in the perfect position to limit the unjustified pay levels on Wall Street and bring a crashing halt to the runaway financialization of our economy. Instead we got a multi-trillion dollar bailout for Wall Street, no health care reform, no serious financial reforms whatsoever, record unemployment, and political gridlock that’s will be with us for years to come.

Is it his fault? Or ours?

Obama has made his share of blunders. However, his statement that we “don’t begrudge” the high salaries on Wall Street because that’s part of the “free-market system” is about the dumbest thing he’s ever said. He was referring to Jamie Dimon’s $17.4 million payday, and Lloyd Blankfein’s $9 million.

But surely the President knows that at this very moment Wall Street is still receiving $10.4 trillion (not billion) in subsidies from the taxpayer — and that’s after the TARP repayments. That’s some free-market.

Dimon’s JP Morgan Chase still has a $34.3 billion subsidy, and Blankfein at Goldman Sachs is sitting on $23.9 billion of government welfare. (Many thanks to Nomi Prins for her first rate sleuthing.. ) Dimon and Blankfein would love to re-write history so that they could be portrayed as swashbuckling entrepreneurial survivors, men who avoided the bad risks that felled so many others.

But without government welfare their institutions would have gone under. They are two very lucky (and well connected) welfare recipients — lucky not to be among the 28 million Americans that go without jobs or are forced into part-time work.

We can moan all we want about Obama’s shortcomings, the mistakes his Administration has made and his inability to take on Wall Street.  But we haven’t exactly applied a lot of heat. A million people on the mall demanding “Jobs Now” along with serious Wall Street reforms might help. A million people showing up repeatedly might actually get the job done.

The free market on Wall Street is dead and has been for a long time. It’s been replaced by a billionaire bailout society that will provide decades of chronic unemployment and on-going bailouts for the super-rich. It’s a damn shame Obama can’t deal with it. It’s a bigger shame that we won’t force him too.