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Posts Tagged ‘Economy’

Unemployment Claims at Nine Month Low?

WASHINGTON – The number of people applying for unemployment benefits fell last week to the lowest level in nine months, that latest evidence that the job market is improving.

The Labor Department said Thursday that weekly applications dropped by 23,000 to a seasonally adjusted 381,000. That’s the lowest number of applications since late February.

The four-week average, a less volatile measure, fell for the ninth time in 11 weeks to 393,250. That’s the lowest average since early April. Applications that drop below 375,000 — consistently — tend to correlate with a steady decline in the unemployment rate.

“There have been numerous indications that the labor market is healing and today’s jobless claims report only reinforces that view,” Dan Greenhaus, chief global strategist at BTIG, a trading firm.

The unemployment rate fell to 8.6% in November, the government said last week, down from 9% the previous month. That’s the lowest rate in two and a half years.

Still, the unemployment rate dropped last month in part because more people gave up looking for work. Once the unemployed stop looking for jobs and drop out of the work force, they are no longer counted as unemployed.

WTF?  What are they counted as then?

Paradox of the New Elite

IT’S a puzzle: one dispossessed group after another — blacks, women, Hispanics and gays — has been gradually accepted in the United States, granted equal rights and brought into the mainstream.

At the same time, in economic terms, the United States has gone from being a comparatively egalitarian society to one of the most unequal democracies in the world.

The two shifts are each huge and hugely important: one shows a steady march toward democratic inclusion, the other toward a tolerance of economic stratification that would have been unthinkable a generation ago.

Other nations seem to face the same challenge: either inclusive, or economically just. Europe has maintained much more economic equality but is struggling greatly with inclusiveness and discrimination, and is far less open to minorities than is the United States.

European countries have done a better job of protecting workers’ salaries and rights but have been reluctant to extend the benefits of their generous welfare state to new immigrants who look and act differently from them. Could America’s lost enthusiasm for income redistribution and progressive taxation be in part a reaction to sharing resources with traditionally excluded groups?

“I do think there is a trade-off between inclusion and equality,” said Gary Becker, a professor of economics at the University of Chicago and a Nobel laureate. “I think if you are a German worker you are better off than your American equivalent, but if you are an immigrant, you are better off in the U.S.”

In the United States, the stratification of wealth followed several decades where economic equality was strong. The stock market crash of 1929 and the Great Depression that followed underscored the excesses of the roaring ’20s and ushered in an era in which the political climate favored labor unions, progressive taxation and social programs aimed at reducing poverty.

From the 1930s to the 1960s, the income of the less affluent Americans grew more quickly than that of their wealthier neighbors, and the richest 1 percent saw its share of the national income shrink to 8.9 percent in the mid-1970s, from 23.9 percent in 1928. That share is now back up to more than 20 percent, its level before the Depression.

Inequality has traditionally been acceptable to Americans if accompanied by mobility. But most recent studies of economic mobility indicate that it is getting even harder for people to jump from one economic class to another in the United States, harder to join the elite. While Americans are used to considering equal opportunity and equality of condition as separate issues, they may need to reconsider.

In an era in which money translates into political power, there is a growing feeling, on both left and right, that special interests have their way in Washington. There is growing anger, from the Tea Party to Occupy Wall Street, that the current system is stacked against ordinary citizens. Suddenly, as in the 1930s, the issue of economic equality is back in play.

Labor Unions Join Wall St. Protesters

Oct 5 (Reuters) – Labor unions including nurses and transit workers planned to join a an anti-Wall Street march on Wednesday through New York’s financial district, and some college students walked out of classes in solidarity with the growing protest movement.

The American Federation of State County and Municipal Employees, Communications Workers of America and the Amalgamated Transit Union said they would be joining the protesters voicing discontent and anger over high unemployment, home foreclosures and the 2008 corporate bailouts.

The nation’s largest union of nurses, National Nurses United, also said it would take part in the New York march, set for late afternoon in downtown Manhattan.

Students on college campuses added their voices, with walkouts scheduled on Wednesday at some 75 universities across the nation.

“We stand in solidarity with those protesting Wall Street’s greed,” said Gerald McEntee, president of the 1.6 million-member AFSCME union, in a statement. “The economy that has wrecked so many lives, obliterated jobs, and left millions of Americans homeless and hopeless is the fault of banks that gamble with our future.”

NYPD Arrest over 700 Protesters

Updated, 3:35 a.m. Sunday | In a tense showdown above the East River, the police arrested more than 700 demonstrators from the Occupy Wall Street protests who took to the roadway as they tried to cross the Brooklyn Bridge on Saturday afternoon.

The police said it was the marchers’ choice that led to the enforcement action.

“Protesters who used the Brooklyn Bridge walkway were not arrested,” Paul J. Browne, the chief spokesman for the New York Police Department, said. “Those who took over the Brooklyn-bound roadway, and impeded vehicle traffic, were arrested.”

But many protesters said they believed the police had tricked them, allowing them onto the bridge, and even escorting them partway across, only to trap them in orange netting after hundreds had entered.

“The cops watched and did nothing, indeed, seemed to guide us onto the roadway,” said Jesse A. Myerson, a media coordinator for Occupy Wall Street who marched but was not arrested.

Peak Oil, Peak Debt, and the Concentration of Power

Stop Coddling the Super Rich

By Warren Buffett

OUR leaders have asked for “shared sacrifice.” But when they did the asking, they spared me. I checked with my mega-rich friends to learn what pain they were expecting. They, too, were left untouched.

While the poor and middle class fight for us in Afghanistan, and while most Americans struggle to make ends meet, we mega-rich continue to get our extraordinary tax breaks. Some of us are investment managers who earn billions from our daily labors but are allowed to classify our income as “carried interest,” thereby getting a bargain 15 percent tax rate. Others own stock index futures for 10 minutes and have 60 percent of their gain taxed at 15 percent, as if they’d been long-term investors.

These and other blessings are showered upon us by legislators in Washington who feel compelled to protect us, much as if we were spotted owls or some other endangered species. It’s nice to have friends in high places.

Last year my federal tax bill — the income tax I paid, as well as payroll taxes paid by me and on my behalf — was $6,938,744. That sounds like a lot of money. But what I paid was only 17.4 percent of my taxable income — and that’s actually a lower percentage than was paid by any of the other 20 people in our office. Their tax burdens ranged from 33 percent to 41 percent and averaged 36 percent.

If you make money with money, as some of my super-rich friends do, your percentage may be a bit lower than mine. But if you earn money from a job, your percentage will surely exceed mine — most likely by a lot.

Back in the 1980s and 1990s, tax rates for the rich were far higher, and my percentage rate was in the middle of the pack. According to a theory I sometimes hear, I should have thrown a fit and refused to invest because of the elevated tax rates on capital gains and dividends.

I didn’t refuse, nor did others. I have worked with investors for 60 years and I have yet to see anyone — not even when capital gains rates were 39.9 percent in 1976-77 — shy away from a sensible investment because of the tax rate on the potential gain. People invest to make money, and potential taxes have never scared them off. And to those who argue that higher rates hurt job creation, I would note that a net of nearly 40 million jobs were added between 1980 and 2000. You know what’s happened since then: lower tax rates and far lower job creation.

My friends and I have been coddled long enough by a billionaire-friendly Congress. It’s time for our government to get serious about shared sacrifice.