The Coronavirus Crash Could Be Worse Than The Republican Great Depression Of 1930
by Thom Hartmann | Mar 27, 2020 | Blog, Democracy, Economy, Featured | 0 comments
Monday, March 30, 2020
Thursday, March 26, 2020
Bernie Sanders Is Trying to Rescue America’s Frail Democracy
Bernie Sanders Is Trying to Rescue America’s Frail Democracy
BY
The Democratic Party elite insists nothing can be done to mobilize working-class nonvoters. By challenging their cynicism, Bernie Sanders is rendering a profound service to American democracy.
Piketty is one of the world's pre eminent economists.
Wednesday, March 25, 2020
Unsanitized: Bailouts, A Tradition Unlike Any Other
Unsanitized: Bailouts, A Tradition Unlike Any Other: Plus, another virtual event and a gracenote to Trump’s use of the Defense Production Act. This is The COVID-19 Daily Report for March 25, 2020.
A critical view of the corporate bailout.
A critical view of the corporate bailout.
Tuesday, March 24, 2020
How Covid Testing Actually Works
How Covid Testing actually works ( and sometimes doesn't).
Clear and basic
Repeating the Mistakes of the 2008 Bailout
Repeating the Mistakes of the 2008 Bailout: We needed to rescue the financial system in 2008, and we need to support sectors like airlines and aerospace now—but TARP is the wrong model.
Monday, March 23, 2020
Public Banks As a Part of the Solution
Socialism at Its Finest after Fed’s Bazooka Fails
Posted on March 21, 2020 by Ellen Brown
In what is being called the worst financial crisis since 1929, the US stock market has lost a third of its value in the space of a month, wiping out all of its gains of the last three years. When the Federal Reserve tried to ride to the rescue, it only succeeded in making matters worse. The government then pulled out all the stops. To our staunchly capitalist leaders, socialism is suddenly looking good.
The financial crisis began in late February, when the World Health Organization announced that it was time to prepare for a global pandemic. The Russia-Saudi oil price war added fuel to the flames, causing all three Wall Street indices to fall more than 7 percent on March 9. It was called Black Monday, the worst drop since the Great Recession in 2008; but it would get worse.
On March 12, the Fed announced new capital injections totaling an unprecedented $1.5 trillion in the repo market, where banks now borrow to stay afloat. The market responded by driving stocks 8% lower.
On Sunday, March 15, the Fed emptied its bazooka by lowering the fed funds rate nearly to zero and announcing that it would be purchasing $700 billion in assets, including federal securities of all maturities, restarting its quantitative easing program. It also eliminated bank reserve requirements and slashed Interest on Excess Reserves (the interest it pays to banks for parking their cash at the Fed) to 0.10%. The result was to cause the stock market to open on Monday nearly 10% lower. Rather than projecting confidence, the Fed’s measures were generating panic.
As financial analyst George Gammon observes, the Fed’s massive $1.5 trillion in expanded repo operations had few takers. Why? He says the shortage in the repo market was not in “liquidity” (money available to lend) but in “pristine collateral” (the securities that must be put up for the loans). Pristine collateral consists mainly of short-term Treasury bills. The Fed can inject as much liquidity as it likes, but it cannot create T-bills, something only the Treasury can do. That means the government (which is already $23 trillion in debt) must add yet more debt to its balance sheet in order to rescue the repo market that now funds the banks.
The Fed’s tools alone are obviously incapable of stemming the bloodletting from the forced shutdown of businesses across the country. Fed chair Jerome Powell admitted as much at his March 15 press conference, stating, “[W]e don’t have the tools to reach individuals and particularly small businesses and other businesses and people who may be out of work …. We do think fiscal response is critical.” “Fiscal policy” means the administration and Congress must step up to the plate.
Trump Removed From Office the Person Who Was In Place to Warn of a New Virus Outbreak
With the administration planning to discontinue the role, the embed return to the US about five months before China began to see its first Covid-19 cases. Under normal circumstances, the embed likely would have passed information about the novel virus to US officials. Instead, Chinese officials were able for weeks to conceal the virus and the threat it posed, leading to a delay in the world’s response to what was then a matter of great concern and is now a pandemic.
Vox news
WASHINGTON (AP) — A series of missteps at the nation’s top public health agency caused a critical shortage of reliable laboratory tests for the coronavirus, hobbling the federal response as the pandemic spread across the country like wildfire, an Associated Press review found.
President Donald Trump assured Americans early this month that the COVID-19 test developed by the Centers for Disease Control and Prevention is “perfect” and that “anyone who wants a test can get a test.” But more than two months after the first U.S. case of the new disease was confirmed, many people still cannot get tested.
In the critical month of February, as the virus began taking root in the U.S. population, CDC data shows government labs processed 352 COVID-19 tests — an average of only a dozen per day.
“You cannot fight a fire blindfolded,” Tedros Adhanom Ghebreyesus, head of the World Health Organization, said at a recent briefing. “We cannot stop this pandemic if we don’t know who is infected.”
The Department of Health and Human Services, which includes the CDC, has begun an internal review to assess its own mistakes. But outside observers and federal health officials have pointed to four primary issues that together hampered the national response — the early decision not to use the test adopted by the World Health Organization, flaws with the more complex test developed by the CDC, government guidelines restricting who could be tested and delays in engaging the private sector to ramp up testing capacity.
Combined with messaging from the White House minimizing the disease, that fueled a lackluster response that missed chances to slow the spread of the virus, they said.
Sunday, March 22, 2020
Robert Reich and the Covid Crisis
I am so furious that I need to shout from the rooftops. But we're in lockdown, so I'm emailing you: No industry—not airlines, not hotel chains, not cruise ships—should be bailed out.
Congress is feverishly negotiating a sweeping economic stabilization bill that is expected to pass as early as tomorrow. The details of it are changing rapidly, but Donald Trump and Mitch McConnell are proposing hundreds of billions of dollars in bailouts for the airline industry and other industries that recklessly mismanaged their budgets by fattening the pockets of their CEOs. And now, these wealthy executives are begging Republicans for a taxpayer handout.
But guess how much the lowest-earning Americans would have gotten from McConnell's initial proposal? As little as $600.1 It's disgraceful.
Duane, breaking news indicates that House is drafting its own bill, that Democrats aren't ready to rubber-stamp the Republican corporate bailout proposal, and this legislation is not yet a done deal.2 But we have only a couple of days to pressure lawmakers to rise to the challenge of this unprecedented moment and make sure that our government bails out the American people, not corporations. That's why I'm writing to you now.
Think about all of the people across America who are constantly checking their local newspapers' websites to learn the latest about how the pandemic is affecting their communities; that's what I'm doing, and you might be, too. But what if, in addition to showing the much-needed news updates, the newspapers' websites showed ads pressuring Congress to give a lifeline to people, not corporations, in the economic stimulus bill? These ads will make lawmakers, who I can assure you care about what's said in their local papers, take serious notice.
As former secretary of the U.S. Department of Labor, I can tell you that there is no justification whatsoever to bailing out corporations right now. The airline industry certainly doesn't deserve a bailout: The biggest U.S. airlines spent 96% of their cash flow over the past decade to buy back shares of their own stock in order to boost executive bonuses and please wealthy investors. American Airlines alone repurchased more than $12.5 billion of its shares over the past 10 years.
But McConnell expects us to bail them out to the tune of $50 billion?
The airlines can stay in business by borrowing at rock-bottom rates, using their assets as collateral. Regular Americans living paycheck to paycheck don't have that same option.
Duane, we need to come together right now to demand Congress put people first and pass an economic stimulus bill to support Americans in need, not provide bailouts for big businesses.
Just three weeks ago, Trump claimed that the coronavirus was "going to disappear. One day—it's like a miracle—it will disappear."3
And on that same day, Republican Senator Richard Burr warned wealthy constituents in a private meeting of the dire consequences that would arise from the crisis. He advised the well-connected group to prepare to alter their travel plans, warned that schools will probably close, and predicted that the military may be mobilized to combat the outbreak.4 When addressing the general public, however, he followed Trump's lead and minimized the severity of the crisis.
And then, Burr sold $1.5 million of his stock holdings, right before the market nosedived.
This is outrageous, and yet another example of Republicans serving their own interests and those of the wealthy over the needs of the American people. Unless we hold GOP lawmakers' feet to the fire, the economic stimulus bill won't help everyday Americans who urgently need help the most.
Seemingly overnight, so many people in every community in America have lost their jobs or are facing a severe cutback in hours due to the pandemic.
Congress has to do the right thing in this unprecedented moment: It must put people first, small businesses second, and big business last.
Thanks for all you do.
–Robert Reich
P.S. My new book, out this Tuesday, March 24, explores the power dynamics that left us with a system that puts corporations before people and leaves so many behind, especially in times of crises. Please order a copy today to understand how we got into this mess, and how we get out.
Sources:
1. "Senate Republicans' cash assistance plan is far too limited, Vox, March 20, 2020
https://act.moveon.org/go/117551?t=6&akid=259893%2E22927824%2EWknbCA
https://act.moveon.org/go/117551?t=6&akid=259893%2E22927824%2EWknbCA
2. "No deal: McConnell delays initial coronavirus stimulus vote," The Hill, March 22, 2020
https://act.moveon.org/go/117567?t=8&akid=259893%2E22927824%2EWknbCA
https://act.moveon.org/go/117567?t=8&akid=259893%2E22927824%2EWknbCA
3. "A Complete List of Trump's Attempts to Play Down Coronavirus," The New York Times, March 15, 2020
https://act.moveon.org/go/117540?t=10&akid=259893%2E22927824%2EWknbCA
4. "Weeks Before Virus Panic, Intelligence Chairman Privately Raised Alarm, Sold Stocks," NPR, March 19, 2020https://act.moveon.org/go/117540?t=10&akid=259893%2E22927824%2EWknbCA
https://act.moveon.org/go/117516?t=12&akid=259893%2E22927824%2EWknbCA
Friday, March 20, 2020
State Economic Policy and the Covid 19 crisis
The Budget Center believes that even in times of crisis, California can lead with strategic and targeted policies that achieve the greatest impact for the children, families, individuals, and workers whose economic and social well-being is most affected by the consequences of COVID-19. We must remember the health of our economy and communities is only as strong as the support we extend to every Californian.
Our Statement of Principles on a State Economic Policy Response
Our Commentary
Every dollar counts for workers earning low wages, especially now – Senior Policy Analyst Alissa Anderson on extending the CalEITC and Young Child Tax Credit to all families, including immigrant families
Check back regularly for updates.
Tuesday, March 17, 2020
Trump, Republicans, Cut Paid Sick Leave from Bailout
SACRAMENTO PROGRESSIVE ALLIANCE: Trump, Republicans, Cut Paid Sick Leave from Bailo...: Trump said he’d expand paid sick leave during the crisis. That’s not happening. By Emily Peck and Igor Bobic, Huff Post. Under pressure fro...
Sunday, March 15, 2020
Saturday, March 14, 2020
Government Must Act to Stop Spread of Economic and Financial Consequences of Coronavirus
How Covid -19 slows the economy
Coronavirus is not only a public health crisis, it is also a shock to the global economy. Working people must demand that government act, or we and our families will pay the price for others’ lack of action, as we so often have in the past.
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The stock market fell 7% at the open Monday morning. That may not sound like a lot, but it’s a catastrophic collapse—a financial crisis type number. Typically, the market might gain or lose in a whole year the value that was lost by the time the sound of the opening bell faded.
The collapse appears to be the result of a combination of the spread of coronavirus and falling oil prices—two events that are themselves connected. But it needs to be interpreted as an alarm bell, because we are dealing with the threat of two deadly kinds of contagions—one biological and the other economic and financial—both of which pose serious but manageable threats to the well-being of working people.
We have heard a lot about biological contagion and how to stop the spread of coronavirus in our workplaces and our communities. You can get up-to-date information on workplace safety and coronavirus at www.aflcio.org/covid-19 and at the websites of our affiliated unions. But what about financial and economic contagion? This is something elected leaders, economic policymakers and financial regulators must take action to stop.
How does it work? Coronavirus is a shock to the global economy. It stops economic activity of all kinds—shutting down factories, canceling meetings, sending cruise ships into quarantine. The only way to prevent that is to stop the spread of the virus (see above). The consequence of economic activity slowing down or stopping is that businesses lose revenue, and generally with loss of revenue comes loss of profits.
People who trade on the stock market usually price stocks by making projections about the future profits of the companies whose stocks trade on the public markets. The stock market reacts instantaneously to changing expectations about what may happen in the economy and to specific businesses. The stock market itself doesn’t create or destroy jobs, but it does contribute to the overall financial health of companies and of people. When stock prices fall rapidly, they can create their own kind of contagion—exposing fragile financing structures for both companies and people. That can in turn lead to retreat—companies pulling back on investments or, in the worst case, going bankrupt.
So the stock market can create contagion all by itself. But the much more serious kind of contagion has to do with corporate debt. We have had low interest rates for years, and businesses around the world have gone on a borrowing spree. This spree has been one of the causes of relatively healthy economic growth in the last few years, but it has also led to businesses carrying a lot of debt relative to their earnings and growth.
Here is where the danger gets very real, because, as we all know, if you borrow money, you have to make payments on that debt. What if businesses that have borrowed a lot of money suddenly don’t have anywhere near the revenue they expected to have? This is what empty planes and blocked supply chains mean.
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Trump's Bogus Google Claim on Convid 19
SACRAMENTO PROGRESSIVE ALLIANCE: Trump's Bogus Google Claim on Convid 19: According to the Washington Post, Trump has lied 1,400 times since becoming President. So, what should we expect ? On Friday. Presiden...
Hint, Don't wait for the Trump Administration.
Hint, Don't wait for the Trump Administration.
Thursday, March 12, 2020
Wednesday, March 11, 2020
Tuesday, March 10, 2020
The Virus and Trump Incompetence
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South Korea currently tests about 10,000 people per day, and the virus is slowing,
The US tests less than 200 per day, because we don’t have test kits distributed. We can not get more test kits because the administration cut the health budget each of the last two years,. And, the virus is spreading, Even in the nursing home in Seattle where many have died, they can not get test kits to test those remaining Tuesday alive.
This is incompetence- and it kills,
We now have had more than a month to prepare to defend our people against the spreading virus. The U.S. still is not responding at the necessary level because the Trump government is spending its energy and time managing perceptions to influence the stock market. See the statement by the nurse’s union.
They have not used emergency authority available to them to mass produce masks and test kits. They also need to be preparing auxiliary hospitals for the coming surge !
This is incompetence. People will die because of the incompetence. I hope that it is not you or a member of your family.
See more:
How delays in testing set back the U.S. response
https://www.nytimes.com/2020/03/10/us/coronavirus-testing-delays.html
White House over rules CDC on elderly
Get serious about fighting the Virus,
https://prospect.org/economy/get-serious-about-fighting-corona-depression/
Editor.
On Sunday, the State Department warned Americans against travel on cruise ships; older adults or those with compromised immune systems should consider postponing nonessential travel altogether, said Dr. Fauci. Many businesses, including Facebook and Amazon, have postponed most employee travel altogether.
Our seminar is suspended by the Corona virus Covid 19.
This week we had planned to take up the Climate Crisis and the Green New Deal.
Here are readings and videos on this topic,
Please take care and stay well,
Duane Campbell
This week we had planned to take up the Climate Crisis and the Green New Deal.
Here are readings and videos on this topic,
“ Paris to Pittsburgh”
Excellent video; here is the promo. To watch the entire piece, you will need to use Prime, or Netflicks,
Full video on National Geographic, for a fee. It looks as if there is a full copy on Youtube for a fee. I have been unable to find it on the National Geographic site,
On Fire: The Burning Case for a Green New Deal
(Democracy Now) 26 minutes.
reading: https://theintercept.com/2019/02/13/green-new-deal-proposal/
Green New Deal , Naomi Klein.
Reading: Care and Repair. Left Politics in the Age of Climate Change.
Naomi Klein.
Monday, March 9, 2020
The Largest Women's Organization in the U.S.- Unions
SACRAMENTO PROGRESSIVE ALLIANCE: The Largest Women's Organization in the U.S.- Uni...: We salute the women throughout history who stood against injustice and who continue to fight for a better future for all working people. ...
Friday, March 6, 2020
Thursday, March 5, 2020
Wednesday, March 4, 2020
BARRED FROM STRIKING, AIRLINE FOOD WORKERS SIT DOW...
The Reality Check: BARRED FROM STRIKING, AIRLINE FOOD WORKERS SIT DOW...: BARRED FROM STRIKING, AIRLINE FOOD WORKERS SIT DOWN IN TRAFFIC Photos and Story By David Bacon, Truthout March 3, 2020 https://truthout....
Workers, union, and health care. Great photos.
Workers, union, and health care. Great photos.
Monday, March 2, 2020
Economic Perspectives in our Seminar
Liberal
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Center
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Conservative
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Keynes
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Neo Classical
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Neo Classical
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Social Democracy
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Neoliberalism
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Neoliberalism
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Corporate
Liberalism
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Market Fundamentalism
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Bernie Sanders
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Elizabeth Warren
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Obama/ Clinton
Biden/ Bloomberg
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Bush /Trump
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Naomi Klein
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PaulKrugman
Robert Reich
Joseph Stiglitz |
Bernanke
Paulson
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Paul Ryan
Steve Mnuchin
Larry Kudlow
Peter Navarro
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Sunday, March 1, 2020
Robert Reich- How to Defeat Trump
by
Democratic presidential candidate, former New York City mayor Mike Bloomberg speaks during a rally held at the Bricktown Events Center on February 27, 2020 in Oklahoma City, Oklahoma. Bloomberg is campaigning before voting starts on Super Tuesday, March 3. (Photo: Joe Raedle/Getty Images)
The day after Bernie Sanders’s big win in Nevada, Joe Lockhart, Bill Clinton’s former press secretary, expressed the fear gripping the Democratic establishment: “I don’t believe the country is prepared to support a Democratic socialist, and I agree with the theory that Sanders would lose in a matchup against Trump.”
Lockart, like the rest of the Democratic establishment, is viewing American politics through obsolete lenses of left versus right, with Bernie on the extreme left and Trump on the far right. “Moderates” like Bloomberg and Buttigieg supposedly occupy the center, appealing to a broader swath of the electorate.
This may have been the correct frame for politics decades ago when America still had a growing middle class, but it’s obsolete today. As wealth and power have moved to the top and the middle class has shrunk, more Americans feel politically dis-empowered and economically insecure. Today’s main divide isn’t right versus left. It’s establishment versus anti-establishment.
Some background. In the fall of 2015 I visited Michigan, Wisconsin, Ohio, Pennsylvania, Kentucky, Missouri, and North Carolina, researching the changing nature of work. I spoke with many of the same people I had met twenty years before when I was secretary of labor, as well as some of their grown children. I asked them about their jobs and their views about the economy. I was most interested in their sense of the system as a whole and how they were faring in it.
What I heard surprised me. Twenty years before, most said they’d been working hard and were frustrated they weren’t doing better. Now they were angry – at their employers, the government, and Wall Street; angry that they hadn’t been able to save for their retirement, and that their children weren’t doing any better than they did. Several had lost jobs, savings, or homes in the Great Recession. By the time I spoke with them, most were employed but the jobs paid no more than they had two decades before.
I heard the term “rigged system” so often I began asking people what they meant by it. They spoke about the bailout of Wall Street, political payoffs, insider deals, CEO pay, and “crony capitalism.” These came from self-identified Republicans, Democrats, and Independents; white, black, and Latino; union households and non-union. Their only common characteristic was they were middle class and below.
With the 2016 primaries looming, I asked which candidates they found most attractive. At the time, party leaders favored Hillary Clinton or Jeb Bush. But the people I spoke with repeatedly mentioned Bernie Sanders and Donald Trump. They said Sanders or Trump would “shake things up,” “make the system work again,” “stop the corruption,” or “end the rigging.”
In the following year, Sanders – a 74-year-old Jew from Vermont who described himself as a democratic socialist and wasn’t even a Democrat until the 2016 presidential primary – came within a whisker of beating Hillary Clinton in the Iowa caucus, routed her in the New Hampshire primary, garnered over 47 percent of the caucus-goers in Nevada, and ended up with 46 percent of the pledged delegates from Democratic primaries and caucuses.
Trump, a 69-year-old ego-maniacal billionaire reality TV star who had never held elective office or had anything to do with the Republican Party, and lied compulsively about almost everything – won the Republican primaries and then went on to beat Clinton, one of the most experienced and well-connected politicians in modern America (granted, he didn’t win the popular vote, and had some help from the Kremlin).
Something very big happened, and it wasn’t because of Sanders’s magnetism or Trump’s likeability. It was a rebellion against the establishment. Clinton and Bush had all the advantages –funders, political advisors, name recognition – but neither could credibly convince voters they weren’t part of the system.
A direct line connected four decades of stagnant wages, the financial crisis of 2008, the bailout of Wall Street, the rise of the Tea Party and the “Occupy” movement, and the emergence of Sanders and Trump in 2016. The people I spoke with no longer felt they had a fair chance to make it. National polls told much the same story. According to the Pew Research Center, the percentage of Americans who felt most people could get ahead through hard work dropped by 13 points between 2000 and 2015. In 2006, 59 percent of Americans thought government corruption was widespread; by 2013, 79 percent did.
Trump galvanized millions of blue-collar voters living in places that never recovered from the tidal wave of factory closings. He promised to bring back jobs, revive manufacturing, and get tough on trade and immigration. “We can’t continue to allow China to rape our country, and that’s what they’re doing,” he roared. “In five, ten years from now, you’re going to have a workers’ party. A party of people that haven’t had a real wage increase in eighteen years, that are angry.” He blasted politicians and financiers who had betrayed Americans by “taking away from the people their means of making a living and supporting their families.”
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