Only 26 % of unemployed receive benefits - that is austerity

Paul Krugman, NYT. 

Last week John Boehner, the speaker of the House, explained to an audience at the American Enterprise Institute what’s holding back employment in America: laziness. People, he said, have “this idea” that “I really don’t have to work. I don’t really want to do this. I think I’d rather just sit around.” Holy 47 percent, Batman!

It’s hardly the first time a prominent conservative has said something along these lines. Ever since a financial crisis plunged us into recession it has been a nonstop refrain on the right that the unemployed aren’t trying hard enough, that they are taking it easy thanks to generous unemployment benefits, which are constantly characterized as “paying people not to work.” And the urge to blame the victims of a depressed economy has proved impervious to logic and evidence.

But it’s still amazing — and revealing — to hear this line being repeated now. For the blame-the-victim crowd has gotten everything it wanted: Benefits, especially for the long-term unemployed, have been slashed or eliminated. So now we have rants against the bums on welfare when they aren’t bums — they never were — and there’s no welfare. Why?

What’s the Matter With Kansas? Nothing a Renewed War on Poverty Can't Fix | Activism, Perspectives | BillMoyers.com

What’s the Matter With Kansas? Nothing a Renewed War on Poverty Can't Fix | Activism, Perspectives | BillMoyers.com



This is how austerity works in many states.

Capitalism vs. The Climate: Naomi Klein

California Children below the poverty line

New Census Data Show That More Than One in Seven Californians -- One-Third of Them Children -- Lived in Poverty in 2013 STATE'S OVERALL POVERTY RATE AND CHILD POVERTY RATE REMAIN HIGH DESPITE DECLINES SINCE 2011, HIGHLIGHTING NEED FOR POLICIES THAT BOOST WORKERS' EARNINGS

SACRAMENTO -- Census Bureau data released today show that the share of all Californians with incomes below the federal poverty line in 2013 remained significantly higher than in 2006, the year before the Great Recession began. More than 5.6 million Californians -- over one in seven -- had incomes below the poverty line in 2013. California's overall poverty rate of 14.9 percent in 2013 is down significantly from 16.9 percent in 2011, but is still much higher than the pre-recession level of 12.2 percent in 2006. Nearly 2 million California children were living in poverty in 2013, accounting for one in five children in the state (20.3 percent). Although this child poverty rate is down significantly from that in 2011 (24.3 percent), children still account for an outsize share of Californians living in poverty. Californians under age 18 were less than one-quarter of the total state population (23.9 percent) in 2013, but they accounted for nearly one-third of those living in poverty (32.5 percent).

How Economists Got it Wrong - Krugman

        

Paul Krugman

    Last week I participated in a conference organized by Rethinking Economics, a student-run group hoping to promote, you guessed it, a rethinking of economics. And Mammon knows that economics needs rethinking in the wake of a disastrous crisis, a crisis that was neither predicted nor prevented.

It seems to me, however, that it’s important to realize that the enormous intellectual failure of recent years took place at several levels. Clearly, economics as a discipline went badly astray in the years — actually decades — leading up to the crisis. But the failings of economics were greatly aggravated by the sins of economists, who far too often let partisanship or personal self-aggrandizement trump their professionalism. Last but not least, economic policy makers systematically chose to hear only what they wanted to hear. And it is this multilevel failure — not the inadequacy of economics alone — that accounts for the terrible performance of Western economies since 2008.

In what sense did economics go astray? Hardly anyone predicted the 2008 crisis, but that in itself is arguably excusable in a complicated world. More damning was the widespread conviction among economists that such a crisis couldn’t happen. Underlying this complacency was the dominance of an idealized vision of capitalism, in which individuals are always rational and markets always function perfectly.

The People vs.Federal Bank Settlements

The People vs. Federal Bank Settlements and Liquidity Rules

By Nomi Prins

Last week, in an interview with Bloomberg News, former Countrywide CEO, Angelo Mozilo gave the nation the middle finger. He expressed zero remorse or culpability for his very personal (and personally lucrative) role in the subprime crisis that catalyzed a global economic recession. Apparently baffled by a potential lawsuit that could be levied by the Los Angeles US Attorney’s Office, he said, ““Countrywide didn’t change. I didn’t change. The world changed.” After blaming the world, he ended his segment by stating, “We didn’t do anything wrong.”

To him, the culprit was the real estate collapse itself.  The same excuse was used by Big Six bank CEOs before multiple Congressional hearings and business news hosts. “OMG, how could we have known prices could GO DOWN?” By placing the blame on the ‘market’, they spun their actions as reactive or ancillary to its apparently random whims, as opposed to proactive on practices leading to crisis events.

The more temporal distance from those events and airtime given to the bankers that inflated the market before crashing it, and Treasury Secretaries that did ‘what they had to do’ in an emergency, the more the Mozillian narrative is cemented in the main annals of history and the plight of the public is rendered a footnote.  Yet, it was not just the loans themselves, but more so, the immense and profitable re-packaging and global re-distribution of those loans in a pyramid of toxic assets wrapped with credit derivatives that blew up in the face of the nation and the world, The economic implosion that followed ignited by the weight of such epic fraud and CEO directed salesmanship, impacted initial borrowers with conditions beyond their control, on top of initial fraud and voracious pushing of those loans to begin with. Thus, banks concocted $14 trillion worth of assets using $1.5 trillion of high-interest loans, compounding and adding to each bit of fraud, instability and risk along the way.

Forbes ranked Mozillo one of the top ten highest paid CEOs in 2006. By 2009, the SEC charged him with fraud for lying about the quality of the loans he sold to Bank of America and insider trading for pocketing $140 million from selling his stock when he knew those loans, and his company, were crumbling. He wound up paying a $22.5 million fine to settle the charge of misleading investors and $45 million for the insider trading charge – leaving him a cool $72.5 million.

Terminology from the Video- Inside Job

Terminology from the film – Inside Job.

You can find key terms in a number of places. 

One is Wikipedia.  Or, you can do a Google search.  When I did a google search for Mortgage backed securities I found this short video.

http://www.investopedia.com/video/play/what-are-mortgage-backed-securities/

For brief definitions, there is a glossary in the back of the report;

The Financial Crisis Inquiry Report.  ( in your reading list.)

A source for details on each of the major parts of the video Inside Job is the book, Predator Nation: Corporate Criminals, Political Corruption and the Hijacking of America. – on your reading list.