Self-Employed Hurting Worse Than Workers

Another fallacy and myth dispelled. While many a pundit tries to deny the jobs crisis by claiming lost jobs push people into entrepreneurship, the Cleveland Federal Reserve says otherwise:

A press release announcing a recent report from the Ewing Marion Kauffman Foundation, for example, went so far as to argue, “Rather than making history for its deep recession and record unemployment, 2009 might instead be remembered as the year business startups reached their highest level in 14 years—even exceeding the number of startups during the peak 1999–2000 technology boom.”

Unfortunately, a careful look at the data suggests otherwise. Multiple sources of government and private data show that the Great Recession was actually a time of considerable decline in entrepreneurial activity in the United States.

 

 

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The Chicken Little Approach to Deficit Reduction - The Dollar is Falling

Economist Dean Baker does a great call out on more fear tactics to convince your average American they must give up their health and retirement to save America:

 

 

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Decline and Fall - Why Would Anybody Believe Standard and Poor's?

Michael Collins

We are in the midst of a bum's rush - the quick eviction of a less than desirable in an unpleasantly abrupt fashion. The problem is we're the bums. Our eviction from the political process is all based the word of a firm that helped fuel the housing bubble, trigger the financial collapse, and found itself indicted by the State of Connecticut for "unfair, deceptive, and illegal business practices" in 2008.

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New Residential Home Sales - March 2011

In March, New Residential Single Family Home Sales increased 11.1% from February's -13.5% revised plunge, or 270,000 homes, with a March annual sale rate of 300,000 new homes. This is a -21.9% drop from a year ago. In March 2010, new home sales were 384,000.

 

 

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NAR Existing Home Sales - Up 3.7% for March 2011

The National Association of Realtors released their existing home sales figures and give a March increase of 3.7%, annualized rate, from February's nose dive, which also was revised upward. Existing home sales are now 6.3% below what they were one year ago.

 

 

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Beyond ForeclosureGate - It Gets Uglier

Michael Collins

The ForeclosureGate scandal poses a threat to Wall Street, the big banks, and the political establishment. If the public ever gets a complete picture of the personal, financial, and legal assault on citizens at their most vulnerable, the outrage will be endless. (Image)

Foreclosure practices lift the veil on a broader set of interlocking efforts to exploit those hardest hit by the endless economic hard times, citizens who become financially desperate due medical conditions. A 2007 study found that medical expenses or income losses related to medical crises among bankruptcy filers or family members triggered 62% of bankruptcies. There is no underground conspiracy. The facts are in plain sight.

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Obama Brings You More Bad Trade Deals

Whenever there is noise in the media machine, you can be sure some agenda the American people absolutely reject will be enacted. Such is the case with the Obama administration moving forward on three more NAFTA style trade agreements with Columbia, Panama and South Korea. These are trade pacts multinational corporate lobbyists demand.

The South Korean trade pact increases the trade deficit and puts U.S. workers in more unfair labor competition. Even with a new biased USTR study, littered with fantasy tariff schedules and nebulous additional regulation requirements, cannot hide the fact this trade deal increases the deficit. The new report was requested by Republicans since they didn't like the dismal results of the previous study. Regardless of the spaghetti wording, the bottom line is imports, just in autos & parts, will increase $907 million while exports will increase $48–66 million. In other words, the Obama administration and Congress know this trade deal will increase the deficit and cause further job losses. They want it anyway.

(The image is a 2008 Obama campaign flier. All three of these trade agreements are structured like NAFTA.)

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Trade Deficit for February 2011 - $45.8 Billion

The February 2011 U.S. trade deficit decreased $1.2 billion to $45.8 billion. The January 2011 monthly trade deficit was $47 billion, revised up from $46.3 billion. $26.7 billion of this deficit is oil related, $0.9 billion less than 1 month ago, and 44.1% of the total goods trade deficit. Both imports and exports dropped, with imports declining $3.6 billion, or 1.7% and exports dropping $2.4 billion, or 1.4% for February.

 

 

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ForeclosureGate Deal - The Mandatory Cover Up

Michael Collins

The Federal government is about to settle the ForeclosureGate affair, according to a report in the New York Times on April 9. The Times noted that twelve million homes will be lost by 2012. Home equity values are down by $5.6 trillion since the real estate crash.

The draft agreement released to American Banker shows another corporate-friendly deal designed to maintain the incumbent perpetrators at the expense of the people. (Image: zoonabar)

The proposed settlement culminates an effort by federal prosecutors to address strongly supported allegations of widespread mortgage fraud perpetrated on as many as sixty percent of current mortgage holders. Homeowners were sold mortgages, serviced for the loans, and, in some cases, subjected to foreclosure and eviction based on fictional contracts and collections practices that violate the most basic principles of contract law and specific federal code pertaining to fraudulent debt collection.

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PPI for March 2011

The Producer Price Index for finished goods increased 0.7% in March 2011. The PPI measures prices obtained for U.S. goods. Intermediate goods prices increased 1.5% and crude or raw materials prices dropped -0.5% after rising 3.4% in February. PPI is often called wholesale inflation by the press.

The reason finished goods prices increased was energy, up 2.6% in one month. The report notes almost 90% of the wholesale price increase was energy, which includes gas prices. Gas alone rose 5.7% in one month and by itself, was 80% of the finished goods wholesale increase. Food, on the other hand, dropped -0.2%, but these are wholesale prices, so demanding $9 bucks for 10 ounces of some frozen food item heavily advertised on TV will probably remain that high.

 

 

Core PPI or finished goods minus food and energy, increased 0.3% for March 2011. There was a 0.7% light truck price increase in core PPI and this was 33% of the total core PPI monthly increase.

 

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Initial weekly unemployment claims for April 9, 2011

Initial weekly unemployment claims increased to 412,000, a 27,000 increase in a week. Last week was revised up to 385,000, from 382,000. The 4 week moving average increased to 395,750. We're going backward, the wrong direction for job growth.

 

 

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Killing Us Quickly - Ryan's Medicare Proposal

Michael Collins

We're not worth having around after 65, says Michael Collins. Why else would they want to kill us off?

House Budget Committee Chairman Paul Ryan (R-WI) proposed a Medicare plan that combines Social Darwinism and a bailout for health insurance carriers, even larger than the one provided by the president's health care reform legislation.

The specific features of the program are less important than the overall effect. In summary, Ryan proposes a plan that will starve most of those sixty-five and older of health care. Here are the numbers, based on Congressional Budget Office projections and elaborated by Dean Baker and David Rosnick (in 2011 dollars) (Center for Economic and Policy Research, April 2011)

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CPI for March 2011

The Consumer Price Index for March 2011 increased 0.5% from last month. For the year, the Consumer Price Index for all Urban Consumers (CPI-U) has risen 2.7%, the highest since December 2009. The February CPI monthly increase was also 0.5%.

 

 

Gas and food was 75% of the CPI increase for the month. Food at home increased, 1.1% from February to March, Gas alone rose 5.6% and Fuel Oil increased 6.2% from last month. For the year, Gas is up 27.5%, fuel oil up 34%, that's over a third, and food at home has increased 3.6%. One must wonder what kind of substitution is going on with food though for it to only be 3.6% versus what real people experience at the grocery. Heating your house with gas, on the other hand, dropped another -1.4% and is down -5.5% for the year. Below is the monthly percentage change in CPI-U.

 

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Friday Movie Night - Of the 1%, by the 1%, for the 1%

It's Friday Night! Party Time!   Time to relax, put your feet up on the couch, lay back, and watch some detailed videos on economic policy!

 

We all know most of us have no representation from government and the great land grab of what's left of the money is still going to the super rich and multinational corporations.

Economist Joseph Stiglitz points out these statistics as well as future implications in a Vanity Fair article, of the 1%, by the 1%, for the 1%. Stiglitz overviews the lack of social mobility, the lack of opportunity and how the United States has turned into a glorified feudal kingdom where favors are for kings and lords and most of us are just the serfs, peasants to be viewed as consumers.

Americans have been watching protests against oppressive regimes that concentrate massive wealth in the hands of an elite few. Yet in our own democracy, 1 percent of the people take nearly a quarter of the nation’s income—an inequality even the wealthy will come to regret.

Below is an extended interview with Stiglitz on income inequality, overviewing his Vanity Fair article.

 

Joseph Stiglitz, part I

 

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Saturday Reads Around The Internets - The Only Things Certain are Taxes and Death

Welcome to the weekly roundup of great articles, facts and figures. These are the weekly finds that made our eyes pop.

Unemployment Increases Death

For those who try to dismiss people as human resources, numbers on a spreadsheet, think again. Lose just one job and your rate of dying prematurely increases 63%. From Job Loss May Increase Premature Death:

The researchers, who analyzed 42 studies with data on 20 million people regarding the relationship between unemployment and the risk of death, also found that the increased risk was greater for men (78 percent) than for women (37 percent). The overall study results reveal that the relationship between unemployment and mortality risk has remained constant for the past 50 years.

Tax Rates Since 1916

Credit WriteDowns reviews the top tax rates since 1916 in the United States and references the below Michael Hudson interview explaining how the U.S. income tax came about.

 

 

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Sunday Morning Comics - Tax Day Classics

^{Brought to you by Multinational Corporations & Billionaires - You Pay Taxes So We Don't Have To}

 

Good Morning! Rise and Shine! Get that Cup O' Joe...
break out the O.J....hang out with the pooch...time to check out these classic Tax Funnies.

 

Monty Python - Tax Thingy

 

Tax Day Reminder for Canadians

 

Monty Python - The Audit

 

E-Trade Baby Has A Lot to Write Off

 

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Credit Rating Agency Scolds the United States on Sovereign Debt

All Hail the credit rating agencies. Standards & Poor's just gave the good ole' USA a negative credit rating outlook, with a scolding on what we should do as a nation:

Standard & Poor’s put the U.S. government on notice that it risks losing its AAA credit rating unless policy makers agree on a plan by 2013 to reduce budget deficits and the national debt.

“If an agreement is not reached and meaningful implementation does not begin by then, this would in our view render the U.S. fiscal profile meaningfully weaker than that of peer ‘AAA’ sovereigns,” New York-based S&P said today in a report that maintained its top rating on U.S. long-term debt while lowering the outlook to “negative” for the first time.

S&P is giving the U.S. a 33% chance of losing it's AAA credit rating.

This is how the game is played to force a nation into austerity. The agenda is to destroy what is left of the working people and middle classes by dismantling what is left of social safety nets, under the claim of too much debt. In other words, it seems S&P is in on the game to make sure Americans have no Medicare, Medicaid and Social Security.

Indeed, it seems Republicans are jumping on this like flies on .....well, you know. All to destroy what is left of America's social safety nets.

Shock of all shocks, Obama's chief economics guy, Austan Goolsbee, is calling cash on S&P and implying this is political:

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Tax Day Less Painful For Top 400 Income Earners

In honor of tax day, we have quite the study on taxes. 45% of Americans pay zero tax. Then the top 400 income Americans pay just 17%, not 35%, in taxes. Why? In part, capital gains, which is taxed at a 15% rate. That's Wall Street profits folks.

The Internal Revenue Service tracks the tax returns with the 400 highest adjusted gross incomes each year. The average income on those returns in 2007, the latest year for IRS data, was nearly $345 million. Their average federal income tax rate was 17 percent, down from 26 percent in 1992.

Over the same period, the average federal income tax rate for all taxpayers declined to 9.3 percent from 9.9 percent.

That said, watch out, Republicans are out to give more tax breaks to the wealthy. Bear in mind most of America is poor, with the median income being a little over $26,000 dollars.

So, statistics like the below disguise the fact the super-rich pretty much already have most of the money in the United States.

More than half of the nation's tax revenue came from the top 10 percent of earners in 2007. More than 44 percent came from the top 5 percent. Still, the wealthy have access to much more lucrative tax breaks than people with lower incomes.

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Ridiculous Budget Games

The most mean spirited and absurd budget came out today while the Republicans are threatening to shut down the government. Yes, we know politicians, both parties, are all bought and paid for, corrupt as hell, but a government shut down? This affects real people and the real economy, not just federal workers but all of the Americans who rely on them. All federal workers except emergency services go unpaid, but guess who still collects their paycheck? Why the ones who caused it, our President and our lovely Congress. Yes, Congress collects paychecks while they get us into this mess with their power driven political game of chicken. Literally instead of being able to fiscally manage, politicians are placing bets on who will win in the opinion polls, based on 1995. Below is yet another example of politics versus the economic effects in a very fragile economy.

 

 

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Initial weekly unemployment claims for April 2, 2011

Initial weekly unemployment claims decreased to 382,000 this week and last week was revised up to 395,250. The 4 week moving average dropped to 389,500, but is higher than the 4 week moving average from March 12th. Weekly unemployment claims seem to be hovering right above the job creation point of 375,000 per week now.

 

 

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Thar Blows Portugal Straight into the IMF Austerity Plan

Portugal is asking for a bail out.

Portugal's prime minister said Wednesday his country has asked for financing assistance from the European Union due to its high debts and difficulty raising money on international markets.

The amount is €80 billion, with the Wall Street Journal reporting €90 billion.

Germany is already backing the bail out.

Of course the help will have a catch, that infamous, vague term, austerity. So far this has been an attack on workers, wages and social safety nets.

The U.K., which has cuts social safety nets, workers will contribute £4bn to the Portugal bail out....in order to cut social safety nets, workers and wages.

The Treasury said the UK was not planning to offer bilateral assistance to Portugal in the way that it did to Ireland.

But it confirmed that Britain could be required to provide a loan of up to about £4.4bn – 13.6% of the €37.5bn remaining in the EU "disasters fund" after it was drawn upon by Ireland – as well as 4.5% of any IMF loan.

Earlier in March, Portugal voted against austerity measures and the Portugal prime minister resigned.

Seems the ECB, EU and the infamous IMF are putting together an austerity plan for Portugal which will take 2 to 3 weeks.

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The Crazies versus the Sleepwalkers - Big Budget Showdown

By Michael Collins

The Republican crazies are in a celebrity death match with sleepwalking Democrats. It is a fabricated drama amounting to not much of anything in terms of the nation's well being. The stakes are supposedly the shutdown of the United States government at midnight this Friday. But the most pressing issue isn't discussed on Capitol Hill.

Why can't anyone in a position of power mention the unmentionable? There have been no net new jobs in the United States since 2000. There were 137 million employed citizens that year. There are 139 million employed citizens today. This comes into clear focus when you consider the size of the workforce for 2000 and 2010; 143 million versus 154 million respectively. There are actually fewer jobs in proportion to the workforce.

Isn't this a worthy topic? Shouldn't the story be carried nightly on a major network with a title like: Jobless America, Day 4000

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Government Shut Down Kabuki Theatre

The crisis loams, the doors close shut, people dependent on government paychecks whirl like dervishes in panic wondering how they will pay for food and shelter. An hour before the clock strikes twelve, when all turn into pumpkins, a deal is struck to not shut down the government.

A deal has been reached between U.S. President Barack Obama and congressional leaders on a budget plan for the rest of this fiscal year that would avert a government shutdown, a spokesman for Senate Majority Leader Harry Reid said on Friday.

What was thrown to the lobbyists to make it at the last hour? It appears part of the agenda to destroy the Consumer Financial Protection Agency, now known as the Consumer Financial Bureau, was added as a rider to the 2011 budget.

Trust a financial sector lobbyist to bring both sides together. We all know the banks don't want any agency whatsoever trying to enact consumer protections.

Just today Elizabeth Warren said the Republican agenda against the Consumer Financial Bureau was all about benefiting the banks:

Republican lawmakers are doing Wall Street’s bidding by trying to restructure the Consumer Financial Protection Bureau’s funding and leadership, Obama administration adviser Elizabeth Warren said today.

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If You Want to Decrease the Budget Deficit, Decrease Health Care Costs

With the never ending pundit pontificating on the budget deficit and how we must cut spending, it seems always the bulls-eye is on the backs of the U.S. middle class, poor and national interest. Yet, even the Wall Street Journal notes health care costs are out of control. In their number of the week, they amplify the U.S. Spends 141% More on Health Care than other nations.

 

^{Source: OECD}

 

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High Resolution Photos of Fukushima, Japan from Cryptome

The photograph to the right is one of a series of Fukushima I images obtained through the resources of Cyptome, a open information web site run by one of the original Wikileaks collaborators, John Young. Cryptome credits them to Air Photo Service Co, Ltd. Japan (Image to right) Two sequences of images show damage to the reactors. Sequence 1 covers March 20 - 24, 2011. It contains photographs not previously available. Sequence 2 shows photographs through April 2, many of which have been released.

Sequence 1, the new images of Fukushima I, has not been subject to scientific analysis made available to the public. ChrisMartenson.Com made extensive comments. Tyler Durden re-posted the Martenson piece at ZeroHedge.

Information is limited concerning the impact of the partial meltdowns at Fukushima, as noted in a previous post on the subject. Measurements critical to understanding the contamination from the plant started on March, 23, according to Japan's chief cabinet minister.

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60 Minutes on ForeclosureGate

Most of us already know the gory details on Foreclosure Gate. The robo-signing of documents fraudulently produced by mortgage servicers, the unnecessary foreclosures and the Rube Goldberg of securitized and resold mortgage backed derivatives, where no one can determine who owns the loan.

60 Minutes put together a segment overviewing this derivative debacle.

 

 

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ISM Non-Manufacturing March 2011 Index - 57.3%

The ISM Non-manufacturing report for March 2011 is out. The overall index increased to 57.3%, 2.4 points lower than February's 59.7%. This report is also referred to as the services index, or service sector index.

 

 

New orders decreased 0.3 percentage points to 64.1%. Business activity was 59.7%, with a 7.2 percentage point plunge from last month. Yet, here we are again, the employment index declined 1.9 percentage points. The employment index is at 53.7%, which means jobs is barely breaking even when it comes to adding any workers. Below is the table from the ISM services report, edited.

 

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Manufacturing ISM for March 2011 - 61.2%

The March 2011 ISM Manufacturing Survey was released April 1st. PMI dropped slightly to 61.2%, from a strong 61.4% in February, when the factory index and it's highest level since May 2004. This is the 3rd month for the manufacturing index to be above 60%. Unfortunately, the employment index dropped -1.5 percentage points from last month. which correlates better to the disappointing manufacturing job growth.

 

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Ohio Denies Workers Bargaining Rights

Ohio just voted to deny public workers collective bargaining rights:

Republicans in the Ohio House on Wednesday approved a bill that would restrict collective bargaining rights for the state’s public sector unions.

The bill passed 53 to 44; no Democrats voted in favor of the bill, while 5 Republicans voted against it. The legislation has already passed the state Senate once and would need just one more expected approval before heading to Republican Gov. John Kasich’s desk, perhaps before the end of the day.

Kasich indicated earlier Wednesday that he plans to sign the measure into law.

The attack on public unions is in full swing. Shame it has little to do with State's budget problems.

 

 

The bill denies collective bargaining, which turns negotiations into basically whatever the employer wants. From the New York Times:

Under the bill, if a public employer chose the costlier of two final offers from management and union and that choice forced a community to raise taxes, then voters would be given the opportunity to overturn the contract through a referendum.

Imagine if the public could overturn a contract the state made with a corporation or business. How many IBM contracts, offshore outsourcing contracts would be cancelled immediately in the next vote? Was that in this bill? Of course not.

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Unemployment 8.8% for March 2011

The March 2011 monthly unemployment figures show the official unemployment rate decreased to 8.8% and the total jobs gained were 216,000, with 28,800 of those jobs being private temporary. Total private jobs came in at +230,000 with government jobs dropping -14,000.

 

 

Those entering not in the labor force dropped by -11,000. The labor force participation rate was unchanged, 64.2%, the same as the previous two months. Those added to the civilian labor force was +160,000 and to the noncivilian population, +149,000. This is the lowest labor participation rate since March 1984. U6, or the broader unemployment measurement, dropped -0.2% to 15.7%.

Below is the nonfarm payroll, the total number of jobs, seasonally adjusted. Since the start of the great recession, declared by the NBER to be December 2007, the United States has officially lost 7.245 million jobs. That does not take into account additional jobs needed to employ the United States increased population, but does include the jobs added over the over 3 year time period.

 

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More On The March 2011 Unemployment Report

Earlier we reviewed the March 2011 BLS unemployment report. This post goes into a more unemployment and jobs details not covered previously.

There are 13,542,000 people officially unemployed, and if one takes the alternative measure of unemployment, it's over 24 million.

Below is a new graph, courtesy of the Saint Louis Federal Reserve, for the unemployment rate of just those unemployed 15 weeks or longer. 60.1% of the people who are officially counted as unemployed have been so 15 weeks or longer. The number of people unemployed 15 weeks or longer as part of the civilian labor force is 5.3%. Compare this to the official 8.8% unemployment rate. This means that it takes most people who are unemployed almost 4 months or more to find a job...if they do.

 

 

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The Top 10 Worst Tax Avoidance Corporations

Everybody knows multinational corporations are not paying U.S. taxes. Yet instead of making corporations cough up, our government is busy planning more screw jobs on the U.S. middle class and labor force, all under the guise of reducing spending.

Senator Bernie Sanders is trying to draw attention to the insanity with a top ten list of the worst corporate tax avoiders.

 

 

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Sunday Morning Comics - Quite a Taxing Imagination Edition

^{Brought to you by Multinational Corporations and Their Bean Counters - Employing Hundreds to Offshore Thousands}

 

Good Morning! Rise and Shine! Get that Cup O' Joe...
break out the O.J....hang out with the pooch...time to check out the Funnies.

 

I Give Up - Pay Anything...

 

^{Cartoonist: Mike Luckovich}

 

American Dream Declared Dead As Final Believer Gives Up

 

^{Cartoonist: Nate Beeler}

 

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