San José, CA – In a sign that the economy is on the edge of another downturn, the Labor Department reported on Sept. 2 that there was no gain in jobs in August. Not counting last summer when there were large layoffs of temporary Census workers, this is the worst jobs report since February of 2010. The Labor Department also revised down the job gains for June and July, so that average job gain over the last three months was only 35,000 net new jobs per month. This is far below the 200,000 or so jobs that a normal recovery would be generating at this stage of an economic expansion.
San José, CA – On August 5, Standard and Poors, commonly known as S&P, downgraded U.S. government bonds from the highest rating AAA to the second-highest AA+. At the same time the S&P called for even more austerity, saying that $4 trillion in cuts in U.S. government spending were needed, not the $2 trillion agreed upon earlier in the week. S&P criticized the U.S. government for not making cuts in Social Security and Medicare. In addition, S&P said that the federal government spending cuts needed to come sooner, increasing the chances of a new downturn in the economy, or the feared ‘double-dip’ recession.
San José, CA – The recent federal debt limit deal passed by the House and Senate and signed into law by president Obama promises at least $2.1 trillion in spending cuts and lower interest payments over the next ten years. This deal did not include any savings from ending the wars in Iraq and Afghanistan, or from restoring higher taxes for the rich. It was a victory for the Tea Party-backed Republicans and benefits the rich and Wall Street. At the same time programs serving poor and working people will be the target for cuts and the deal opens the door for cuts in Social Security and Medicare.
The recession ain’t over yet, fears of a ‘double-dip’ rise
San José, CA – On July 29, the Commerce Department released its report on Gross Domestic Product or GDP for the Second Quarter (April to June) of 2011. GDP, which measures the value of goods and services produced in the United States, rose at only a 1.3% annual rate, much slower than most mainstream economists expected. Even worse, the First Quarter (January to March) economic growth was cut from an earlier estimate of 1.9% to just 0.4%.
The Congressional Progressive Caucus proposal is good but could be better
San José, CA – A proposal for a federal budget that serves working people and not the rich and corporations needs to include four points. First, a budget proposal for the people needs to recognize that the biggest economic problem right now is not the federal budget deficit, but rather an unemployment rate of almost 10% more than two years after the recession officially ended. Second, given the fact that the public debt is mainly due to wars, tax cuts for the wealthy and recessions, balancing the budget must be done in a way that cuts military spending, raises taxes on the well-to-do and increases spending in the short run to get more people back to work. Third, future funding problems for Social Security and Medicare must protect the programs by increasing funding, not by cutting back on the safety net for seniors.
Plan would cut taxes for the wealthy and corporations while cutting Social Security
The Bipartisan Senate Proposal is being pushed by the so-called Gang of Six – Saxby Chambliss (R-Georgia), Tom Coburn (R-Oklahoma), Kent Conrad (D-North Dakota), Mike Crapo (R-Idaho), Dick Durbin (D-Illinois), and Mark Warner (D-Virginia). Four of them were members of the National Commission on Fiscal Responsibility and Reform which was unable to pass a proposal to cut the Federal Budget deficit. This proposal has been welcomed by President Obama, who said that he endorsed the thrust of the proposal.
San José, CA – On July 8, the U.S. Department of Labor released its report on unemployment and new job creation for the month June. The report said that the unemployment rate rose for the third month in a row to 9.2%, while only 18,000 new jobs were created. The job creation was much worse than most mainstream economists expected, and was less than one-tenth as many new jobs as in February, March and April. The number of new jobs created in May was revised down from a weak 54,000 to an even worse 25,000.
Minneapolis, MN – The framework agreement reached by Minnesota Governor Mark Dayton and Republican politicians is a victory for big corporations and Minnesota’s wealthy. For the rest of us, it is a setback. It is the opposite of what a progressive solution to the state budget crisis should be. The Republican shutdown of state government appears to be ending with a Republican solution to the budget short fall – the burden of the crisis will be shifted onto the backs poor and working people. Again.
