Comrades and friends,

On behalf of Freedom Road Socialist Organization, I extend our warmest greetings to all who are assembled here at the International Theoretical Conference on Economic Crises under Imperialism, and thank our hosts, the National Democratic Front of the Philippines, for organizing this important gathering.

In his great work Anti-During, Fredrick Engels made the point that freedom is the recognition of necessity. In other words, historical development is a law-governed process, and by understanding these laws, revolutionaries can be more effective in our efforts to change the world. Therein lies the great importance of a conference such as this. We have the opportunity to learn from one another and discuss some of the key features of monopoly capitalism and how it impacts the world. We do this from the perspective of bringing this system of exploitation and oppression to an end as soon as we possibly can.

The contributions to this conference address three big topics and, while this paper will address all of them, the principal focus of this paper will be the sharpening contradictions in the international financial architecture and challenges to the neoliberal model.

But before doing so, let me note the following. Many of us were here for the October 2023 Theoretical Conference on Imperialism and War, and, shortly before that conference got underway, the Palestinian resistance launched the historic Operation Al Aqsa Flood. Since that time, the Israeli occupiers and their U.S. backers have launched a genocide in Gaza. For its part, the Palestinian resistance has been resolute and steadfast, and it continues to land heavy blows. It is a movement of heroes that deserves the support and solidarity of all progressive people.

Economic crisis and the decline of U.S. imperialism

The history of capitalism is the history of periodic crises of overproduction, and these crises are rooted in the contradiction between a process of production that is social and the individual appropriation of the wealth that is created in that process by the capitalist class. Anarchy reigns in unplanned capitalist economies, where the guiding law is the hunt for the maximum rate of profits.

As Stalin said the work Economic Problems of the USSR that the most basic law of capitalism is

“…the securing of the maximum capitalist profit through the exploitation, ruin and impoverishment of the majority of the population of the given country, through the enslavement and systematic robbery of the peoples of other countries, especially backward countries, and, lastly, through wars and militarization of the national economy, which are utilized for the obtaining of the highest profits.”

U.S imperialism has been in a state of decline since the early 1970s. The periodic economic crises which have occurred in the context of that decline have altered the landscape of the productive forces in a dramatic way. One of the functions of crisis is to destroy the forces of production that are least profitable. Marx and Engels referenced this is The Communist Manifesto, stating, “In these crises a great part not only of the existing products but also of the previously created productive forces are periodically destroyed.”

The fall of the U.S steel industry illustrates this. The plurality of steel was once produced in the U.S. and in 1955 it dominated about 40% of the world market. In 1973 steel production reached its peak, but it was a colossus with feet of clay. The industry had failed to create new capacity with up-to-date technology such as basic oxygen furnaces. Japan and Europe, which had their industrial capacity destroyed during World War II, employed more advanced technologies. The economic crisis that unfolded in the 1973–75 period delivered huge blows to the U.S. centers of steel production like Gary, Indiana; Pittsburg, Pennsylvania, and Cleveland, Ohio. The following economic crisis of 1980 continued the collapse of the industry. By 2019 the U.S. was one of the largest steel importers, only producing about 5% of the world’s steel.

A look at the numbers compiled by the U.S, Bureau of Labor Statistics show similar trends for manufacturing as a whole. Since the 1970s, every crisis or contraction of the economy has resulted in a decline in manufacturing jobs. In 1979, manufacturing employment was 22% of total nonfarm jobs. It was 9% in 2019.

Some general observations can be made. U.S. imperialism has entered a period of accelerated decline and repeated periodic crises have rocked the economic base. Capitalism is not capable of real, long-term planning and it is fixated on short term gains. As a result, the composition of the economic base has been altered with manufacturing’s relative decline. The U.S. has less ability to deal with disruptions of global supply chains and would face tough going in the event of another major war.

The neoliberal model in a changing world

Since the 1980s, neoliberalism has been the dominant economic model of the capitalist world. In his important statement Neoliberalism: A Scourge on Humankind, the brilliant communist Jose Maria Sison states:

Reagan and Thatcher undertook signal actions and pushed legislation to press down the wage level, suppress the trade union and democratic rights of the working class and cut back on social spending by government. They reduced taxes on the corporations and individual members of the monopoly bourgeoisie and provided them with all the opportunities to make super profits and accumulate capital.

These opportunities were made available through the flexibilization of labor, trade and finance liberalization, privatization of public assets, anti-social deregulation, the denationalization of the economies of the underdeveloped countries, the increase of overpriced contracts in war production and guarantees and subsidies for overseas investments.

U.S.-led imperialist globalization took place in this context. Not every center of monopoly capitalism fully adopted the neoliberal model – for example in Japan, liberalization was mainly limited to the financial sector, but that was an exception.

U.S. industrial policy

The decline of U.S. imperialism and sharpening rivalry between the respective centers of monopoly capitalism present a set of genuine challenges to neoliberal, free market fundamentalism.

While it could be said that the U.S. has always had an industrial policy, that of spending vast amounts of money on arms production, the recently adopted Inflation Reduction Act (IRA) along with the CHIPS Act have a real significance. U.S. government spending on developing the semiconductor industry will top $53 billion and create the ability to produce the most advanced computer chips. Government subsidies will also underwrite energy projects and the transition to electric vehicles. A huge boom in new factory construction is now underway.

A major target of this U.S. industrial policy is the People’s Republic of China. Currently about 90% of the world’s advanced computer chips are produced in Twain, and China’s leadership has made clear that the issue of reunification can not be put off forever. Additionally, China is the world’s largest producer of electric vehicles.

Using the measure Purchasing Power Parity (PPP), which allows one to compare which commodities and services can be purchased with a given currency, the World Bank concluded that the Chinese economy was 23% larger than that of the U.S. in 2022. Looking at the sum of these statistics it’s not hard see why the U.S. has moved towards a policy of massive subsidies for key industries: it is a declining, moribund power and its domination of the world economy is coming to an end.

Trade, tariffs and the rise of protectionism

The U.S. spent a huge amount of political capital to establish the World Trade Organization in the mid-1990s. It was the continuation of the post-World War II, U.S. designed General Agreement on Tariffs and Trade (GATT), which set the rules of trade in the capitalist world. At lease some of us can remember the massive 1999 protest against corporate globalization that coincided with the WTO meeting in Seattle, Washington. The U.S. is now the one stopping the dispute mechanism of the WTO from functioning.

In 2017, the Trump administration stopped appointing judges for the WTO appeal process. The Biden administration has continued that policy. So as things stand, countries that do not like WTO decisions can appeal the decisions, but there is no quorum of judges to hear the case, so nothing happens.

Likewise, the Biden administration has continued many of the Trump-era tariffs, particularly those aimed at China, and it is looking at imposing new ones. Currently the U.S. has an ongoing discussion with the European Union on limiting imports of Chinese steel. Trump, who is ahead in the election polls, is promising to put 10% tariffs on all goods entering the U.S., including those for Europe and Japan.

The U.S. also has ongoing trade disputes with Europe on a host of issues ranging from aluminum exports to American subsidies for “green” industrial production.

There are three major centers of monopoly capitalism today: the U.S., Europe, and Japan. As the decline of the U.S. picks up speed, it has less ability to occupy the center of the capitalist world’s financial architecture. A weakening U.S. has become increasingly preoccupied with the defense of its own markets at the expense of an international system of free trade, where the U.S. was the supreme rule maker.

There is a military element to all of this as well. The U.S. is preparing for a war with China, and that’s at the core of the talk about “delinking” the U.S. and Chinese economies. The U.S. proxy war in the Ukraine is going poorly. U.S. influence in the Middle East is waning as the movement for national liberation is continuing to advance. The U.S. is determined to maintain its domination of the Pacific region, plundering the regions land, labor and natural resources. It is also attempting to block China’s development, and hinder reunification with Taiwan.

The environment

All of us understand that the state of the environment is an existential question that is of vital interest to communists and revolutionaries.

The FRSO program states, “Monopoly capitalism is killing our planet. The boundless drive for profit is a threat to our continued existence. Climate change is causing more extreme weather disasters around the globe, with the most severe falling on the peoples of Asia, Latin America, and Africa.”

The existence of imperialism gives class and national dimensions to environmental crisis. Droughts, for example, do not impact everyone equally. Those who make the homes around Wall Street don’t worry about them, they don’t have to. The same can not be said for poor farmers in the Philippines or what few farmers that are left in the U.S.

Given that the monopoly capitalists are responsible for creating the environmental crisis, they are incapable of solving it. Instead, they hypocritically point at the countries that are, or have been, oppressed by imperialism and that are trying to make progress in national development.

In the U.S., investment in “green” technologies has become a mechanism to transfer wealth to the largest corporations.

In the U.S. our organization has been active in building the fight for climate justice and it is our view that the environmental movement can play an important role in opposing monopoly capitalism.

Polarization

The decline of U.S. imperialism has been accompanied by political polarization and sharpening contradictions in the camp of the enemy. The great uprising that followed the murder of George Floyd helped reshape the political landscape. The standard of living for the people of the U.S. is falling. The U.S.-backed genocide Gaza has brought millions of people into the streets.

Monopoly capitalism is a failed and dying system. Nothing – not industrial policy, increased contention with other centers of capital, or new wars are going to save it. Crises are a built-in feature of capitalism that express, in a way that words cannot, the overall weakness of an irrational system.

It is the task of communists to lead the fight that will bring this system to an end. To do this we need to start where people are at and recognize their felt need. By doing so we can continue to build mass movements and expand the strength of the mass organizations. And most importantly, we can win the advanced, the most active, to Marxism-Leninism and build a new communist party.

The outstanding revolutionary Mao Zedong once stated, “Historically, all reactionary forces on the verge of extinction invariably conduct a last desperate struggle against the revolutionary forces, and some revolutionaries are apt to be deluded for a time by this phenomenon of outward strength but inner weakness failing to grasp the essential fact that the enemy is nearing extinction while they themselves are approaching victory.”

It is like the great revolutionary Mao Zedong wrote, “U.S. imperialism is paper tiger.” It is dangerous. It should not be underestimated. But at the end of day, it can and will be defeated.

Long live the unity of the world’s peoples!

Long live proletarian internationalism!

In the words of Marx, “We have a world to win.”

#RevolutionaryTheory #FRSO #Statement #CapitalismAndEconomy #EconomicCrisis #Imperialism

Tampa is among the cities facing the worst of the national housing crisis. Tampa ranks ninth worst in the world for decrease in housing affordability. Renters in the city spend 42% of their income on housing, a 6% increase from 2017 during a time of rising inflation and stagnant wages. In 2022, affordable housing listings decreased by 46% while housing prices increased by 26%. More people in Tampa are at risk of losing their housing.

As the housing crisis worsens, community groups have united to demand housing for all. People’s Council Tampa, a coalition of Tampa activists and concerned residents, was launched on January 5 to stop rent increases and evictions. People’s Council Tampa and many community groups demanded that the Tampa city council pass a Tenants Bill of Rights. Later, they demanded the city also declare a “housing state of emergency”, which would help pave the way for a rent control ordinance.

The Tampa city council had its first reading of a Tenants Bill of Rights on January 13, with a majority of council members in support (6-1). The bill contained anti-discrimination measures and required giving tenants a list of resources. At the second reading on February 3, many council members flipped their vote to be against the bill of rights (4-2) after emails from local landlords and lawyers. The backlash against the council’s rejection of the Tenants Bill of Rights was strong enough for the city council to flip again, and they voted in favor unanimously on February 17.

Seeing the efficacy of public support, People’s Council Tampa and a dozen other groups agreed to mobilize to the next city council meeting on February 24 and demand Tampa declare a “housing state of emergency.” Over 100 people attended, with 50 speaking on the need for rent control to stop the housing crisis. While the city council did accept there was a “crisis” at that meeting, members rejected the idea of a rent control ordinance.

Although the fight to pass a rent control ordinance was not over, more issues with the city council emerged. Councilman John Dingfelder resigned in March as part of a public records lawsuit. Weeks later, Council Chair Orlando Gudes faced a hostile work environment lawsuit and immediate pressure from Mayor Jane Castor to resign. Gudes stepped down as council chair in response but is still a council member – for now. Mayor Castor’s administration is in charge of prosecution in both lawsuits. In Gudes’ case, the Castor administration was aware of the allegations in 2020 but did not pursue legal action until the end of 2021. Castor’s administration also revealed the accuser’s identifying information in a statement about the case. Both lawsuits have increased hostility between the mayor and city council.

Another part of this division is Mayor Castor’s public and firm rejection of rent control, a contrast to city council’s more receptive stance. The Coincidentally, Castor receives a large part of her PAC funds from landlords and developers. While Tampa city council at first voted against the Tenants Bill of Rights after landlords objected, they did pass the bill weeks later.

Despite Mayor Castor’s anti-rent control stance and city council controversy, a rent control ordinance is still possible. To replace Dingfelder, city council chose Amanda Lynn Hurtak, who has stated that her main concern is addressing the housing crisis. City councilmembers like Gudes have voiced support for rent control in the past. If five members of the city council vote in favor of rent control, the ordinance would automatically pass with the mayor unable to veto it.

The Tampa community is responsible for the Tenants Bill of Rights and an ordinance requiring six months’ notice for rent increases, although these are concessions from city council instead of the main demand of rent control. These concessions are not a sign to give up on solving the housing crisis, but encouragement to work even harder. Tampa city council can pass a rent control ordinance with enough community support.

Freedom Road Socialist Organization’s May Day Rally for Housing is part of this struggle to get housing for all. As midterm elections approach, protesting for an end to the housing crisis with rent control is necessary to build massive public support. If a large part of the Tampa community demands rent control and nothing less, the Tampa city council would have no choice but to act.

#TampaFL #EconomicCrisis #HousingStruggles #tenantsRights

San José, CA – On Friday, January 14, the U.S. Department of Commerce reported that retail sales dropped 1.9% in December 2021. This number was called “terrible” by economists, who expected a very slight drop of 0.1%. Since the retail sales report is not adjusted for inflation, sales discounting higher prices fell almost 2.5%.

Many news reports tried to blame the new Omicron variant of COVID-19, which began to surge in the United States in December. But online sales, which usually go up when people don’t want to shop in stores because of the pandemic, fell a much sharper 8.7% in December, more than four times the overall drop in sales. Restaurants and bars, which do worse when people stay home, only fell 0.8%, or half the average drop in sales.

More likely is that the surge of sales in 2021 has begun to fade. Even including the December drop, retail sales at the end of 2021 were almost 17% higher than the end of 2020. This reflected the trillions of dollars in federal government monies to fight the recession of 2020. But this aid has ended piece by piece. The last relief checks went out early in 2021. The federal eviction moratorium ended in August. Expanded unemployment insurance benefits ended in September.

With last expanded federal Child Tax Credit payments going out in December, only the federal student loan moratorium remains. State and local government budgets are starting to go into the red, so cuts will start to be more frequent this year. This trend towards more government austerity, combined with the Federal Reserve Bank’s commitment to start raising interest rates as soon as March, will put two brakes on the economy.

While the economy surprised many by bouncing back from the recession in 2020 and 2021, it is more likely to surprise to the downside in 2022. One sign of growing negative economic views of the future among wealthy investors is that the stock market began the year with back-to-back weekly drops.

#SanJoséCA #EconomicCrisis #PeoplesStruggles #Omicron

Continuing claims, which measures the number of people receiving regular state unemployment insurance benefits, fell by much larger number, dropping 916,000 to 12.6 million for the week ending September 5. But much of this drop was because the surge in unemployment insurance claims began in March, when travel, hospitality, and restaurants began to cut back because of the COVID-19 pandemic.

The broadest measure of unemployment insurance rose by 98,000 for the week ending August 29, to a total of 29.8 million. This number includes the regular state unemployment benefits, the federal Pandemic Unemployment Assistance or PUA for gig workers and the self-employed, the federal Pandemic Emergency Unemployment Compensation or PEUC and the state Extended Benefits program, both which aid those who have run through the six months for regular state unemployment.

Other signs that the economy continues to slow emerged this week. On Wednesday, the government report on retail sales for August saw a gain of only six-tenths of one percent. This was just more than half of what most economists expected, and a drop from August’s increase. But this was not unexpected, given the expiration of the $600 a week in additional unemployment insurance benefits.

Trump’s executive order granting an additional $300 week has also ended after only five weeks. While many states are still making retroactive payments, they will run out soon, leaving almost 30 million people high and dry.

Another sign of weakness was that new construction on homes and apartments fell 5.1% in August, led by a big decline in apartment construction projects. This is no surprise as more and more people are being evicted, despite a moratorium issued by the Centers for Disease Control. The big problem with the CDC order is that the federal government is not providing any money for rent relief. A better approach has been proposed by Representative Ilhan Omar of Minnesota, who call for rent forgiveness for tenants hit by the recession, and government aid to landlords who commit to more protection for their tenants.

#SanJoséCA #EconomicCrisis #unemploymentInsurance

San José, CA – For the second week in a row, the U.S. Department of Labor reported April 9 that more than 6 million people applied for unemployment insurance in the previous week. The Labor Department also revised up last week’s claim numbers to 6.6 million, meaning that a total of 16.8 million people have lost their jobs and applied for UI benefits in just the last three weeks. The actual number could be higher as many states’ websites, phone lines and paper application sites were swamped.

The number of newly unemployed is about 10.3% of the labor force. Adding these numbers to the official unemployment rate of 4.4% based on surveys in the first part of March, the unemployment rate was 14.7% as of last week. This number does not include all those who were not able to file or who were still being laid off this week. This means that the unemployment rate as of last Saturday was almost 15%, the highest since records began in 1948. It is likely to be the highest unemployment rate since 1939, when the U.S. economy began to pull out of the Great Depression.

While at least two states, New York and Illinois, said that they were processing the additional $600 a week from the recent federal government relief law, many states have not started, leaving millions without the additional benefits that have been promised. Some states have said that these additional benefits may not be available for up to five weeks. Other states, such have Utah, were not taking applications from people who were self-employed, although the recent federal relief law also covers them. And the $1200 per adult payments are not coming until at least next week.

With unemployment benefits only covering about 55% of a worker’s income on average, and others still waiting for their claim to process or unable to even apply, demand for food banks has gone up as much as ten-fold. Lines of cars, literally miles long, have been reported at food distribution sites, including one just across from President Trump’s Mar-a-Lago resort. Food banks also face fewer donations as many restaurants which donated leftover food are closed and grocery stores are selling out.

According to NMHC, a group of apartment owners, about 13% fewer tenants paid their rents on time at the beginning of April as compared to a year ago. While some cities have banned evictions for the time being, landlords are expecting to be paid in full by their unemployed tenants. This means millions of families that are struggling to survive without a paycheck also have the threat of homelessness hanging over their heads in the midst of a pandemic.

But for the third week in a row, Wall Street rallied in the face of economic calamity for millions of workers and self-employed. The broadest major stock market index, the S&P 500, rose by almost one and a half percent on news that the Federal Reserve was expanding their lending again by more than $2 trillion to support the investors who bought corporate and municipal bonds (bonds issued by state and local governments).

#SanJoséCA #PoorPeoplesMovements #EconomicCrisis #Unemployment #US #Healthcare #PeoplesStruggles #stockMarket #DonaldTrump

Jobs have disappeared and there is no sign that they will be back anytime soon. There are more than 5 million unemployed who have been out of work for more than six months. About 2.5 million of them are collecting extended federal benefits and could be cut off in 2013. Most of the rest have exhausted their benefits. We demand that the government acts now to extend and expand benefits to the unemployed.

Incredibly enough, a host of right-wing politicians are trying to demonize the unemployed and to blame people who are out of work for the lack of jobs. So they take a page from the welfare bashers and propose drug test requirements for unemployment benefits. They say that the unemployed are lazy and are a ‘drag’ on the economy. Then they turn around and propose some new tax breaks for the rich.

Here is the deal. There are 4 million fewer jobs today than there was when the economic crisis unfolded in late 2007. At the current rate of job growth – which is minimal at best – it will take about four more years to regain those lost jobs. That’s if there is not a new economic downturn or capitalist crisis. By all indications, we are in for a long period of time with high unemployment rates.

On top of this, because of racist discrimination against oppressed nationalities in this country – African Americans, Chicano/Latinos, and Native peoples – unemployment rates in these communities are much higher. Not a little higher, much higher. For example, the unemployment rate for African Americans is double to that of whites.

There are not enough jobs for workers who need and want them. This has nothing to do with being lazy, or the level of training or education for that matter. It’s true that if one gets more education there are more opportunities for any given individual. But it’s also true that more education and job training does not change the overall number of folks unemployed. And that is why there are plenty of college grads and skilled workers in the ranks of the jobless.

The one-percenters in Congress want to make life a lot harder for the unemployed. At the beginning of next year, 2013, federal Extended Unemployment Compensation (EUC) will expire. This means that the only unemployment compensation out there will be what is provided by individual state governments. Typically this means benefits for only 26 weeks. Given what is going on in Washington D.C., especially the unending coddling of that failed class which bills itself as “jobs creators,” allowing Extended Unemployment Compensation to lapse would be nothing short of criminal.

The heat needs to be put on the politicians to preserve the federal Extended Unemployment Compensation. And there needs to be a political debate about it. Not only should Unemployment Compensation be extended, it should be expanded to last longer and include more people. If there are no jobs, unemployment benefits should last as long as it takes for new jobs to come into being and for the unemployed to find them. Undocumented workers who are laid off should also be eligible. It’s contrary to the notions of fairness and equality that a factory can be shut down and you have undocumented workers with five, ten, or more years of seniority, who pay taxes – and who are unable to get unemployment benefits just like other workers.

The only reason that unemployment compensation exists at all is because the working class demanded and fought for it. As the economic crisis deepened in the early 1930s, hundreds of thousands of workers, most organized by communists, staged dramatic demonstrations on the streets of U.S. cities and towns demanding “work or wages,” and unemployment insurance for the unemployed. We need that same will to fight and win today. The 1%, along with their bought and paid for politicians are not going to give us anything we are not organized to take.

Jobs or Income Now!

Defend and Expand Unemployment Insurance!

#UnitedStates #EconomicCrisis #Capitalism #ExtendedUnemploymentCompensation

Protesters carried signs reading “Kids can't eat footballs”, “No tax dollars for stadiums” and “We need housing, not stadiums.”

Welfare Rights Committee member Darnella Wade stated, “They [the Minnesota legislature] cut my wages for being a personal care attendant and now they want to use our tax dollars to build a new stadium? That's a crying shame.”

People are mobilizing for the next hearing, on financing proposals for the stadium, scheduled for Dec. 6.

#StPaulMinnesota #StPaulMN #CapitalismAndEconomy #PoorPeoplesMovements #WelfareRightsCommittee #EconomicCrisis #Stadium #TaxpayerRipoff

Some of the daily actions are spontaneous and some are planned. Every day so far there have been spontaneous marches during the day, and every day has a planned rally and/or march at 5:00 pm. The calendar for this week is already brimming with several great rallies, marches, teach-ins and events on many topics.

Some of the highlights for this week include a rally to celebrate Indigenous People’s Day (“Columbus Day”) today (Monday, Oct. 10) at 5:00 pm. This rally will feature American Indian Movement leader Clyde Bellecourt, the danzante group KetzalCoatlicue, and other speakers about the more than 500 years of oppression and genocide against Native peoples here, and Native resistance to that.

On Tuesday, Oct. 11 there will be two marches targeting huge multinational banks. At 11:00 a.m., Minnesotans for a Fair Economy (which includes SEIU, CTUL, and several other groups) is leading a march from the occupation space to protest US Bank and Wells Fargo bank.

On Tuesday, Oct. 11 at 5:00 p.m., there will be a rally at the occupation which will march to TCF bank. TCF Bank is based in the Twin Cities and is a huge contributor to pro-corporate and very conservative politicians and causes. According to Kim DeFranco of the MN Coalition for a People’s Bailout, “TCF Bank is terrible. Everyone should come out to the People’s Plaza to march on TCF this Tuesday at 5:00 pm. They shamelessly defend the ultra-rich, giving endless money to pro-corporate right wing politicians, while they snub poor and working people. On Tuesday at 5:00 p.m. we’ll send them a strong message that the 99% won’t take it anymore.”

In the 2010 elections, TCF Bank gave $250,000 to the State Fund for Economic Growth, LLC, which in turn gave the money to MN Forward to support far right wing pro-corporate politicians, and the Taxpayer’s League of Minnesota, which is dedicated to destroying any government program that benefits poor or working people. They are also dedicated to striking down Minnesota’s campaign finance disclosure laws. Last year, Target came under intense criticism and protests for their contributions to MN Forward, but TCF did not receive as much public criticism. Protesters say that TCF Bank will hear from outraged Minnesotans on Tuesday.

On Tuesday at 10:00 p.m. there will also be a Prisoner Solidarity Noise Demo in front of the Hennepin County Jail (right next to the Occupation site) in solidarity with the more than 12,000 prisoners on hunger strike in California.

On Thursday, Oct. 13, at 5:00 p.m. there will be a student & youth rally at the occupation, then at 6:00 p.m. there will be a student & youth meeting there hosted by Students for a Democratic Society (SDS). According to Steph Taylor of U of M SDS, “Whether you’re in high school or college or not in school at all, we want all young people to come together to rally Thursday at 5:00 p.m. and then to meet together at 6:00 p.m. at the occupation. We want to talk about how Wall Street, the rich & the politicians are hurting young people, and how we can get better organized to fight back.”

On Friday, Oct. 14, there will be a march at 3:00 p.m. targeting Wells Fargo and US Bank's roles in the home foreclosure crisis.

Then on Friday there will be a rally at 5:00 p.m. at the People's Plaza occupation site to celebrate the one week anniversary of the Minnesota occupation. Organizers encourage everyone to attend this rally to celebrate this important accomplishment and to rededicate themselves to joining together to end the domination of corporations and the rich over the political process.

On Saturday, Oct. 15, there is a city-wide march protesting 10 years of the war against Afghanistan. The protest begins at 1:30 p.m. at Lake Street & Hiawatha Ave., in Minneapolis. People will gather at the occupation site at 12:30 p.m. to go together to the anti-war protest.

You can keep up with the many other events, workshops and teach-ins at OccupyMN here: http://www.occupymn.org/prepare/events/

#MinneapolisMN #CapitalismAndEconomy #EconomicCrisis #OccupyWallStreet #OccupyMN

Republican presidential candidates have taken the free market view that the government is to blame for economic instability and have called for, for example, dismantling the Environmental Protection Agency (EPA) as a ‘job-killer.’ Unfortunately Democratic politicians from President Obama to California Governor Brown have also adopted this view of sacrificing the health and welfare of people in the interests of corporate profits.

These right-wing, free market views even go as far as trying to blame the boom and bust in housing prices on government-backed mortgage giants Fannie Mae and Freddie. In fact, the big boom in housing was driven by Wall Street and big banks that pushed risky and exotic mortgages from 2003 to 2007 while pushing Fannie and Freddie to the sidelines. The right wing also tries to put blame for the housing crisis on federal government efforts to increase homeownership among African Americans and other oppressed nationalities under the Democratic Clinton administration, when the big boom and bust came under Republican George Bush.

Backers of the free market view are calling for more austerity. Republican presidential candidates complain that the poor, working parents and seniors on Social Security often pay no income tax, while ignoring the payroll and sales taxes that lower income folks pay. Free marketers claim that extending unemployment insurance benefits causes unemployment by reducing people’s interest in finding a job, ignoring the fact that there are almost four people looking for a job for every job opening. They have also proposed at different times to do away with Social Security and Medicare and turning people’s retirement funds over to Wall Street and health care to private insurance companies.

Keynesian economists such as Nobel-prize winner Paul Krugman have argued that these policies of austerity are cruel and that the federal government should have spent even more, as the $800 billion economic stimulus under Obama barely offset the spending cuts and tax increases by state and local government, adding little stimulus to the economy. They correctly point out that the large U.S. government budget deficits have not increased interest rates, as the interest rate on long-term government bonds have dropped to the lowest levels in 70 years.

But the example of Japan shows that even massive government spending can fail to revive an economy. In the early 1990s the Japanese economy suffered a triple whammy of recession, a stock market crash and a bursting real estate bubble. The Japanese government borrowed and spent huge amounts, driving Japanese government debt from the lowest among the wealthier nations to the highest – it is now more than twice the size of the Japanese economy (in contrast, the U.S. government’s debt is still smaller than our economic production as measured by GDP). Nevertheless, the Japanese economy has remained in the doldrums, with only a strong export sector boosting the economy.

Marxist economics sees recession as neither caused by the government nor as curable by government spending. Rather, recessions are part and parcel of a capitalist economy where profit is the motive force. Businesses cut workers’ pay and benefits to increase their profits. But this limits their workers’ ability to buy back what they create. At the same time, these profits are reinvested in developing new technologies and expanding production. This clash – between limited ability to buy and growing ability to produce – leads to periodic crisis of overproduction, or what are called recessions.

Over the last 30 years a vast expansion of debt, especially credit cards and mortgages, has allowed workers to buy more and more despite having stagnant wages. At the same time it has been a profitable investment for capital that has had a hard time finding enough productive investments to turn a profit. But this pile of debt began to collapse with the financial crisis triggered by the collapse of the Wall Street investment bank three years ago.

Without more and more debt to stimulate the economy, it should be no surprise that the recovery from the last recession has been so weak. More than two years after the official end of the last recession, there are almost 7 million fewer jobs than before the recession started and many parts of the country are still mired in depression. More frequent recessions and quite likely worse ones are in the near future, as governments lose their will to bail out the economy and austerity measures cut spending.

The ultimate solution is that we need socialism, which includes an economy based on people’s needs, not profit. But in the meantime we also need to build a mass movement to defend the unions and social programs that have helped people raise their standard of living. Instead of cutting Medicare, we need a national health insurance program for all. Instead of cutting Social Security, we need to restore Social Security taxes on higher income individuals. Instead of closing schools and raising tuition at public colleges, the U.S. must get out of Iraq and Afghanistan.

#UnitedStates #EconomicCrisis #recession #doubleDipRecession

Minneapolis, MN – With the theme of “People before profits” and inspired by the Occupy Wall Street protests in New York, a similar occupation will start on Friday, Oct. 7 at 9:00 a.m. in Minneapolis. The Minneapolis occupation will be at Government Plaza (300 South 6th Street, downtown Minneapolis). The Occupy MN movement has already renamed it “People’s Plaza.” This is one of many ongoing occupations that have sprung up around the country since the Wall Street occupation began on Sept. 17.

Brad Sigal, an activist with MIRAc and the Minnesota Coalition for a People’s Bailout is supporting the OccupyMN movement. He said, “OccupyMN’s message of ‘people before profits’ is on target. People can see that the big corporations and the rich really have all the power in this country, while working and poor people are ignored by the government. We’ve faced years of unending economic crisis, budget cuts, unemployment, foreclosures, growing debt and endless wars. Now is the time to join together, stand up and say enough is enough. People should come join and support the occupation.”

Kim DeFranco, a member of the Welfare Rights Committee, is also supporting OccupyMN. She said, “Year after year the politicians at the capitol cut welfare and attack any program that benefits the poor. The politicians just do what the banks and the rich tell them to do. We’re coming together with others in OccupyMN to stop that. We demand that the rich pay for the economic crisis, not the rest of us.”

For more information and updates on OccupyMN, check occupymn.org

#MinneapolisMN #CapitalismAndEconomy #EconomicCrisis #WallStreet #OccupyWallStreet #OccupyMN

This austerity has cost the working people of Greece. This year the Greek economy is expected to shrink by 5.5%, as more and more businesses are failing. With the unemployment rate at 16% and rising, Greek workers and their supporters have been organizing huge street protests and strikes to protest the austerity plans of the social democratic (socialist in words, pro-business in deeds) PASOK government.

As the Greek government spending cuts and tax increases deepen their recession, tax revenues fall, making the government budget deficit even bigger and leading to calls for even more cuts and tax increases, which increase unemployment and poverty even more. This vicious cycle has gotten to the point where hospitals are running out of medicines and suicides are way up.

Greece is not alone. Over the last year, more and more European governments have had problems selling their bonds to borrow money. The crisis began in Greece, but has since spread to Portugal, Ireland, Spain, and now Italy. With big German and French banks set to lose billions, and perhaps even fail if Greece or another euro zone country defaults on the its government bonds, the other governments in the euro zone (the 17 countries that share a common currency, the euro) have arranged a bailout fund, the EFSF, and are demanding austerity from Greece and other countries..

The mainstream media and politicians try to blame Greece for the crisis by saying that Greece borrowed and spent too much. Politicians in the United States (and other countries) are using the example of Greece to try to get the United States to cut spending and reduce our budget deficit. If done here, this would have the impact of pushing the United States back into a recession, causing the unemployment rate to go up, and the amount of tax revenues to go down, which would tend to increase the budget deficit.

But the European financial crisis is not fundamentally a problem of too much government debt. While the Greek, Portuguese and Italian governments have been running sizable budget deficits for years, Spain and Ireland both had budget surpluses in the years before the 2008 financial crisis. Japan has been running large government budget deficits for 20 years and has a total government debt (compared to the size of the economy) much larger than Greece, but has no debt crisis. Indeed, while interest rates on some Greek government debt has risen to 85% (showing that bond buyers think that Greece will default), Japanese government bonds have interest rates of less than 2%!

What Greece, Portugal, Ireland, Spain and Italy all had in common was that they all depended on large flows of foreign capital to pay for their trade deficits as they imported more than they exported. This is why Japan is not facing a financial crisis like Europe, because Japan has a large trade surplus, as it exports more than it imports. Japan, despite its huge government debt, does not rely on inflows of foreign capital; instead Japan is exporting capital to other countries, such as the United States.

The euro zone crisis is similar to the 1997 financial crisis that began in Thailand and spread to Indonesia, Malaysia, South Korea and other Asian economies. Then, as now, big inflows of foreign capital turned to outflows, causing financial crisis and a deep recession. What happened in Asia was that the value of Asian moneys plunged. This led to higher inflation that cut the purchasing power of working people, but it also making their goods cheaper on world markets, so that these countries were able to export more.

This is what Greece, Portugal, Ireland, Spain and Italy cannot do, because they are a part of the euro zone. So instead, what is being done is to try to lower the wages of working people in those countries, through high unemployment and cuts in government services, in order to make their economies even more attractive to businesses searching for the lowest possible wage.

Argentina also tried to do this following the economic crisis in Latin America in 1998. For many years, Argentina set the value of its money, the peso, as equal to the U.S. dollar. The government of Argentina, like the governments of Greece and other euro zone countries, tried to maintain the value of its currency on par with the U.S. dollar and Argentina’s economy fell deeper and deeper into a depression. But then in 2001, Argentina defaulted (stopped paying back) its government debt, and allowed the peso to fall dramatically in value, allowing Argentina’s economy to export more and grow again.

More and more austerity will just further impoverish the working people of Greece and won’t solve the Greek debt problem. Greece needs to follow the example of Argentina, default on their government debt and go back to their own currency, the drachma. This is not a cure-all for the people of Greece who will have to cope with higher prices, but it will free the economy from the euro-chains that are helping to destroy their economy right now.

Working people here in the United States should support the working people of Greece, who have organized massive street protests and strikes to oppose the austerity plans of their government. We also need to understand that whether it is common currency such as the euro, or free-trade agreements promoted by the United States, that these international agreements are all about boosting profits by allow capital to move to wherever it can find the cheapest labor. In the end, it is the workers who pay.

#Greece #EconomicCrisis

New York, NY – In a city of nine million people, protesters aren’t supposed to shut down a major traffic artery on a Saturday afternoon. But on Saturday, October 1, Occupy Wall Street did just that, blocking the Brooklyn Bridge and sending a loud message to the bankers and politicians from Wall Street to Washington D.C. to California that a new day is at hand.

Saturday was Day 15 of Occupy Wall Street, a 24-hour living protest in the shadow of the World Trade Center, surrounded by City Hall, One Police Plaza and the headquarters of banks and finance. Thousands of people have been gathering every day despite a persistent rainy September. What started out as a call by radical youth has steadily given rise to the participation of the transit workers union, Black nationalist organizations, grandmothers, students, teachers and other forces. Many question what the heck Occupy Wall Street is. With the claims of being leaderless and without demands, I can relate to that question.

It seemed part street theater held together with duct tape and crazy glue. Yet a funny thing has occurred on the streets of New York. Inspired by political uprisings in Cairo, Greece, and Palestine there is a rising politic that is pissed off at our rising unemployment rate, the burning awareness of the boot of the NYPD on people of color communities, endless expanding wars, and the execution of Troy Davis. While the effects of the festering economic crisis brought people to occupy Wall Street on September 17, that and many other injustices keep more people coming.

If the call to occupy lower Manhattan was heeded by youth first, the state murder of Troy Davis by the state of Georgia shook many to the core who were already frustrated by conservative policies coming from the White House. Many peoples’ hopes rose with the election Barack Obama, only to have hearts grow twisted and heavy as now he rallies the forces of US imperialism and corporations like JP Morgan since taking office.

In a dreary rain I was pleased to see hundreds of people grow to a couple of thousand as the day progressed. This is impressive on the 15th day of a round-the-clock protest action. The people's loud speaker announced a march in the afternoon with an unclear direction or goal. But once people began to move up Broadway towards City Hall it didn't seem to matter.

After going to political protests for a couple decades it’s easy to wear a skin of cynicism, but the pure energy of the crowd inspired all of us. People on the street smiled and cheered. Horns honked from every side street, and as we marched the rain stopped and the day got crisp our voices got louder. We arrived at the mouth of the Brooklyn Bridge and many marched legally onto the walkway while others began to block traffic and head towards the roadway. Police were ill-prepared to handle the growing militancy of the demonstration. And as a cop gave warnings over a loudspeaker, you could tell people were marinating over the heavy choices at hand. One. Two. Ten. Twenty. 100 people began to chant, “take the bridge, take the bridge!” And we did.

After protesters marched strong and blocked the road, the police regrouped and eventually arrested over 700 people. As people organized support for their jailed sisters and brothers, news of protests actions in many other cities were also on people lips.

Work needs to get done. It’s time to step up and into the fray. Occupy Wall Street. This is now.

#NewYorkNY #CapitalismAndEconomy #EconomicCrisis #OccupyWallStreet

Boston, MA – In solidarity with the Occupy Wall Street campaign, Boston is joining in with other cities across the United States.

The Occupy Boston event was planned in less than a week, showing up in strength on the evening of Sept. 30. Over 1000 occupants started their own protest in Dewey Square, right across from the Federal Reserve Bank. The gathering included a large swath of persons with diverse political leanings. After some initial planning for an encampment, the protesters took to the street in an unplanned march.

The march lasted for nearly two hours and weaved all over downtown Boston. Bars and restaurant patrons regarded the protest with a mix of awe and camaraderie as it moved past. The slogans proclaimed solidarity with fellow demonstrators across the nation with chants like “We are the 99 percent!” Other chants included, “Out of the bars, into the streets,” and “They got bailed out, we got sold out!” After the march finished, protesters gathered in front of the Federal Reserve Bank. Police guarded the doors.

Eventually, demonstrators settled down for night, occupying Dewey Square. Support groups have been established to meet all essential needs: medical, food and sanitation. Many other secondary services have also been established, indicating that Occupy Boston is there for the long haul. Signs show a wide support for demands against the capitalist system. When one protester was ask why he was there, he replied, “We live in an unjust world and an unjust country. Too many people rich, too many people poor, too many people starving and dying. We need to change the system and it cannot be reformed. We have to build a new one.”

#BostonMA #CapitalismAndEconomy #EconomicCrisis #OccupyBoston #OccupyWallStreet

On June 19th the *Washington Post* published “With Executive Pay, Rich Pull Away from Rest of America” by Peter Whoriskey. This very informative article connected the rise in corporate executive’s pay with the growing economic inequality in the United States, using the example of a large U.S. dairy company combined with recent research by economists on high incomes. At the same time the article only offered very vague explanations for *why* the rich are winning out at the expense of almost everyone else.

Based on a recent study of tax returns, the top one-tenth of one percent (0.1%), or 152,000 income earners, now make over 10% of all income, the highest level since the 1920s. While income for this group has gone up more than four times (385%) between 1970 and 2008, the income of the bottom 90% of the population has actually *fallen* 1% (both figures take inflation into account). The economists’ study was also able to point out *who* these rich are: 60% are corporate executives, managers and highly paid financial professionals.

The article offered the explanation of supporters of growing executive pay, who say that today’s corporations are much larger and more complex – in other words, the CEOs deserve their massive paychecks. The only other view that the article offered was that “social norms” have changed.

While it is no doubt true that a culture of greed has been spread by Wall Street and the corporate media, there are very clear political and economic changes that are behind the increase in economic inequality. The two most important, in my opinion, has been the growing movement of capital from the midwest and northeast to first the south and southwest in the United States, and then to Third World countries, all in search of lower wages and less regulation. The second is the decline in union membership and the even larger drop in mass strikes by workers.

Starting in the 1970s, there was a movement of businesses from the more unionized, higher wage midwest and northeast, to the largely non-union, low-wage areas of the U.S. south and southwest. This so-called Sunbelt Strategy can be seen in the shift in auto production from the midwest to the south.

By the 1980s, under the guise of ‘free trade,’ U.S. corporations more and more shifted their production to Third World countries where wages were even lower than the U.S. south or southwest. This so-called ‘globalization’ continues to this day, as big U.S. companies have shed about 4 million jobs in the United States but created more than 3 million in other countries over the last ten years. For example, General Electric (which by the way paid no taxes on their almost $15 billion of corporate profits last year), cut almost 16% of their workers in the United States will expand their workforce in other countries by 1.3%.

The result has been lower wages for workers in the United States, as the jobs are created in low-wage areas or industries and higher paid jobs are lost. But even workers whose companies stay put see the wages stagnate under pressure from the growing number of unemployed and the companies’ threats to shut down and move their jobs.

This first trend, capital mobility (and running over the worker, so to speak), is closely related to the second trend of de-unionization. Companies are continuing to move to less or non-union areas, as seen in the struggle of unionized Boeing workers in the state of Washington to block the company’s shift of work to non-union South Carolina.

At the same time the turn to the right in national politics with the Reagan administration had a clear anti-union policy. President Reagan’s breaking of the airport flight controller’s union, PATCO, in 1981, ushered in an era of declining union membership and mass strikes. As union membership fell from about 25% in 1979 to less than half that (11.9%) in 2010, workers lost their bargaining power and wages and benefits have suffered.

Today the last bastion of union membership is among public sector workers, where more than 36% are union members, as compared to less than 7% for private sector workers. Now these unions and the benefits that they have won, especially retirement security, are under attack by the right-wing in Wisconsin and other states. Instead of going after the fat-cat CEOs and Wall Street tycoons, the corporate dominated media, led by the notorious Fox media conglomerate, is attacking this last large group of unionized workers.

A capitalist economy leads to economic inequality, especially between the 90% of us who have to work for others (the working class), and the top 1%, who own most of the wealth and who hire us and lower and lower wages to increase their profits (the capitalists). This can only come to and end with the replacement of the current capitalist economy with a socialist economy, where people’s needs, not profit, drive the economy.

But the struggle here and now to defend public sector workers in Wisconsin and other states, and to block the free trade proposals for South Korea and Colombia that will further undermine the strength of labor in the United States are important for the well-being of all workers.

#UnitedStates #EconomicCrisis #WallStreet #Capitalism

Chicago, IL – Over 3000 teachers, healthcare workers, janitors and community activists descended on the corporate leaders meeting here, June 14 outside the Midwest CEO/CFO conference. The protesters demanded jobs, homes and schools.

Participants shouted, “Banks got bailed out, we got sold out,” as over 15 activists were arrested for sitting down and blocking a street near the hotel meeting site.

The Chicago teachers union, SEIU, UE, Homeless Coalition, Brighton Park Neighbors and many more organizations left the action ready to take on the bankers and rich folk, who are driving millions into poverty, the next time they show their faces in Chicago.

#ChicagoIL #Labor #EconomicCrisis

San José, CA – In the first week of June, two important reports showed a sharp slowdown in the U.S. economy. On Friday, June 3, the Department of Labor said that unemployment in May rose to 9.1%, while only 54,000 new jobs were created, far less than what mainstream economists were predicting. Two days earlier, on June 1, a report on home prices showed another drop of 4.2% in the first three months of 2011, bringing home prices to a new low since the housing market began to tank in 2006.

Not only did the unemployment rate rise for the second month in a row, but the average length of unemployment rose to 39.7 weeks (almost 10 months), the longest time on records going back to 1948. Unemployment continued to hit oppressed nationalities the hardest, with the African American unemployment rate at 16.2%, more than twice the rate of whites.

One of the reasons for the small number of new jobs created in May was that local governments cut 28,000 jobs, mostly from cuts in education. Over the last year, local governments have cut 268,000 jobs as the poor economy and cuts in state and federal government support have forced cutbacks in schools and other local government services. These cuts often hurt poor and working-class families who have to depend on public schools and local government services, especially with the continuing high unemployment rates.

The fall in home prices was reported by the Standard and Poor’s/Case-Schiller index, which looks as changes in prices of same homes (as opposed to most reports that just give the average price of whatever homes are sold, which can be pulled up or down by the numbers of low or high priced homes being sold). The fall in home prices has brought the average home in 20 U.S. metropolitan areas back down to 2002 levels, wiping out all of the gains of the housing boom from 2003 to 2006. Falling home prices are pushing more and more homeowners ‘underwater’, where their mortgages are worth more than their homes. Almost a quarter (23%) of homeowners with mortgages are in this situation, which makes it harder for them to sell their home and foreclosure more likely.

Falling home prices are not only hurting homeowners, but are also a drag on the overall economy. In previous recessions, construction of new homes has been a big part of an economic recovery by creating new jobs in construction, real estate and finance. But with large numbers of foreclosed homes putting downward pressure on home prices while continuing high unemployment is a damper on home buyers, housing construction remains very slow despite very low interest rates on mortgages. The latest report of about 550,000 starts of home construction (at an annual rate) is one-third to one-half the rates following the last three recessions.

With high unemployment limiting household spending, the construction industry in the dumps, businesses sitting on a trillion dollars of cash that they are unwilling to spend, and local and state government cutting jobs, wages and pensions, only the federal government has been able to spend to sustain the economy. But the Republican-led charge to cut federal government spending promises even more job losses, increasing the chances of the economy falling back into a recession.

#SanJoséCA #EconomicCrisis #Unemployment #DepartmentOfLabor

Thousands march to protest teacher firings

By an American Federation of Teachers national delegate

The city of Providence, R.I., sent termination letters Feb. 23 to all of its 1,926 teachers. Newly elected Mayor Angel Taveras claimed he was doing this to guarantee flexibility in addressing the budget deficit. He is also going to close an unspecified number of schools.

On March 2, thousands of teachers, including contingents from other Rhode Island cities, members of other unions, and community and progressive organizations flooded the streets around Providence City Hall to protest Tavares’ attack on the Providence Teachers Union. The protest was part of a nationwide response to attacks on public education.

Teachers and union members pointed out that this was a direct attack on the seniority and collective bargaining rights of the PTU. This attack was done unilaterally by management with no consultation with the union. (Providence Journal, March 3).

Randi Weingarten, president of the American Federation of Teachers — the national affiliate of the PTU — said in a Facebook statement that the union and the school board have been cooperating on “improving low-performing schools, developing an innovative hiring process and revamping the teacher evaluation system.” The PTU is the only AFT local to endorse President Barack Obama’s Race to the Top Program, which promotes privatizing education. But this “cooperation” didn’t protect the PTU from a mass firing.

In contrast to what is happening in the Midwest, where Republican governors have targeted public sector unions, Taveras is a Democrat who has decided to use an iron fist to take on other unions beside the PTU. Tavares is also proposing to sell off parts of Providence’s public “crown jewel,” Roger Williams Park.

A giant orange and black banner at the March 2 rally reading “Save our schools, Defend public education!” was held by members of the SOS (Save Our Schools) Coalition. That group just finished a hard-fought community struggle in 2010 against seven school closings attempted by former Mayor David Cicilline and School Superintendent Tom Brady. Together, students, parents and teachers mounted a struggle strong enough to save five of the seven schools.

The SOS Coalition says there is plenty of money for public education, jobs and other human needs if trillions of dollars are no longer poured down the rat-holes of tax-breaks for the rich, bank bailouts, corporate welfare, wars and ever-expanding military budgets.

Weingarten stated at the Providence rally: “Something insane is going on. I thought the only insanity was in Wisconsin.” But it is not really “insanity” for the rich and powerful in this country to attack unions. They are driven to remove restrictions on how public funds for education are spent.

Providence may be the first major system to fire teachers, but much larger school districts in both New York City and Los Angeles are considering such moves.

Bill Bateman, a long-time Providence activist, contributed to this article.

#ProvidenceRI #EconomicCrisis #MayorAngelTaveras #AmericanFederationOfTeachers

Under the cover of deficit reduction, the co-chairs’ proposal is really pushing the Republican and Wall Street agenda of cutting Social Security and Medicare while lowering the tax rates for the wealthy and corporations. The proposal to further increase the retirement age would hit lower-income Americans the hardest, as they are falling further and further behind the life span of the well-to-do. Some of the biggest cuts would come from Medicare reimbursements for doctors, which would lead to less access to medical care, as doctors switch to higher reimbursements from private insurance.

The co-chairs want to cap tax revenues and propose dropping the top personal tax rate from 35% today (which would rise to almost 40% in January if the Bush tax cut is not extended) to between 23% and 28%. The corporate tax rate would drop from 35% today to 26% to 28% and multinational corporations would not have to pay any taxes on profits from abroad, which can be more than half of their total profits.

One way that the most recent recession differed from the Great Depression is that the rich have done relatively better this time around. During the 1930s, inequality of income went down as the well-to-do suffered relatively more than today. New Deal programs such as the Works Progress Administration jobs program, Social Security and unemployment insurance benefitted working people.

But between 2008 and 2009, the share of income going to the 20% of households who had the highest income (over $100,000) actually went up from 50% to 50.3%, with most of this gain going the top 5% of households (making more than $180,000) who saw their share of income go up from 21.5% to 21.7% of total income. The actual share of income going to the most well-to-do is probably even greater, as capital gains (income from sale of land, businesses, stocks, bonds, etc.) are not counted and non-wage and salary income, such as interest and dividends that mainly go to higher-income households, are more likely to be underreported.

This growing inequality is no surprise, since the government bailed out the big banks while millions of homeowners have been foreclosed. Corporate profits and the stock market are back to levels from before the financial crisis began in September 2008, while there are still 5.8 million fewer jobs, more than a year after the recession officially ended. College administrators are getting big raises while workers and classes get cut and student fees are at record levels. Military spending is up while spending on education is down. The list goes on and on, as the rich try to put the burden of the crisis on working people. This ‘deficit reduction’ proposal is just one more scheme to make the rich richer and the poor poorer.

#UnitedStates #EconomicCrisis #SocialSecurity #BarackObama #DeficitCommission

Deb Konechne, of the Minnesota Coalition for a People’s Bailout and the Network to for to Fight for Economic Justice, states, “The anger about a lack of jobs is growing and our call to fight back is getting a great response from the unemployed.

The leaflet from the Network to Fight for Economic Justice reads in part:

“Every week hundreds of thousands are being pushed off the unemployment rolls. In Washington D.C., the Senate Republicans spent weeks blocking two federal programs that give 73 weeks of unemployment coverage. The Democrats didn’t do much to help us, until the last minute. While corporate profits and Wall Street stocks go up, working people are stuck in the worst recession since the 1930’s Great Depression. Since the recession began in December of 2007, 8 million jobs were lost and 14 million of us are ‘officially’ unemployed – half for six months or more. 4 million more want to work but “stopped looking,” according to the government, and 8 million more work just part-time. Altogether, 25 million cannot find a job because of the economic crisis. It is not our fault. The system is broken. We are not just losing our jobs. We are losing health insurance, homes and sometimes spouses and children. Small businesses are closing left and right. Schools and libraries are laying off teachers and workers because of falling taxes. Unemployment has discriminatory effects too. We need to organize and fight back for our families, neighborhoods, schools, communities and for ourselves. Outrageously, Republicans in the Senate claim that extending unemployment benefits drives up the federal debt! These same politicians cut taxes for the rich and started two expensive wars. The federal debt under Bush doubled from $5 to $10 trillion, and now the politicians want to stick it to the unemployed by cutting us by $33 billion! Ridiculous! Some so-called ‘economists’ claim that unemployment benefits actually cause unemployment. They say that $300 a week is an “incentive” to not work. There are at least five unemployed workers applying for every one job opening. We fill out dozens of applications without getting a job. There simply are not enough jobs. The Republicans blocked the unemployment extension by using the filibuster. The Democrats could have stopped them at any time with the “reconciliation” tactic. But they didn’t. After hundreds of thousands lost UI, it took the replacement of a dead Senator for them to act. It is time for politicians to stop messing around, the people need to get together and fight back!”

#MinneapolisMN #PoorPeoplesMovements #Labor #EconomicCrisis #Unemployment #NetworkToFightForEconomicJustice

These dismal reports on home sales capped a week of bad economic news. On Aug. 19, the Department of Labor reported that new claims for unemployment insurance rose for a fourth week in a row, to a nine-month high of 500,000. The total number of people getting state or federal unemployment insurance topped 10 million. This level of new claims for unemployment insurance points to job losses in the private sector for the first time this year, on top of job losses at the local, state and federal levels of government due to budget cuts and the end of temporary census jobs.

With the housing and job markets in retreat, the threat of another downturn in the overall economy, or what economists call a ‘double-dip,’ looks more and more likely. While most economists still say that they don’t expect a double-dip, the fact is that most U.S. recessions show a pattern of an initial fall in the economy, a period of recovery and then another leg down to a new low.

More ominously, a double-dip took place during the Great Depression of the 1930s, where the economic expansion that began in 1933 was followed by another severe recession in 1937-1938, when the government stimulus was cut back. With the stimulus of the 2009 American Recovery ad Reinvestment Act largely spent and Republicans trying to block more federal stimulus at every turn, there is the growing possibility that a new downturn will worsen.

Last week the Federal Reserve, which bought $1.7 trillion dollars of government and mortgage bonds to save the financial system, voted to keep buying bonds to replace those bonds that are paid back. The Fed still has the option of buying even more bonds, pumping even more money into the economy. The problem is that most of this money created by the Fed is sitting in banks, which have more than a trillion dollars of “excess reserves,” i.e. money that they could lend out, but aren’t.

U.S. corporations are also sitting on record amounts of cash from their swollen profits made by cutting jobs and squeezing more work out of their remaining employees. At the end of March, U.S. non-financial corporations had almost $2.5 trillion in their checking and savings accounts and money market funds, a record high.

With another economic downturn looming and an even more pro-business, pro-rich government in the cards for next year, working people, trade unions and grassroots community and student groups will have their work cut out for them in the fight to defend our livelihood, homes, schools and communities.

#SanBrunoCA #EconomicCrisis #2009AmericanRecoveryAdReinvestmentAct