Investors continue to look for the bottom of the stock market. Each bear market rally inspires glee in Wall Street denizens. The theory reads that after a fall the recovery can't be too far behind.
However, the latest economic contraction has been global gathering speed in a terrifying downward spiral.
We are in free fall in regards to residential investment, industrial production, income, consumption and employment. Potential consumers are stuffing their mattresses hoarding cash against the rainy day. The FDIC already has paid out half of its reserve to insure bank accounts turning the rain into a downpour.
The economists emit a collective shudder at the free fall of GDP, exports, imports and capital expenditures throughout the world.
For years the Asians have saved funds for investment. With the failure of exports, excess capacity has reared its ugly head. The capitalists are closing factories and laying off millions of workers. Such woes are structural and will require years to amend.
Throwing newly printed money at fiscal imbalances is like pushing on a string. It doesn't go anywhere. The export-led growth that enriched the Chinese coast had little effect on the peasants in the interior. Still poor, they make lousy consumers.
The answer is to increase consumption demand in the hinterlands to offset the lost demand for exports a monumental task.
Similarly, the US labor policies during the past 30 years have beggared the working class [consumers]. As organized labor [unions] went into decline, they lost the means to bargain collectively for wage and benefit increases.
US wages have remained flat for 30 years more family members had to take underpaid jobs and most borrowed on credit cards or home equity just to tread water. They sank deeper in debt after the housing bubble burst.
As a result, the American workers are underpaid by a factor of 30% to 50%. This is a major structural injustice not easily corrected even by vigorous fiscal policy. It will take years for the labor movement to regain its collective bargaining power. Will the Congress resolve to return the 50% losses to the work force [consumers]?
The Employee Free Choice Act
President Obama has held back this legislation. It enables workers to choose to join a labor union and thus is a first step to loosen the 30-year stranglehold the corporations have held on workers.
The Republicans have vowed to fight to the death to neutralize this Act as well they should. The corporations wrecked the social order after 1970. On this basis they developed virtual license to steal. They robbed the middle class to reward the rich.
The Republicans raped and murdered the middle class [consumers]. The GOP gives aid and comfort to enemy combatants.
Justice for Ms Johnson is Vital to Justice for Us All
If we fail to promote justice for a PFC, how can we achieve liberty and justice for 300 millions of us citizens? Does anyone believe that PFC Johnson sprinkled lye on her genitals prior to her suicide?
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