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AdLib On August - 8 - 2011

Welcome to the new normal, it’s called high unemployment…and high underemployment. The hollowing out of the nation by Wall Street and Corporate America has progressed to a new level and it’s one that many Americans haven’t realized as yet.

Anyone who is looking forward to the time when major corporations will start hiring Americans for good paying jobs again in big numbers, are among those who don’t know what the “new normal” is for corporations.

There is no job recovery coming, at least not from the corporate world. The stock market could hit 20,000 and it won’t translate into many well paying jobs because a new dynamic has been adopted by corporations and proven effective. Corporations have learned how to operate by employing fewer Americans to work as full time employees and are enjoying record profits as a result. What corporate CEO would be interested in changing that?

This is not doom and gloom so hang in there and you’ll see some suggestions for solving this situation but before a problem can be solved, as they say in AA, you first have to admit you have a problem. And like an alcoholic, America, in general, is in denial. Corporations have been transferring the wealth of the Middle Class to themselves for decades. Simply put, they don’t want a Middle Class possessing the assets that could, and in their minds, should be theirs. A society of haves and have-nots insures a low cost of labor and an inordinate amount of power in society and government in the hands of the few who have enormous wealth.

Americans want to believe in the American Dream which corporations and their political arm, the GOP, preach about like evangelists. However, the biggest threat to it has been and continues to be the very same corporations and political party that hide their American-Dream-destroying policies behind their banners and balloons celebrating it.

This concerted effort by corporations to reduce American jobs isn’t new, it’s just been accelerated thanks to the economic collapse of 2008 that they helped cause…like being hit by a car then watching the driver rush over to you just to take your wallet before speeding away.

Over the past decades, as corporate greed chipped away at unions, pensions, health care, 40 hour work weeks, raises and upward mobility, the central pillar of the employment relationship was being chipped away at as well. That is, corporations were avidly seeking ways to shrink the costs of having so many full time Middle Class Americans as their employees. It’s not that corporations were unprofitable, it’s that the salaries, bonuses and stock options for top executives at those corporations became far richer when each quarter’s profits were greater than the previous quarter’s and hopefully exceeded expectations.

So, there first came a cocktail of corporate employment that gradually blended full time employees, part-time employees,  temporary employees and consultants.  The great thing about all of these categories of workers that aren’t full time employees is that they cost much less than full time employees, chiefly because health insurance is not part of the arrangement. Also, the more fragile, limited and/or temporary the employment relationship is, the more insecure the employee feels and the more leverage the employer has on freezing or reducing wages  (the “You can be replaced” arrangement).

Going into greed overdrive in the 2000’s, there was a corporate race to outsource employment around the world to countries with impoverished people who would work as virtual slaves for them, being paid a miniscule fraction of what a full time American worker would cost. Thus, the cost to corporations of providing humane working conditions and providing living wages disappeared.

According to the the U.S. Commerce Department, U.S. multinational corporations, which employ a fifth of all American workers, cut their work forces in the U.S. by 2.9 million during the 2000s while increasing employment overseas by 2.4 million. In contrast, in the 1990s, they added 4.4 million jobs in the U.S. and 2.7 million abroad.

ThinkProgress created the following graphic based on this info:

ThinkProgress’ insightful article also provides this graph based on responses from major corporations at their 2009 Strategic Outsourcing Conference, convened by these corporations to discuss how to send American jobs overseas in the aftermath of the 2008 economic crash:

So even before the financial crash that many of these same corporations participated in causing, corporations were bent on eliminating full time American jobs wherever and whenever possible. Then comes the crash and an economic slowdown does in fact take place. Corporations slash jobs as is typical in such times. Before too long, Wall Street and the major corporations recover but oddly, American jobs don’t reappear. Wall Street and corporations begin making record profits and yet oddly…American jobs don’t reappear.

Or maybe not so oddly if one simply refers to what corporations have been openly saying for some time…their plan is to keep reducing American jobs, never increasing them.

So, as usual, the numbers, facts and actual statements by the principal parties involved prove the GOP to once again be engaged in another dishonest scheme in the name of class warfare, to defraud Americans in order to further shift their wealth to the top 1%.

If corporations have made clear through their literal statements, their indisputable practices and track records and their sitting on $2.5 trillion right now that is doing nothing but staying in a bank, that they will not add American jobs if it is at all avoidable, the GOP’s representations for their policies can only be seen for the scams that they clearly are.

In fact, it’s adding insult to economic injury to methodically re-brand those who have made it clear they don’t want to employ Americans as “Job Creators”. This is not a coincidence, the Corporate/GOP PR machine loves using the Atwater/Rove tactic of calling things the opposite of what they are (calling the NAACP racist for decrying their racism, calling any attempt to block or reverse their class warfare against 98% of Americans, “Class Warfare” by Democrats, etc.). George Orwell’s “1984” isn’t fiction to them, it’s a how-to book.

We hear time and again, echoed by the corporate media/news outlets, that the reasonable and alternative path the GOP suggests to bring back American jobs is to cut taxes for corporations, let them bring money back into the US from overseas (where they’ve stashed it to avoid paying taxes on it) for free or with next to no taxation, reduce regulations on oil companies, Wall Street, etc. Even though these news stations and papers have all the facts in their possession that appear above, even though they know it is Corporate America’s position NOT to grow American employment instead of employment in other countries…they present these conceits unchallenged as if passing along a party’s propaganda without comment is what a responsible or impartial news entity does.

And then there’s my personal favorite of these manipulations, the biggest and most cynical lie, that corporations aren’t hiring or investing in the US economy because of “uncertainty”. If you don’t have your

GOP-to-English dictionary handy, here’s the translation: 

GOP to Plain English Dictionary



1. The state of not having all laws and taxes unfairly favor the wealthy and corporations over all Americans. “Job Creators aren’t creating jobs because of uncertainty.”

2. A false claim that can’t be disproved as a cause for corporate economic decisions or that can be claimed no matter how many concessions are made to corporate greed: “We gave them 10 years of Bush Tax Cuts, decades of stagnant employee wages, tax credits for shipping jobs overseas, pork barrel bonanzas, no-bid contracts, trillions of dollars worth of tax loopholes, subsidies to help them pay the expenses of their own billion dollar profits business and cut the deficit as they wanted but the reason corporations aren’t hiring is because of uncertainty.” 

As we all know, the American economy has always been certain in every decade except this one. In the 1960’s, there were no leadership, economic or social conflicts to make things uncertain, nor in the 1970’s, 1980’s, 1990’s or the 2000’s. No market bubbles, no boom and bust, no attacks or wars, nothing but stable economic times for all. If only we could return to the halcyon days of Gerry Ford’s Whip Inflation Now (WIN) buttons, corporations would be hiring Americans like mad.

With things as they are, any further laws that give corporations one penny more than they are getting right now, unless it mandates hiring American workers at decent wages, is nothing other than continuing the greatest transfer of wealth in American history from the many to the few.

As the saying goes, if you don’t know you’re in a war, you’ve already lost.

There is a preponderance of economic and historical evidence to prove that no matter how much money Wall Street and corporations have, no matter how you cut their taxes or give them subsidies and no matter how high the economic indicators or the Dow Jones Industrial Index go, they simply will not create anywhere near the amount of decent-paying jobs Americans need to sustain a middle class.

However, there are other directions to go to create those jobs. Here are a few suggestions circulating around the White House, the web and others that come to mind (please feel free to suggest your own as well) that could turn things around to one degree or another:

1. A New WPA/An Infrastructure Bank 

Boehner says he got 98% of what he wanted in the Debt Ceiling deal and with the global market crash and US credit rating downgrade that followed his brilliant economic planning, he probably got the remaining 2%. Okay, we’ve tried it their way again and again, Bush Tax cuts, deregulation and now budget cutting in the middle of a jobs recession.  It would be an exercise in futility to try and pass another stimulus bill with Tea Baggers controlling The House  but if Obama’s support for an Infrastructure Bank was brought to fruition, which would not add to the deficit but reduce it as a revenue generating service, a new WPA program could be fired up across the nation and good paying jobs, repairing this nation, could be generated swiftly.

2. Tax Credits to Businesses for Hiring Americans/Revoking Tax Credits for Outsourcing Jobs Overseas

Currently, US tax law pays corporations to move American jobs to other countries. In a jobs recession, these tax loopholes need to be closed permanently. Even if the GOP can’t find or be pressured into finding that crumb of patriotism or compassion needed to agree to closing those loopholes, maybe they can be convinced into giving businesses more tax cuts?  Pres. Obama has proposed such a tax credit for hiring those who have been in the military which is good but why not provide it for all Americans? For the many reasons stated above, I doubt corporations would find it as appealing as hiring more people in their sweatshops elsewhere in the world but for small and local businesses, it could be very effective.

3. Enhanced SBA Loans for New Businesses

A real job engine for this nation may be the growth of new businesses and industries that create and innovate. The consumer side of the economy is shaky so startups will need to be able to develop and sustain themselves for a while which is where the SBA could come in. This isn’t a giveaway nor should standards be loosened to allow fraud or exploitation, it could be an enhanced loan program that offers greater and more loans and delays repayment for a period deemed sufficient for the consumer economy to have recovered sufficiently. These would be loans that are repaid with interest so this would represent increased revenue to the US, not debt. The self-sustaining aspect of this is that as new and viable businesses are supported, they are creating good paying jobs across the nation that are helping to build that very consumer base they need to flourish. The SBA could even set up a networking between companies it lends to so they can find opportunities to work together to support and sustain each other.

4. Leverage the Bush Tax Cuts Expiration into Killing Loopholes for the Wealthy and Corporations

A natural instinct for Democrats is to insist on finally killing the Bush Tax Cuts for the wealthy. Of course, this would feel to Republicans like having their tea bags cut off but in reality, how much of a win would it be to increase the tax rate the wealthy and corporations are technically supposed to pay but in reality, like Exxon and GE, they could still continue to pay no taxes because of loopholes, subsidies and tax credits? The GOP whines about the tax burden on the wealthy but as recent statistics show, those wealthy people who can’t avoid paying their taxes as others do, only pay on average 18% in federal income tax. So, put aside the gross number and focus on the net. If Obama and the Dems do so, they can paint the GOP into a real corner. They could even propose lowering rates slightly from where they are, below the Bush rates in exchange for removing the loopholes and tax credits for the wealthy and corporations.  Even if the top tax rate was lowered to 29%, GE and Exxon would go from paying zero to 29% of profits. The average wealthy person would go from paying 18% to 29%. The huge boost in revenues would allow for funding the social programs the Deficit Deal might otherwise cut, reducing the deficit and providing revenues for infrastructure repair and other job creation programs (assuming that in 2013, when the Bush Tax Cuts would expire anyway, the Dems re-take the House and keep The Senate and White House).

As all of the above reflects, it seems likely that the only sizable Middle Class job creation that there can or will be, won’t ever come from major corporations again, it can only come in this era from government and small and startup businesses that aren’t the committed adversaries of The Middle Class that major corporations have shown themselves to be.

Written by AdLib

My motto is, "It is better to have blogged and lost hours of your day, than never to have blogged at all."

64 Responses so far.

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  1. jjgravitas says:

    We need a new “-ism” for this. It seems to help when one can boil an amorphous problem down to a single word. For example, all this seemed to take us over while we were spending all our national capital in this fight against the “terrorism” that we were “terrified” would destroy us. Which, ironically reminds me of a quote by a famous Democrat: “There is nothing to fear but fear itself.” No surprise that phrase wasn’t passed around during the Bush administration. Republican rule only thrives in an atmosphere of fear and panic.
    Another great POV for AdLib. Eat the rich!

  2. bito says:

    Help wanted:

    VanJones68 profile

    VanJones68 Are you progressive, creative, ambitious & want to make a difference? Apply for the #AmericanDream Fellowship.
    http://t.co/5NESkmt #1u #p2

  3. Jenuwin says:

    Excellent article Ad Lib! Now I am off to look for job and will keep ya posted as to how it goes!

    • Chernynkaya says:

      I wish you the best! Go get ’em.

      My 20 year-old step daughter just spent 8 hours standing in line to apply for a minimum wage temp job, and one she’d worked at before. Of course, it was for Knott’s Berry Farms’ Halloween Haunt, so I guess you can check that off your list. 😉

      (Oh, she got the job!)

  4. AdLib says:

    Coincidentally, MoveOn.org and Rebuild the Dream came out today with their Contract For the American Dream, addressing many of the same issues and solutions this article and our members mention (quite a potent think tank we have here, folks!). Here’s their ad:

    Putting aside my issues with MoveOn, this is exactly the kind of thing we’re talking about here and that the Dems need to get behind. Time for a Democratic Contract For America that will give voters a clear choice between what Dems and Repubs will do if they win in 2012.

    There is one thing that Obama can adopt that can counter much of the bad times surrounding him, a detailed vision for how we can fix the problems in our nation that Americans will support. That is an advantage the Repubs won’t have in 2012.

    • Emerald1943 says:

      That is something I was hoping to hear more about today when the President spoke. We need to hear his plans, especially what can be done about jobs. That is, after all, the #1 priority for the American people…not the debt or the deficit or the environment. The only things I heard him mention were tax reform and “adjustments” to Medicare. While important, this is NOT what the people want to hear.

      Even if he puts a jobs plan out there and the rethugs fight him, that will be a perfect issue for him to use in the campaign. In this case, he cannot afford to wait for the Congress to come up with a bill.

      • Sad to say, but it was WWII that made us the most prosperous nation on earth. The massive manufacturing of war materials brought about massive manufacturing of civilian goods.
        We don’t manufacture much these days. What replaces manufacturing for economic growth?

        • bito says:

          KT, I saw your Senator on the floor saying that (I’m unclear if he was just talking about OHIO) that in the ’90’s 27-28% of GDP was manufacturing and 11% was financial services, today that ratio is flipped. How many middle class jobs does the financial sector provide compared to a steel mill,auto plant, PV solar plant or wind turbine plan?

          • Manufacturing in Ohio has suffered quite a bit in the last ten years. We really could use some renewable energy manufacturing here and in many other states as well. There ARE a large number of jobs in the medical field.

            • Emerald1943 says:

              Too bad he had to go North! That must have been painful!

              No grits! :-)

            • Em, I had a good friend from NC that worked in the furniture business. He had to come north to get a decent job. Now, even that is shaky.

            • Emerald1943 says:

              KT, here in North Carolina, we have been devastated by outsourcing. First it was the textile business. I remember when I was a kid that there were huge textile plants in my home town, making socks, underwear and upholstery fabric. That is all gone, moved overseas for cheap labor.

              Then, the furniture industry just upped and moved out. My home town of High Point was “the Furniture Capital of the World” with furniture shows several times a year. Buyers from all over the world would come, bringing lots of money to our local economy, as well as sales of the furniture itself. The manufacturers are mostly all gone now. Many of these plants employed hundreds of people. I don’t know what the people have done for jobs. There was very little else there.

              A sad state of affairs! Now we buy Hanes underwear made in China…and cheap particle-board “put it together yourself” furniture from WalMart…also made in China. It’s a pity!

    • foodchain says:

      Hey AdLib; a strong, forward looking piece. Obama promoted a similar set of points this afternoon. I appreciate his chastising the “stuck” legislators on both sides--although consensus does seem to put it on the GOP--and his commitment to governing the whole instead of only his party.

      MoveOn has been productive and seems to play the ball where it lies better than some. The next year should be very telling. This could well be the best of times and the worst of times for this country. The richness of our complexity is exciting, a collision course of historic differences. I hope we serve ourselves well. My confidence is not high that we will do this with any sense of grace.

      • AdLib says:

        Thanks Foodchain!

        I saw Obama explain that he will be coming out with a specific proposal he wants the Super Committee to consider, that is exactly what I and many others were hoping to see so I am very pleased about that.

        MoveOn has jumped on the self-destructive bandwagon recently by attacking Obama mercilessly but unlike the Purists, I don’t disqualify working with others when we disagree with their stands on other issues.

        I do hope this is something that Dems and Progressives can come together on, putting aside the purity tests and overheated hatred of Obama and supporting and advancing the values all of us share.

    • bito says:

      AdLib, let’s hope that ‘MoveOn.org’ can and has moved on with their coupling with Van Jones and his “American Dream” movement. They have the ability to be problem solvers and not just fund-raisers.

      I want to give major kudos to our Planeteers for not just raising the the problems, like the above, but for them presenting solutions!

      • AdLib says:

        Yes Bito, sorry for leaving out that Van Jones and his American Dream movement are working in concert on this effort.

        Sorry if I’m being redundant but I must express a bit of pride in the community here for putting together in less than a day, a combination of proposals that compare favorably with what this substantial coalition has put together in their Contract For The American Dream.

        A pretty impressive think tank here,indeed.

        • Emerald1943 says:

          Adlib, PPOV is such a unique site and one that I’m so proud to be a part of in my own limited way. I have found some of the most intelligent and astute people here. The Planet community never fails to stimulate my thinking and always challenges me to delve deeper into the issues.

          Although I have never met any of our members face to face, I feel that I have made many dear friends that I care deeply about…and who care about me. They have never failed to support me personally when I was in need. I hope I can return the favor if it is ever necessary.

          You and the other founders of PlanetPOV truly have something to be proud of. I know that PPOV will only grow and prosper in the years to come. I look forward to being a part of that growth!

          You hit the nail on the head…”a pretty impressive think tank indeed”! :-)

          • AdLib says:

            Emerald, if I could frame comments and put them in the PlanetPOV lobby for all to see, this one would have a place of honor on that wall.

            Thank you so much for the wonderful thoughts. The sense of real community that’s missing out there far too often, is alive and well here at The Planet, thanks to you and everyone else here who makes it so.

            • Emerald1943 says:

              Adlib, that is sweet of you to say, but I mean every word of this. When I was grieving for my dying sister, the Planet community prayed and I felt it. The well wishes were so important to me and I will never forget the kindness of the members. I am fortunate to have found you and all my friends here. It is a most unique group!

              Sorry this is off topic…now, back to politics! :-)

  5. bito says:

    A thoughtful post and combined with the many comments here on The @PlanetPOV (that was for the Google crawl 😉 ), I have read some of the best ideas compared to anywhere, anyone, including these two:

    President Obama: Our Problems Are Eminently Solvable

    Contract for the American Dream

    I do disagree with raising the gas tax at this time because it is regressive on to many working people at this time and still like my idea of the introduction of investing in infrastructure bonds. They can be priced as little as 20 dollars to 20 million dollars to give everyone a chance to make an investment in the future. With close to 2 trillion dollars of investment money sitting on the sidelines, from Union Building Trades to School Teachers pensions, it would offer many to personally invest in the future.

    Declare war on our crumbling infrastructure (see Sue’s post below) and sell them as like we have in the past as War Bonds.

    Great Post, Sir! And Great comments Planeteers!

    • foodchain says:

      Hi Bito, I must need a vacation. I wish I felt my solutions would be effective. In many ways this is a very exciting time--a crescendo of thoughts, the disharmony before resolution, the dark before the dawn. If we can organize ourselves, we have enough will and numbers to change. I am more confident that our malcontents are closer to coming on board that the GOP’s

      • Emerald1943 says:

        Hi foodchain!

        It is an exciting time! I’ve found myself on a roller coaster during this whole debt ceiling debate. After the bill was done last week, the havoc that it caused kept my head spinning. Democrats that I had long trusted came out strongly against the President and made it difficult to get to the truth of the matter. I felt much better after reading the agreement on the White House website and realizing that the deal really wasn’t all that bad. In fact, it was the best the President could have gotten under the circumstances.

        Where I have problems now is with the President’s insistence on “bipartisanship”. I know…the repubs have the House, but I feel that he has not come out showing much passion, something that I think the American people would like to see. I don’t want him to lose his cool, but today, his speech was a bit of a downer. He let the baggers and S&P off the hook with barely a mention.

        Meanwhile, Fox news continues to bash him 24/7 and there is no answer to their lies and distortions from the White House. It’s as if the voice of the LEFT has been effectively silenced. As Adlib mentioned earlier, even Andrea Mitchell asked a member of the Congressional Black Caucus “if the Democrats were now ready to compromise?”

        Even MSNBC is getting into the Obama-bashing business!

        I do agree that we are closer to unity within our party than the repubs. We just need to get control of the message and make sure we are all on the same page.

      • AdLib says:

        I think you’re onto something there. I am optimistic that Dems can come together far easier than Baggers and the rest of the GOP.

        In general, Progressives are about doing what’s best for the many over the few, which can lead to choosing altruism. The Right is about serving oneself or the few over the many (then Trickle Down works everything out). It’s a selfish philosophy which can work to unify or as we’ve seen recently in the House, divide severely.

        I would bet on Dems coming together more powerfully than Repubs if either can at this point.

    • AdLib says:

      Thanks so much, my friend!

      With gas prices going up and down far more than 2 cents a day, I don’t think 2 cents would be a big impact but you are right, it is a regressive tax and a progressive one would be preferable. I would still support this one if another wasn’t possible.

      As to that, your bond proposal is a great one and in the spirit of the Infrastructure Bank. Your point about unions and pension funds investing in such bonds is very strong, they would be investing in the financing of their members jobs while making money for them and improving the national infrastructure. A real win-win!

      Your kind compliments mean a lot to me, thanks for them and I’m right with you on applauding the creativity and insights our fellow Planeteers are sharing on this, really remarkable!

      • Emerald1943 says:

        Hey adlib, I wrote this a few days ago when bito first mentioned the idea of bonds.

        “I think the infrastructure bonds idea by bito is a good one. I’m no whiz kid when it comes to finances, (that will be apparent!) but would this not be a good way to raise money quickly? My mom told me about war bonds during WW2. They were sold to the American people as the patriotic thing to do to support the war effort. I could imagine that a great deal of money could be raised with a good PR campaign…”Put America Back to Work – Buy Bonds” Small denominations could be offered for individuals just wanting to contribute a little money to the effort. I could imagine a PR/advertising firm doing a huge blitz urging people to buy bonds…”Let’s Fix America”…that kind of message.

        Maybe this is too simplistic, but you know that this Congress is NEVER going to allow any spending for anything that will help the people or provide the President with a win. In fact, I believe that monies for infrastructure are part of the discretionary spending cuts in this latest bill. But ALL ideas should be explored.”

        I think it might be the QUICKEST way to raise some money for roads, bridges and schools. By the time we wait for Congress to have committees, hearings, briefings, more hearings, debates and more debates, the roads and bridges will be gone! How could this be done?

        • AdLib says:

          This is a fantastic idea! And may I add to it? Offer a tax deduction for the investment, like an IRA contribution, up to a maximum amount, maybe $6,000 as with an IRA.

          The quicker and bigger this amount could be, the more exponentially its economic impact would be.

          As Bito mentions below, Congress may not be required for such a thing, Treasury may already have the authority to do this.

          States could be encouraged to help promote such bonds too, considering the money that would come back to them in the forms of purchases and sales tax, jobs, income tax and the value of improved infrastructure.

          I’ll throw a name for the bonds out:

          “AmericaWorks Bonds”.

          • Emerald1943 says:

            Hey Adlib, I like the idea about the tax advantage…and the name! :-)

            The name could also be used for the states like “North Carolina Works”.

            If we keep coming up with good ideas, we can have this program ready for Treasury in a couple of days! Certainly quicker than our esteemed(?) Congress!

        • bito says:

          Ha, a convert to my idea, but you have it exactly right in my way of thinking, no hearings in Congress, just have Treasury announce a new “savings bond” program dedicated to investing in “Build America Bonds.” They can be structured the same way as the newer bonds were structured a minimal interest plus inflation. and they can be purchased at increments from 20 dollars to a 10 million dollars and use all your slogans!
          ”Put America Back to Work – Buy Bonds”

          You have truly fleshed out my simple idea Em, and great job!

          • Emerald1943 says:

            Bito, why not use a Facebook challenge to sell bonds on their site? Users could opt in to participate in a contest to sell bonds to their friends with a prize going to the winner. I can imagine millions of bonds being sold that way.

            Banner ads on FB go without saying…also Google. I would bet that they could be coerced into donating the ad space.

            More flesh! :-)

          • Emerald1943 says:

            Hi bito!

            I’ve been known to do a little advertising/copy writing in my days working in New York. I like fleshing out ideas like this.

            I could just see posters like the old WW2 “Rosie the Riveter”. We could even use celebs to go out and sell the bonds like they did then. During the war, movie stars would board trains and travel all over the country, making stops to publicize and sell the bonds. I think this kind of campaign would be a slam dunk! It sure would be fun to work on!

            ADDENDUM: The train thing is perhaps a little outdated! But I think you catch my drift. Using a smart publicity campaign with some of Hollywood’s finest couldn’t hurt! I think you’ve really hit on something great, bito! Good thinkin’ there, buddy!

            • bito says:

              Em. a gem of an idea and you would be hired for the PR if I had was able! I guess in this day and age we would alo have to ad a a banner ad to every gooogle search but you are on the right track IMHO.

  6. agrippa says:

    Adlib, that is a good article.

    I do not see a good way out of this. A real and strong stimulus was not passed. And this deficit reduction business is wrong. This did happen before with FDR. That administration did pull back from “pump priming” in 1937, to ill effect. It boils down, I think, to an article of faith about deficits: they are always bad.
    It is hard to go back to more stimulus now. We are kind of stuck right now.

    I do not think that much of anything positive is politically possible right now; so I see years of economic stagnation. High unemployment and no growth: a lost decade.

    Wall Street and multi national corporations do not care; manufacturing has been largely outsourced and for that reason alone there should not be much job growth.

    It will take a long time for ordinary people to see all this. Most are too busy trying to provide for themselves and their family.

    • AdLib says:

      I’m not giving up the fight even though you are right, it’s not a probability but only a possibility that anything positive can be accomplished before the last week of 2012 (when the Bush Tax Cuts expire).

      I don’t have any expectations that the Baggers will ever become sensible or reasonable but in light of the market crashing, which is hammering many corporations’ stocks, I do think it is possible that they put more pressure on Repubs to work something out on taxes or at least some of the kinds of revenue and job programs described throughout this discussion.

      It is a challenge to get the message across, one of the reasons I thought this message needs to be hammered in, corporations and the wealthy will never bring back jobs no matter what you give them. Fuck them, get them to pay their fair share of taxes and let government use that money to bring back Middle Class jobs.

      • Emerald1943 says:

        I agree with you, Adlib! Those jobs that went overseas are not coming back. The factories have been closed and shuttered…over 58,000 factories gone. I say hit them where they have hit us…in the wallet! Tax them if they are US corporations. Use the money to buy the properties and re-open factories for green industries. Facilitate the SBA to finance these new companies. Enable co-ops to form with employees owning and operating the firms.

        As far as pressure by corporations on the repubs is concerned, I’m no longer sure that this will have much effect. During the debt ceiling debate, there was a lot of pressure on the baggers by their big business donors as well as the US Chamber of Commerce who didn’t want to see us driven off the cliff. We can see how well that worked out! The baggers are completely unreasonable and I think we can see that they will not bend to any pressure from anyone. If the US Chamber couldn’t do it, I don’t know who could.

  7. ADONAI says:

    1.)Great article AL. The two graphs you threw in from Think Progress are worth a thousand words on their own.

    2.)Maybe we should wake up from the American dream. Not everyone is gonna own a house with a white picket fence and a new car every 5 years. That America only ever existed on film. I’m not saying lower your expectations so much as adopt realistic ones. If you have a job you like, a place to stay, and money to live on, what more do you need? Who cares if you rent? Most Americans do. You wanna counteract a crooked, volatile housing market? Don’t even get involved. You can find a town house just as nice and you won’t owe your entire life to a bank. Just my opinion though.

    3.)People. The people need to be ready to fight. We have laws and regulations on the books that could fix a lot of our problems, but there’s no force behind them. They either don’t go far enough or are weakly enforced. Your Congressman/woman isn’t gonna care until you care. Many of them, the good ones, desperately want you to care.

    4.)Trade deals. I see these have already been touched on. They have to be rewritten. There is no free trade here, and definitely no fair trade. The deals should be weighted to favor the American worker. Not a faceless multinational company.

    5.)Nationalize the manufacturing industry. Buy all the factories and machines and give them to the public. Americans WILL put Americans back to work. We own the products, we own the machines making them. People will work again, our economy will get back the giant chunk we cut away from it, and we get ALL the profits.

    6.)China. China’s currency manipulation(which I admittedly know very little about) is what brings American companies to them. Not only is labor cheap but profits are larger and production cheaper as well. But that will change soon. I say we ignore China for now. They will fuck themselves up in due time. Remember the Great Depression? Well, good luck with that China.

    7.)Taking away corporate tax incentives will only make them more inclined to seek labor elsewhere. Corporations are legally bound to make profits. Maybe they should change that for starters. But that won’t really matter if we assume control of the manufacturing base. My goal is to either have corporations conform or leave the country. We’ll sign some deals with them but it will ALL be on our terms.

    But since the ideas people are proposing here will require a momentous period we haven’t seen in this country in decades, I figure we’ll just talk about taxes for awhile and pretend that’s solving the problem.

    • choicelady says:

      Adonai -- NO do NOT nationalize manufacturing. Centralized control from the government is another form of corporatism as inefficient and lousy at long term thinking as private corporations.

      Decentralize and let working people employed at ALL plants become the owners AND managers. It has been proven over and over that the 11,000 companies with this form of operation are THE most profitable in America and have the greatest stability. It’s not artisanal bakeries -- it’s Southwest Airlines. It’s WinCo and HighLow groceries. It’s Sleep Train mattress stores. Big or small, these grow, stay here, invest in their people, pay decently, and keep money in the communities.

      All of the suggestions AL has are excellent, but this is never mentioned. We PAY companies when they go OUT of business by letting them do an accelerated depreciation. Been the “cash cow” for decades. But if employees want to buy them -- it’s full market value. Well nope -- if you write down a firm to value it at $4.98, that’s the SALE price, buster. So we need to change that so that companies have one of two choices -- sell at fair value OR write down, but not both. If you write down (and I’d argue that’s stupid -- rewarding a business with our tax money for failing) then that IS the value and the price of the firm.

      TAx laws matter. They change every calculation. AL I would disagree that ALL outsourcing is inevitable. It’s not. Canada reversed its outsourcing by noting that keeping local supplies local was VASTLY more efficient, and they don’t subsidize the runaways. We need to stop doing that. Divert the Overseas Investment Corporation money that pays companies to relocate to keep companies here. WORLD of difference. Some will still go -- but not on our dime. And most will stay because without the subsidy, the profit’s not there.

      But mark my words -- if the next president is Rick Perry or worse, NONE of this will happen, MORE jobs will float away, and we will become their dream nation -- a Christian Banana Republic.

      Canada -- here I come.

    • AdLib says:

      As for The American Dream and People, I do think that it would be a positive thing if people put less faith in a fantasy of what their lives will become one day and more focus on what it is today and how it can be improved, both short term and long term. Then, each person’s ideal of the American Dream could be far more realistic and achievable.

      Otherwise, it is a fable meant to pacify those who aren’t wealthy and make them sympathetic to the wealthy (“One day, you too will be wealthy! In America, it can happen to anyone!”).

      Agree on trade deals, paying $1 more at Walmart for plastic crap can put thousands a month in the pockets of unemployed Americans.

      Nationalizing manufacturing seems fraught with problems and conflicts. However, having the SBA set up an enhanced or new fund as I mentioned could provide for entrepreneurs to borrow from the government with favorable terms, to buy manufacturing plants and other facilities to build up business.

      China’s financial policy should indeed be addressed though it is a bit tricky because of our economic entanglements with them as our banker. Still, I do agree with this.

      I wholly disagree with #7, taking away subsidies and tax loopholes from Exxon, GE, etc., who currently pay zero taxes, won’t send them moving their entire operations out of the US, it’s an idle threat which should be ignored. Secondly, if trade deals and tariffs are implemented, there should be terms financially punishing American corporations with fees and tariffs for fleeing the US then trying to export their goods or services back in. After all, we have nothing to lose if they’ve pulled their company out of the US, all jobs and tax revenues would already be gone.

      When it comes to corporations, government is foolish and its efforts are futile when using the carrot, with them you need to use the stick. Make it cost them money and that will make them back up and change their tune.

      • ADONAI says:

        I don’t think just taking away the tax incentives will send them running either. i kinda think it’s meaningless in the long term. I want to break them. And if they leave, they leave. time to put the dogs back on the leash.

        And, honestly,I have to agree with you about nationalization. I know I blew right past several steps before even getting anywhere near that. And the idea you’re talking about sounds like a good one.

        And most definitely more stick. GOOD LORD more stick! One that would make Teddy R. say “Damn! That’s a big stick!”

    • agrippa says:

      Adonai, I noticed your number 6. China will have serious troubles of their own down the road.

      • ADONAI says:

        Indeed agrippa. I think the new government realizes this too but I don’t think they have the time to get the consensus they need to really address it.

        I don’t wan tot see another country suffer an economic crash but it will seriously hamper their ability to “overtake us economically” as many think they will.

        Which I still don’t get. Not only are we worth more than China, we’re worth more than them and every other country combined.

        China has solvency problems coming down the road. Today and for decades to come we are the very best bet for creditors and investors.

        From a purely credit standpoint, defaulting would not have killed us. many.MANY people would have suffered but we would have gotten back on course. Creditors would come back because we are still the best bet plus we would then be free of debt. China’s debt will eat them up. Especially when their sizable elderly population retires.

        But that’s just one of many opinions I’ve read on the future of all this. it seems to make the most sense though.

        • bito says:

          Adoni the US economy is far from “worth more than them and every other country combined” and China does not have major sovereign social security or health care program for everyone including the elderly. They also don’t have a currency that is openly traded on the world markets. They set the value of the Yuan, not the markets or bond holders.
          Agreed, the US economy is close to 2-1/2 times larger and they are very dependent on the health of the US and others for their exports, but they do have a controlled economy and their solvency on the world market being questioned doesn’t exist.

          • ADONAI says:

            bito, The only people questioning our solvency is us.

            Don’t see anyone turning our money down. We still have a top tier credit rating.

            China just doesn’t have the debt and deficit issues we do. Yet. They will though.

            And if China collapsed, the world would move on. If America collapsed, the world stops spinning. Too big to fail.

  8. SueInCa says:

    Your number 1 is near and dear to my heart. As you drive around even your local areas all you have to do is look around and see the crumbling infrastucture. What is escaping a lot of peoples’ attention is not only the security threat this proposes but the potential for major man made disasters.

    I bet a lot of people would be surprised to learn that if a major earthquake struck in the right area in Northern Ca, the potential for the south to lose their water supply would be catastrophic. The delta levees are so fragile that a good earthquake would cause the levees to break, allowing the salt water from the SF bay to flood the region. Not to mention the tragic loss of crops that feed the nation. Things are so precarious that the ranchers in this area are patrolling their own levees and shoring them up as well as they can.

    Our ports are not protected which allows for greater possibility of shipping containers entering with WMD’s, deadly viruses or any number of security risks.

    Bridges are crumbling, sanitation/sewage plants infrastructure is crumbling. There are water treatment plants all over the country with aging and crumbling pipes. One breakage could cause flooding of a nearby city up to 10 feet or more.

    Dams are aging and the proverbial chewing gum in the break analogy is probably not far from the truth.

    Other countries are far ahead of us in speed/bullet trains. How much more convenient is it to take the train from London to Paris? And how has that opened new worlds to a lot of people?

    America was once the leader in industrial revolution then we forgot Alexander Hamilton’s 11 point plan and slowly have faded into the abyss. There is still time to change that but not until our leaders start thinking seriously about main street and not just paying lip service to it.

    If you want to read more about our infrastructure, Dr. Stephen Flynn has a great book: The Edge of Disaster. He is the current president of the Center For National Policy.


    • AdLib says:

      Great points and details about infrastructure, Sue.

      It is really outrageous and frightening to realize that such an enormous disaster, the destruction of the water supply for half of the state of CA…is just primed and ready to go without any efforts being made to prevent it.

      Then again, it’s CA, what are the chances of having a strong earthquake out here.

      And as you’ve pointed out, once seawater spreads into the system, you can’t just fix the breaches and problem solved. The fresh water supply is contaminated.

      Along with the other infrastructure issues you mention, it’s clear that where we are as a nation is reflected by our infrastructure. The accomplishments of the past have been neglected and allowed to crumble, both literally and figuratively with regards to our society and government.

      We’ve had one wake-up call after another, I sure hope the snooze button’s not hit this time.

  9. Chernynkaya says:

    AdLib, what a terrific post. Really first-rate! In addition to those proposals, there are a couple of others that I’d like to see, and that might be possible. (Actually, I could probably think of more, but for now I’ll just stick to those at least in the realm of the possible.)

    —Aid to state and local governments: Most states have made huge cuts and those cuts effect local municipalities too. The debt deal will make that aspect worse. Even modest help from Washington could help states according to Moody’s.

    “States could maybe rescind some of the budget cuts they’ve already made, rehire some of the workers who’ve been laid off. And by 2013, state revenues will already be recovering.” With the expiration of the stimulus, states lost significant federal matching dollars for Medicaid, for instance. “In an ideal world, you could provide the Medicaid match in the short run and make whatever structural changes” to save money down the road, says Chad Stone, chief economist for the left-leaning Center for Budget and Policy Priorities.

    —Maybe the Free Trade deals: Labor unions say that such free-trade deals will take jobs away from Americans. I think they are probably right, but some economists say that the failure to pass the trade agreement is simply driving business — and jobs — to other countries. The White House claims they will create some 70,000 jobs. So I don’t know, but think we need to think about this.

    —Surface Transportation Funding: This was an idea I heard Ray LaHood talk about when interviewed about the FAA debacle. He said that highway jobs are the fastest and easiest way to create jobs immediately. A bill reauthorizing spending on surface transportation — which would help build roads, highways, and the like — is set to expire in September. The House GOP wants to slash federal spending to 35 percent less than Fiscal 2009 levels, but Barbara Boxer has a two-year plan to spend $55 billion a year. Boxer’s proposal would require revenue beyond what’s in the Highway Trust Fund, which receives money from the gas tax,and I’d like to see the gas tax increase just a few cents to make up that difference. I know people hate the gas tax, but often when it’s explained as just pennies, it might be acceptable. I mean, couldn’t we say, “For only two more cents a gallon, we can create thousands of jobs.”

    And this is not a job-creation suggestion, but Chris Matthews actually came up with a good idea about how to sell the Infrastructure Bank.

    Take pictures of the bridges
    Name the Districts where they are located
    Name the elected Congress-people from those Districts
    Ask them point-blank if the safety of their constituents, and of their own
    families, is truly a priority for them
    Consult local engineers as to how best to repair the unsafe bridges
    Contact local media outlets -- newspapers and television -- to print the
    pictures and do high profile stories on the safety issues and need for repairs

    In other words -- force members of Congress to say “Yea” or “Nay” that they are willing to let school buses filled with children continue traveling on these bridges.

    “Yea” or “Nay” whether a catastrophe is more acceptable than FIXING the dang things.

    The publicity will rile up all Americans to say that such a catastrophe is NOT acceptable.

    Take it to the very people who are driving on those bridges. The people will demand that funds be made available to get to work doing what we all know needs to be done.
    And jobs in all these places will be immediate.


    Again, just want to say this is such an excellent post!

    • AdLib says:

      Cher, thanks for the kind words!

      Aid to state governments probably won’t have a chance of being increased until Dems retake the House.

      Free trade deals usually turn out to hurt employment in the US, it seems like we lose higher paying jobs and get fewer lower paying ones in the end while corporations get wealthier.

      As for the Surface Transportation funding, I REALLY like this one! Even in these times, if the President asked them to pull together and pay two cents a gallon to create thousands of jobs and repair our infrastructure, I think people would support that.

      BTW, the bar here is set so high by your marvelous work on The Daily Planet, Kalima’s on Morning Blog, Khirad’s on the Middle East Updates, Bito’s on TO/OT and our Twitter account and the many thoughtful and brilliant articles and comments people share here daily.

      It really is all of us together at The Planet who create the mass that gives the work here its gravity. 😉

    • Emerald1943 says:

      Cher, we can always count on you to come up with some sensible suggestions! I particularly like going out and looking at the condition of the roads and bridges an easy one. Almost everyone has a cell phone with built-in camera. We should use them!

      And while we are on the subject of outsourcing and cheap goods coming back into America, I received a very disturbing email from Change.org concerning those sweatshops where brand-name clothing is made and the horrible conditions forced upon the slave labor they hire.
      “Thousands of Change.org members have already spoken out against abuses at what’s
      becoming known as the “rape factory” in Jordan.

      “We only went to Jordan to earn money to help our families; we had no idea that
      factory managers would rape so many of us young girls,” said a young woman who goes
      by the name Nazma to protect her identity.

      Nazma is one of the dozens of Sri Lankan and Bangladeshi young women who have been
      sexually assaulted by supervisors at Classic Factory in northern Jordan, which makes
      clothes for American brands like Walmart, Target, and Macy’s.

      Leading up to next week’s trial against a Classic supervisor charged with rape —
      the first such trial — managers are escalating abuses. Supervisors are locking
      victims and witnesses in the factory, threatening and intimidating them to ensure
      they will not testify.

      And although the Jordanian government promised that Anil Santha, the manager accused
      of rape, would not be allowed to return before the trial, he’s back on the factory

      Despite global outcry over Classic’s abuses and the tactics they’re using to dodge
      justice, international customers like Walmart, Target, and Macy’s are still buying
      Classic clothing.

      Given the critical situation on the ground, Classic Factory workers, consumers, and
      human rights organizations, are urgently calling on these high-profile companies to
      immediately condemn human rights abuses and force change.

      Click here to sign the petition now:

      Target and Macy’s have claimed that they are investigating conditions at the
      factory, but they’re deferring to the Jordanian Ministry of Economy and Labor —
      which claims there is no evidence of sexual abuse.

      Instead, conditions are getting worse. In addition to imprisoning women inside the
      factory, managers are removing all the males workers — in some cases even deporting
      them — cutting the staff to older male supervisors and vulnerable young women.

      At Classic’s urging, the government also arrested the leader of an outside human
      rights NGO and took his passport to prevent him from intervening to protect the
      women at the factory.

      “All we can do is cry,” Nazma said. “We ask the people who buy our garments, please
      end this abuse and torture we face. We should be able to work without fear of sexual

      Now is a critical moment for action. Outside pressure and attention can ensure that
      victims and witnesses are freed and can testify against their rapists — and that
      Classic Factory reforms its policies and practices.

      Otherwise, the manager and supervisors will continue to imprison, assault, and rape
      girls and women with renewed impunity.

      Sign now to urge Walmart, Target, and Macy’s to force Classic Factory to free
      imprisoned victims and witnesses — and end its human rights abuses against women:”



      This is kinda’ off topic, but it isn’t really. This is just a prime example of US corporations’ abuse of foreign workers, the end result of outsourcing American jobs. This is a part of the myth that globalization is so wonderful for all those poor people over there! We all know these things are happening…we just need to get our heads out of the sand!

      Thanks, Cher! You wrote a great comment, one that I intend to follow up on.

  10. HelenWheels says:

    Most excellent article, AdLib. Wow, very impressive indeed, and right on the money. I like that you did include solutions. I wonder, however, if any of those are possible before disaster hits. Remember, we also have deal with corporations having more power as never before. And then there is the problem with privatising prisons for cheap labor, a really huge story that the corporate-controlled MSM will never report. Things like prison privatization happen at the secretive ALEC meeting every year. Amy Goodman had a feature on this the other day.

    THIS is what we are up against -- the fact that our gov’t and corporate collusion is not even secretive anymore. They don’t have to be. They have been sanctioned by the SCOTUS:

    “Hundreds of state legislators from all 50 states have gathered in New Orleans for the annual meeting of the American Legislative Exchange Council, known as ALEC. Critics say the Washington-based organization plays a key role in helping corporations secretly draft model pro-business legislation that has been used by state lawmakers across the country. Unlike many other organizations, ALEC’s membership includes both state lawmakers and corporate executives who gather behind closed doors to discuss and vote on model legislation. In recent months, ALEC has come under increasing scrutiny for its role in drafting bills to attack workers’ rights, roll back environmental regulations, privatize education, deregulate major industries, and passing voter ID laws. Nonetheless, this year’s annual ALEC meeting boasts the largest attendance in five years, with nearly 2,000 guests in attendance. We go to New Orleans to speak with Lisa Graves, executive director of the Center for Media and Democracy. Last month, her organization released 800 model bills approved by companies and lawmakers at recent ALEC meetings.” [includes rush transcript]


    • AdLib says:

      Thanks so much HelenWheels and so nice to see you!

      As far as disaster striking, it’s more like girding for another in a series of ongoing disasters, like the tragedy in Japan. First they get hit with a massive earthquake, then a monster tsunami, then the threat of a nuclear reactor failing and dispersing radiation, etc.

      Our economy and the Middle Class are being hit by one calamity after another, all caused by the greed of corporations and the wealthy.

      Unlike Japan, which has no control over all the tragedies and difficulties it’s having to deal with, we can turn things around swiftly IF we have the political determination and majorities to do so.

      There’s been a bit of discussion around here about ALEC and the very fact that so many are now aware of them, is a blow against them. The vote this week in WI against the KOCH/ALEC puppet Walker’s regime should affirm the people being roused and rebelling against the corporate machine.

  11. jkkFL says:

    In the midst of all this doom and gloom, I found one tiny victory for the US worker..
    The backlash against outsourcing customer service reps has finally turned the trend.
    Companies who outsourced those jobs are bringing them back to the US due to customer outrage and outright refusal to talk to “Peggy” in Siberia. 😉
    The US call center industry has grown by 200% in the first two quarters, and it’s growth is projected to increase thru the end of the year.
    (This does Not include telemarketing- which is another worm entirely.)

    • AdLib says:

      That’s a good thing though I would bet another factor is that the price of American labor right now and Indian labor, for example, is less separated than before.

      It is a good thing, I’ve always felt that those companies who didn’t sell out their customer service to be a frustrating, excruciating experience (as most corps have (because they don’t see the profit in it, it’s just a necessary evil to them), would be rewarded by providing greater customer satisfaction and better service. That’s how you keep customers and build word of mouth, something that Corporate CEOs can’t put on a profits ledger so it’s worthless to many of them.

  12. Emerald1943 says:

    WOW! Great, Adlib!

    A huge thorn in my side has been this outsourcing issue for quite some time, especially after I found out about the very lucrative tax benefits that big corporations get to ship our jobs to overseas sweatshops.

    I believe it was Ed Schultz on MSNBC who brought this into the open back some time ago. He stated that over 58,000 manufacturing PLANTS had closed in the recent past. That would mean hundreds of thousands of jobs cut from beneath American workers with nothing there to replace those losses.

    This should have been a wake-up call…those jobs ARE NOT COMING BACK! Why would any self-respecting big corporation want to give up all their tax advantages and opportunities to fatten their bottom line by hiring foreigners at pennies-on-the-dollar wages?

    I, for one, don’t believe these greedy corporations should be enticed to “please, please…bring the money/jobs back to the US!” Cut out their loopholes and tax expenditures immediately! Hit them where they have hit us…in the pocketbook!

    It should be plain and simple to voters in this country…it is IMPERATIVE that the Democrats win back the House and keep the Senate and the White House in 2012. Otherwise, we will neither see fairness in our taxes nor will we see jobs created for the middle class. Democrats MUST keep that message front and center in the debates that will follow. We MUST control the message! The rethugs’ continuing their favorite talking point “We can’t tax the job creators”, easily debunked with articles like this, should be shown for the corporate buy-out of our lawmakers that it is.

    Could it be that the debt ceiling battle has awakened the sleeping giant? We can only hope so!

    ADDENDUM: Something I forgot to mention…In looking into outsourcing a few days ago, I was surprised to see that there are many new firms out there that specialize in advising corporations on HOW to outsource! To me, this is totally unpatriotic, given the current state of unemployment in this country!

    • AdLib says:

      Thanks Emerald!

      I do think things have gotten to the point, with such entrenched and vicious greed controlling corporations, that the only way back to economic justice is by simply taking what’s been stolen back from the thieves (instead of trying to convince them to give it back).

      The government needs to tax the wealthy and corporations in a fair but tough way and put much of that money directly into programs and policies that create and finance well paying middle class jobs.

      I see no market solution to repairing a slanted economy that the market itself slanted to its benefit because it doesn’t want the majority having a fair share of the nation’s wealth.

      As for outsourcing, in addition to tax breaks for hiring American workers, indeed, let’s raise tariffs that cost companies for outsourcing labor and use those tariff revenues towards creating jobs and funding social services.

      The mirage is that corporations are “American”. They have no loyalty to America and have sold out its people and economy whenever it seemed profitable. They deal with and enrich America’s enemies, money is money to them.

      So let us put to rest the idea of “American” corporations because if they really were American and really were people, they could be on trial for treason.

    • jkkFL says:

      and..Tax the hell out of the goods they are importing, as a result of outsourcing.

  13. Abbyrose86 says:

    Excellent article ad lib. Thanks for writing it.

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