Archive for the ‘Economic News’ Category
May 26th, 2010
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Author: Just as I predicted in this week’s Politics Monday, the Gulf region is experiencing an economic boom.
“The spill, now a month old, could end up killing the livelihoods of thousands of fishermen, restaurant workers, charter boat captains and tourism employees.
“But for now, it’s triggering a mini-boom in other jobs across the five-state region.”
***
“BP has spent more than $750 million so far in oil spill response initiatives. Spokesman John Curry said the company has hired more than 20,000 people as part of the response to the April 20 accident and its aftermath.”
And all the health problems the clean-up workers will inevitably contract will pour money into the local health care economy to boot. That’s disaster-nomics.
Posted in 
Just as I predicted in this week’s Politics Monday, the Gulf region is experiencing an economic boom.
“The spill, now a month old, could end up killing the livelihoods of thousands of fishermen, restaurant workers, charter boat captains and tourism employees.
“But for now, it’s triggering a mini-boom in other jobs across the five-state region.”
***
“BP has spent more than $750 million so far in oil spill response initiatives. Spokesman John Curry said the company has hired more than 20,000 people as part of the response to the April 20 accident and its aftermath.”
And all the health problems the clean-up workers will inevitably contract will pour money into the local health care economy to boot. That’s disaster-nomics.
End the war on drugs.
After 40 years, $1 trillion, US War on Drugs has failed to meet any of its goals
— $121 billion to arrest more than 37 million nonviolent drug offenders, about 10 million of them for possession of marijuana. Studies show that jail time tends to increase drug abuse.
— $450 billion to lock those people up in federal prisons alone. Last year, half of all federal prisoners in the U.S. were serving sentences for drug offenses.
Obama’s drug war policy is the same as Bush’s only moreso.
“Obama is requesting a record $15.5 billion for the drug war for 2011, about two thirds of it for law enforcement at the front lines of the battle: police, military and border patrol agents struggling to seize drugs and arrest traffickers and users.
“About $5.6 billion would be spent on prevention and treatment.”
And yet, the debate du jour is whether playing softball is proof of lesbianism.
Terrific post by Mark Cuban about the business of Wall Street.
“The only people who know what business Wall Street is in are the traders. They know what business Wall Street is in better than everyone else. To traders, whether day traders or high frequency or somewhere in between, Wall Street has nothing to do with creating capital for businesses, its original goal. Wall Street is a platform. It’s a platform to be exploited by every technological and intellectual means possible.”
***
“My 2 cents is that it is important for this country to push Wall Street back to the business of creating capital for business. Whether its through a use of taxes on trades, or changing the capital gains tax structure so that there is no capital gains tax on any shares of stock (private or public company) held for 5 years or more, and no tax on dividends paid to shareholders who have held stock in the company for more than 5 years. However we need to do it, we need to get the smart money on Wall Street back to thinking about ways to use their capital to help start and grow companies. That is what will create jobs. That is where we will find the next big thing that will accelerate the world economy. It won’t come from traders trying to hack the financial system for a few pennies per trade.”
This also helps explain why there’s no interest among banksters and Wall Street to assist small business.
“In 2008 and 2009, large banks that received government bailouts actually cut lending to small businesses. At the 22 largest banks to receive government bailouts, for example, average small business loan balances fell 4.6% between April and November of 2009, the report said. Meanwhile, originations for new loans slid by 7.4%, according to the report.
“‘Big banks pulled back on everyone, but they pulled back harder on small businesses,’ said Elizabeth Warren, the panel’s chair.”
Gaming the system for quick profit pays. Investing in long-term development is a game for suckers.
More from Cuban -
“Regulators have got to start to recognize that traders are not investors and vice versa and treat them differently. Different regulations. Different tax structure. Different oversight. Individual investors and the funds that just invest in stocks and bonds are not going to crash the market. Big traders who are always leveraging up and maximizing the number of trades/hacks they make will always put the system at risk. We need to recognize that they do not serve much of a purpose other than to add substantial risk to the global economy. That their stated value add of liquidity does not compensate the US and World Economy nearly enough for the risk of collapse they introduce into the system.”
Seriously, read the whole thing.
If the Alaska Permanent Fund is good enough for Sarah Palin and her Republican supporters and Alaska’s libertarian population, why isn’t it good for the rest of America?
If we take Republican leaders at their word, the states are supposed to be laboratories of liberty, each trying their own strategies of improving the general welfare, with the most successful being adopted by the Federal government. Obama has urged Democratic leaders to adopt this Republican philosophy into the Health Care Reform bill.
For those unfamiliar with Alaska’s successful experiment with socialism, the Alaska Permanent Fund is rooted in the Alaska Constitution’s assertion that the natural resources of Alaska belong to all Alaskans, and it is the legislature’s responsibility to develop these resources for the “maximum benefit of its people.”
“The legislature shall provide for the utilization, development, and conservation of all natural resources belonging to the State, including land and waters, for the maximum benefit of its people.”
In 1976 Alaskans amended their constitution so that –
“At least twenty-five per cent of all mineral lease rentals, royalties, royalty sale proceeds, federal mineral revenue sharing payments and bonuses received by the State shall be placed in a permanent fund, the principal of which shall be used only for those income-producing investments specifically designated by law as eligible for permanent fund investments. All income from the permanent fund shall be deposited in the general fund unless otherwise provided by law.”
The money collected through the rentals, etc., is then managed and invested by the Alaska Permanent Fund Corporation and every year the earnings are split among the citizens of Alaska, providing just over $1,300 to each Alaskan last year.
Given that this policy is embraced by Republicans and Libertarians alike it should be easy to adopt something similar on a national scale. (I’m joking, of course. If Obama adopted the GOP platform wholesale, Republican leadership would continue to accuse him of being a craven Marxist.)
In addition to the 30+ years of experience we have to draw on in Alaska, we also have an endorsement from F. A. Hayek, a Nobel Prize winning economist and favorite among the Libertarian crowd. In The Road to Serfdom, at the beginning of the Security and Freedom chapter, he writes –
“There is no reason why in a society which has reached the general level of wealth which our has attained the first kind of security [the security of a minimum income] should not be guaranteed to all without endangering general freedom.”
Similarly, Nobel Prize winner and conservative favorite Milton Friedman argued for a negative income tax, where people whose annual salaries fall below a set minimum receive a money from the government to bring their annual salary up to a minimum set by the legislature.
While this system might allow the more bohemian or lazy among us to lounge around all day watching television or blowing their government funds on cheap weed, it brings a lot more positives than negatives. People in abusive relationships would find it easier to move out on their own if they knew they’d be able to pay rent. If it’s applied to everyone, the stigma of being on the dole is removed. If the fund is sufficient then unemployment insurance becomes an issue of the past. In fact, a program like this could conceivable reduce taxes since many of the programs funded by tax dollars would be less necessary if everyone received a sufficiently large enough stipend.
But, where would this money come from?
It would probably have to be drawn from multiple sources; revenue from the spectrum auction, and from government-owned utilities; inheritance tax and partial repayment of the funding upon death; sin taxes and consumption taxes; as well as resource sharing from the 44 million acres of US public land currently leased for a pittance to oil and gas companies.
We know that there are some drawbacks. This is a disincentive to work. But, the advantages greatly outweigh the disadvantages. Research shows that improving income inequality reduces crime, improves health, increases access to education, reduces some taxes, reduces poverty, improves children’s health, and improves the general welfare.
So, if it’s good enough for Sarah Palin, Alaskan Republicans, and Libertarian economic philosophers, why isn’t it good enough for all Americans?
If the Alaska Permanent Fund is good enough for Sarah Palin and her Republican supporters and Alaska’s libertarian population, why isn’t it good for the rest of America?
If we take Republican leaders at their word, the states are supposed to be laboratories of liberty, each trying their own strategies of improving the general welfare, with the most successful being adopted by the Federal government. Obama has urged Democratic leaders to adopt this Republican philosophy into the Health Care Reform bill.
For those unfamiliar with Alaska’s successful experiment with socialism, the Alaska Permanent Fund is rooted in the Alaska Constitution’s assertion that the natural resources of Alaska belong to all Alaskans, and it is the legislature’s responsibility to develop these resources for the “maximum benefit of its people.”
“The legislature shall provide for the utilization, development, and conservation of all natural resources belonging to the State, including land and waters, for the maximum benefit of its people.”
In 1976 Alaskans amended their constitution so that –
“At least twenty-five per cent of all mineral lease rentals, royalties, royalty sale proceeds, federal mineral revenue sharing payments and bonuses received by the State shall be placed in a permanent fund, the principal of which shall be used only for those income-producing investments specifically designated by law as eligible for permanent fund investments. All income from the permanent fund shall be deposited in the general fund unless otherwise provided by law.”
The money collected through the rentals, etc., is then managed and invested by the Alaska Permanent Fund Corporation and every year the earnings are split among the citizens of Alaska, providing just over $1,300 to each Alaskan last year.
Given that this policy is embraced by Republicans and Libertarians alike it should be easy to adopt something similar on a national scale. (I’m joking, of course. If Obama adopted the GOP platform wholesale, Republican leadership would continue to accuse him of being a craven Marxist.)
In addition to the 30+ years of experience we have to draw on in Alaska, we also have an endorsement from F. A. Hayek, a Nobel Prize winning economist and favorite among the Libertarian crowd. In The Road to Serfdom, at the beginning of the Security and Freedom chapter, he writes –
“There is no reason why in a society which has reached the general level of wealth which our has attained the first kind of security [the security of a minimum income] should not be guaranteed to all without endangering general freedom.”
Similarly, Nobel Prize winner and conservative favorite Milton Friedman argued for a negative income tax, where people whose annual salaries fall below a set minimum receive a money from the government to bring their annual salary up to a minimum set by the legislature.
While this system might allow the more bohemian or lazy among us to lounge around all day watching television or blowing their government funds on cheap weed, it brings a lot more positives than negatives. People in abusive relationships would find it easier to move out on their own if they knew they’d be able to pay rent. If it’s applied to everyone, the stigma of being on the dole is removed. If the fund is sufficient then unemployment insurance becomes an issue of the past. In fact, a program like this could conceivable reduce taxes since many of the programs funded by tax dollars would be less necessary if everyone received a sufficiently large enough stipend.
But, where would this money come from?
It would probably have to be drawn from multiple sources; revenue from the spectrum auction, and from government-owned utilities; inheritance tax and partial repayment of the funding upon death; sin taxes and consumption taxes; as well as resource sharing from the 44 million acres of US public land currently leased for a pittance to oil and gas companies.
We know that there are some drawbacks. This is a disincentive to work. But, the advantages greatly outweigh the disadvantages. Research shows that improving income inequality reduces crime, improves health, increases access to education, reduces some taxes, reduces poverty, improves children’s health, and improves the general welfare.
So, if it’s good enough for Sarah Palin, Alaskan Republicans, and Libertarian economic philosophers, why isn’t it good enough for all Americans?
Elinor Ostrom is one of my intellectual heroes. She recently won the Nobel Prize in economics for her research on common property and cooperation. She’s interviewed at Yes! Magazine.
“Elinor: Well, I don’t see the human as hopeless. There’s a general tendency to presume people just act for short-term profit. But anyone who knows about small-town businesses and how people in a community relate to one another realizes that many of those decisions are not just for profit and that humans do try to organize and solve problems.
“If you are in a fishery or have a pasture and you know your family’s long-term benefit is that you don’t destroy it, and if you can talk with the other people who use that resource, then you may well figure out rules that fit that local setting and organize to enforce them. But if the community doesn’t have a good way of communicating with each other or the costs of self-organization are too high, then they won’t organize, and there will be failures.”
“But when people can communicate, particularly on a face-to-face basis, and say, “Well, gee, how about if we do this? How about we do that?” Then they can come to an agreement.”
Elinor Ostrom is one of my intellectual heroes. She recently won the Nobel Prize in economics for her research on common property and cooperation. She’s interviewed at Yes! Magazine.
“Elinor: Well, I don’t see the human as hopeless. There’s a general tendency to presume people just act for short-term profit. But anyone who knows about small-town businesses and how people in a community relate to one another realizes that many of those decisions are not just for profit and that humans do try to organize and solve problems.
“If you are in a fishery or have a pasture and you know your family’s long-term benefit is that you don’t destroy it, and if you can talk with the other people who use that resource, then you may well figure out rules that fit that local setting and organize to enforce them. But if the community doesn’t have a good way of communicating with each other or the costs of self-organization are too high, then they won’t organize, and there will be failures.”
“But when people can communicate, particularly on a face-to-face basis, and say, “Well, gee, how about if we do this? How about we do that?” Then they can come to an agreement.”
The Washington Post has some great charts that help clarify the Federal budget.
Especially check out the historical chart tabs.
The Washington Post has some great charts that help clarify the Federal budget.
Especially check out the historical chart tabs.