Wednesday, August 17, 2011
Wednesday, August 17, 2011 2 comments
Things are deteriorating in Europe as Germany’s GDP went flat last quarter. The much anticipated meeting between German Chancellor Angela Merkel and French President Nicolas Sarkozy didn’t produce the results the markets were looking for, and the markets fell. Most Americans don’t realize that the EU is a much bigger economy than the US and in general it’s in better shape.
The Euro Zone has a few problems though with their banks in danger of collapse after being flimflammed by Wall Street and the Euro likely to be scrapped if they can’t get a handle on bond interest rates also thanks to Wall Street. The markets were hoping to see the creation of Euro bonds but that was ruled out at this meeting.
Europe, unlike the US, has a large export sector and this is contracting rapidly. China has been a big market for high tech goods but they are producing their own. The third world is cutting way back on European goods in order to buy food and oil thanks to Goldman Sachs driving up commodities. And the United States is turning into a third world country and just isn’t buying as much.
The really big problem though, is that Europe seems to have been bitten by the Austerity Bug and the push to cut back at all costs seems to have overtaken an otherwise rational people. Austerity is of course the big job killer as it naturally becomes a self reinforcing cycle of decline. You would think that they would take heed from the UK’s bitter lesson as austerity there is driving them toward collapse.
Not that we are doing any better as Republican governors have cut a million jobs that added another full percentage point to the unemployment rate not counting the workers those government jobs supported. Unemployment would be less than the number Obama promised at the time that the Stimulus Program began, without the deliberate sabotage from the right.
Governor (scary) Perry brags about all the jobs he created in Texas but doesn’t mention the ones that pay more than minimum wage were pretty much all created by Chinese companies or by the government (47% of all new government jobs in the US from 2007-2010 were in Texas). The minimum wage jobs (Texas leads the nation in minimum wage jobs) only appeared as the population of Texas increased dramatically creating openings for burger flippers. In the last three years some 437,000 workers have moved to Texas and only 126,000 jobs were created and the rest of new workers replaced Texans at lower wages. Once Perry institutes draconian budget cuts to cover a multi-billion dollar revenue shortfall (tax cuts and declining economy together) those jobs he “created” will pretty much evaporate with government layoffs.
Since the unemployment benefits for all those displaced Texans are to be eliminated by Congressional Republicans at the end of the year, Perry will find himself being the “Yell Leader“ for Obama‘s efforts to get them extended. Unless he plans to leave Texas for greener pastures by throwing them under the campaign bus. Do you suppose Texans will want to “get ugly” with Perry for destroying their state?
Something not posted on The Drudge Report today, both Democratic Senators up for recall in Wisconsin on Tuesday won re-election handily. This happened despite Republicans and their Billionaire masters pouring more money into these few recall elections than is normally spent in a Presidential election year. If Democrats get continued support from the one independent Republican in the State Senate then all of the planned privatization of the public commons will be stopped in its tracks.
This is a major set back for the Koch Brothers and the DeVoss family of the scAmway fortune who are also responsible for your friendly Blackwater private army. Governor Scott wanted to use the Wisconsin National Guard on protesters but found that most of the Guard is made up teachers and county workers. In the good old days they broke strikes with Pinkerton mercenaries, the Republicans can’t wait to get back to those days, they already have the mercenaries on the payroll. www.prairie2.com