Monday, November 7, 2011

Everybody all at once scream, BOO!

The current Depression has been going so long that the majority of the unemployed are no longer receiving benefits. Eighteen months ago, 75% were still getting benefits and now only 48% remain eligible. This doesn’t include people who weren’t eligible for benefits to begin with, like people who hadn‘t worked enough since depleting their benefits after their last job was outsourced , those people simply aren’t counted. Teenagers entering the workforce or recent college grads, and those looking for work after re-training at for the 2nd, 3rd or 4th time following the outsourcing of their middle class job don’t count either.

In the olden days, before Clinton ended “Welfare as we know it” in 1996 these people would get welfare, not today as this would lessen the pressure to drive down wages if people weren’t willing to work for food (and not enough of that).

Nearly five million Americans have been out of work for more than a year, and again that’s just the ones that are being counted. Besides people who have simply fallen through the non-existent safety net, there are millions that took early retirement or disability payments that would still work if they could. Still more millions have gone back to school to live on student loans with little chance finding a job when they enter the job market. Fully half of recent college grads either have no job or work at a job they didn’t need a college degree for. The majority of new corporate lawyers each year are in India, medical researchers, accountants, engineers, architects and on and on are all being out sourced.

By the end of the year Congress must extend the 99 weeks program or another million people will have their benefits end suddenly and this number will grow steadily. By February it will 2.2 million cut off from benefits, but 45 billion dollars for the extension is a lot of money for Tea Baggers to agree to. No admission from them that they are the ones who caused this mess.  They bought into the magic of Reaganomics and free trade, tax cuts for the rich that didn’t trickle down, wars that would pay for themselves, free trade would make everything more affordable and create high tech, high finance and high wage jobs that never happened.  The Tea Baggers made these mistakes despite our warnings, but they won’t pay for them. The children, the old, the helpless will pay with their lives.

Even if Congress does the right thing, this one small “right thing” and renews the unemployment benefit program, this won’t help the “99ers” who have already fallen off the rolls.  The Census Bureau says unemployment benefits kept 3.2 million people from stepping over the edge into the abyss of poverty last year. The threshold for poverty is far too low of course, defined as annual income below $22,314 for a family of four.

The cost of raising child in America with a middle class lifestyle until age 18 is estimated to half a million dollars (and with no frills like piano lessons or cell phones) . For a family of four with two kids this would be $55,000/year which is more than the median family income in the United States. You can make do on a fraction of this by giving up luxuries like good nutrition or healthcare, and the numbers make it clear that the majority of American families are giving up a lot of things to get by.

The reality is that millions of American families in the most powerful, most wealthy nation on the planet aren’t getting by. The leader of the most powerful institution in the world, the Speaker of the House in the Congress of the United States of America says we are broke, he says it everyday on his way to a thousand dollar dinner. The poor, the weak, the sick, the children and the elderly must fend for themselves in this land that this evil man calls “exceptional”. It’s only exceptional for him and his cronies.

A new record number of people got Food Stamps in August, more than 46 million and the benefits are enough to feed a family and food banks can’t begin to serve the needy. The longest people have been on unemployment set a record during the first Reagan Recession of 1983 at 21 weeks, the current average is twice that. Reagan fixed his economic problems which were much less then (we still had a manufacturing base) with trillions in deficit spending (back when a trillion was real money) and he deregulated banking to pump out trillions in consumer credit. Don’t mind the Savings and Loan crash from deregulation.

Weekly unemployment checks average about $300 nationwide, the Congressional Budget Office has estimated that each $1 spent on unemployment benefits generates up to $1.90 in GDP growth. Still you are talking about the equivalent of a minimum wage job that in itself doesn’t produce anything. A modest increase in the minimum wage would have much more significant effects, especially when you consider that such an increase would combat the falling wage trend we have now.

When unemployment benefits expire around Christmas time, the Congress will decide to extend benefits for people out of work for less than 99 weeks or cast them into the gutter. This will be the first time the measure has come up with the House under the control of Republicans. The safe bet is those “out of work by no fault of their own” (to quote the benefit rules) will be heading for that slushy place beyond the curb. Even most Democrats aren’t considering any help for the millions already past 99 weeks of eligibility as they are treated like ghosts. They may haunt the Occupy Wall Street sites but Republicans don’t believe they really exist. Tell them “Boo”, everybody all at once. BOO!