Thursday, September 15, 2011

US poverty rate highest since 1993

THE US poverty rate rose in 2010 to 15.1 per cent, the highest rate since 1993, the Census Bureau has reported in another sign of a sputtering economy following a deep recession. The report showed a sharp increase in poverty from 14.3 per cent in 2009, and a fourth consecutive rise in the number of people below the poverty threshold, to 46.2 million.

The number of people in poverty was the highest since data collection began in 1959, although the rate was 7.3 percentage points lower than in 1959.

The US definition of poverty is an annual income of $22,314 for a family of four, and $11,139 for a single person in 2010.

The survey showed struggles for the rest of Americans, with median household income falling 2.3 per cent to $49,445.

The poverty rate for blacks and Hispanics was much higher than for the overall population at 27.4 per cent and 26.6 per cent, respectively. Among regions, the South had the highest poverty rate at 16.9 per cent and the highest percentage without health insurance, 19.1 per cent.

The report, showing the first full year since the recession officially ended in June 2009, supports the notion that Americans have been losing ground economically. It showed real median incomes fell 6.4 per cent from pre-recession levels in 2007 and were 7.1 per cent below the peak in 1999.



New footage reveals how Jacqueline Kennedy Onassis felt about Martin Luther King

IN early 1964 Martin Luther King was the unchallenged leader of America's civil rights movement, still basking in the glory of his "I have a dream" speech the previous summer.

According to former US first lady Jacqueline Kennedy, later Jaqueline Kennedy Onassis, he was also a "phoney", a sex pest and a "terrible man".

Four months after her husband's death, the First Lady of Camelot sat down with a close friend and a tape recorder to give her calm, candid and brutal assessment of many of those she had met in the White House. The recordings are released today

No one who displeased Mrs Kennedy was spared. Charles de Gaulle was a spiteful "egomaniac". Indira Gandhi was a pushy, bitter "prune". Ted Sorensen, the legendary Kennedy speechwriter, had a "big inferiority complex" and Clare Booth Luce, the playwright and Republican politician, was quite possibly a lesbian.

It was Dr King, who the former First Lady believed had been drunk at her husband's funeral, who came off worst.

"I just can't see a picture of Martin Luther King without thinking, you know, that man's terrible," she told Arthur Schlesinger, the former White House aide, during eight hours of intimate recollections recorded four months after the Kennedy assassination but kept secret at her request for 47years.

Mrs Kennedy said she had been told that secret FBI wiretaps of a Washington hotel suite occupied by Dr King the night before his most famous speech revealed that he had spent much of the evening telephoning women to invite them to a sex party.

In sections of the interviews, to be broadcast tonight in the US, she describes hearing from Robert Kennedy, the former US Attorney-General and her brother-in-law, how the civil rights icon "was calling up all these girls and arranging for a party of men and women, I mean, sort of an orgy".

Mr Kennedy also told his brother's widow that Dr King had been heard joking about being drunk and seeing the pallbearers almost drop the coffin at John F.Kennedy's funeral.

Allegations of Dr King's promiscuity are not new but such unvarnished language from one liberal figurehead about another may help to explain why the tapes have stayed under wraps for so long.

The New York Times, required reading for America's liberal establishment, devoted 19 words to the King sections in a 2,000-word front-page article on the tapes yesterday.

Such hesitancy is partly explained by doubts about the authenticity of FBI wiretaps conducted under J. Edgar Hoover, but Mrs Kennedy's views on Dr King are clearly her own. She is not much kinder to Lyndon Johnson, newly installed in the White House at the time of the interviews.

Her husband had dreaded the idea of a Johnson presidency and enlisted his brother to help find alternatives to be the next Democratic nominee, she told Mr Schlesinger.

The interviews do not touch on John F.Kennedy's own affairs, which were still a closely held secret at the time.

They scarcely mention his death but they dwell in detail on the idea of death during the Cuban missile crisis. "I said, please don't send me away to Camp David, you know, me and the children," Mrs Kennedy said. "If anything happens we're going to stay right here with you ... I just want to be with you. I want to die with you, and the children do, too."



A lesson for now: How Britain escaped the worst of the Great Depression

By economic historian Martin Hutchinson

In the 1930s, those hoping for economic recovery got lucky in the British political cycle and unlucky in the American one (and even more unlucky in the German cycle.) In Britain, the economically capable National Government took office in August 1931. Chancellor of the Exchequer Neville Chamberlain promptly banished Maynard Keynes from the Treasury (condemning him to six years of inferior investment returns, since he had been cut off from his sources of information) and instituted an anti-Keynesian economic policy of public spending cuts and a modest Imperial Preference tariff that proved remarkably successful. By 1933, the British economy was recovering fast, and 1932-37 provided the fastest peacetime five year growth period since Lord Liverpool’s era over a century before.

A few weeks ago I carried out a Gross Private Product analysis for the United States, subtracting government spending from GDP and looking at trends in private sector output, from which all wealth and jobs ultimately derive. The same calculations can be done for Britain, using the helpful website, and taking figures from before 1950 with a pinch of salt.

As in the United States, the greatest falls in Britain’s GPP came during the two World Wars, as output was converted to military usage – GPP fell by 45% between 1914 and 1917 and by an astonishing 57% between 1940 and 1945. In both wars, private sector output fell to levels not seen since the nineteenth century, in the second war to the level of 1870.

However the British Great Depression was not all that Great -- GPP fell by 11.7% between 1929 and 1932. This fall has since been exceeded twice in peacetime, by the Heath/Wilson downturn of 1973-75 (14.1%) and the Gordon Brown one of 2007-09 (13.2%.) The Thatcher downturn of 1979-81 and the Thatcher/Major downturn of 1989-93, both of which caused endless angst among the chattering classes and the left, were barely half as severe. Thus while the Chamberlain policy of cutting public expenditure, even slightly (by a mere 2.1% in real terms, peak to trough) opened opportunities for the private sector and turned the Great Depression into rapid recovery, the Keynesian stimulus policies pursued in the much milder global downturns of 1973-75 and 2007-09 produced significantly deeper economic troughs.

In the United States, the political cycle in the Great Depression was as unlucky as that in Britain was lucky. The Republican elected just before the downturn began followed government-enlargement, protectionist and tax-increasing policies, thus making matters much worse. Then the Democrat elected at the bottom of the slump intensified the enlargement of government and added a heavy layer of regulation, ensuring that while output recovered from the appalling depths to which it had fallen, the recovery was only partial. Only when centrist policies were restored in 1939-40 did vigorous growth resume. In summary therefore, while the first year of vigorous growth in Britain was only four years after the beginning of the Great Depression downturn, in the United States there was a full ten years delay before recovery occurred.

From previous discussion in these columns, three things need to occur before we get a vigorous recovery. First, short-term and long-term interest rates need to be raised above the level of inflation. This will allow the U.S. capital base to recover through higher saving. Moreover, a higher cost of capital relative to the cost of labor will lead the corporate sector to refocus from outsourcing jobs by investing in emerging markets to creating jobs in existing U.S. facilities.

Second, the budget deficit, both short-term and long-term needs to be brought down to at most 3-4% of GDP ($500-600 billion) initially and balance thereafter, so that the private sector ceases to be crowded out. Ideally this will be achieved as it was by Chamberlain, simply by cutting out waste in government, but closing tax loopholes can help in this process if it appears necessary – removing the tax deductions for mortgage interest and state income taxes will have little adverse economic effect, while removing that for charitable contributions will have an economically positive effect.

Finally, the blizzard of regulations that has proved a substantial additional obstacle to economic growth in 2011 needs to be cut back. Ideally some of the most egregious new regulations must be repealed, and at least the flow of new regulatory activity must be halted.



Economies flourishes when government leaves them alone

Some more instructive history -- from economist Thomas Sowell

Some people are hoping that President Obama's plan will get the economy out of the doldrums and start providing jobs for the unemployed. Others are hoping that the Republicans' plan will do the trick. Those who are truly optimistic hope that Democrats and Republicans will both put aside their partisanship and do what is best for the country.

Almost nobody seems to be hoping that the government will leave the economy alone to recover on its own. Indeed, almost nobody seems at all interested in looking at the hard facts about what happens when the government leaves the economy alone, compared to what happens when politicians intervene.

The grand myth that has been taught to whole generations is that the government is "forced" to intervene in the economy when there is a downturn that leaves millions of people suffering. The classic example is the Great Depression of the 1930s.

What most people are unaware of is that there was no Great Depression until AFTER politicians started intervening in the economy.

There was a stock market crash in October 1929 and unemployment shot up to 9 percent -- for one month. Then unemployment started drifting back down until it was 6.3 percent in June 1930, when the first major federal intervention took place.

That was the Smoot-Hawley tariff bill, which more than a thousand economists across the country pleaded with Congress and President Hoover not to enact. But then, as now, politicians decided that they had to "do something."

Within 6 months, unemployment hit double digits. Then, as now, when "doing something" made things worse, many felt that the answer was to do something more.

Both President Hoover and President Roosevelt did more -- and more, and more. Unemployment remained in double digits for the entire remainder of the decade. Indeed, unemployment topped 20 percent and remained there for 35 months, stretching from the Hoover administration into the Roosevelt administration.

That is how the government was "forced" to intervene during the Great Depression. Intervention in the economy is like eating potato chips: You can't stop with just one.

What about the track record of doing nothing? For more than the first century and a half of this nation, that was essentially what the federal government did -- nothing. None of the downturns in all that time ever lasted as long as the Great Depression.

An economic downturn in 1920-21 sent unemployment up to 12 percent. President Warren Harding did nothing, except for cutting government spending. The economy quickly rebounded on its own.

In 1987, when the stock market declined more in one day than it had in any day in 1929, Ronald Reagan did nothing. There were outcries and outrage in the media. But Reagan still did nothing.

That downturn not only rebounded, it was followed by 20 years of economic growth, marked by low inflation and low unemployment.

The Obama administration's policies are very much like the policies of the Roosevelt administration during the 1930s. FDR not only smothered business with an unending stream of new regulations, he spent unprecedented sums of money, running up record deficits, despite raising taxes on high income earners to levels that confiscated well over half their earnings.

Like Obama today, FDR blamed the country's economic problems on his predecessor, making Hoover a pariah. Yet, 6 years after Hoover was gone, and nearly a decade after the stock market crash, unemployment hit 20 percent again in the spring of 1939.

Doing nothing may have a better track record in the economy but government intervention has a better political record in getting presidents re-elected. People who say that Barack Obama cannot be re-elected with unemployment at its current level should take note that Franklin D. Roosevelt was elected a record four times, despite two consecutive terms in which unemployment was never as low as it is today.

Economic reality is one thing. But political impressions are something very different -- and all too often it is the political impressions which determine the fate of an administration and the fate of a nation.




Republican wins Weiner’s former NY seat: "In a blow to Democrats, a Republican candidate captured the heavily Jewish New York City congressional district previously represented by Rep. Anthony Weiner. The Republican candidate, Bob Turner, beat his Democratic opponent, New York State Assemblyman David Weprin, in Tuesday’s special election. The Associated Press called the race for Turner shortly after midnight. The race was closely watched as a measure of attitudes toward President Obama, with the Jewish vote a particular focus of attention. Former New York City mayor Ed Koch, a Democrat, urged voters to support Turner in order to send a message of dissatisfaction to President Obama over his policies toward Israel."

Jobs speech: Back to the future: "Those who are impressed by words seem to think that President Barack Obama made a great speech to Congress last week. But when you look beyond the rhetoric, what did he say that was fundamentally different from what he has been saying and doing all along? ... If government spending were the answer, we would by now have a booming economy with plenty of jobs, after all the record trillions of dollars that have been poured down a bottomless pit."


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The Big Lie of the late 20th century was that Nazism was Rightist. It was in fact typical of the Leftism of its day. It was only to the Right of Stalin's Communism. The very word "Nazi" is a German abbreviation for "National Socialist" (Nationalsozialist) and the full name of Hitler's political party (translated) was "The National Socialist German Workers' Party" (In German: Nationalsozialistische Deutsche Arbeiterpartei)


1 comment:

tillurdizzy said...

You should enjoy this link to a timelapse of Brisbane.