Tuesday, September 11, 2012

Today's links

1--Democrats and Republicans line up against Chicago teachers, WSWS

(Rahm) Emanuel is not just the mayor of Chicago, he is Obama’s right-hand man. There can be no doubt that he is coordinating his actions closely with the administration. Emanuel served as the president’s chief of staff before he left to run for the post of Chicago mayor.

A former investment banker, Emanuel is also a top figure in the Obama reelection campaign, having just stepped down as co-chair of the campaign to head fundraising efforts by Obama’s super PAC. The stated aim of the super PAC is to raise $150 million from multi-millionaire and billionaire donors.

The political connections between Obama and the Chicago establishment are innumerable. Obama’s education secretary, Arne Duncan, is the former CEO of Chicago Public Schools (CPS), where he initiated many of the anti-teacher policies now being expanded by Emanuel. Duncan headed the CPS under Mayor Richard Daley, the brother of William Daley, who replaced Emanuel as Obama’s chief of staff in 2001.

Emanuel has plans to shut down dozens of public schools and lay off thousands of teachers. At the same time, the city hopes to open 60 new charter schools in addition to the 100 that are currently operating. Many of the charter schools are owned and operated by Noble Charter Network, which has close ties to billionaire Hyatt Hotel heiress Penny Pritzker, a longtime supporter of Obama....

Romney’s running mate, Paul Ryan, was even more explicit in his support for Emanuel. “Rahm and I have not agreed on every issue or on a lot of issues,” he declared, “but Mayor Emanuel is right today in saying that this teachers’ union strike is unnecessary and wrong.” He added that “education reform is a bipartisan issue.”

Whatever their differences, when it comes to their hatred for the working class, the two parties are entirely united. The Republicans are no less aware than the Democrats that a defeat of the Chicago teachers’ struggle is essential for carrying out the bipartisan policy of dismantling public education. And after decades in which the class struggle has been artificially suppressed with the help of the trade unions, the ruling elite views any working class resistance as intolerable, if not criminal...

Over the last two years, the CTU has accepted mass layoffs, school closures, “turnarounds” and the dismantling of tenure and other workplace rights. In April of 2011, behind the backs of the membership, the CTU collaborated with the Illinois Democratic-controlled state legislature in the passage of the anti-teacher Senate Bill 7, which restricts the right to strike and expands the use of standardized tests. Earlier this year, the CTU accepted the lengthening of the school day as part of an interim agreement.

2--Striking teachers speak out in Chicago, WSWS

The Democrats and Republicans want working people to pay for the financial crisis, and teachers have been first on the firing line.”

3--'Underwater Mortgage' Refis Get Fresh Push in Congress, Realty check

With the revisions that were made and introduced today, we are glad to be able to support the bill to help additional segment of homeowners who had not previously been able to refinance at today's historically low rates,” said David Stevens, president and CEO of the Mortgage Bankers Association. “As it pertains to amendments, we will evaluate each one on its own merits.

4--As Low Rates Depress Savers, Governments Reap Benefits, NYT

...older Americans and other savers are just unintended casualties of policies aimed at other economic targets, particularly the policy making it easier for consumers and companies to borrow.

“If you care about the distribution effects of these policies, and being fairer to the elderly or other people, that seems to argue for carefully designed fiscal stimulus,” said Robert J. Shiller, an economics professor at Yale. “With fiscal stimulus you have more control over who gets taxed at what rate and so on. At least it’s more transparent anyhow.”

But, he added, “the whole reason we like using monetary policy is that it avoids those very political discussions of who gets taxed.”

5-- We Are Now One Year Away From Global Riots, Complex Systems Theorists Say, motherboard

6--University of Phoenix Tops Debt Slave Racket with 35,049 Student Loan Defaults (Top Public School has 786); Debt Slave Collection Business is Booming; Housing and Economic Implications, Mish

7--Housing on Mend, but Full Recovery Is Far Off, WSJ

8--More on the strike, CEPR

As Diana Ravitch, a one-time leading school "reformer" and assistant education secretary in the Bush administration, argues that charter schools on average perform no better than the public schools they replace. The main determinants of childrens' performance continues to be the socioeconomic conditions of their parents. Those unwilling to take the steps necessary to address the latter (e.g. promote full employment) are the ones who do not care about our children.

9--“Bin Laden Determined to Strike in U.S.”, economists view

The direct warnings to Mr. Bush about the possibility of a Qaeda attack began in the spring of 2001. By May 1, the Central Intelligence Agency told the White House of a report that “a group presently in the United States” was planning a terrorist operation. Weeks later, on June 22, the daily brief reported that Qaeda strikes could be “imminent,” although intelligence suggested the time frame was flexible.

10--How central banks contributed to the financial crisis, Vox

11--Consumer Debt Declines, Even as Student Loans Grow, WSJ

12--Augmented Misery Index: First Half of 2012, Peterson Institute

13--Vital Signs Chart: Americans Cut Back on Credit Cards, WSJ

14--Consumer credit falls unexpectedly in July, Reuters

Consumer credit fell in July for the first time in nearly a year as Americans reduced credit card debt, a worrisome sign for an economy that has struggled to create jobs.

Consumer credit shrank by $3.28 billion in July, the Federal Reserve said on Monday. That was well below the $9.1 billion advance Wall Street economists had forecast in a Reuters poll.

However, in a more positive sign, the Fed revised substantially higher its estimate for credit growth in June.

The data follows a report on Friday that showed U.S. jobs growth slowed sharply in August, setting the stage for the Federal Reserve to pump additional money into the sluggish economy as soon as this week.

15--French President Hollande outlines budget cuts, law-and-order policies in TV interview, WSWS

16--Cuts in US jobless pay, government layoffs throw 1.5 million more people into poverty, WSWS

17--Hollowing Out the Workforce, counterpunch

According to a study performed by the National Employment Law Project, 58 percent of all new post-recession jobs come with hourly wages between $7.69 to $13.83. A worker would need two of these jobs just to afford rent, food, and other basics.

The New York Times commented on the “new normal” of low wage jobs:

“The disappearance of midwage [living wage], midskill jobs is part of a longer-term trend that some refer to as a hollowing out of the work force, though it has probably been accelerated by government layoffs.”...

The Democrats’ attack on public employees confirms that this dynamic is being purposely done: over 600,000 public employees have lost their jobs since 2009. Most of these workers were paid a living wage and had health care and pension plans. Their private sector replacement jobs that Obama boasts about pay peanuts and more often than not have no additional health or retirement benefits. The Obama administration understands perfectly well that these public sector layoffs could have been prevented by government action, but undermining employment and the wages of public employees is one way to drive down wages for everyone else. Together these trends lower the need for taxes and raise corporate profits.

The attack on unions is yet more proof that the low wage syndrome is a self-induced illness: Democratic Party governors across the country have demanded major wage and benefit concessions from public employees. And while the Democrats blame the Republicans for being “anti-union,” the concessions demanded by the Democrats drastically weaken unions to the point that Republicans can finish them off....

Why is President Obama hell-bent on lowering wages for the U.S. workers? He was very clear about this in his acceptance speech, with his repeated reference to increasing U.S. exports for the world market. The rub, however, is that China, India, and other low wage countries also compete on this same world market, and the workers in those countries make horribly low wages. But in the last four years the U.S. corporations that aim to compete with these low wage nations have made spectacular “progress” in driving down the wages of their workers. Thus Obama can brag about his “achievement” of increasing U.S. exports.

Democrats and Republicans agree that no national jobs program should be implemented, that unions should be weakened or destroyed, that the public sector should be slashed and its workers’ wages cut. Both parties want U.S. corporations to compete better on the world market, requiring that U.S. workers make lower and lower wages. This is the fundamental economic issue being ignored in the mainstream media.

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