Not Really Labor's Day - NYTimes.com

Not Really Labor's Day - NYTimes.com: "The lack of any fiscal stimulus aimed at lowering unemployment has contributed to this trend. Ironically, the Federal Reserve’s policy of quantitative easing to stimulate the economy and lower unemployment – which some Republicans tried unsuccessfully to outlaw — has probably also benefited those at the top more than those at the bottom. Lower interest rates have driven up the price of stocks, but left those dependent on less risky sources of investment income (such as savings accounts and bonds) stranded with low returns."

+++++++++++++++++++++++++++++++++++

Accelerated adoption of digital technology (reduction in the labor component) and globalization (lower priced labor component) on the classical economic definition of productivity has favored capital investment and its returns. These megatrends have disrupted the expectations and requirements for workers.

This is why I believe the historic Keynesian economic theory that government 'stimulus' will goose the economy no longer works as it has in the past.

The Fed's stimulus efforts (low interest rates, QE, etc.) have fallen short of expectations and have benefited capitalists far more than labor because of the two mega-factors mentioned above.

Add to these difficulties the inertia of the education system and we have a dispirited workforce ill-prepared for today's and tomorrow's economy.

The Renewal of Civic Capitalism - NPQ – Nonprofit Quarterly - Promoting an active and engaged democracy.

Scott Harshbarger, Former Attorney General in Massachusetts, has it right in this graduation speech.

 "Civic capitalism is all about a robust business community, an engaged citizenry and a government that actively promotes your ability to provide a check on large institutions, from banks to corporations, and on government itself. It is about ensuring that democratic values endure, even as politicians and movements come and go. It is about rooting out corruption and insisting on honesty, opportunity, and full information, not just because it is the right thing to do, but because markets and civil society cannot function otherwise. Civic capitalism takes the long view, and teaches us that the government has a role in minimizing risks to the system—financial and otherwise—because that civil society is the base from which entrepreneurs and firms operate."

'via Blog this'

The Affordable Housing Scam - Reason Magazine

The Affordable Housing Scam - Reason Magazine:

John McClaughry's excellent review of the recent book, Reckless Endangerment, provides a realistic appraisal of the leaders, groups and  and policies that moved the appealing notion of expanding home ownership as a part of the American Dream to the near-collapse of the banking system and the economy. This is well worth reading for a thumbnail sketch of how the mess unfolded. Good work, John.

 "The thesis of Reckless Endangerment is simple: In a rush to orchestrate affordable home ownership—and generate enormous profits—politicians, government-sponsored enterprises, pusillanimous regulators, greedy mortgage brokers, and profit-chasing Wall Street investment bankers combined to drive the American economy into its worst crisis in 70 years, saddling taxpayers with trillions of dollars of debt and leaving the financial landscape littered with the wreckage of ruined lenders, borrowers, and taxpayers."

'via Blog this'

Excerpt: Mike Mayo's Exile on Wall Street - WSJ.com

A recently popular opinion from one of the few analysts who early on called out the banking sector for too-risky investments/activities and was chastised for it before the bottom fell out of bank stocks and the financial crisis precipitated by their house of cards.

"To fix the banking sector, should we rely more on government regulation and oversight or let the market figure it out? Tougher rules or more capitalism? Right now, we have the worst of both worlds. We have a purportedly capitalistic system with a lot of rules that are not strictly enforced, and when things go wrong, the government steps in to protect banks from the market consequences of their own worst decisions. To me, that's not capitalism."

'via Blog this'

The Divider vs. the Thinker - WSJ.com

Sounds like a statement that thoughtful Occupy Wall Street folks could buy into and adopt as their own. But it comes from a conservative Republican who understands our national disease and speaks openly about it.

"Rather than raise taxes on individuals, we should "lower the amount of government spending the wealthy now receive." The "true sources of inequity in this country," he continued, are "corporate welfare that enriches the powerful, and empty promises that betray the powerless." The real class warfare that threatens us is "a class of bureaucrats and connected crony capitalists trying to rise above the rest of us, call the shots, rig the rules, and preserve their place atop society.""


'via Blog this'

The Weekend Interview with Mortimer Zuckerman: The Exasperation of the Democratic Billionaire - WSJ.com

Strong talk from a highly successful real estate capitalist disenchanted with TeamObama.

"...The Boston Properties CEO is trying to understand why Mr. Obama has made little effort to build relationships on Capitol Hill or negotiate a bipartisan economic plan. A longtime supporter of the Democratic Party, Mr. Zuckerman wrote in these pages two months ago that the entire business community was "pleading for some kind of adult supervision" in Washington and "desperate for strong leadership." Writing soon after the historic downgrade of U.S. Treasury debt by Standard & Poor's, he wrote, "I long for a triple-A president to run a triple-A country..."

His words struck a chord. When I visit Mr. Zuckerman this week in his midtown Manhattan office, he reports that three people approached him at dinner the previous evening to discuss his August op-ed. Among business executives who supported Barack Obama in 2008, he says, "there is enormously widespread anxiety over the political leadership of the country." Mr. Zuckerman reports that among Democrats, "The sense is that the policies of this government have failed. . . . What they say about [Mr. Obama] when he's not in the room, so to speak, is astonishing." 

Further evidence of Wall Street capitalists' alienation from Obama can be found in this October 15, 2011 NY Times story. Romney has raised far more campaign cash from Wall Street than Obama, a substantial turn-around from the 2008 campaign.