People in the streets and angry isn’t enough (though it is a start). People need to be in the streets and with an institutional program to replace capitalism. That’s how you move mountains.

But angry people in the streets will still frighten a few elites here and there, and so a slightly looser monetary policy may result. It’s still just crumbs though.

You want steak, instead of crumbs? You really want to kick some elite capitalist ass? Then you’ve got to become a pareconist. There’s no other way.

I’ve said before that, if anyone can find another way, it would be Jane. And I’ll be happy if she can prove me wrong. However, I still don’t believe it. I don’t see any mountain moving occurring without the benefit of participatory economics.

The problem is capitalism. Does anyone dispute that? If you agree with that, then the question immediately becomes, What is the solution? Your options are (1) market socialism, (2) centrally-planned socialism, (3) fascism, and (4) parecon. The former three have all existed and can be studied (and have been). Parecon has not existed, but its theoretical model holds up extremely well — which is why the professional economists who have studied it have never questioned its validity and, indeed, why they now simply ignore it (since they can’t challenge it).

If someone has another way to move mountains, please prove me wrong. Absent that, I think elementary logic dictates that the entire U.S. left become a pareconish left — that is, if winning huge gains is the goal, and not just something toward which one pays lip service.

Great comment, Eric. I was going to say that people in the streets had to have an effect.

I certainly hope they take note of the stimulus and quantative easing done here in the US. It didn’t do one thing to help the economy, only the rich were able to grab more. THe leacherous no-goods!

A true stimulus would be to either remove all debt from the citizens, or give them the money to remove their debt. That could happen in many ways, one of which would happen in the fastest and most effective way would be massive Public Works programs paying $17.00 to 28.00 dollars and hour. And it would have to be impleminted in each county of every state of the union.

Stimulus isn’t a solution to structural economic problems.

Michael Spence, Nobel Laureate:

A stimulus package that temporarily restores elements of precrisis demand is unlikely to generate the escape velocity needed to get out of the jobs hole. Nontradable job [i.e. US service jobs which can't be outsourced overseas] growth can’t mask the declines in the tradable sector any more. The structural problem demands a structural answer.

[i.e. US service jobs which can't be outsourced overseas]

Nuh uh! Walmart CAN save us!

Ha!

You think that maybe DC should change our economic plan from the, “Service Economy” that Bush and crew installed wiping out all manufacturing?

Seriously, the remake of burger joints into manufacturing industries is beyond stoopid. It is insanity and to allow that to continue is something worse. I just don’t have a term for it yet.

The last time the US did Public Works they paid the going minimum wage and only allowed one person from each family to participate (to spread the benefit to more families).

I just don’t have a term for it yet.

How about evil?

Paul Krugman, liberal economics guru, has ridiculed a structural approach.

. . .So what did the O.E.C.D. have to say about high unemployment in its member countries? “The room for macroeconomic policies to address these complex challenges is largely exhausted,” declared the organization’s secretary general, who called on countries instead to “go structural” — that is, to focus on long-run reforms that would have little impact on the current employment situation.

And how do we know that there’s no room for policies to put the unemployed back to work? The secretary general didn’t say — and the report itself never even suggests possible solutions to the employment crisis. All it does is highlight the risks, as it sees them, of any departure from orthodox policy. . .

For example, we could have W.P.A.-type programs putting the unemployed to work doing useful things like repairing roads — which would also, by raising incomes, make it easier for households to pay down debt. –June 1, 2011

I agree. However by using stimulus, especially direct job creation FDR really saved capitalism for this one more Gotterdamerung.

The PTB may again resort to stimulus patches that will last awhile. But the entire system needs to change if we are to ever achieve a better life for the most of us.

Rules of Capitalism (in a monetary system)
Posted on April 26, 2010

5% of the global population own 95% of its wealth (roughly speaking).
Those who have the most get to make the rules.
The more money you got the more money you can make.
The less money you got the less money you can get.
The poorer you are the more expensive everything is.
The poorer you are the sicker you will be and the sooner you will die.
The poorer you are the worse your education and your job will be.
The worse the pay the harder the job.
The higher the pay the easier the job.
If you are really rich you can be a capitalist and not do any work at all.
The poor pays for every mistake made by the rich.
Rich people start wars that poor people have to fight.
Most rich people get rich by inheriting
Most poor people stay poor through hard work and sacrifice

These rules are a transcript from “Capitalism & other kids’ stuff” a film documentary presented by Paddy Joe Shannon of The World Socialist Movement.

http://dueband.wordpress.com/2010/04/26/rules-of-capitalism/

“Most rich people get rich by inheriting
Most poor people stay poor through hard work and sacrifice”

Sounds about right.

Well, looking up Parecon didn’t get me a definition, but I did get an invitation to bed a beautiful babe, and some young thing in a popup called me cutie and wanted to know my current activities, assuming that “Hey, cutie, whatcha doing” means just that. Since I’m a way-overweight 68 year old with beard, bald head, and non-alcoholic beer gut, I was quite flattered. In short, to keep me from getting too bounced about by crazy Internet ads, a brief description of Parecon would be a kindness.

Someone help me out here.

Quantitative easing, as far as I know, did little to help the US economy.

Why is it expected to work in the UK?

wiki: Participatory economics, often abbreviated parecon, is an economic system proposed primarily by activist and political theorist Michael Albert and radical economist Robin Hahnel, among others. It uses participatory decision making as an economic mechanism to guide the production, consumption and allocation of resources in a given society. Proposed as an alternative to contemporary capitalist market economies and also an alternative to centrally planned socialism, it is described as “an anarchistic economic vision”, and it could be considered a form of socialism as under parecon, the means of production are owned by the workers.

The US has to make something, they have to corner the market with exclusivity. We will always have a trade deficit if we having nothing but scrap metal to export.

Take the headlines that IBM has developed a computer chip that thinks. Where is that being made? Does IBM owe Americans anything for their growth and largesse? Is IBM loyal to the US and it’s people?

The movie in the link is worth watching.

That was the Last time.

We need a new program for a new problem.

Well, a year or so ago our no. 1 export to China was scrap paper, perhaps all those missing mortgage notes.

America does make stuff. More than anyone.

The latest data again shows the USA is the largest manufacturer but China looks poised to take over the number one spot soon.

http://investing.curiouscatblog.net/2011/01/04/top-15-manufacturing-countries-in-2009/

Multi-national corporations think in market share. Geo-political lines of sovereignty and flags are irrelevant and the people who live under them as sources of cheap labor.

Try this, this, and this.

Oh and since congress is paying a minute amount of attention to the price of medications, let’s ask them why we can’t make those medicines here in the US!

They sided with Pharma that we the people can’t import our medicine from other countries where it is cheaper. But, Heck! They import it to sell it to us at hugely exaggerated prices!

Okay, but who bells the cat? Voluntary participation seems a bit doubtful.

Pardon me, but you are mistaking the numbers from US based businesses. The jobs themselves are not on our shores.

If something is going to be done (go after the rich or riot) can it be done this fall before all the poor freeze to death this winter because of the Liheap cuts? Seroiusly, changing the government will do no good until the individuals meddling in it are taken care of first. May I recommend starting with the Koch brothers.

5% of the global population own 95% of its wealth (roughly speaking)

If you’re American or European, you’re part of that 5% (globally speaking).

Mr. Dayen . . . you don’t see this austerity drive as something DELIBERATE on the part of the rich elitists to strip the middle class of it’s wealth?

And reduce the planet to one of serfdom akin to the 1200′s?

You see this all as bad policy making? A political blunder as opposed to intentional class war?

Do I have this correct?

yes, you may.

Spot on comment. Monetary stimulus won’t work in England just like it hasn’t worked here.

Central Banks have exhausted the supply of willing credit worthy borrowers with decades of easy money policies that created a credit bubble that must now be deflated.

Easy money can’t solve the problems that easy money created in the first place. That’ why Bernanke and the other Central Bankers are pushing on a string.

Who are these people (26%) who approve of the president’s handling of the economy?
–not Repubs (5%) or independents (23%) but Dems (53%) according to Gallup.
But why?

Thanks.

you need to explain that to me. I see it backwards. I see it as the globe trotter elites being the 5%.

Rustbelt recovery

Factory employment has been slower to recover than output, since productivity has risen. Nonetheless, that too is growing. In February factory payrolls rose by 33,000 from January. In the past year manufacturing employment has gone up by 189,000, or 1.6%, the biggest gain since the late 1990s. Total employment rose just 1% in that period. Unemployment has fallen more sharply than the national average in Illinois, Ohio and Michigan, which are relatively dependent on manufacturing.

http://www.smartplanet.com/blog/business-brains/reports-of-us-manufacturings-demise-may-be-greatly-exaggerated/14285

You seem to be only focusing on the few who have it better than you. There are about 180 countries in the world, 95% of them have it worse than you, some a lot worse.

http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)_per_capita

Nobel laureates Paul Krugman and Joseph Stieglitz, plus many other economists say a stimulus is very much needed. The Obama stimulus, while way too little, according to these economists, did provide a jobs boost for awhile.

Why would a large enough stimulus not help the economy? In a recession – which we’re still in for many Americans – happens when people stop buying goods and services, which leads to layoffs, leading to less buying. Only government stepping in by creating buying power, in the form of direct stimulus or tax cuts or both, can break up this vicious cycle.

FDR used stimulus spending, though again not enough. The economy responded, but again not enough. When WWII came along, massive government spending on the military finally ended the depression for good.

The Obama stimulus did help the economy, even though it was far too small, and its effects therefore didn’t last. Why was it too small? Because Obama is a Norquist Republican and the last thing he wants is for government to succeed in anything. That flies in the face of the Norquist creed.

That’s a fuckin’ blogpost with “they” and “some” said/say sprinkled throughout. How about a primary source for your assertions.

Absolutely. The old maxin, the rich get richer and the poor get poorer is right.

This isn’t a new problem. It’s the same problem that unfettered capitalism has brought about in the repeated boom and bust cyles that have occurred almost through the entire history of this country. Fixing it is not rocket science but mostly common sense.

A new article in The Economist (linked in the link above) points out that the manufacturing sector — in the Rust Belt no less — is leading our economy back into global competitiveness.

Considering that the assertion in #5 that “ALL US manufacturing had been wiped out”, and the research technique that came to that conclusion seems to be “running around with hair on fire”, I think I’ve provided more than enough info.

From the article in The Economist:

Beyond this cyclical bounce-back, though, a structural shift may also be under way. Makers of floorings, furniture and glass, all of which go into houses, were especially hard hit and have yet to start hiring again. But those that make things for businesses or customers overseas—computers, machinery, electronic equipment, heavy-duty trucks—are thriving. Cisco Systems and Intel Corporation notched up record sales last year. Caterpillar and John Deere, which makes diggers, bulldozers and farm equipment, saw sales leap.

Emphasis mine.

Where are the manufacturers of stuff regular citizens use in their day to day lives? Not counting autos and war toys, I’ll grant you the US is the worlds largest arms manufacturer and exporter, this stuff isn’t made for the shelves of Wal-Mart or Sears. The stuff that ordinary folks buy is what made our manufacturing the best and biggest in the world. We’re not doing that any more.

Stuff like clothes, shoes, hand tools, etc.

Monetary stimulus by central banks in coutries with fiat currencies – currencies created by the central governments through their central banks – has nothing to do with debt or credit bubbles. In the US such stimulus involves, not lending by the government but spending dollars directly in the economy and/or causing dollars to be available by cutting taxes. Government spending on excess goods and services creates jobs because companies now need to produce more to replace what the government has bought. And citizens who have received a substantial tax cut are in a better position to spend.

The mistake (?) most politicians, very much including Obama, make about this is to decry how all this gov’t spending and tax cutting will increase the federal deficit. Aside from the fact that most economists like Krugamn and Stieglitz say emphatically that running up the deficit during a recession is not a bad thing but a good and necessary thing, federal debt is categorically unlike private sector debt in that the government can not, by definition, go bankrupt. This is because it issues and has complete control over its own currency.

“The government neither has nor does not have dollars.” Warren Mosler

Maybe the same lunatic fringe (albeit a big fringe) who hung on with W right to the bitter end. After all, the Obama admin is really Bush’s third term.

Quantitative easing in Britain will work and will significantly boost their economy, for 1 to 1.5 years, just as it did here, and immediately (i.e., a month or two) after the quantitative easing ends, the economy will stumble and fall, just like here, because the markets will always eventually go where they belong. But pacifying the population for a year and a half can be exactly what’s needed at this time by those desparately clinging to power. I have deep skepticism about the whole concept that the government could or should be involved in manipulation of markets and market prices. The natural rhythms of the markets do a better job of setting the correct allocations and prices at any moment in time, the ones that are natural and normal, and they allow the markets to retain the essence of what made them appear valuable, correctly, IMO, to theorists in the first place. Better than government-manipulated markets, over the long haul.

Both the U.S. and Europe need an Economic Marshall Plan (EMP), like that instituted after World War II in Europe that helped rebuild all that was destroyed by war machines built by a bunch of German industrialists, a post-war “stimulus plan” that generated jobs, put food in people’s bellies, rebuilt devastated societies and spurred the growth of prosperity across the economic spectrum.

Instead, we are seeing post-World War I austerity being pushed, no economic stimulus being proposed (but if proposed, too little, or too late, or being blocked entirely), the rich hoarding wealth at epic proportions and bought politicians calling for austerity for everyone but the rich.

And regarding an anti-austerity pro-stimulus Economic Marshall Plan (EMP), it takes EMP to spell empathy, something that seems sorely lacking in high-level discussions and decisions, both in Washington D.C. and European capitals, at least any empathy toward the “least” amongst us. What would Jesus do, if he were involved in these discussions and decisions? Well, we all know what he had to say about the “least” amongst us, relative to himself, so I’d guess he’d be for the rich giving instead just the rich taking, thus displaying some empathy for the “least” even if they don’t necessarily feel any empathy for the “least.”

The Obama stimulus did help the economy, even though it was far too small, and its effects therefore didn’t last. Why was it too small? Because Obama is a Norquist Republican …

I think it’s because he knew we didn’t have much money (or credit) to work with and he knew Republicans wouldn’t let him have much and because he knew a huge expansion of the money supply would generate massive inflation which would be as bad as anything else.

Look at it this way — if America is to stand on its feet it can’t be because the government is constantly pushing money through the pipe into the real economy. It has to stand on it’s own. Government did push a lot of money into the economy and that stabilized it. Now there’s still some need for infrastructure spending and such. That’s good. But, in the long run government just can’t be the only source of economic energy.

If the Republicans in the business community want America’s economy to fail they may have the power. A stockholder rebellion could change that, but if all the rich are in cahoots, then they can destroy the economy any time they want.

OTOH, if the real problem is we’ve lived on our credit far too long and outsourced so much that we’re just a house of cards, a shell of our former self and just inches away from collapse (as in the fall of ’08), then we need to really reshape things to bring money home and to force employment of Americans. Republicans naturally oppose anything that big and the current administration would certainly try everything more incremental before going to that extreme. But, something like tax system changes which push corporations to bring overseas profits home would be incremental and may happen.

The heat on Republicans is ramping up, so maybe something will happen, but the “Change we can believe in” the Democrats were ready for in ’06 & ’08 is only now becoming something the Republicans have to consider.

It isn’t just about a short stimulus boost. It’s about a huge shift of wealth to the financial sector, to the wealthy and out of the country which we have to change.

Obama is not to blame, but can be part of the solution by leading.