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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: Tenchusatsu who wrote (181155)	1/20/2004 5:27:38 PM
From: Road Walker	Read Replies (1) \| Respond to of 1573772

Bush's Black Hole Economic Policy By Stephen Pizzo, AlterNet January 20, 2004 What's going on? The DOW and NASDAQ are way up. Interest rates are way down. Wall Street analysts are humming "Happy Days are Here Again." And President Bush has all but unfurled a "Mission Accomplished" banner over at Treasury. But apparently not everyone is so sanguine. Against all these bullish Wall Street indicators are indicators heading in the opposite direction. Gold, which generally moves in the polar opposite direction of stocks, has also soared in recent weeks. And the U.S. dollar plumbs new lows against other key currencies. Meanwhile the once iffy euro is now worth more than the dollar – a lot more. It now takes nearly $1.30 to purchase a single euro. The dollar and the Japanese yen are now nearly at par. This can mean only one thing – investors are dumping dollars. So far foreign governments have restrained from throwing their dollar reserves into the bonfire, but that could change at any moment. If governments begin selling, the dollar will slide further. The kinds of investors who trade precious metals and foreign currencies are a different breed than the cheerleader types who trade stocks. These folks are steely-eyed, ice-water-in-their-veins speculators who would foreclose on their mothers. They are quintessential realists immune from hype, spin or "irrational exuberance." So when these folks start shorting America it's prudent to ask why. These savvy investors are aware that U.S. fiscal policy has fallen back into its old ways. Record deficits are on tap for at least the next decade, and there appears to be no political will in either party to change that. But the U.S. economy has survived deficit spending before, so there must be more than that spooking these folks. And there is, a lot more. First there's the much-ballyhooed "recovery." These speculators do not see the bounce in U.S. stocks or GDP numbers as a result of any fundamental growth in the American economy, but rather a spike spending fueled by overly generous tax cuts. Only job growth can sustain a true recovery and that's not happening. The latest job numbers fuel such worries. The December jobs report shows payrolls grew by only 1,000 new (non-farm) jobs that month – 299,000 jobs short of the 300,000 new jobs a month the President promised his tax cuts would soon create. Job outsourcing further clouds the future of the U.S. economy. What had been a slow leak of U.S. manufacturing jobs to cheaper overseas markets has become a high-pressure stream of jobs heading east. A tipping point appears to have been reached during 2003. Companies with large U.S. operations discovered that they either had to compete against companies producing similar products from cheaper labor venues or fold. A manufacturer paying U.S. workers $9.50 an hour cannot compete against a competitor paying Mexican workers 78 cents an hour. Until 2002 primarily U.S. manufacturing jobs were being off-shored. But in recent months that trend spread with a vengeance to America's high-value, high-wage white-collar jobs. Programmers, engineers and even architects, can be had in India or China for a tenth of what employers pay similarly skilled American professionals. The loss of these top-tier jobs puts into serious question assurances from open market advocates that when one class of jobs is off-shored it simply opens the way in the U.S. for new kinds of higher value, higher wage jobs. In fact, what appears to be afoot is a great leveling of wages across national boundaries. The migration of U.S. and European companies to the cheap-labor venues is boosting wages in those countries while conversely exerting downward pressure on the wages of workers in the developed nations. This leveling effect is already showing up in government numbers. According to the December jobs report, average weekly earnings fell $2.08, to $522.35 from $524.43 in November – during a "recovery." President Bush's new temporary worker/immigration reform proposal, if enacted, would only accelerate this process by putting additional downward pressure on U.S. wages, especially for service industry workers who are already at the bottom of the wage scale. While better wages and improved working conditions may be long overdue good news for the developing world, it is difficult to see how the trend can result in anything but steady erosion in the standard of living of American workers. Wage competition is not a zero-sum game. At the end of the day someone gets less. Henry Ford fathered the notion that workers should at least earn a wage high enough to enable them to buy the products they build. Ford's industrialist contemporaries thought he was nuts to pay workers more than the prevailing wage. History, however, proved Ford a visionary whose egalitarian notion spurred the most vibrant, self-sustaining economy in history. The current trend of driving wages down reverses that logic, threatening to reverse the result as well. While American consumers currently benefit from lower prices by feeding on foreign-produced goods, it is a short-term benefit. Over time, more well paying U.S. jobs will be lost and replaced by lower-paying jobs. Eventually American workers will be less and less able to fuel the product-consumption continuum that has been the engine of the American economy for the past 60 years. And then begins the death spiral. Fewer companies will be paying U.S. taxes. Those still domiciled in the U.S. will have lower profits resulting in less tax revenue. American workers will be paying less in withholding taxes as well since they will be earning less. It is a downward spiral that feeds on itself; a kind of black hole from which no energy or light – or economy – can escape. Stephen Pizzo is a freelance journalist in Sonoma County, California. alternet.org

To: Tenchusatsu who wrote (181155)	1/20/2004 6:05:58 PM
From: i-node	Read Replies (2) \| Respond to of 1573772

>>> David, if Kerry and his supporters (i.e. Al, who's just looking for anyone to defeat Bush) is going to hold up his Vietnam war record, they should also hold up his anti-war record as well: Ten, That's pretty bad. I didn't realize he had these ties to Hanoi Jane and Ramsay Clark. These are two people who leap to mind when I think of treason. I would think this would provide a lot of political fodder for Republicans in a general election. I've been thinking Dean was the easy kill; but it may be that Kerry has some history that is yet to be presented...