Category Archives: economy

World Bank: Republicans Are Wrong On US Economy

Woopsies. It’s the death of yet another cherished Republican talking point:

With the economies of the U.S. and Europe sputtering along on fumes, politicians are quick to blame regulation and taxation as the main cause of a lackluster business environment. Yet, according to the World Bank’s 212 page “Doing Business 2012″ report, released on Wednesday, there is less red tape for setting up shop in the U.S. than there is in all of Europe, Latin America, Africa and most of Asia.

The World Bank uses indicators such as time spent to set up a business to getting credit, among other things, in benchmarking the 183 countries it ranks in “Doing Business”. The report measures and tracks changes in the regulations applied to domestic companies in 11 areas in their life cycle–such as investors rights, taxation, cross border transactions, legality and enforcement of contracts and bankruptcy law. A fundamental premise of doing business is that economic activity requires good rules that are transparent and accessible to all, not just big business. Such regulations should be efficient, the World Bank states, striking a balance between safeguarding some important aspects of the business environment and avoiding distortions that impose unreasonable costs on businesses. “Where business regulation is burdensome and competition limited, success depends more on whom you know than on what you can do. But where regulations are relatively easy to comply with and accessible to all who need to use them, anyone with talent and a good idea should be able to start and grow a business (legally),” the World Bank said.

Where does the supposed regulation and taxation crippled U.S. stand in the rankings? It is number four, trailing behind New Zealand (3), Hong Kong (2) and Singapore (1).

That’s the uber-liberal Socialisticky World Bank, you know, the one that used to be run by Iraq War hawk/creepy neocon Paul Wolfowitz and is now run by Iraq War hawk/creepy neocon Robert Zoellick.

Oh, dear. So American businesses aren’t strangled by burdensome regulations and taxes? It’s not the fault of the EPA and OSHA and Obamacare? But that’s the exact opposite of what we hear from every single Republican in Washington — including every member of the insane clown posse that is the GOP presidential field (except maybe Rick Santorum, who seems to be blaming everything on gays and vaginas).

So in other words: once again Republicans are wrong about the economy. I know, y’all are shocked. Shocked!

Forbes concludes:

The U.S. economy is suffering because of a combination of historic deleveraging, lackluster support from fiscal policy makers in Washington, and a general, yet pervasive, lack of business confidence. The U.S. economy is not suffering because of taxes, energy policy, or Obamacare as data and polls have shown consistently.

I would add, the number one reason the U.S. economy is suffering is because of decreased demand: plain and simple. Or, as Paul Krugman famously wrote last year: “It’s demand, stupid”:

I’ve said this before, but Catherine Rampell has a very nice chart making the point: if you ask businesses — as opposed to their lobbyists — what their problem is, you find no hint of the stories the usual suspects are telling you about government interference, political uncertainty, etc.. Businesses aren’t hiring because of poor sales, period, end of story….

Yes. We keep hearing this over and over. And yet, Republicans remain strangely attached to their false notions of the world, all evidence to the contrary. I really don’t get it. This is a political party completely divorced from reality.

Or, to give you a visual:

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Filed under economy, Republican Party, World Bank

Holding Workers Hostage

[UPDATE]:

Several folks have wondered what Melissa Brookstone’s small business might be, and if she’s planning on not hiring now. I can’t be sure (she worships at the altar of Ayn Rand and is promoting this “planetary bill of rights” project according to her Facebook page…)

I’m not certain but it appears she works as a process server in Denver. Hope none of her law firm clients are planning to Go Galt.

—————————————

Those Tea Party people, they’re such awesome patriots:

Tea Party Nation sent to their members today a message from activist Melissa Brookstone urging businesspeople to “not hire a single person” to protest the Obama administration’s supposed “war against business and my country.” Brookstone writes that business owners should stop hiring new employees in order to stand up to “this new dictator,” the “global Progressive socialist movement,” Hollywood, the media and Occupy Wall Street.

Click on the link and read the insane wackadoodle this Melissa Brookstone person has cooked up in her “manifesto”: Obama has seized “dictatorial powers” to “bypass Congress,” congress is ” controlled by a Progressive socialist Senate,” and best of all, those all-powerful Democrats and their minions in Hollywood and the liberal news media are promoting an “anti-business, an anti-free market, and an anti-capitalist (anti-individual rights and property ownership) agenda.”

Okie dokie. Sounds like someone forgot to take her medication this month. So yeah, she wants all small business owners to stop hiring because if things get even worse in this country, that’ll show ’em! Or something.

Let’s just imagine what kind of backlash such America-hating rhetoric would generate if it came from the left. But it’s perfectly fine for the Tea Party to call for businesses to hold American workers hostage until there’s a Republican in the White House. Isn’t that what we call economic terrorism? IOKIYAR.

Honestly, this isn’t much different from Mitch McConnell’s grand plan to make Obama a one-term president by obstructing any legislative effort to fix the economy.

I wonder how many small businesses would be interested in taking Brookstone up on her offer? Can you imagine? “I really need to expand my business right now so I can increase my profits but I can’t because making sure Obama fails is just too important.”

Hilarious. What a bunch of morans!

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Filed under economy, employment, Tea Party

Tone Deaf

With the protests against corporate greed spreading not just nationally but internationally, the Republicans in Congress have decided now is the perfect time to revamp our corporate taxes and move toward a territorial system:

The idea behind the system is to encourage multinational companies to bring back their money to the U.S., where supporters of the change say the money could be invested. Proponents also argue the move would make U.S. companies more globally competitive, particularly since most industrialized countries have tax systems in which companies are only taxed in the country where it is earned.

The Ways and Means proposal would not be a fully drafted bill, but instead a proposal that would allow business groups and other stakeholders to offer suggestions. As of now, it’s unclear when the panel might release the proposal.

Well, that’s nice of them to let the corporations write their own laws. Why even bother with an expensive, unwieldy institution like Congress? Just let the corporations do what they want, right? Dispense with the middle men/women!

Now, would someone please explain to me how taxing American corporations only on profits made within U.S. borders encourages them to bring their money back to the U.S.? Near as I can tell, the territorial idea simply encourages multinationals to move more of their operations offshore (and Citizens For Tax Justice seems to agree with me). It’s basically the same as our present “deferral” system. In theory, under “deferral” corporate profits generated overseas are not taxed but “deferred” until they’re brought back to the U.S., but in practice that never happens because multinational corporations have all sorts of overseas subsidiaries and tax havens where they park these funds. That’s the whole point of “repatriation” — letting corporations bring that money home at temporarily reduced tax rates.

Shouldn’t we do away with the “deferral” loophole, not cement it in place? I guess Republicans are trying to pretend that overseas profits will flood back to the U.S. like a mighty river of tax-free revenue — kind of like the “repatriation” scheme, but set in stone in the corporate tax code. It’s that same Republican fairy tale: lower taxes create jobs! That’s what they keep telling us, isn’t it?

Well let’s see how that worked last time we offered multinationals a chance to repatriate their offshore funds at low, low tax rates. We did that under Bush The Lesser in 2004. So, guess what the participating companies did with their tax savings?

…in fact, the corporations who took most advantage of the holiday enacted in 2004 shed jobs in the ensuing years and did not increase their rate of spending on research and development.

On the flip side, the study found those corporations also appear to have used the holiday for stock buybacks and to boost executive pay, which was not allowed under the legislation authorizing the holiday.

Oh noes! And Republicans want to make this permanent? Egads.

But Republicans are still drinking the “lower taxes creates jobs” Kool-Aid, despite the continued failure of these ideas. We’ve been cutting taxes on wealthy “job creators” for years, and we still aren’t seeing the magic. And now they want to permanently cut corporate taxes with this “territorial” scheme because hey, if they’re doing it in the UK and Japan, then we have to, right? To be “competitive”?

You know what they have in the UK and Japan that makes them competitive? A functioning healthcare distribution system that doesn’t place the burden of our overpriced, for-profit healthcare system on the backs of employers. But I digress.

Citizens For Tax Justice thinks we need to go in the complete opposite direction, which means keep our worldwide tax system but remove the “deferral” loophole. That removes the incentive corporations have to offshore their operations and move jobs away from the U.S. That makes absolute perfect sense to me, but our debate is so muddied with the fairy tales, I’m sure we’ll keep hearing about how lower taxes creates jobs over and over again. Yet no one can ever point to a time when that was true.

Anyway, this idea was first floated back in the spring but now the GOP is supposedly moving forward with it. I’m just trying to imagine how a corporate tax idea that permanently encourages outsourcing jobs while offering corporations lower tax rates will go over with the masses protesting corporate greed. I’m thinking not too well.

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Filed under corporations, economy, employment, taxes

It’s Back To The Land

For someone who likes to eat and cook as much as I do, I admit I don’t know much about food policy. So today’s blog action day topic had me at a bit of a loss. But I do know that food impacts our society and cultural life in a very profound way, and we’re seeing changes now that I predict will have an impact for years to come.

Earlier this summer I read Melissa Coleman’s amazing memoir, This Life Is In Your Hands, about a family of homesteaders back in the 1970s. If you’re too young to remember this movement, back in the ’70s a lot of young people decided to ditch the establishment life of 9-to-5 and what they saw as a corrupting consumer culture and return to the land. They weren’t hippies, they were homesteaders, though I do believe a lot of our modern perceptions of the ’60s and hippie culture actually comes from this later movement. These folks were considered radicals but we have them to thank for the organic farming revolution, health food, alternative medicine, alternative energy, recycling and a whole range of once non-conventional practices that are now part of mainstream American life.

What I didn’t realize is that the homesteading movement was sparked by the global economic crisis of the 1970s and the oil crisis that started in 1973. Growing your own food became an economic necessity.

And oh my God but 40 years later, here we are again:

My turn with spade and hoe started a few years ago when I found myself divorced and flat broke. My livelihood as a freelance writer went out the window when the economy tanked. I literally could afford beans, the dried kind, which I’d thought were for school art projects or teaching elementary math. And I didn’t know how to cook.

Luckily, my late father had hammered into me that grit was more important than talent. So, when I couldn’t afford fancy food — never mind paraben-free shampoo — for my babies, I figured, if peasants in 11th-century Sicily did all this, how hard could it be?

I researched how to raise hens from chicks so we could get our omega-3-filled eggs. I learned to stretch a single piece of cheap meat into nearly a week’s worth of dinners. I made my own cleaning products. Not because I liked it. Because it was cheap.

Read the rest of Susan Gregory Thomas’ column. It’s the 1970s, homesteaders, back-to-the-land movement all over again, but on steroids. That generation laid the groundwork and now we’re seeing tons of new options. The movement has been transported to urban areas, for one thing: it’s no longer necessary to move to Maine for your self-sufficiency experiment. People are raising chickens in backyard coops these days, community gardens have sprung up serving those without yards. Information is available at the click of a computer keyboard. Buying shares in a CSA is another option bringing organic, sustainable produce, meat and dairy products to urban dwellers (and I was shocked at the large number of CSA’s in the Nashville area).

This is the homesteading movement transported into the internet age. And thinking about the major changes that last movement sparked, I can only imagine how these modern homesteaders will change American attitudes about food. I think the impact will be profound. I also think this is as big a threat to corporate America as any protest.

This has to send chills through John Mackey’s heart:

Even if things turn around financially, I don’t think I could stomach going to Whole Foods (except maybe for olive oil) because my biggest revelation in terms of self-sufficiency is this: It is no big deal. You can tell yourself anything is too difficult, or you can just do it. And you do not need to reconstruct your worldview or take issue with others.

Shhh… don’t tell SC Johnson and Procter & Gamble that we just need a $2 bottle of generic vinegar to wash our floors. Don’t tell Whole Foods that we can buy our organic garlic from a local farm, not shipped in from Argentina. (By the way, can someone explain to me why Whole Foods sells locally-grown produce, and organic produce, but rarely locally-grown organic produce? What’s up with that? We have tons of organic farms around here, is there some reason they aren’t buying from them?)

How all of this shakes out socially and culturally I have no idea, but it will be fascinating to watch.

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Filed under economy, food

Death Of Another Right-Wing Meme

Uh-oh:

Regulations, taxes aren’t killing small business, owners say

By Kevin G. Hall | McClatchy Newspapers

WASHINGTON — Politicians and business groups often blame excessive regulation and fear of higher taxes for tepid hiring in the economy. However, little evidence of that emerged when McClatchy canvassed a random sample of small business owners across the nation.

“Government regulations are not ‘choking’ our business, the hospitality business,” Bernard Wolfson, the president of Hospitality Operations in Miami, told The Miami Herald. “In order to do business in today’s environment, government regulations are necessary and we must deal with them. The health and safety of our guests depend on regulations. It is the government regulations that help keep things in order.”

What’s that, you say? Surely this person must be some kind of Dirty Fucking Hippie or a big Democratic Party donor or something. Just an isolated case, right?! Nope:

McClatchy reached out to owners of small businesses, many of them mom-and-pop operations, to find out whether they indeed were being choked by regulation, whether uncertainty over taxes affected their hiring plans and whether the health care overhaul was helping or hurting their business.

Their response was surprising.

None of the business owners complained about regulation in their particular industries, and most seemed to welcome it. Some pointed to the lack of regulation in mortgage lending as a principal cause of the financial crisis that brought about the Great Recession of 2007-09 and its grim aftermath.

Wolfson’s firm is readying to open a Hampton Inn this year in Miami on land purchased from a condo developer during the housing downturn. His business could be in line for higher taxes if President Barack Obama allows the current, lower rates on the richest Americans to expire in 2012 and return to previous levels.

That didn’t seem to bother Wolfson, who through his partnership declares profit and loss as a pass-through on his personal income taxes, as many small businesses do.

“Higher taxes are not good for business, but some of the loopholes and deductions should be looked at,” he said.

The answer from Rick Douglas — the owner of Minit Maids, a cleaning service with 17 employees in Charlotte, N.C. — was more blunt.

“I think the rich have to be taxed, sorry,” Douglas said. He added that he isn’t facing a sea of new regulations but that he does struggle with an old issue, workers’ compensation claims.

Douglas told The Charlotte Observer that he’s hired more workers this year, citing pent-up demand from customers.

“My theory is that the people that do have jobs are working harder and they have less time to clean. People were holding back for such a long time, and then they started spending a little more,” he said.

Then there’s Rip Daniels. He owns four businesses in Gulfport, Miss.: real estate ventures, a radio station and a boutique hotel/bistro. He said his problem wasn’t regulation.

“Absolutely, positively not. What is choking my business is insurance. What’s choking all business is insurance. You cannot go into business, any business — small business or large business — unless you can afford insurance,” he told Biloxi’s Sun Herald.

To look at how this “regulations and taxes are choking small businesses” meme has taken off in the national discourse, we need to look at who’s spreading it: the U.S. Chamber of Commerce. And they don’t represent small businesses, they represent large corporations, as does the Republican Party in general.

In fact, McClatchy asked the U.S. Chamber of Commerce which specific regulations are choking small businesses:

When it’s asked what specific regulations harm small businesses – which account for about 65 percent of U.S. jobs — the Chamber of Commerce points to health care, banking and national labor. Yet all these issues weigh much more heavily on big corporations than on small business.

It’s a good story; go read it. Clearly one of the biggest problems this country is facing is the tyranny of multinational corporations, who rule our politics and our discourse. Perhaps we can all get together and tackle that issue together, whaddya think?

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Filed under corporations, economy, taxes, U.S. Chamber of Commerce

Shocking!

Amazing! Truly no one could have anticipated that if you cut government jobs at the federal, state, and local levels at a time when the private sector has made “keeping a lean and cheap labor force …the norm”, that would mean no new jobs would be created!

Shocking, I know. Could you ever imagine? Especially after all of those tax cuts we just gave the “job creators” — which we’ve been told is the magic fairy dust they need to create jobs. What could possibly have gone wrong?

Okay, I’ll kill the sarcasm.

We got home from vacation today. One thing that really stands out after being gone is how incredibly stupid our discourse is. Every TV at DFW was tuned in to CNN and everyone was talking about the sucky August jobs news. And all anyone was talking about was what the Republicans thought of this news, how they have no faith in President Obama’s policies (another shocker, I know, that the opposition party is opposed to the president’s policies. Whodathunkit?). It was all, “how will this affect the 2012 elections,” blahbbedy blah. All spin, all politics, no facts. Nothing about how many government jobs have been lost, how many teachers have been laid off, about the reasons why the August numbers look the way they do. Just, who’s the winner and who’s the loser?

The news in Canada was not like this. In Canada they actually had fact-based discussions about issues. What a strange thing.

Folks, I don’t really care about an election that’s 14 months away right now. I just don’t. I don’t want people calling me for money or asking me to sit in on a phone call with Joe Biden. It’s too early to swing in to campaign mode for me.

Right now I care about people who are out of work, who can’t buy stuff like back to school clothes for the kids and all of the other things that keep the economy chugging along. I care that we’re creating a society that has no place for people in the prime of their working life, where our “human resource” has been devalued to such a degree that we’re basically telling able-bodied citizens to move along, there is no place for them here. This is a tragedy.

But we aren’t talking about that. God forbid.

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Filed under economy, media

It’s Not Class War

Warren Buffett has an op-ed in today’s New York Times where he tells the GOP to “stop coddling the super-rich”:

Last year my federal tax bill — the income tax I paid, as well as payroll taxes paid by me and on my behalf — was $6,938,744. That sounds like a lot of money. But what I paid was only 17.4 percent of my taxable income — and that’s actually a lower percentage than was paid by any of the other 20 people in our office. Their tax burdens ranged from 33 percent to 41 percent and averaged 36 percent.

[…]

Back in the 1980s and 1990s, tax rates for the rich were far higher, and my percentage rate was in the middle of the pack. According to a theory I sometimes hear, I should have thrown a fit and refused to invest because of the elevated tax rates on capital gains and dividends.

I didn’t refuse, nor did others. I have worked with investors for 60 years and I have yet to see anyone — not even when capital gains rates were 39.9 percent in 1976-77 — shy away from a sensible investment because of the tax rate on the potential gain. People invest to make money, and potential taxes have never scared them off. And to those who argue that higher rates hurt job creation, I would note that a net of nearly 40 million jobs were added between 1980 and 2000. You know what’s happened since then: lower tax rates and far lower job creation.

It’s the death of yet another right-wing meme. Apparently the “fighter pilots of capitalism” — some of them at least — really do want the government to raise taxes on the wealthy. Imagine that!

I’m sorry I don’t have more time today to delve into this, because it’s the final nail in the conservative coffin. We know trickle-down doesn’t work, we know higher taxes don’t cause rich people to “go Galt” and head off to … I dunno, Somalia or some place. We know forcing middle class Americans to shoulder the national tax burden has ruined the economy. We know cutting government spending at a time when lower demand has caused the private sector to curtail hiring has led to higher unemployment. We know that sometimes you have to spend money to make money, and in the case of a catastrophic economic downturn, if the private sector won’t hire, the government must and that means temporary, short-term deficits.

Instead we have these free market fairy tales bringing the country to the brink of economic collapse.

Now, I don’t hang out with a lot of really rich folks, we don’t belong to a country club, we don’t have a yacht, we don’t move in those circles. But I’ve talked to a couple of people in that world, people I work with, music people, Wall Street people. Not a lot of these folks, just a handful. But I haven’t spoken to one millionaire who said they didn’t want their taxes raised. Maybe the few I know are just hippies or something, I dunno. But in the throes of the debt ceiling debate one Wall Street type told me he would rather have his taxes raised than deal with a market crash. “I could pay more,” he said. “I would rather pay more than lose what I do have in a market collapse.”

I just have to wonder who the super rich the Tea Party is supposedly coddling are. If billionaires like Warren Buffett want the country to return to a sane tax policy where “shared sacrifice” really means something, then who’s fighting it? The Koch brothers? Do the Kochs really think if the country spirals into an economic collapse people are going to line up to buy their StainMaster carpets and Lycra yoga pants and Supplex jogging gear and hunting trips to the Matador Ranch and Koch-refined gasoline for the SUV?

This isn’t a class war, it’s an ideological one. We’re fighting a group of people who, all evidence to the contrary, still believe that “freeing the market” to run roughshod over people is the way to go. That might have been true a few decades ago but we all live and work in a global marketplace now, and absence of any moderately protectionist policies just lowers American standards, it doesn’t raise those of the rest of the world. That’s what we’re dealing with here.

Even after the collapse of 2007, even after 30 years of wage stagnation, we still have people stubbornly attached to their crazy ideas which they are convinced will work this time. It didn’t work under Bush but by golly, he just did it wrong! It will work this time, honest! This is so crazy I have to think there’s something else going on. Something psychological, like maybe if they admit they were wrong and their economic model has a flaw, that means they were wrong about everything else, too.

You know why China is such an economic powerhouse? Besides billions of people, of course. How about some policies that have labeled it the “most protectionist country ever”:

“China has intervened massively in the foreign exchange markets for at least five years, buying at least $1 billion every day to keep the dollar strong and its own renminbi weak,” Fred Bergsten, president of the Peterson Institute for International Economics, said in the text of a speech.

“This is by far the largest protectionist measure adopted by any country since the Second World War — and probably in all of history,” Bergsten said.

Bergsten estimated the China’s renminbi, also known as the yuan, is currently undervalued by at least 20 percent against the U.S. dollar as a result of China’s currency intervention.

That “is the equivalent of a subsidy of 20 percent on all China’s exports and an additional tariff of 20 percent on all China’s imports,” Bergsten said.

I know, just because China does something doesn’t mean we have to do something. But we really could have some modestly protectionist policies in place, you know, “for the duration.” One thing that annoys the hell out of me is hearing Democrats decry Washington gridlock by saying “there are some things we all agree on. Free trade agreements, for example. Let’s do those.”

No we most certainly do not all agree on free trade agreements! Free trade agreements are why American manufacturing has shipped overseas and the only jobs left for Americans are WalMart greeter and Wall Street trader. Come on, quit acting like there isn’t disagreement on this issue, because there is.

Back in 2009 I linked to a Harper’s piece by Alan Tonelson of the U.S. Business and Industry Council, in which he made a series of recommendations for President Obama. They were good recommendations, and I urge you to read them. Because the White House’s current approach is basically useless.

I don’t have time to go into any more depth on this, hopefully I’ll get back to you later in the week. But seriously: we’ve got some complicated problems right now, and they won’t be solved by bumper-sticker bromides, conservative fairy tales, or Democrats too afraid that Fox News will say mean things about them.

We need government policy that raises taxes on the wealthy and encourages job creation at home not abroad. When people have jobs they have income, and when they have income they buy shit. This ain’t hard, people.

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Filed under economic stimulus, economy, free hand of the market, taxes

Message To Democrats

Dear Democrats:

It is patently obvious to anyone with a brain that the Republicans in Congress do not want to help the economy.

They do not want to raise one penny of revenue or create one job before the 2012 election.

They want the country to sink into the abyss. They want things to get bad, and when they are bad, they want them to get worse. And when things get worse, that’s when they’ll really get busy making them worse still.

To quote Mitch McConnell, his “single most important political goal, along with every active Republican in the country,” is for Obama to be a one-term president. Not only that, they want the House and Senate, too. They’re greedy. They smell blood in the water and they’re salivating.

I mean, they’re not even hiding it. You can see it in their actions and you can hear it in their words.

I know you know this. You’re not stupid. And neither are we. So here’s my advice: over the August recess, please take that message to the American people. Please remind everyone, in every single interview, talk show appearance and town hall meeting, that the Republican Party is wholly focused on their political ambitions at the expense of the national interest. And every liberal constituent in a Republican district, please ask your representative how they can sleep at night knowing they are purposely hurting the economy for craven political reasons. Ask, like Lucy-Lou in Whoville Cindy Lou Who (I think I confused her with Lucy Liu from “Ally McBeal” and the Charlies Angels movies. Pop culture mash-up!), “Why? Why Senator Alexander? Why Senator Corker? Why won’t you help your colleagues in Congress make the economy better? Why won’t you help create jobs? Why?

Finally, Chuck Schumer said it. And oh how the Republicans cried and moaned and whined. Oh how their little fee-fees got hurt! Good.

Keep at it. Keep calling them on their shit. Hammer it home, repeat it over and over again, every chance you get. Pull back the curtain. Find memos, leak e-mails. Do it for the good of the country, because one political party is purposely sabotaging the economy to grab power, and that’s not just treasonous, it’s immoral.

Real people are suffering out here in Real America™ and we need you to do more than just play Mother May I on the policy level.

Thanks.

Love,

Southern Beale

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Filed under 2012 presidential election, Democratic Party, economy, Republican Party

America The Gated Community

There’s no shortage of news reports about homeowners’ associations acting like dicks. Here’s one in Texas that told a woman she had to get rid of her pet pot-bellied pig; here’s another one (also in Texas) which wouldn’t let a retired Marine fly his flag (Texas had to get the long arm of the eeeevil government to intercede in that case.)

And then there’s this:

But that was Inlet House before the rats started chewing through the toilet seats in vacant units and sewage started seeping from the ceiling. Before condos that were worth $79,000 four years ago sold for as little as $3,000. And before the homeowners’ association levied $6,000 assessments on everyone — and then foreclosed on seniors who couldn’t pay the association bill, even if they didn’t owe the bank a dime.

Normally, it’s the bankers who go after delinquent homeowners. But in communities governed by the mighty homeowners’ association, as the sour economy leaves more people unable to pay their fees, it’s neighbor vs. neighbor.

HOA’s are constantly in the news for dickish behavior, but the economic downturn has raised this to a whole new level. I would hope I never have to subject myself to the whims of my busybody, power-hungry neighbor who got elected to the HOA board, but you know what they say: never say never. But the whole HOA issue strikes me as a microcosm of our national budget debate, too.

I find this really interesting:

In the meantime, the board, facing $172,000 in costs from non-payers, has had no choice but to raise dues by an extra $50 a month to an average of $375. Between the assessment and increased dues, some residents complain that they pay more than they would to rent a plush oceanfront spread down the street at the posh Fontainebleau condo complex. Association manager Janice Stinnett, who is also an Inlet House resident, says she isn’t to blame, the non-payers are.

“It’s unfair that everyone is paying extra to cover these deadbeats,” she says.

The board is continuing to make the plumbing repairs that made the assessments necessary to begin with. It will soon issue another special assessment to cover the costs.

To homeowners who opposed the repairs on the grounds that they were too expensive, the entire picture adds up to a crime. Says Silvestri, “What these associations are doing is illegal. It’s a fraud.”

So even with sewage leaking through the ceiling and rats infesting the condo development we’re hearing that they should just “cut expenses” and “live within their means”! People can see what’s falling apart, and some people want to fix it and others want to let it crumble, destroying the entire neighborhood in the process.

This is America in a nutshell. We have a bunch of deadbeats who won’t pay their dues for living and working in this country, and we have an entire political party rallying to their defense. Imagine if a group of people at Inlet House said “we can’t make these deadbeats pay their dues, they might move to another subdivision!” Let ’em! Go! Go be that other subdivision’s problem! What do you want to bet that other HOA will make them pay their dues?

Who seriously thinks that if we raised taxes on the millionaires and billionaires they’d all take their yachts and private jets and go live somewhere else? And so what if they did? John Boehner referred to these people as “job creators,” but they’ve been getting tax cuts courtesy of the last president and GOP congress since 2001. Where are the jobs?

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Filed under budget, economy

We’re Doomed

I don’t know if this is spin, wishful thinking or just plain stupidity, but any way you slice it, it’s just plain wrong:

President Obama’s senior political adviser David Plouffe said Wednesday that people won’t vote in 2012 based on the unemployment rate.

[…]

“The average American does not view the economy through the prism of GDP or unemployment rates or even monthly jobs numbers,” Plouffe said, according to Bloomberg. “People won’t vote based on the unemployment rate, they’re going to vote based on: ‘How do I feel about my own situation? Do I believe the president makes decisions based on me and my family?’”

God I miss those days when Democrats were the party of “it’s the economy, stupid.” Some folks have worried that we’ve reached a place in our politics where unemployment of 7% and higher is “the new normal.” All of this talk about deficits has had diddly to do with jobs, and now with Plouffe spouting this nonsense it appears those folks may be right.

The very last thing President Obama and the Democrats need to be projecting right now is that they don’t care about jobs.

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