The last election brought in a wave of new Republican/Tea party legislators who, according to today's news reports, at least 25% of are worth over one million dollars. They campaigned against out of control spending and wanting to represent the common citizens.

Sen. McConnell has now informed Sen Reid that there will be cooperation on NOTHING until all tax breaks are extended for everybody. Boehner has echoed this ideology. Those people who have the incomes that would benefit most from the extended tax breaks are the ones deciding if they should be extended.

The Republicans who are about to take control of the nation's business have made it clear that unless they can spread a bunch of gifts under the trees of their rich benefactors, everyone else will get a lump of coal. It amazes me that they are so out of touch they will deprive people of daily meals by not extending unemployment benefits unless they are "paid for", but they have not introduced any "paid for" legislation for extending the tax breaks that will add $700 billion to the debt.

Guess the unemployed and hungry can't make campaign donations, so screw them.

What are the odds that the Tea Party folks, and Palin backers, and all those that bought into the last election season's campaign rhetoric, will ever be able to distinguish reality from bullshit?

Anyone else hoping they end all social services and shut the government down on the off chance that causes enough rioting to get them killed?

As far as the politics go, both parties are doing everything 100% by the idealogical numbers which is all they will ever base decision making on. So we have a Continuing Resolution which of course will just have to continue a bit longer.....

Makes one wonder if the States themselves have contigency plans for when the Federal Government finally goes tits up and its time to go it alone.

It's the opposite. The FED is printing money like crazy to buy US Treasuries. The FED is buying more Treasuries than any foreign country at this point. They won't let the US Federal Government become (technically) insolvent. As powerful as the FED is, the value of the Federal Reserve Note is ultimately dependent on our courts, LEOs, military, etc.

On the other hand, the states don't have that luxury. The FED hasn't been directly helping them, thus far. If they can't sell their bonds, they're broke and dependent on the Federal Government to bail them out.

Can't they just let the tax break expire, and move on to next year? I mean I hate partisan politics but there is a point where you have to make a stand?

They should.

They should but probably won't. The tax structure would barely change for people who work for a living, and in that I include even people making mid 6-figure salaries. My personal belief is that letting the Bush tax code expire is the best option. Any actual fiscal conservative or anyone responsible, even, has to acknowledge that whatever we do long term about taxes, they must at least be structure in the near term to address our debt. However, this has been a shouted down point since Reagan, who started us on this con game in the first place.

Interestingly enough Reagan's old budget adviser is doing the talk circuit rounds basically saying "I was wrong and this is destructive," -- welcome outside the echo chamber, buddy, but they can't hear you.

I think they'll all pass. Obama's administration will pass the Bush era tax cuts for both the middle and upper classes in exchange for the stimulus tax cuts on the poorest people (I think they worked out to be a savings of $1400 / year on someone making minimum wage) and an extension of the unemployment benefits.

Its so ironic the Republicans refuse to pass any other legislation until the Tax Cuts are addressed the same fucking week as the Presidential Debt Commission votes on their plan to cut the debt.

Yeah, there is finally a plan being put out for discussion on how to finally do something about the debt, and Republican leaders are screaming no because taxes are involved and Democrat leaders are screaming no because social programs would be scaled back.

How the hell do they figure to get out of debt, or at the least to stop increasing it, without some combination of those, as well as eliminating pork and cutting some programs completely.

I found very little that I would argue with the Debt Commission's proposals, as they have been outlined so far. Something has to be done. Unfortunately, those so-called "leaders" in Washington are more concerned with their own status quo than with showing some fortitude and behaving responsibly.

It's impossibly simplistic (doesn't consider cascading effects of the changes, for example), but I found it trivially easy to get a surplus on this thing: http://www.nytimes.com/interactive/2010/11/13/weekinreview/deficits-graphic.html

I actually started off expecting it to be intended as a lesson about how difficult it really is to balance the budget. Instead, it turned out to be absurdly easy. I was balanced about half way through and went back to reinstate some programs that were touch choices.

The pork totally isn't worth fighting for. It's such a tiny proportion of the problem, but embroils you in a fight with almost everyone in Congress. For that matter, it's legitimately used to get net-good done sometimes. We need to focus on the low hanging fruit first.

Balancing the budget is as easy as reversing all of Bush's major decisions. Sad. Pull out of Fuckedupistan and revert to the Clinton era tax code, 95% of problem solved.

There will be cuts to the military for one, in places you might not suspect right off. Force strength will remain about the same as far as manning but they want to get the paygrades reduced. The Navy has what is called "Perform to Serve", which used to effect only E-4 and below not so long ago. Now it effects E-6 which used to be a retirement paygrade and still is as long as you have over 14 years served. If you are under 14 years and an E-6, you have to be subjected to a review board and assigned a quota if you want to re-enlist. If your rate is overmanned you can change rates, or take a mini golden parachute and get out of the service. Changing rates usually means going down a paygrade or two and having to retrain.

The goal? Get the military back to an E-4 being a "high rank" for enlisted with the majority being in the E-1 to E-3 bracket and very few senior NCOs past that. The service is getting very top heavy and they want to get rid of that. A service full of E-nothings means they have to live on base in the barracks, eat at the chow hall and stay well under control and very cheap. No more BAH/COMRATS and you probably won't stick around too long to make rank (which is getting vastly more difficult) unless you are shit hot nor will you qualify for the Post 9/11 GI Bill either. Not to mention you get in and out of the military before you have kids so that is even less expense. One service member can get astronomically expensive when you have to pay to house their family, pay to have their babies, care for all the family illness, ship the whole bunch and their household goods around the world, provide a home overseas, schools etc. If you get in knowing that you are coming in as an E-1, serving 4 years and will probably make E-3 at best on average, people won't stick around to structure a marriage and family around it, let alone expect a pension 20 years down the road.

Also, many MOS/Ratings will get farmed out to contractors in the host nation for pennies or given to part time civilians that don't have to be given bennies.

One thing the military will never cut is technology as the contractors won't allow it and congress has more faith in having a small fighting force that is well trained with the best gadgets and systems than having to deal with paying for personnel. People have a bad habit of not dying in wars, but getting maimed and surviving to soak life long benifits so the best thing is to have a puppy mill mentality for those that arn't in it to actually make the military a career. The least amount of tours an average service member does, the less likely they will get hurt. If you are insistant on sticking aorund, you best be the model service member which is probably a good deal for the military and the country. Expect the same in all other branches of Government. You better be shit hot with a drive to serve and not a leach just sponging some easy pay and bennies or you will be gone. For me, I passed PTS board no problem but I will probably never make Chief so I figured it was time to get out and use that Post 9/11 GI bill. 8 years is enough for me and I go home in April as a civvy. =) LOL, as a civil engineer though I will probalby end up right back in China again or the Middle East.

It's impossibly simplistic (doesn't consider cascading effects of the changes, for example), but I found it trivially easy to get a surplus on this thing: http://www.nytimes.com/interactive/2010/11/13/weekinreview/deficits-graphic.html

I actually started off expecting it to be intended as a lesson about how difficult it really is to balance the budget. Instead, it turned out to be absurdly easy. I was balanced about half way through and went back to reinstate some programs that were touch choices.

The pork totally isn't worth fighting for. It's such a tiny proportion of the problem, but embroils you in a fight with almost everyone in Congress. For that matter, it's legitimately used to get net-good done sometimes. We need to focus on the low hanging fruit first.


that's a pretty interesting link thank you!

http://www.nytimes.com/interactive/2010/11/13/weekinreview/deficits-graphic.html?choices=f7psp00q

and

http://www.nytimes.com/interactive/2010/11/13/weekinreview/deficits-graphic.html?choices=f7ptp016

The second link represents creating a more favorable tax environment for businesses. Could keep some jobs in the USA.

This was so easy a caveman could do it. It even avoids some thorny issues.

The 'compromise' supported today by Obama with regard to the Bush tax cut expiry is simply put, unconscionable, and a clear signal to me of whom he's really working for. Under the cover of giving the middle class yet another tax break they aren't asking for (I'm referring to the proposed social security payroll tax one year holiday, which will just get absorbed/pocketed by employers anyway, as well as the Bush tax cuts), we're giving away hundreds of billions we can't afford to the people who least need it, and have a decade-long track record of NOT CREATING JOBS with it.

Far worse, and most cynically, we're *intentionally* setting up Social Security for dismantling via manufactured fiscal crisis, because apparently people figured out that it wasn't actually insolvent (nor will it be for decades), nor contributing to the deficit (despite the 'deficit commission's attempted hit job on it), and god knows *that* couldn't stand. (If we raised the income cap on which Social Security taxes were taken, even a small amount, the program would remain solvent indefinitely - the 'crisis' that keeps getting talked about with regard to SS is wholly manufactured by the looting class in an attempt to get their hands on one of the last sizable buckets of money and human dignity left to the American people.

I used to think that President Obama was just the equivalent of that naive kid who keeps getting rolled for his lunch money:

"Give us what we want or we'll kill this puppy!" (the puppy in this case being the portion of the unemployed who haven't already exhausted their benefits)

"No, not the puppy! Okay..."

But it is becoming clearer to me over time that Mr. Obama is doing exactly what he wants to do, and it's no wonder that he cites Ronald Reagan as someone to be admired, while obfuscating and minimizing FDR's accomplishments at every turn (and misrepresenting who was covered by Social Security at its inception in his speech today).

All the Democrats and White House had to do around the Bush tax cut expiry deadline looming was... nothing. Truthfully, what would the Republicans have done? They might have shut down the government, but even that would have likely blown up in their faces, as happened when Newt Gingrich and the Republican congress shut down the government in 1994 when Clinton called their bluff. How would they have answered their constituents who weren't getting their unemployment checks? Barack Obama is a case study in how *not* to deal with bullies, and even some of the bullies themselves are aghast at how he's rolled over.

As someone who qualifies as middle class, I'd *happily* pay Clinton-level taxes in order to ensure that we continue to have a functioning government and that the richest pay their fair share as well. Instead, under the rationale of helping the hurting middle class, these 'negotiations' have opened the door to abuses that are going to make the aforementioned metaphorical puppy-shooting look tame by comparison. Letting the tax cuts expire would do far more to protect and, yes, create jobs than the act of creating yet more deficit that will have to be paid for by the poorest so that what remains of the 'captains of industry' (well, finance) can offshore it, or perhaps more accurately, blow it on hookers and cocaine.

Yeah, I'm really, really, angry - the writing is on the wall about whether we have a government that even gives a shit about actually running the country anymore, or whether we're just going to just sit here while the last remaining underpinnings of American infrastructure and the means to *create* a viable society is sold off and carted elsewhere. How long will it be before this reaches critical mass in the American subconscious and people take to the streets? When *Ben Bernacke* voices concern about income inequality and its effects on societal stability (which he did this week), you know that day cannot be far off.

As a nominal academic who works for the state and whose political speech and activity is thereby legally constrained, I find myself walking a narrower and narrower tightrope of conscience and feel like I will be pressed to make some rather uncomfortable decisions soon with regard to what I am willing to support by silent complicity.

Sincerely,
Nydia

http://www.realclearpolitics.com/articles/2010/12/07/why_obama_caved_on_the_bush_tax_cuts_108166.html

Welcome to the biggest issue for the 2012 election!

It at least makes it clear the Republicans don't actually care one bit about the deficit, though. Now it'll be easy to call them out on it anytime they try to use the deficit as a justification for, well, anything. (And forget about claiming to be the party of fiscal responsibility!)

Easy, but no one will.

http://www.cnn.com/2010/POLITICS/12/09/tax.plan/index.html?hpt=T1

Oh shit. Didn't see that one coming.

Not surprised at all, really.

No shockers at all. Its all or nothing these days and neither party is going to budge an inch.

Compromise? Work together? Pfffftttt. F all that S.

Well in reality, the compromise wasn't a compromise at all. It was the entirety of what the Republicans wanted, and the Republicans have refused to work on any other piece of legislation until they get what they want.

Bernie Sanders, the lone Socialist in the Senate, is currently filibustering the compromise bill, and he's not reading the phone book, he's *hammering* them with GAO statistics on corporate welfare, etc (just cited stat that 82 of the fortune 500 either paid no taxes or got a *refund* in the early 2000s), and showed a mockup check of the refund Exxon/Mobil received for 100 million dollars, he's going on about the Cayman Island corporate money hoarding now, and punctuating his remarks with 'Mr President', xxx (only the little people pay taxes in this country, we can negotiate a better deal):

http://www.c-span.org/Watch/C-SPAN2.aspx

It's an awesome stand, tune it in if you can!

I'm watching it now. How long has he been going?

He's in his third hour at the moment.

Woo, just got out of the shower, Sherrod Brown has picked up the baton and is talking up how we're borrowing from the Chinese to offer these tax breaks, did Sanders just run to the restroom or something, or did he actually shame his colleagues into a real filibuster?

He's still there. It's apparently some procedural thing where he "asks" Brown a question without losing control. Filibuster relay race!

He's going into more generic discussion on income inequality now (just put up a pie chart, god I love that he came in prepared for a long grind) , but boy, the first couple of hours were chock full of in your Face! data, trying to watch as I houseclean...

Jesus he's tearing them a new asshole. Looks like Landrieu and Sherrod are tag teaming this as well. Sadly, in the background, most of the other jackoffs aren't even there, Too busy sucking Exxon and Goldman Sachs off.

Baton handed (in colloquy) to Mary Landrieu, who is considered a Blue Dog and not the most intellectually... gifted member of the senate, but she did take a stand on her own re this issue earlier this week, surprisingly enough.

I liked the poster about the Waltons not needing a tax break on their inheritances.

Go Mary! Just awesome, her challenging one of the Republican leadership to 'passionately defend' the tax cut extension to the > 1 million a year club, and asking who insisted on that being in the deal, and where it happened ;)

Four hours in a couple minutes.

This is also interesting and unexpected.

He's moved on to Glass-Stegal and the banks, this is history in the making...

8 hours in just a few minutes. He's still going strong.

And he's done (right at 7pm Eastern).

And pussy Reid didn't make the republican cockblock squad do that even once.

Apparently it wasn't actually a filibuster, because it wasn't during the right session. It was just a long speech to gain attention, but had no chance of procedural impact. Still awesome.

Good on Bernie for going the distance. I didn't catch much of it, but the shit about the Waltons was spot on.

Good on Bernie Sanders and House Dems. I'm hoping to God that they can muster up enough votes in the Senate to block cloture and kill this thing dead in the water.

Letting all the cuts expire would go a long way towards reducing the deficit. It would also mean that Obama would most likely lose in 2012, and Dems would take huge hits in the Congress. What is politically viable and widely supported is a continuation of the cuts for the middle class, but letting the top 2% return to previous taxation rates.

The Democrats are doing a piss poor job of communicating this to the American public. It's not fucking complicated.

The Republicans are willing to let all the tax cuts and extended employee benefits expire unless they get the tax cut for the ultra-rich. I cannot understand why people are not frothing at the mouth over this. Everyone hates the wealthy. Wall street couldn't be less popular. Yet most Americans are too damn stupid to put 2 and 2 together and realize that the ONLY thing putting them at risk for increased taxation is the Republicans outright refusal to stop catering to millionaires.

Instead these fucking idiots watch Sarah Palin's Alaska and run around going to Tea Party rallies, pushing policy that goes against their self-interest.

Obama needs to man up or he's going to lose a lot of his base. This "negotiation" strategy of "Here, I'll give you a lot. And then maybe, ya know, if ya want you might give me a little something" is not working. Obama backs off the offshore drilling ban to appease Republicans, all the while completely alienating his enviro base. What did he get in return? Jack shit. No Republicans supported his climate change bill.

http://crfb.org/stabilizethedebt/

Here is another budget calculator. Let all or some of the tax cuts expire and see how much it increases revenue. Obama's attempts to attack the deficit through measures like "freezing federal pay" are entirely disingenuous. It saves almost NOTHING, and the "freeze" is basically relegated to COLA. He knows this, and he's trying to take advantage of the rampant stupidity of the American public instead of doing a better job explaining how fucking dumb their heralding of the Republican "fiscal conservative" movement is.

Obama needs to man up or he's going to lose a lot of his base. This "negotiation" strategy of "Here, I'll give you a lot. And then maybe, ya know, if ya want you might give me a little something" is not working. Obama backs off the offshore drilling ban to appease Republicans, all the while completely alienating his enviro base. What did he get in return? Jack shit. No Republicans supported his climate change bill.

Contra Lummus, this has been the losing Obama/Reid strategy for much of the past two years. Starting from a compromised position is no way to bargain. Republicans simply don't care -- lowering taxes on the wealthy and preventing any furtherance of Obama's agenda are the only things on their plate.

The Republicans are willing to let all the tax cuts and extended employee benefits expire unless they get the tax cut for the ultra-rich. I cannot understand why people are not frothing at the mouth over this. Everyone hates the wealthy. Wall street couldn't be less popular. Yet most Americans are too damn stupid to put 2 and 2 together and realize that the ONLY thing putting them at risk for increased taxation is the Republicans outright refusal to stop catering to millionaires.
Too many conservatives believe it is the right of the rich to be rich, even when they themselves might be poor. The driving force for some is that people have a right to do what it takes to be wealthy, and the government has no right to interfere.

And in keeping with the spirit of the Palin/Teaparty folks, I'm now obligated to call you a communist socialist pinko fascist.

Cspan 2 , which is supposed to be live senate coverage, still has Sanders speaking. Is that repeating or are they not following the session schedule? Anyone know?

Vote in progress as of now. He very well may have been speaking an hour ago at the open of the vote.

Jon Stewart has done some real fun stuff with not only this issue, but some of the others being worked on and passed by the "lame duck" Congress. His (and his staff's) expert use of video clips has shamed more than a few elected officials to modify somewhat their positions when the vote has been called.

I have really enjoyed watching these "Republican" folks frothing about the welfare state and food stamps and unemployment benefits, and how that was all going to change when they have the majority in the House next year. Do they not read any of the material that is available? Food stamps and unemployment benefits have a more pronounced, positive impact on the economy than any of the tax breaks or other stimulus programs that have been enacted. People don't sit on their unemployment checks, not do they 'save' their food stamps; they put them to use, which pays for goods, which spurs other spending, which provides jobs for some other folks, and so on and so on and so on....

But them feisty "Republican" folks are going to fix that, by golly. Our economy is in too poor a shape to be spending money on something that is helping it. :rolleyes:

The problem for a lot of people isn't that they can't find work; it's that they can't find comparable jobs paying what their old ones were. There has to be some end to the unemployment benefits or they ultimately do more damage than good. Ideally, they should have been tapering off gradually for people out of work more than a year. Those people would take a job "beneath them" when their benefits hit equilibrium with their new true market value.

The problem for a lot of people isn't that they can't find work; it's that they can't find comparable jobs paying what their old ones were.

I'll give you the point that is happening, but it's a much smaller percentage of the over all problem than people think. most of the unemployed would take a lesser job in a heart beat but the few crumbs for a day jobs left(ala Wally world at a whopping $7.25 an hour) are so over applied for good luck even landing an interview.

A large part of the problem is the housing crash and the trade skill job crash that followed. eggs,basket etc.

Well that's a problem. It was a problem for typewriter repairmen, stagecoach drivers, and scribes too. Things change; this happens. We cannot pay them until they're dead just to subsidize their not learning new skills though.

But how does one learn new skills by taking a job at the drive-thru window? How does one effectively look for a comparable job when picking up as many hours as possible on the paper route trying to feed a family? Maybe benefit extensions "ultimately do more damage than good" in some way, though I've yet to be convinced of this, but giving the finger to millions of would-be workers and their families does immediate harm to the people involved and the economy as a whole (as Bylimet pointed out).

A friend I went to nursing school with has 10 years prior experience as an LPN. She is the only new grad RN I know who has been unable to find a job in this area, which has 8 hospitals (including the one she spent the bulk of her career at). Possession of viable skills and experience isn't a sure fix to the job hunt.

Thanks to the insanity of modern "economics," by which I mean the neocon insanity that demands that privatized, unrestricted "free market" fantasies are the only way anything happens, we refuse to comment to a WPA-esque program to actually give these people jobs doing something useful. Most of the stimulus funding towards that end seems to have primarily served to consolidate many of the remaining contractors normally used by states and municipalities.

Would be nice to see them end all the unemployment, just so we got some starving people rioting. Nothing less seems to sink in.

But how does one learn new skills by taking a job at the drive-thru window? How does one effectively look for a comparable job when picking up as many hours as possible on the paper route trying to feed a family? Maybe benefit extensions "ultimately do more damage than good" in some way, though I've yet to be convinced of this, but giving the finger to millions of would-be workers and their families does immediate harm to the people involved and the economy as a whole (as Bylimet pointed out).

A friend I went to nursing school with has 10 years prior experience as an LPN. She is the only new grad RN I know who has been unable to find a job in this area, which has 8 hospitals (including the one she spent the bulk of her career at). Possession of viable skills and experience isn't a sure fix to the job hunt.

Avoiding the do or die situation of "giving the finger" to people is exactly why I think tapering benefits off slowly would be a better solution than what we're doing. Without a realistic plan in place, the long-term unemployed are already getting the finger by the disruptions in the pipeline around each extension.

Going from a short-term safety net to a long-term distortion of the labor market is definitely harmful in a capitalist economy.

You point out one side of the coin with the dead-end McDonald's employee, but what about the flip side? If you pay people to sit indefinitely, waiting on an ideal job that may never come, how can you expect the situation to improve? If I was a mortgage broker and am now collecting unemployment based on that unrealistic previous income, why would I ever consider taking a realistic job for my devalued skillset as long as the unemployment keeps coming?

Meanwhile, that money has to come from somewhere. Either through taxes (which become pennies on the dollar by the time it gets back to the unemployed) or through QE (aka inflation). Each of those impact the economy, either by dipping into profits or by harming savers (or both). Punishing people for investing or seeking profit is a great way to ensure that new jobs are created as slowly as possible.

It's a textbook example of moral hazard. Do it short-term in an emergency (with a clear exit strategy), maybe, but never ingrain those expectations in the long-term. Maybe if we weren't a debtor nation, we could even afford to subsidize people in the long-term, ala Qatar, but I don't see how we can in reality.

Thought I'd add, if you really want to help people struggling to find their footing, find charities like this one (http://www.findawayhome.org) and help however you can. Small, effective organizations like theirs exist in most communities. I've watched those guys do a phenomenal job of turning some would-be deadbeats around, through slightly subsidized homes, financial education, job search training/assistance, etc.

I'm not usually one to quote religious scholars, but I've always thought Walter F. Adley summarizes the situation pretty well with this (re: irresponsible handouts):

I. It injures the recipient. The independence of the recipient is destroyed and he becomes something less than a man through habitual and constant dependence upon others for support.

II. It injures the giver.

III. It injures those who are truly needy. [I]dlers are the more insistent and clamorous for support in their idleness; and all that is given to them is no longer available for those who have just claims upon the charity of others.

IV. It injures the community. It destroys initiative, diminishes industry, and propagates the worst element in society. The idle part of the population of great cities are the canker of civilization, in which are bred and incubated every vice and crime. Some, alas, must be cared for by others; but, when they are able-bodied, "the state that gives bread should compel labor"!

You point out one side of the coin with the dead-end McDonald's employee, but what about the flip side? If you pay people to sit indefinitely, waiting on an ideal job that may never come, how can you expect the situation to improve? If I was a mortgage broker and am now collecting unemployment based on that unrealistic previous income, why would I ever consider taking a realistic job for my devalued skillset as long as the unemployment keeps coming?
...
It's a textbook example of moral hazard. Do it short-term in an emergency (with a clear exit strategy), maybe, but never ingrain those expectations in the long-term. Maybe if we weren't a debtor nation, we could even afford to subsidize people in the long-term, ala Qatar, but I don't see how we can in reality.
If you're a mortgage broker collecting unemployment, the realistic scenario is that your payments are significantly inferior to what you made while employed. Realistic options increase as time goes on and options not originally entertained become more palatable. The ex-broker may not find a job equal to his previous income, but he has an excellent opportunity to find something superior to unemployment payments.

The clear exit strategy in this scenario is the end of the recession and the restoration of economic growth and opportunity. Presumably, the current state of affairs will come to an end, and we can taper unemployment benefits to pre-recession levels.

I've seen sentiments similar to Adley's expressed elsewhere and am unconvinced, especially on the first point. A few years on the dole may make a person feel like crap until they find work again, but living in the gutter is far, far worse, especially if family is involved. All this dramatic hyperbole might be appropriate during times of 5% unemployment, but right now it's out-of-place dickishness.

If you're a mortgage broker collecting unemployment, the realistic scenario is that your payments are significantly inferior to what you made while employed. Realistic options increase as time goes on and options not originally entertained become more palatable. The ex-broker may not find a job equal to his previous income, but he has an excellent opportunity to find something superior to unemployment payments.

Depending on the state, dependents, etc that mortgage broker's looking at $1,500-$2,000 per month in unemployment (not counting any other entitlement programs he might qualify for). That's a pittance compared to brokering subprime mortgages, but it's also more than the drive-thru job you mentioned or the average Starbucks income.

Why should he bust his ass 20-40 hours a week to make what he's making sitting around sending out a bunch of resumes? He's incented to wait around on a job that is not going to return. Unfortunately, that just makes him less and less employable over time (and obviously keeps the unemployment number high).

When you read news pieces about people down on their luck in the recession, the unemployment benefit trap scenario is second in frequency only to the house lost to subprime mortgage. I'm surprised you'd pretend this isn't a common situation people are getting in.

The clear exit strategy in this scenario is the end of the recession and the restoration of economic growth and opportunity. Presumably, the current state of affairs will come to an end, and we can taper unemployment benefits to pre-recession levels.

The recession has been over for a while.

The unemployment rate is even (and always was) below 5% for several demographics.

When is the recession over in your book? It seems to be when people can find jobs doing what they want to do, earning the amount that they want to make. There's no guarantee that will happen for every person. As long as we incent devalued workers to sit on the sidelines waiting for a miracle to return their old jobs, we ensure that unemployment is both elevated and prolonged.

There's absolutely no reason to believe that the old normal will be the new normal.

I've seen sentiments similar to Adley's expressed elsewhere and am unconvinced, especially on the first point. A few years on the dole may make a person feel like crap until they find work again, but living in the gutter is far, far worse, especially if family is involved. All this dramatic hyperbole might be appropriate during times of 5% unemployment, but right now it's out-of-place dickishness.

This is the second time that you've thrown out the false dichotomy between extremes. Not sure why you insist on that. There's a lot of room between endless unemployment incentives and tossing orphans in the ditch. Bringing this extremist rhetoric just ensures we can't reasonably or rationally discuss it. You should run for Congress!

Personally, I've donated thousands to charities helping the underemployed in my area this year, and worked at their fundraisers. If you think I'm suggesting that people be tossed in the streets for falling on hard times, you couldn't have missed the mark much worse.

The recession may be over for the financial overlords, but out in working man's land we never even recovered from the one in 2001, and there are now policy wonks talking about 10% unemployment (which is actually over 20% when you count all the people who gave up, are functionally unemployed despite having part-time jobs, etc) being permanent, which is code speak for the financial class having pretty effectively defeated the labor market and anyone who didn't already get across the moat not being able to make it as the drawbridge slams shut on prosperity.

The recession may be over for the financial overlords, but out in working man's land we never even recovered from the one in 2001, and there are now policy wonks talking about 10% unemployment (which is actually over 20% when you count all the people who gave up, are functionally unemployed despite having part-time jobs, etc) being permanent, which is code speak for the financial class having pretty effectively defeated the labor market and anyone who didn't already get across the moat not being able to make it as the drawbridge slams shut on prosperity.

Oh, I agree precisely that it's potentially permanent unemployment for certain people that is what is really the issue at hand. That's why I asked him to specify what he really means.

At the same time, it's not just the elite who are in decent shape. People like you and I (white, 30ish male, college) are running a way sub-5% unemployment rate. Same with quite a few other groups. Some are sub-1%.

On the flip side of that, long as we incent prolonged unemployment for groups that aren't in demand, of course they'll continue to remain unemployed. I think using that money to fund TVA type programs for them would be a much better idea. At least get something out of the deal and help train them for something else, rather than pay to keep them on ice until the government can no longer afford it (at which point they'll be unceremoniously dumped in that proverbial ditch without transition or preparation).

Depending on the state, dependents, etc that mortgage broker's looking at $1,500-$2,000 per month in unemployment (not counting any other entitlement programs he might qualify for). That's a pittance compared to brokering subprime mortgages, but it's also more than the drive-thru job you mentioned or the average Starbucks income.

Why should he bust his ass 20-40 hours a week to make what he's making sitting around sending out a bunch of resumes? He's incented to wait around on a job that is not going to return. Unfortunately, that just makes him less and less employable over time (and obviously keeps the unemployment number high).
No, he's incented to wait on a job that that exceeds the benefits enough to make the time investment worthwhile. That's not necessarily his old job or one of similar pay grade. Talk about false dichotomies. And the notion that taking that barista job in the absence of further beneftis represents some kind of solution to the problem is dismissive of the realities faced by the current unemployed.

When you read news pieces about people down on their luck in the recession, the unemployment benefit trap scenario is second in frequency only to the house lost to subprime mortgage. I'm surprised you'd pretend this isn't a common situation people are getting in.
I'm not pretending anything of the sort. I simply recognize that the current times warrant such measures, and I'm not worried about the supposed harm done to anyone's soul over covering them, in however limited a fashion, until the situation improves. I'd prefer more stimulus to put people to work (retraining programs might be helpful as well), but Congress couldn't go that far, and the business community is busy calculating its bonuses.

The unemployment rate is even (and always was) below 5% for several demographics.
You've got to be kidding me.

When is the recession over in your book? It seems to be when people can find jobs doing what they want to do, earning the amount that they want to make. There's no guarantee that will happen for every person. As long as we incent devalued workers to sit on the sidelines waiting for a miracle to return their old jobs, we ensure that unemployment is both elevated and prolonged.
I would think it doesn't seem to be anything of the sort. Anyone waiting around for just the right job is a fool, but in my experience people are actively looking for jobs that run the gamut from similar to their former positions to employment down a few rungs on the ladder. As with my very experienced nurse friend, it's not always that simple. Relevant experience is often more burden than benefit, and older workers, last I checked, are having particular trouble finding employment. Or maybe they became one of those "several demographics" at 5% when I wasn't looking.

There's absolutely no reason to believe that the old normal will be the new normal.
Wouldn't expect it to at all.

This is the second time that you've thrown out the false dichotomy between extremes. Not sure why you insist on that. There's a lot of room between endless unemployment incentives and tossing orphans in the ditch. Bringing this extremist rhetoric just ensures we can't reasonably or rationally discuss it. You should run for Congress!
Congress and I wouldn't get along, and you need to lower your sensitivity meter on what counts as "extremist rhetoric." Or I can label your characterization of benefit extension as "irresponsible handouts" similarly extremist, and we can call it even.

Personally, I've donated thousands to charities helping the underemployed in my area this year, and worked at their fundraisers. If you think I'm suggesting that people be tossed in the streets for falling on hard times, you couldn't have missed the mark much worse.
I don't think you're suggesting it. I think it's the ultimate result of the policy your advocating, unless your tapering suggestion coincides chronologically with a rise in employment.

Are you suggesting that the recession hasn't ended? That unemployment isn't sub-5% for entire demographics? I'm not "kidding you." Which part do you disagree with?

I have to wonder when the "last time you checked" was. The BLS makes its data freely available, and what I've been saying is easily verified. It shouldn't take you three searches to find a 45+ demographic with sub-5% unemployment. In fact, the older demographics have significantly less unemployment than my own, with comparable education.

It's pointless to pretend that your anecdotal experience or a few of the scariest numbers from news articles angling for pageviews represent the median. We shouldn't hope for Congress to legislate as though the plural of anecdote is data either.

Do you honestly believe that there aren't significant numbers of people willfully sitting on the sidelines due to perpetually extended unemployment incentives? What makes you think people like mortgage brokers will ever get jobs, in any profession, paying anything close to what they were making before? Many of them were barely college educated, earning in the six-figures for pushing paper.

On the flip side of that, long as we incent prolonged unemployment for groups that aren't in demand, of course they'll continue to remain unemployed. I think using that money to fund TVA type programs for them would be a much better idea. At least get something out of the deal and help train them for something else, rather than pay to keep them on ice until the government can no longer afford it (at which point they'll be unceremoniously dumped in that proverbial ditch without transition or preparation).

It's a bit more insidious than that as the effectively systemic unemployed are frequently stuck with large debt obligations they can not escape (thanks W!) and no means of easy relocation, so even a few major TVA-esque projects are going to have a hard time delivery the same amount of money to as many people.

I'm more and more inclined to think the real answer to unemployment is going to involve lynching bankers.

In the meantime, we have the pressing issue of how people are supposed to pay for food. As Thor said, it's slightly less urgent to figure out how to keep them psychologically well and productive than to keep their brats from starving.

It's a bit more insidious than that as the effectively systemic unemployed are frequently stuck with large debt obligations they can not escape (thanks W!) and no means of easy relocation, so even a few major TVA-esque projects are going to have a hard time delivery the same amount of money to as many people.

I'm more and more inclined to think the real answer to unemployment is going to involve lynching bankers.

In the meantime, we have the pressing issue of how people are supposed to pay for food. As Thor said, it's slightly less urgent to figure out how to keep them psychologically well and productive than to keep their brats from starving.

If you have no money and no net-worth, it's pretty easy to duck debt at the low end. Even if you get judgements against you, nothing actually happens if you have no assets. Trust me, having been on the collecting end of a few of those, I know it's damn near impossible to get a penny out of deadbeats, even with the law on your side.

It's pretty damn easy to find food for kids here. There's a wide range of non-profits and government programs to feed needy children. That endeavor has always (rightfully) erred on the side of overfeeding. "What about the children" is one of the biggest strawman of them all when it comes to unemployment incentives.

I'm not even sure what you're really getting at with this anymore, so I'll leave it at this: Basically all of Western Europe handles food, medical care, and residual income for the unemployed better than we do, and virtually all of them do for years longer, some virtually forever. They also have a fraction of our unemployed and hungry as a result. Maybe you are arguing for a local optima, but it's still in the shitter once you take that guppy out of our little pond.

The stability of the Euro is also basically contingent on Germany's patronage now. It's not as if they've got a utopia over there. Instead of poisoning the ambition of individuals, they've got entire countries falling into dependence.

If the end is all that counts, the USSR had virtually no unemployment and everyone was fed for the majority of its existence. I suppose we should abandon Democracy altogether!

It's worthwhile to consider the alternatives employed elsewhere, but it's not useful to consider them in a vacuum. For example, we'd need to raise taxes to fund social programs that extensive. How in the world would you propose raising taxes here toward the Western European average without pandemonium? We'd need to bring in about 15% more tax revenue vs GDP than we currently do to match the EU15. Good luck with that.

Sure, cut defense spending. I'm all for it. You and I both know that it won't happen until our empire has thoroughly fallen and there's no choice though.

I suppose my point, here and earlier, is simply that a lot of this talk sounds nice on the surface but is not very realistic at all. Worse, there's no definitive evidence that it's even a net-positive for the people it's "helping."

If the criteria here is realism, digressions into whether dumpster diving to feed your kids is less psychologically damaging than being on the federal dole or the Godwinizing power of Stalin seems pretty far from your point.

You (and Thormir) are arguing right past me, much father to the right, against John Boehner & Co.

I'm not suggesting people be cut off abruptly, and certainly not that food assistance should have any time limit for the needy (I'd like to see better means testing though). If anything, pretending we can continue unemployment benefits indefinitely is increasing the chances that a lot of people will eventually get dropped cold, with little/no notice, when we can no longer float the bill for it.

Unfortunately, John Boehner & Co. are the ones calling the shots, and we know the sorts of prescriptions Malse and/or myself might advocate will face the same fate as cutting defense spending. Maybe you should run for Congress!

But I don't think either of us are advocating indefinite unemployment. The recession may have officially ended, but there were serious problems before it officially began, too. New claims reports are promising, relatively, but despite those "several demographics" doing well :rolleyes: there are still millions of non-mortgage broker, non-ex-6 figure making people who -- I feel -- need the support.

But if we're all arguing that benefits shouldn't persist forever, then maybe we're not arguing at all. Ultimately, the issue isn't that we can't "float the bill" for the kind of social safety net that Malse and I support. The issue is the lack of desire to do so compared to the desire of powerful interests to continue concentrating wealth upward.

I'm curious if you really don't believe that the economy is fine for entire demographics and work sectors (and I'm not talking about bank/finance types). It seems like you keep referencing that snarkily, but maybe I'm misunderstanding.

There's a 40+% disparity in the unemployment rate between some age/race combinations. When you see the ~10% number in headlines, that's actually comprised of most groups clustered around 5-7% (and some down around 1-2%) and then some that are 3-5x that. 15-24 black male was right at 50% last I looked, for example. National averages are nearly worthless in a country as heterogeneous as ours.

"Fine" is a bit of delusion. Our own income, well above a living wage but still working wages, is safe enough and is likely to remain so (at least for me, as I have comparatively rare skills and experience in an industry that is about as indispensable as possible, mileage may vary). Rising poverty and income disparity and the collapse of social institutions all around me due to the apparently permanent poverty of 1 in 5 citizens around me does not bode well for what I'm able to do with that, though.

You can argue that people with technical professions (in the historic sense prior to computers usurping the word) have always fared reasonably well as a demographic even during the great depression of the 1930s or Weimar Germany, but that still ignores the huge pitfalls on either side of the narrow path they walk into insolvency. In particular, anyone who pins their retirement hopes on a market-based package, particularly the grand theft that has been 401ks and similar, is essentially handing their balls to Wall Street so that it may puppet them with impunity for the rest of their lives. It only takes one bad injury or illness or one run in with the law or one of any unexpected event to send even the "safe" middle class household spiraling into indefinite debt and poverty.

US corporations are still laying off local workforces to move their jobs overseas, where they hire at a breakneck pace. It's easy to segregate one job pool from another in your mind, but eventually the owners figure out that the whiter the collar, the less location specific it is.

I just want to say that this is probably some of the best conversation on this board I've seen in months. I've nothing to contribute to the debate but am really enjoying it. Please continue guys and thanks for doing so.

"Fine" is a bit of delusion. Our own income, well above a living wage but still working wages, is safe enough and is likely to remain so (at least for me, as I have comparatively rare skills and experience in an industry that is about as indispensable as possible, mileage may vary). Rising poverty and income disparity and the collapse of social institutions all around me due to the apparently permanent poverty of 1 in 5 citizens around me does not bode well for what I'm able to do with that, though.

You can argue that people with technical professions (in the historic sense prior to computers usurping the word) have always fared reasonably well as a demographic even during the great depression of the 1930s or Weimar Germany, but that still ignores the huge pitfalls on either side of the narrow path they walk into insolvency. In particular, anyone who pins their retirement hopes on a market-based package, particularly the grand theft that has been 401ks and similar, is essentially handing their balls to Wall Street so that it may puppet them with impunity for the rest of their lives. It only takes one bad injury or illness or one run in with the law or one of any unexpected event to send even the "safe" middle class household spiraling into indefinite debt and poverty.

US corporations are still laying off local workforces to move their jobs overseas, where they hire at a breakneck pace. It's easy to segregate one job pool from another in your mind, but eventually the owners figure out that the whiter the collar, the less location specific it is.

I'm not even considering my (our?) skillset as a reasonable counterpoint. The last numbers I saw put software developers at some absurdly low sub-1% unemployment level, and there aren't that many of us anyway. We're aberrantly lucky right now (though we paid our dues after the dotcom bust).

I'm talking about groups as broad as people with any four year degree (5.1% as of 11/2010, down from 5.2% in 2009). Heck, people with graduate degrees are down near 2% unemployment right now, and that includes sociology majors!

I find that impossible to believe given the number of unemployed recent graduates, particularly in popular but highly saturated fields like law. Perhaps I'm misremembering the numbers on degree level with regard to age as opposed to simply degree level, but there are a massive number of people outside of the hard sciences and engineering that simply do not have extant job opportunities.

Not to mention how many of those forensic psychologists or whatever pop touchy feeling crap is in the rage amongst yuppie kids nowadays are working behind the counter at your local burnt coffee stand. Those Art Institute degree mills are churning out thousands of BA and MFA suckers every semester so they can go be fry cooks and Walmart stockers.

I don't have a citation handy, but that's directly from the BLS. That certainly does have the issue of underemployment and discouraged workers, but the unemployment number has always had those issues and it's the measure we've been using throughout this thread. Moving the goalposts isn't a valid way to make a point.

And you're right, the youngest group is the least employed right now, consistently across just about every other axis (race, education, skillset, etc). That's a great example of why it's so important we hone in on and attack the actual problem instead of blindly throwing blunt weapons at the average.

Wait wait wait...you are using a STATISTIC to back up your argument? And then not properly referencing all the caveats surrounding that statistic, and in fact discounting some of them? There's an old adage about that sort of argument involving lies and damned lies, I believe....

I am not sure which news station I was watching the other day, but I do recall clearly the news piece on the top US companies showing financial gains the past year were all doing extensive hiring OVERSEAS.

Outsourcing will continue to be the order of the day until the organized labor movement is crushed, and the haves can dictate what they are willing to pay someone to make their widgets, without any interference from organized labor or government. And President George W Bush and the Republican majorities made this possible, or at least much more palatable, with the tax breaks for those moving their business overseas.

I just got back from New Year's debauchery and haven't had a chance to dig through them, but yes, the BLS and other labor statistics need a lot of explanation to be understood, particularly in relation to each other.

Now, his basic point, and I think most stat sets support this, is that in demographic terms, the current permanent unemployment numbers ARE highly grouped by region, age, education, industry, et al. I'm sure you could construct a set that had sub 2% unemployment, however I don't think that's meaningful data except to show that some labor markets are highly inelastic.

I don't think that changes the overall problem in that if we really do have permanent 20% unemployment, we had a very large set of new poor-house candidates that are going to be either starving or stealing very soon if we do not address some means of getting them back to productive activities. In the meantime, my own opinion is that historically, unemployment subsidies have produced far better results than any other means of easing a transition back to productivity, and I think the German system stands as a great example of it.

You keep insinuating that it requires a tightly narrowed set to find low unemployment, but it absolutely does not. I've just been talking about age, race, and education here, not work industry; broad groups of millions of people. Narrowing to work industry, of course, it's easy to find full employment groups (like our own). That's not the point at all. You seem to be reading right past what I'm writing.

I think we should help those who truly need it, but disagree that blunt instruments are a sensible way to go about that when the country is so diverse.

It's useful to look at what other countries do, but dangerous to assume those things are directly applicable here. There are nearly as many German Americans living here as there are people in all of Germany. Germany enjoys a very homogeneous populace compared to ours, which makes a tremendous difference in the ease and efficiency of these things.

I think that's a non-trivial aspect of much of our problems here. It's taboo to point to exactly which demographics need help (which includes old white people right now too, not just minorities). If you can't or won't identify what exactly is wrong, you have no hope of fixing it.

One nagging question is....

Are government, business and community leaders really looking at what is trying to be accomplished? Are we giving out the dole to pay for what? Should we be shifting the funds and attention more to the long term, taking into consideration that the whole nation has to look at what its going to take to lead a much leaner, Post Consumerist life? Or is all this bickering just over band-aid tactics?

Ultimately, the world is going to probably see an era of less starvation and poverity, but generally the majority of Humanity is going to also have to find a way to not rely on staggering logistics and energy costs in order to make it happen. Those that don't get that all figured out are going to lose. Our country is not set up for savings in those areas as the status quo that seems to be what many want to preserve is you own a home in the 'Burbs, drive to work in at least one of the family cars as the soul occupant and then go about your work day with many miles of seperation between home, employer and the daily needs of life. Honestly who feels that we all can continue to afford that? Is it worth working 2-3 jobs between husband and wife?

Many of those who are really hosed are those that had that kind of situation where they were just barely keeping in the black while balancing all the expenses associated with it. Blam the recession AKA reality hits and they lose their jobs, never to be seen again. Now they need a large chunk of the dole just to get by in the interim while they figure out how to downsize their lives to fit a much reduced income but the sad thruth is...our country is NOT set up to handle the reality that we all are going to be either making less money, paying far more for everything or both. Asia is going to be driving energy and commodities markets this Century. There are vastly far more Asians buying fuels and demanding resources than Westerners while as they have the infrastructure in place to support life without long commutes and distances for shipping. Prices are going to go up at a far faster pace than salaries. Does the USA have infrastructure in place to handle that?

We don't.

Also, with Asia able to go toe to toe with any American or European worker as far as quality of work and work ethics while demanding far less pay because their societies are geared to function with far less demand on infrastructure as well as energy because everything is centralized, than where does that leave us?

Assed out in the cold.

I could go to college, get my civil engineering degree and then get my license to pratice civil engineering while expecting to make 60-90k a year. Well whats happens if some firm in China or India can do the same work to the same quality standards while working under the same standards as far as licensing for 20k a year? Well, I guess I have to take a huge paycut and figure out how to live with it or try to find a job in a market that can't be lowballed by some asshole 8 thousand miles away. The fact that everything is spawling in the USA and you must have transportation to cover the distances makes living with a lower income very harsh where as in Asia that 20k a year pays for a comfortable existance where you can walk or take transit.

So we really do need a WPA. Something that not only gives us jobs now but also realizes that these leaner times are here to stay and provides the means to move people to those lower paying jobs forced upon us by the global economy as well as get goods and services rendered at lower costs so we all might actually be able to afford them. Plus, education needs a serious look as well. Seems a better deal to address infrastructure and education than give the same rich bastards a break who sold us all up the river. I won't vote for anyone in either party unless they take into consideration that the whole way we do business in the USA is not even a competative model anymore globally due to costs to workers as well as business in addition to the gradual errosion of worker education and something has to be done to address that.

I could go to college, get my civil engineering degree and then get my license to pratice civil engineering while expecting to make 60-90k a year. Well whats happens if some firm in China or India can do the same work to the same quality standards while working under the same standards as far as licensing for 20k a year? Well, I guess I have to take a huge paycut and figure out how to live with it or try to find a job in a market that can't be lowballed by some asshole 8 thousand miles away.


No no no no. You then hire out as a contractor who FIXES what they screw up in doing exactly what the customer asks for rather than what they actually want. Basically, this is a wake up call that it's time to be as heartless in one's own labor negotiation as one's manager.