Monday, November 09, 2009

ITYS #500 -- 10%



Remember that I told you so ? Back in January ?

”Unemployment is currently 7.2%. Most projections expect it to reach 10%. During the Depression, unemployment hit 25%. That shouldn’t provide much comfort. The tipping point -- the point that seems to scare the experts -- is somewhere around 10% unemployment. I suspect that the various people doing these calculations know what they mean and can’t bear the thought of projecting 12% or 15% unemployment -- knowing what the consequences of those projections would mean. “

(Emphasis added)

Okay, we’re there. Unemployment officially reached 10%.

U.S. Unemployment Rate Hits 10.2%, Highest in 26 Years


”As the unemployment rate surged to 10.2 percent in October, reaching double digits for the first time in 26 years, it suddenly seemed possible that the nation might yet confront the worst joblessness since the Great Depression. “

If I could see this coming almost a year ago (mostly because I knew which people to read) you can bet your bottom dollar that every U.S. Congressman could see it coming. That is what makes them successful politicians -- their ability to tell which way the wind is blowing. If you accept that premise -- that Congress has access to better data and analysis than I do -- you have to ask yourself the question, “Why didn’t they do something about it ?” They’re not stupid. Not even the Republicans.

Which brings me to my main point. Not only did Congress not do anything substantial about the coming unemployment spike (they did extend unemployment benefits), the Republicans actually tried to prevent Congress from doing anything. You need to appreciate the cold political calculation taking place here and just how dangerous it is.

The Republican party prevented a larger stimulus from being passed. A stimulus bill that allowed such things as keeping people employed (think State-employed teachers, police, firemen, etc. if nothing else) and would have created more jobs. Most States can’t run deficits (by law) and are using the stimulus money to plug the huge holes in their budgets. Even with this money, the States are laying people off as their tax revenues decline because their citizens are not working -- they’re unemployed. So the States have no choice but to add fuel to this fire by adding their own employees to the ranks of the unemployed.

An employed citizen -- even one doing “make work” -- pays State and local taxes. An unemployed one doesn’t. He also sits at home and stews about it. He sits at home and thinks about how unfair it is that he -- a hard-working, honest American -- can’t find a job. It doesn’t take much imagination to see how this situation can breed anger and resentment. Serious anger and resentment. The kinds that leads to riots and civil unrest.

The Republicans have to know this. Unless you think they are stupid. Or insane. So, have they tried to alleviate this ? From what I’ve seen, they have actually promoted it. Tea Parties. Carrying guns to a town hall meeting. And now, this latest episode at the Capitol.

No one said freedom was pretty

”Rep. Michele Bachmann (R-Minn.), who made her name suggesting that Barack Obama and other Democrats have "anti-American" views, appeared on Fox News on Friday night and urged Americans to come to Washington to protest: "We need to pay a house call on Nancy Pelosi and tell her what she can do with the Pelosi health-care plan."

They came as directed, about 5,000 tea-party regulars and antiabortion activists, to the West Lawn of the Capitol on Thursday for what Bachmann called a "Super Bowl of Freedom," sponsored by Republican members of Congress. And what a game it was.“


The whole ball of wax is there for you to see if you care to. The “Tea Party”, aka “Angry White Men”, aka "The Permanently Pissed Off", “sponsored by Republican members of Congress”, Fox News and Michele Bachmann. Heaven help us. The leadership of the Republican party actually jumped onto the crazy lady’s bandwagon. Seriously, Representative Michele Bachmann is nuts. Don’t take my word for it.

”Leading Republicans wince occasionally at her appearances on the floor and on television, but they also see her as someone with telegenic appeal who can energize conservatives and aggravate Democrats and they are not likely to rein her in. “

The country is sitting on a powder keg of unemployment and the Republicans want to strike a match. They are consciously using words like “revolution” and feeding the anger that exists in the country. These events could spin out of control. And they know it. It is a calculated position taken at great risk.

Two more things and I’ll let you go. First, take a look at the legend for the unemployment map.



Notice that it -- effectively -- doesn’t show unemployment rates above 10%. The darkest areas are “10.0 to 60.0” percent.

Second, if you think it’s just the Republicans that are making cold political calculations you aren’t paying attention. Take a look at this special report in The New York Times.

House Democrats Who Voted Against the Health Care Bill

”An overwhelming majority of the Democratic lawmakers who opposed the bill — 31 of the 39 — represent districts that were won by Senator John McCain, Republican of Arizona, in the 2008 presidential election, and a third of them were freshmen. “

Even in perilous times -- when political courage is needed -- the cold calculations of getting reelected are there for all to see. “We (Congress) don’t care what health care costs you, as long as it doesn’t cost us our jobs.” If only they cared as much about us losing our jobs as they do about losing theirs.

Don Brown
November 9, 2009

No comments: