“Do we invest in students, or millionaires?”
That’s the question posed by Senator Elizabeth Warren. She will introduce a bill to levy a minimum tax on incomes above $1 million (known as the “Buffet rule”), and devote the revenue to lowering interest payments on student debt:
Warren’s plan would allow students with outstanding student loans to refinance at lower rates. The cost of the change would be covered by a “dollar for dollar” effort where for “every dollar the Buffet rule brings in, we use that dollar to refinance student loan debt.”
Learn more here.
New Economies Conference in Jackson, Mississippi: May 2-4, 2014
From a description of the upcoming New Economies Conference in Jackson:
Jackson, Mississippi like most of the metropolitan centers throughout the country needs to broaden its economy to confront the challenge of globalization, address its social ills, and revitalize itself. To address the growing crises of economic collapse, social inequality and environmental degradation, the broadened economy must diversify itself to include various forms of ownership and wealth creation models that fully include the vast majority of the population. The broadened economy must include economic democracy, worker ownership, food sovereignty, new models of home ownership, and sustainable production and distribution.
The New Economies Conference will focus on how the City of Jackson can and will start building the city of the future today through the inclusion of cooperatives and other forms of wealth creation based on the principles of solidarity, participatory democracy, and economic and social equity.
Read more here.
For a profile of Jackson mayor Chokwe Lumumaba, who passed away this week, see here.
Read about the connections Lumumba drew between civil rights and immigrant rights here.
See Democracy Now!’s portrait of Lumamba here.
Whose recovery?
Econ4’s Jerry Friedman looks at the changing composition of demand in America:
While Sears and J.C. Penney drift towards bankruptcy, Nordstrom and other luxury brands flourish. Rather than depending on sales to working-class and middle-class consumers American corporations are doing very well selling to rich consumers, here and abroad. Rather than promising workers high wages to ensure productivity, they maintain labor discipline through fear.
Read his piece here.
We’re #1!
Sam Bowles and Arjun Jayadev reveal a dubious distinction of the American economy:
Another dubious first for America: We now employ as many private security guards as high school teachers — over one million of them, or nearly double their number in 1980.
And that’s just a small fraction of what we call “guard labor.” In addition to private security guards, that means police officers, members of the armed forces, prison and court officials, civilian employees of the military, and those producing weapons: a total of 5.2 million workers in 2011. That is a far larger number than we have of teachers at all levels.
Read more here.
Coming soon to a market near you
Matt Taibbi on another improvised explosive device buried in bank deregulation – one that could lead to the biggest bang yet:
Banks aren’t just buying stuff, they’re buying whole industrial processes. They’re buying oil that’s still in the ground, the tankers that move it across the sea, the refineries that turn it into fuel, and the pipelines that bring it to your home. Then, just for kicks, they’re also betting on the timing and efficiency of these same industrial processes in the financial markets – buying and selling oil stocks on the stock exchange, oil futures on the futures market, swaps on the swaps market, etc.
Allowing one company to control the supply of crucial physical commodities, and also trade in the financial products that might be related to those markets, is an open invitation to commit mass manipulation. It’s something akin to letting casino owners who take book on NFL games during the week also coach all the teams on Sundays….
The irony was incredible. After fucking up so badly that the government had to give them federal bank charters and bottomless wells of free cash to save their necks, the feds gave Goldman Sachs and Morgan Stanley hall passes to become cross-species monopolistic powers with almost limitless reach into any sectors of the economy.
Read more here.
Who’s afraid of the T-word?
Jeffrey Sachs writes that investing in our future will require new tax revenues, along with reined-in war spending and real health care reform:
Much as conservatives hate to admit it, the landslide election of Bill de Blasio as mayor of New York City may prefigure the start of a new swing of the national political pendulum as well. He won a resounding victory, in part by calling for a small rise in taxes to fund preschool education, a major reform that would help relieve the disadvantages faced by poorer children. The recent meeting of mayors at the White House may give a hint of possible local pressures for increased public investments and public services. We’ve been on a thirty-year course of diminished public investments in our future. The dismal results are plain to see.
Read his piece here.
Rethinking economics
Demand from students for reality-based, ethically grounded economics is growing around the world:
When the financial crisis hit in 2007, economics students at respected institutions around the world found that theories handed down in classrooms failed to explain the reality outside, and an international movement began to demand a change in the way economics is taught.
Read more here.
Maximum wage?
Econ4’s Doug Smith writes in the New York Times:
The national discourse continues to sleepwalk past this out-of-the-box question: How about setting a maximum wage for government officials and top-paid government contractors?
Read his op-ed piece here.
Confessions of a wealth addict
In an insightful, introspective piece in yesterday’s New York Times, a recovering derivatives trader writes:
Like alcoholics driving drunk, wealth addiction imperils everyone. Wealth addicts are, more than anybody, specifically responsible for the ever widening rift that is tearing apart our once great country. Wealth addicts are responsible for the vast and toxic disparity between the rich and the poor and the annihilation of the middle class. Only a wealth addict would feel justified in receiving $14 million in compensation — including an $8.5 million bonus — as the McDonald’s C.E.O., Don Thompson, did in 2012, while his company then published a brochure for its work force on how to survive on their low wages. Only a wealth addict would earn hundreds of millions as a hedge-fund manager, and then lobby to maintain a tax loophole that gave him a lower tax rate than his secretary….
Dozens of different types of 12-step support groups — including Clutterers Anonymous and On-Line Gamers Anonymous — exist to help addicts of various types, yet there is no Wealth Addicts Anonymous. Why not? Because our culture supports and even lauds the addiction.
Read his piece here.
The trust deficit
Joe Stiglitz points out another casualty of widening inequality:
Trust is what makes contracts, plans and everyday transactions possible; it facilitates the democratic process, from voting to law creation, and is necessary for social stability. It is essential for our lives. It is trust, more than money, that makes the world go round….
Inequality in America is degrading our trust. For our own sake, and for the sake of future generations, it’s time to start rebuilding it.
Read more here.
