Economic crisis, danger for democracy

As stock markets plummet worldwide, the media increasingly repeat the call for strong government: here.

US stocks soared in the final hour of trading Tuesday after the Federal Reserve Board pledged to keep its benchmark interest rate at its current level of zero to 0.25 percent at least until mid-2013: here.

Ellen Brown, Truthout: “On Thursday, August 4, the Dow Jones Industrial Average fell 512 points, the biggest stock market drop since the collapse of September 2008. Why? Weren’t the markets supposed to rebound after the debt ceiling agreement was reached on Monday, avoiding US default and a downgrade of US debt? So we were told, but the market apparently understands what politicians don’t: the debt deal is a death deal for the economy. Reducing government spending by $2.2 trillion over a decade, as Congress just agreed to do, will kill any hopes of economic recovery. We’re looking at a double-dip recession. The figure is actually more than $2.2 trillion”: here.

This video from the USA is called Detroit area workers, retireees speak out on social spending cuts.

US black workers ‘disproportionately hurt by cuts’: here.

Some 30,000 Michigan college students have been removed from the state’s food stamp program: here.

Notes on the social crisis in America: here.

While Many Americans Struggle to Pay for Food, the Rich Are Back Buying $2495 Pairs of Boots: here.

US Spends Six Times More on Defense Than China, Iran and North Korea Combined: here.

USA: The walkout by 45,000 telecommunication workers against Verizon is entering its fourth day after “informal” talks between the company and unions produced no results Monday: here.

The Verizon strike is one of the labor movement’s biggest battles in many years: here. \

Verizon’s Workers Strike Back at Corporate Greed – You Can Join Them: here.

Telecoms firm Verizon launched legal action in New York on Wednesday in a bid to prevent strikers from picketing facilities: here.

Greece’s main civil servants’ union announced today that it will file lawsuits against the nominally Socialist government over its €50 billion (£44bn) privatisation programme: here.

4 thoughts on “Economic crisis, danger for democracy


    The demand economy has collapsed for the vast majority of Americans. Jobs have been lost, wages have stagnated and the buying power of all but the wealthy dramatically reduced.

    But if you are super-rich, according to an August 4 New York Times article, you “are (almost) spending like it’s 2006: luxury goods are flying off the shelves, even with the economy staggering.”

    If you want to walk in the shoes of the ultra-wealthy, it will cost you a few weeks’ wages (if you are lucky enough to have a job). According to The Times, “In 2008, for example, the most expensive Louboutin item that Saks sold was a $1,575 pair of suede boots. Now, it is a $2,495 pair of suede boots that are thigh-high.”

    While most of America struggles with the basic costs of living, even delaying medical care because of high health insurance deductibles (for those who have medical insurance), the rich are on a luxury item buying rampage. According to the Times:

    Luxury goods stores, which fared much worse than other retailers in the recession, are more than recovering – they are zooming. Many high-end businesses are even able to mark up, rather than discount, items to attract customers who equate quality with price….

    The luxury category has posted 10 consecutive months of sales increases compared with the year earlier, even as overall consumer spending on categories like furniture and electronics has been tepid, according to the research service MasterCard Advisors SpendingPulse. In July, the luxury segment had an 11.6 percent increase, the biggest monthly gain in more than a year.

    With the ongoing DC subsidies of the most affluent Americans through tax cuts, America has moved closer to the class and income gaps that characterize third-world nations.

    To paraphrase an old Nancy Sinatra song, “These $2,495 boots are made for walking, and one of these days these boots are going to walk all over you.”

    They already are.

    Mark Karlin
    Editor, BuzzFlash at Truthout


  2. Bank of New York to lay off 1,500

    United States: Bank of New York Mellon Corporation bosses revealed on Wednesday that they intend to lay off 1,500 employees -3 per cent of its workforce.

    CEO Bob Kelly acknowledged that the bank’s revenue had been growing but added that “expenses have been growing unsustainably faster.”

    It said it would try to minimise lay-offs with a hiring freeze and by reducing the use of temporary staff, consultants and contractors.


  3. Pingback: British economic crisis, workers fight back | Dear Kitty. Some blog

  4. Pingback: British riots update | Dear Kitty. Some blog

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