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  1. Atypical is offline
    06-04-2011, 04:03 PM #71

    McDonald's April hiring spree could have accounted for half of May's job growth:


    The Labor Department's latest jobs report was already disheartening. And now it turns out half of the paltry number of jobs created in May could have been the result of McDonald's.

    Up to 30,000 of the 54,000 jobs created in May were the result of a hiring spree by the hamburger chain, analysts at Morgan Stanley told Market Watch on Friday.

    The fast food giant added tens of thousands of new Mcstaffers to their payroll on April 19, and Morgan Stanley estimates that when all the
    bookkeeping is done and the final job count tallied, McDonald's hiring will boost the overall May number by 25,000 to 30,000.

    The unemployment rate ticked up to 9.1%, according to the jobs report released Friday. Economists had hoped for six-figure jobs growth in May
    -- the previous three months each averaged gains of 230,000, making May's 54,000 a major disappointment.

    More people entered the work force last month, but new entrants couldn't find jobs, which attributed to the unemployment increase from 9% in April.

    President Obama didn't specifically mention the jobs report in his weekly address on Saturday, but said the economy will face "tough headwinds" in the months ahead.

    The high unemployment rate and struggling economy will be one of the biggest hurdles the commander-in-chief will face in order to win re-election.

    "Lately, it's high gas prices, the earthquake in Japan and unease about the European fiscal situation. That will happen from time to time," he said from a Chrysler plant in Toledo, Ohio. "There will be bumps on the road to recovery."

    Yay, that's GREAT news. These people will be making approximately $8.00 @ hr. And income for the middle class hasn't moved up much in 30 years. Yay. Soon just $12.00 and under for most and millions for a lot of others. Yay. Don't worry, though. Few care. Just capitalism at work. If these people were smart, good, honest, and hard-working they wouldn't be at McDonalds. Right?

    The previous was a recorded message from Republican headquarters.


  2. Atypical is offline
    06-05-2011, 11:10 AM #72

    Bank of America branch gets padlocked after homeowner forecloses on it‏

    Collier County, Florida -- Have you heard the one about a homeowner foreclosing on a bank?
    Well, it has happened in Florida and involves a North Carolina based bank.

    Instead of Bank of America foreclosing on some Florida homeowner, the homeowners had sheriff's deputies foreclose on the bank.

    It started five months ago when Bank of America filed foreclosure papers on the home of a couple, who didn't owe a dime on their home.

    The couple said they paid cash for the house.

    The case went to court and the homeowners were able to prove they didn't owe Bank of America anything on the house. In fact, it was proven that the couple never even had a mortgage bill to pay.

    A Collier County Judge agreed and after the hearing, Bank of America was ordered, by the court to pay the legal fees of the homeowners', Maurenn Nyergers and her husband.

    The Judge said the bank wrongfully tried to foreclose on the Nyergers' house. So, how did it end with the bank being foreclosed on? After more than 5 months of the judge's ruling, the bank still hadn't paid the legal fees, and the homeowner's attorney did exactly what the bank tried to do to the homeowners. He seized the bank's assets.

    "They've ignored our calls, ignored our letters, legally this is the next step to get my clients compensated, " attorney Todd Allen told CBS.

    Sheriff's deputies, movers, and the Nyergers' attorney went to the bank and foreclosed on it. The attorney gave instructions to to remove desks, computers, copiers, filing cabinets and any cash in the teller's drawers.

    After about an hour of being locked out of the bank, the bank manager handed the attorney a check for the legal fees.

    "As a foreclosure defense attorney this is sweet justice" says Allen.

    Allen says this is something that he sees often in court, banks making errors because they didn't investigate the foreclosure and it becomes a lengthy and expensive battle for the homeowner.

    CBS News

    This is what the powerful do. Screw you, they say. What ya gonna do bout it?
    That's why they must be fought. Anyone who knows what they do must join in the fight. That's why I post.

  3. Atypical is offline
    06-08-2011, 06:14 PM #73

    The Bernanke Scandal: Full-Frontal Cluelessness

    Wednesday 8 June 2011
    by: Robert Scheer, Truthdig

    How I wish that Ben Bernanke would get caught emailing photos of his underwear-clad groin. Otherwise we don’t stand a chance of reversing this administration’s economic policy, which is shaping up to be every bit as disastrous as that of its predecessor.

    Indeed, the Fed chairman’s much anticipated remarks on Tuesday take one back to the contemptuous indifference of a Herbert Hoover to the public’s suffering: Bernanke dismissed the wobbly economy with its anemic 1.8 percent first-quarter growth as merely “somewhat slower than expected.” The rise in unemployment to 9.1 percent was “some loss of momentum.”

    The problem with Bernanke is that he is utterly clueless as to the stark pain and fear endured by the 50 million Americans who have experienced, or face the prospect of, losing their homes. His remarks reflected the insularity of a ruling-power elite that is magnificently impervious to the damage that Bernanke’s policies in the current and past administration helped inflict on what used to be called the American way of life. This is a man who assured us there was no housing crisis, while his policies at the Fed encouraged the mortgage securitization swindles that caused the meltdown of the economy.

    His full statement stands as a classic example of the limits of economic language as morally descriptive: “Overall, the economic recovery appears to be continuing at a moderate pace, albeit at a rate that is both uneven across sectors and frustratingly slow from the perspective of millions of unemployed and underemployed workers.” Frustratingly slow—how about going bat nuts with fear over not being able to make your mortgage payment and losing your home? Tell it to workers who must contend with stagnant wage rates and sharply rising gas and food costs as better jobs and therefore consumer demand move offshore. Bernanke takes low wages to be reassuring news on what he sees as the all-important inflation front: “subdued unit labor costs should remain a restraining influence on inflation.”

    At home we are experiencing a social tsunami with the disappearance of a middle-class workforce of stakeholders who were assumed by observers as varied as Thomas Jefferson and Alexis de Tocqueville to be the very bedrock of America’s experiment in freedom. Many with jobs are struggling desperately to get by as the average workweek and pay scales fall, and countless workers find themselves settling for rewards well below their skill sets. Even those slim pickings are denied to the unemployed. Bernanke concedes: “Particularly concerning is the very high level of long-term unemployment—nearly half of the unemployed have been jobless for more than six months.”

    The jobs that have been created by our large multinational corporations, like the bailed-out GE, are primarily outside of the country, as Bernanke admitted: “Many U.S. firms, notably in manufacturing but also in services, have benefited from the strong growth of demand in foreign markets.” Those foreign gains, fueled by far more successful anti-recession policies in China, Brazil and Germany, have driven up demand and prices abroad in the areas of petroleum, food and key construction commodities.

    Bernanke, speaking at a monetary conference in Atlanta, conceded that “the depressed state of housing in the United States is a big reason that the current recovery is less vigorous than we would like,” and that the “U.S. economy is recovering from both the worst financial crisis and the most severe housing bust since the Great Depression.”

    But he offered not a word as to how the severe effects of that housing bust might be mitigated. Not a word about assisting people to stay in their homes. Yet he claimed that the relief that the Fed provided to the bankers by buying up more than $1.2 trillion of the toxic mortgages those bankers had created “has been accomplished, I should note, at no net cost to the federal budget or to the U.S. taxpayer.”

    This is the Big Lie technique at work, employed by a huge banking lobby that stresses the direct cost of the TARP program while ignoring other programs that will not be paid back, as well as the additional cost of $5 trillion to the national debt that a proper Fed policy could have avoided.

    The record is by now indelibly clear that the economic approaches pursued by George W. Bush and Barack Obama, with Bernanke playing a key role in both administrations, can be most accurately summarized as a policy of government of the bankers, by the bankers, and for the bankers.

    Assurances of stability to the financial markets, meaning the ability for companies to borrow government funds at a near-zero interest rate without giving anything back to the public in the form of mortgage relief or job creation, have been the overwhelming goal. But even by that standard, as the latest statistics on job creation and construction starts attest, the government’s effort is not working. Putting the bankers first has represented pushing on a string, what Paul Volcker condemns as a “liquidity trap,” a situation in which taxpayer money has been made available to major corporations that invest in job creation that benefits foreigners instead of U.S. workers. Now that’s an obscenity we should be concerned about.

    Anyone seriously affected by the financial crises caused by Wall Street - just suck it up. Don't expect anything else.

    We're busy.

  4. SiriuslyLong is offline
    SiriuslyLong's Avatar
    Joined: Jan 2009 Location: Ann Arbor, MI Posts: 3,560
    06-10-2011, 09:14 AM #74
    Wall Street IS the Federal Reserve, or visa versa should you insist.

    Good article.

  5. Atypical is offline
    06-12-2011, 06:30 PM #75

    Sexual Predators and Serial Rapists Run Wild At Wal-Mart Supplier in Jordan,

    According to New Report By Institute for Global Labour and Human Rights.

    Today the Institute for Global Labour and Human Rights is releasing a very disturbing report, Sexual Predators and Serial Rapists Run Wild at Wal-Mart Supplier in Jordan,which documents in great detail, and in the workers' own words, how scores of young Sri Lankan women sewing clothing for Wal-Mart and Hanes have suffered routine sexual abuse and repeated rapes, and in some cases even torture. One young rape victim at the Classic factory in Jordan told us her assailant, a manager, bit her, leaving scars all over her body. Women who become pregnant are forcibly deported and returned to Sri Lanka. Women who refuse the sexual advances of Classic's managers are also beaten and deported.

    Classic, the largest garment export factory in Jordan, sews clothing for Wal-Mart, Hanes, [...], Kohl's, Target and Macy's. The garments enter the U.S. duty-free under the U.S.-Jordan Free Trade Agreement.

    On the weekly holiday, the alleged serial rapist and general manager, Anil Santha, sends a van to bring four or five young women to his hotel, where he abuses them. The lives of the young Sri Lankan rape victims are completely shattered, as in their culture, virginity is highly prized and critical for a good marriage.

    The standard shift at Classic is 13 hours a day, six and seven days a week, with some 18 ½ hour shifts before the clothing must be shipped to the U.S. Workers are routinely cursed at, hit and shortchanged of their wages for failing to reach their mandatory production goals. To press the women to work faster, managers grope and fondle them.

    On releasing the report, Institute director Charles Kernaghan said, "The minimal efforts of Wal-Mart, Hanes and the other labels to monitor factory conditions at Classic have failed completely. Workers are threatened by management and forced to say that conditions are good. We are strongly urging representatives of the labels to join us in Jordan on Friday, June 17 for a large meeting with the Classic workers. It is our intention, along with the United Steelworkers and our women's rights colleagues in Sri Lanka, to rescue the rape victims and return them safely home to their families. We expect Wal-Mart, Hanes and the other labels to pay significant compensation to the rape victims to restore some dignity to their lives. This is the least they can do."

    One Bangladeshi worker recently deported from the Classic factory told us today that, "all the workers of Sri Lanka, India, Bangladesh...everybody will testify that Anil raped the Sri Lankan women. Everybody knows. In a safe place, the workers will testify."

    Links to report being released:


    Yay, free trade. Yay, no unions. Yay, cheap goods. Yay, low, low, wages. Yay, pretty girls who have no power can be raped! Yay, American companies don't care. Yay, government does not collect duty so this stuff is really cheap. Yay, the media won't report this. Yay, we consumers don't care anyway, as long as it's cheap!

    Anybody at the retail chains care? No?

    Last edited by Atypical; 06-13-2011 at 01:20 PM.

  6. Atypical is offline
    06-13-2011, 01:27 PM #76

    After David Koch Leaves NIH Board, NIH Hands Down Long-Delayed Classification Of Top

    Koch Pollutant As A Carcinogen.

    Large manufacturers and chemical producers have lobbied ferociously to stop the National Institutes of Health from classifying formaldehyde as a carcinogen. A wide body of research has linked the chemical to cancer, but industrial polluters have stymied regulators from action.

    Last year, the New Yorker’s Jane Mayer reported that billionaire David Koch, whose company Georgia Pacfic (a subsidiary of Koch Industries) is one of the country’s top producers of formaldehyde, was appointed to the NIH cancer board at a time when the NIH delayed action on the chemical. The news was met with protests from environmental groups. Faced with mounting pressure from Greenpeace and the scientific community, Koch left offered an early resignation from the board in October.

    Yesterday, the NIH finally handed down a report officially classifying formaldehyde as a carcinogen:

    Government scientists listed formaldehyde as a carcinogen, and said it is found in worrisome quantities in plywood, particle board, mortuaries and hair salons. They also said that styrene, which is used in boats, bathtubs and in disposable foam plastic cups and plates, may cause cancer but is generally found in such low levels in consumer products that risks are low. Frequent and intense exposures in manufacturing plants are far more worrisome than the intermittent contact that most consumers have, but government scientists said that consumers should still avoid contact with formaldehyde and styrene along with six other chemicals that were added Friday to the government’s official Report on Carcinogens. Its release was delayed for years because of intense lobbying from the chemical industry, which disputed its findings.

    An investigation by ProPublica found that Sens. David Vitter (R-LA) and James Inhofe (R-OK) had used their power to add years of delay to the report. The piece linked Vitter to lobbying from Koch’s Georgia Pacific company, which has plywood plants in Louisiana.


    Does this mean that Koch doesn't care about causing cancer? Because of money?
    Does this mean that publicity helped get him to resign? That without it nothing would have happened?
    That Vitter (R) (visitor of prostitutes and still in office) and Inhofe (R) one of the stupidest people in gubmint, are complicit with Koch in these matters?

    This crap actually happens? I'm shocked!!

  7. Atypical is offline
    06-18-2011, 08:17 PM #77

    Greek Protesters Are Better Economists Than the European Authorities

    by: Mark Weisbrot, The Center for Economic and Policy Research | News Analysis

    Imagine that in the worst year of our recent recession, the United States government decided to reduce its federal budget deficit by more than $800 billion dollars – cutting spending and raising taxes to meet this goal. Imagine that, as a result of these measures, the economy worsened and unemployment soared to more than 16 percent, and then the president pledged another $400 billion in spending cuts and tax increases this year. What do you think would be the public reaction?

    It would probably be similar to what we are seeing in Greece today, including mass demonstrations and riots, because that is what the Greek government has done. The above numbers are simply adjusted for the relative size of the two economies. Of course the U.S. government would never dare to do what the Greek government has done – recall that the budget battle in April that had House Republicans threatening to shut down the government resulted in spending cuts of just $38 billion.

    What makes the Greek public even angrier is that their collective punishment is being meted out by foreign powers – the European Commission, European Central Bank (ECB), and the International Monetary Fund (IMF). This highlights perhaps the biggest problem of unaccountable, right-wing, supra-national institutions. Greece would not be going through this if it were not a member of a currency union. If it had leaders that were stupid enough to massively cut spending and raise taxes during a recession, those government officials would be replaced. And then a new government would do what the vast majority of governments in the world did during the world recession of 2009 – the opposite, i.e. deploy an economic stimulus, or what economists call counter-cyclical policies.

    And if that required a renegotiation of the public debt, that is what the country would do. This is going to happen even under the European authorities, but first they are putting the country through years of unnecessary suffering, and taking advantage of the situation to privatize public assets at fire sale prices and restructure the Greek state and economy so that it is more to their liking.

    I have maintained for some time that the Greek government has had more bargaining power than it has used, and the past week’s events seem to confirm this. Because of the massive opposition to further economic self-destruction – the latest polls show that 80 percent of Greeks are opposed to making any more concessions to the European authorities – the Greek government has so far been unable to reach an agreement with the IMF for the release of their latest loan tranche on June 29. So what happened? The IMF is going to hand over the money anyway, while the European authorities (who are in control of IMF decision-making on matters of Greek economic policy) continue to quarrel over how long they will postpone Greece’s inevitable debt restructuring, roll-over, or whatever they choose to call it.

    That’s because the prospect of a disorderly default – as would be triggered by the IMF simply sticking to its program and not lending Greece the money – is too scary for the European authorities to contemplate. For this reason the many news articles about the possibility of a financial collapse comparable to what happened after Lehman Brothers went under in 2008 are somewhat exaggerated. The European authorities are not going to let that happen over a measly $17 billion loan installment. The events of the past week were all a game of brinkmanship, and the European authorities had to blink because the Greek government, as much as it wanted to, couldn’t get approval for the deal.

    A democratically accountable Greek government would take a much harder line with the European authorities. For example, they could start with a moratorium on interest payments, which are currently running at 6.6 percent of GDP. (This is a huge interest rate burden, and the IMF projects it to increase to 8.6 percent by 2014. For comparison, despite all the noise about the U.S. debt burden, net interest on the U.S. public debt is currently at 1.4 percent of GDP.) That would release enough funds for a serious stimulus program, while they negotiate with the authorities for the inevitable debt write-down. Of course the European authorities – who are looking at this from the point of view of their big banks and creditors’ interests generally -- would be enraged, but at least this would be a reasonable opening bargaining position.

    The IMF’s latest review of its agreement with Greece suggests that the Euro, for the Greek economy, is still 20-34 percent overvalued. This makes a recovery through “internal devaluation” – i.e., keeping unemployment so high and therefore lowering wages to make the economy more internationally competitive – an even more remote possibility than it would otherwise be. But the big problem is that the country’s fiscal policy is going in the wrong direction, and of course they cannot use monetary policy because that is controlled by the ECB.

    The European authorities have more than enough money to finance a recovery program in Greece, and to bail out their banks if they don’t want them to take the inevitable losses on their loans. There is no excuse for this never-ending punishment of the Greek people.

    This article was previously published in The Guardian (UK) on June 17, 2011.
    Last edited by Atypical; 06-18-2011 at 08:58 PM.

  8. SiriuslyLong is offline
    SiriuslyLong's Avatar
    Joined: Jan 2009 Location: Ann Arbor, MI Posts: 3,560
    06-18-2011, 08:42 PM #78
    You need to consider all the social capital plywood has created. Without it, all the affordable housing the government promoted for decades wouldn't have been available. Likewise for the cheap bathtubes, shower stalls and sinks that are made from composites that use styrene.

    You are one of those that probably hate plastic, but can't / won't recognize all the good it has done for society and the advancement of mankind.

    Hate on............... It's all about the Koch brothers, democrats and republicans............. lol.

  9. Atypical is offline
    06-26-2011, 02:07 PM #79

    Offshoring Has Destroyed The U.S. Economy: Nobel Economist Michael Spence Says

    Globalization Is Costly For Americans.

    By Paul Craig Roberts
    I have been thinking about whether to post this essay for a few days. It is a bit long but packed with important new economic information. It is written by a conservative who was one of the heroes of Republican policy and a frequent contributor to the hysterically conservative editorial page of the WSJ. His views have changed apparently.

    Michael Spence is currently on C-Span. I have recorded his talk due to this essay by Dr. Roberts.

    For those that want a new perspective on commonly accepted economic wisdom - read this - slowly. See the links and videos. (Atypical)

    These are discouraging times, but once in a blue moon a bit of hope appears. I am pleased to report on the bit of hope delivered in March of 2011 by Michael Spence, a Nobel prize-winning economist, assisted by Sandile Hlatshwayo, a researcher at New York University. The two economists have taken a careful empirical look at jobs offshoring and concluded that it has ruined the income and employment prospects for most Americans.

    To add to the amazement, their research report, "The Evolving Structure of the American Economy and the Employment Challenge," was published by the very establishment Council on Foreign Relations ( industrial-policy/evolving-structure-american-economy-employment-challenge/p24366).

    For a decade I have warned that U.S. corporations, pressed by Wall Street and large retailers such as Wal-Mart, to move offshore their production for U.S. consumer markets, were simultaneously moving offshore U.S. GDP, U.S. tax base, U.S. consumer income, and irreplaceable career opportunities for American citizens.

    Among the serious consequences of offshoring are the dismantling of the ladders of upward mobility that made the United States an "opportunity society," an extraordinary worsening of the income distribution, and large trade and federal budget deficits that cannot be closed by normal means. These deficits now threaten the U.S. dollar's role as world reserve currency.

    I was not alone in making these warnings. Dr. Herman Daly, a former World Bank economist and professor at the University of Maryland, Dr. Charles McMillion, a Washington, D.C., economic consultant, and Dr. Ralph Gomory, a distinguished mathematician and the world's best trade theorist, understand that it is strictly impossible for an economy to be moved offshore and for the country with the offshored economy to remain prosperous.

    Even before this handful of economists capable of independent thought saw the ruinous implications of offshoring, two billionaires first recognized the danger and issued warnings, to no avail. One of the billionaires was Roger Milliken, the late South Carolina textile magnate, who spent his time on Capital Hill, not on yachts with Playboy centerfolds, trying to make our representatives aware that we were losing our economy. The other billionaire was the late Sir James Goldsmith, who made his fortune by correcting the mistakes of America's incompetent corporate CEOs by taking over their companies and putting them to better use. Sir James spent his last years warning of the perils both of globalism and of merging the sovereignties of European countries and the UK into the EU.

    Sir James's book, The Trap, was published as long ago as 1993. His book, The Response, in which he replied to the "free trade" ideologues in the financial press and academia who denigrated his warning, was published in 1995. (For readers who wish to hear a speech given by Sir James to the U.S. Senate in 1994 warning of the perils of globalism, go to TP8vTO0, Also: 4PQrz8F0dBI&feature=related.)

    Sir James called it correct, as did Roger Milliken. They predicted that the working and middle classes in the United States and Europe would be ruined by the greed of Wall Street and corporations, who would boost corporate earnings by replacing their domestic work forces with foreign labor, which could be paid a fraction of labor's productivity as a result of the foreign country's low living standard and large excess supply of labor. Anytime there is an excess supply of labor, or the ability of corporations to pay labor less than its productivity, the corporations bank the difference, share prices rise, and Wall Street and shareholders are happy.

    All of this was over the heads of "free trade" ideologues, who threw accusations such as "protectionist" at Sir James, Roger Milliken, Herman Daly, Ralph Gomory, Charles McMillion and myself. These "free trade" ideologues are economically incompetent. They do not know that the justification for free trade is based on the principle of comparative advantage, which means that a country specializes in those economic activities in which it performs best and trades for those goods that other countries do best. Instead, the ideologues think that free trade means the freedom of capital to seek absolute advantage abroad in lowest factor cost. In other words, the free trade incompetents have never read David Ricardo, who formalized the case for free trade.

    Other economists, especially those high profile ones in high profile academic institutions, were bought and paid for (see "Inside Job" at http://www.informationclearinghouse....ticle28189.htm). In exchange for grants from offshoring corporations, these hirelings invented "the New Economy" in which everyone would prosper as a result of getting rid of "dirty fingernail jobs." The New Economy wouldn't make anything, but it would lead the world in innovation and in financing what others did make. The "new economists" were not sufficiently bright to realize that if a country didn't make anything, it couldn't innovate.

    Let's go now to Michael Spence and Sandile Hlatshwayo, who have provided an honest report for which we should give thanks. Professor Spence could have made many millions using the prestige of his Nobel Prize to lie for the Establishment, but he chose to tell the truth.

    Here is what Spence and Hlatshwayo report:

    "This paper examines the evolving structure of the American economy, specifically, the trends in employment, value added, and value added per employee from 1990 to 2008. These trends are closely connected with complementary trends in the size and structure of the global economy, particularly in the major emerging economies. Employing historical time series data from the Bureau of Labor Statistics and the Bureau of Economic Analysis, U.S. industries are separated into internationally tradable and non-tradable components, allowing for employment and value-added trends at both the industry and the aggregate level to be examined. Value added grew across the economy, but almost all of the incremental employment increase of 27.3 million jobs was on the non-tradable side. On the non-tradable side, government and health care are the largest employers and provided the largest increments (an additional 10.4 million jobs) over the past two decades. There are obvious questions about whether those trends can continue; without fast job creation in the non-tradable sector, the United States would already have faced a major employment challenge.

    "The trends in value added per employee are consistent with the adverse movements in the distribution of U.S. income over the past 20 years, particularly the subdued income growth in the middle of the income range. The tradable side of the economy is shifting up the value-added chain with lower and middle components of these chains moving abroad, especially to the rapidly growing emerging markets. The latter themselves are moving rapidly up the value-added chains, and higher-paying jobs may therefore leave the United States, following the migration pattern of lower-paying ones. The evolution of the U.S. economy supports the notion of there being a long-term structural challenge with respect to the quantity and quality of employment opportunities in the United States. A related set of challenges concerns the income distribution; almost all incremental employment has occurred in the non-tradable sector, which has experienced much slower growth in value added per employee. Because that number is highly correlated with income, it goes a long way to explain the stagnation of wages across large segments of the workforce."
    Last edited by Atypical; 06-26-2011 at 05:09 PM.

  10. Atypical is offline
    06-26-2011, 02:07 PM #80


    What is Spence telling us? Spence is careful not to say that globalism is the intentional result of enhancing capital's profits at the expense of labor's wages, but he does acknowledge that that is its effect and that globalism or jobs offshoring has the costs that Daly, Gomory, McMillion, Milliken, Goldsmith and I have pointed out. Spence uses the same data that we have provided that proves that during the era of globalism the U.S. economy has created new jobs only in nontradable services that cannot be offshored or be produced in locations distant from their market. For example, the services of barbers, waitresses, bar tenders and hospital workers, unlike those of software engineers, cannot be exported. They can only be sold locally in the location where they are provided.

    Tradeable jobs are jobs that produce goods and services that can be exported and thus can be produced in locations distant from their market. Tradeable jobs result in higher value-added and, thereby, higher pay than most non-tradable jobs.

    When a country's tradeable goods and services are converted by offshoring into its imports, it is thrown back on low productivity domestic service jobs for its employment. These domestic service jobs, except for dentists, lawyers, teachers and medical doctors do not require a university education. Yet, America has thousands of universities and colleges, and the government endlessly repeats the mantra that "education is the answer."

    But with engineering, design and research jobs offshored, and with many of the jobs that remain within the U.S. filled by foreigners on HB-1 and L-1 visas, we now have the phenomenon of American university and college graduates, heavily indebted with student loans, jobless and living with their parents who support them.

    Spence also acknowledges that the change in the structure of American employment from higher productivity to lower productivity jobs is the reason both for the stagnation in U.S. consumer income and for the rising inequality of income. Sending middle class jobs abroad raised the earnings of capital. Spence understands that the lack of growth in consumer income has resulted in a shortfall in domestic demand, resulting in high unemployment. He could have added that jobs offshoring also gave us the Federal Reserve's policy of pumping up consumer debt as a substitute for the missing growth in consumer income. There is an obvious limit to the ability to maintain the growth of consumer demand via the growth of indebtedness.

    The offshored economy is the "New Economy," which the "free trade" hirelings of Wall Street and the global corporations invented in order to pay, with grants from the offshoring corporations, for their summer homes in the Hamptons.

    As a graduate student in economics, I was fortunate to study with a number of professors who had or were subsequently awarded Nobel Prizes. Among these creative people there are two economists whom I did not study under, but whose work I have read, and whose work is of great importance to our economic prospects. The two most important economists of our time, who, without any doubt, deserve the Nobel Prize are Ralph Gomory and Herman Daly.

    Ralph Gomory's book, "Global Trade and Conflicting National Interests," coauthored with William Baumol, a past president of the American Economics Association, is the most important work in trade theory ever produced. This book and subsequent papers by Gomory prove beyond all doubt that the free trade theory set out by David Ricardo at the beginning of the 19th century is merely a special case, not a general theory.

    Economists learn in their graduate courses that free trade is an unchallengeable doctrine and that only ignorant protectionists dispute the theory. This mindset was sufficient for Gomory's book to be largely ignored, even though Paul Samuelson, the dean of American economics, acknowledged the critical point that there are situations in which free trade is not mutually beneficial.

    The other deserving recipient of the Nobel Prize is Herman Daly. On the trade issue, Daly's point is different from and less revolutionary than Gomory's. Daly makes the same point that I make, which is that the classic theory of free trade is based on comparative advantage, not on absolute advantage, and that offshoring is based on absolute advantage. Thus, offshoring is not free trade.

    Daly's revolutionary contribution to economics comes from his realization that the production function that is the basis of economic science is wrong.

    This production function is known as the Solow-Stiglitz production function. This production function assumes that man-made capital is a substitute for nature's capital. It follows from this assumption that whatever humans do to use up and destroy the natural environment can be overcome by the resourcefulness of science and technology.

    Daly shows that this reasoning is incorrect. If the Gulf of Mexico is destroyed by fertilizer run-offs from agri-business and by oil spills, only nature can correct the problem after many years measured in decades or centuries. In the meantime, humans are without the resource.

    Daly's argument is brilliant in its simplicity. In former times, nature's capital was enormous, and man's reproducible capital was small. For example, fish in the oceans were plentiful, but fishing boats were not. Today fishing boats are in excess supply, but ocean fishing stocks are depleted. Thus, the limiting factor is not man-made capital, but nature's capital. Daly stresses that by leaving ecological and social costs out of the computation of GDP, economists do not have a reliable measure of the effect of economic activity on human welfare.

    All of economics is predicated on the notion that resources are inexhaustible, and that the only challenge is to use them most efficiently. But if resources are not inexhaustible and cannot be replicated by human capital, the world economy is being ruthlessly exploited to its detriment and to the detriment of life on earth.

    To find a Nobel prize-winner documenting the high cost of globalism to developed economies is extraordinary. For the Council on Foreign Relations to publish it suggests that the Establishment, or some part of it, suspects that its hubris has run away with its fortunes, and that different thinking is needed to restore the U.S. economy.

    We must hope that Spence's paper will encourage thought. On the other hand, the bought-and-paid-for-economists will confront Spence with their fantasies that the U.S. would be enjoying full employment if only government did not discourage employment with unemployment compensation, food stamps, income support programs, unions, minimum wages and regulation.

    Recently, yet another high-level warning came from the International Monetary Fund. The IMF report said that the U.S. economy has been seriously eroded and that the age of America is over.

    Will the U.S. business and economic establishments heed these warnings, or will the U.S. become a third world country as I predicted at the beginning of this century?

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