Economic Signs Point to Longer, Deeper Recession

[onehandle]

Source: Washington Post

The U.S. economy entered a recession one year ago, a group of the nation's leading economists said yesterday, and new evidence that the downturn will be deep and prolonged sent the stock market plummeting.

The Dow Jones industrial average dropped 7.7 percent, or 680 points, on bleak economic reports, including one that showed that manufacturing activity in November was weaker than it had been since 1982. Investors plowed money into U.S. Treasury bonds, seen as safe havens in uncertain times.

Meanwhile, Federal Reserve Chairman Ben S. Bernanke indicated in a speech that he is inclined to keep cutting interest rates and using novel approaches to try to contain damage from the downturn. Treasury Secretary Henry M. Paulson Jr. said he is designing new programs to strengthen the financial system.

The pledges to take aggressive action come as the recession appears to be getting worse.

Read more: http://www.washingtonpost.com/wp-dyn/content/article/2008/12/01/AR2008120101559.html

[Double T]

1. We need JOBS! We need JOBS! We need JOBS! We need JOBS!

Meanwhile American plants continue to close and relocate to foreign slave wage markets taking our JOBS with them.
There will be no economic recovery without JOB creation and very few want to face that hardcore fact.

[Possumpoint]

4. Very Few Want to Face

the fact that in order for jobs to return to the United States our wage costs across the board must be competitive. If wage costs are higher, then fewer workers must be more productive to compete. If our wage costs are reduced then everything else is too high. Everything is over priced and also must be devalued i.e. food, medical, energy, clothing, car and housing costs. That would be a long term project to bring that back into equilibrium.

The only other way to do it is protectionism. That becomes a self defeating process, you raise tariffs, your competitor raises tariffs.

[Jackpine Radical]

8. So, the only way to compete is to match the slave-labor pay of the Far East?

Just as an oddball thought, what would happen if we put some effort into improving the conditions of workers around the world? Seems to me that if workers in general get a larger share of the fruits of their labor, the whole world benefits.

The Chicago School of economics from which all of this race-to-the-bottom stuff derives is not the only way to structure an economic system.

[Odin2005]

9. You have it backward. The corporate elite are using the mantra of globalization to depress wages.

Things like outsourcing are all about pitting one country against another economically in a race to the bottom to depress "labor costs" (I hate it when capitalists treat worker's wages into just another expense, it's dehumanizing) in order to "encourage investment" (that is, to suck up to the multinational corporations).

[Dogmudgeon]

10. The Reason Why This Is So

(Edit: changed "true" to "so")

It implies that the only route to survival is poverty.

Harder labor for less return.

Turn the USA into one big Sunbelt economy.

MORE "trickle-up" economics.

MORE "just give the rich everything they want."

Ummm ... this is a big part of what got us into trouble in the first place.

The second part of your proposal, "Everything is over priced and also must be devalued i.e. food, medical, energy, clothing, car and housing costs. That would be a long term project to bring that back into equilibrium (...)" proposes a strong round of deflation.

That process has already started; money markets are drying up, and the price of petroleum has crashed.

No, we need to produce real wealth in this country again, instead of "profits" from derivative ("paper") financial maneuvering for a privileged few, while everyone else works in retail or fast food -- the "Service sector". We need Rustbelt, non Sunbelt, economics.

--p!

[pattmarty]

11. So I take it YOU are advocating a Depression????

[NOW tense]

2. Does the Bush admin. still think fast food is manufacturing?

[peacefreak]

5. Yup.

Just as much as the Reagan Administration thought ketchup was a vegetable.

[NOW tense]

6. So does that mean that

people are not even eating fast food because it is to expensive?

[SpiralHawk]

3. The republicon legacy to America

Ptoooey on the greed, corruption, and FAIL of Republiconomics.

[Beer Snob-50]

7. Even though turdblossum thought it a bad idea on the today show

i believe that we stimulate the economy by public works projects. much as roosevelt did, we have to hire americans to rebuild roads and bridges.