Our Economy Is Going to Keep Tanking Until We Stop Shoveling Billions to Rich People

[marmar]

via AlterNet:



Our Economy Is Going to Keep Tanking Until We Stop Shoveling Billions to Rich People

By Pam Martens, CounterPunch. Posted June 2, 2009.

There's a cycle going on here: if you don't put money in consumers' hands, you get repetitive cycles of layoffs and growing unemployment.



For the past eight months, we have been a nation focused on bailouts and bankruptcies. For the past ten years, we have been a nation ignoring massive wealth transfer and wealth concentration through a rigged Wall Street.

As simple and clear as this picture is, some of the brightest minds in this country are unwilling to connect the cause and effect of wealth in too few hands to bankruptcies and a tanking economy.

Wealth-deprived consumers can't buy the goods and services being produced. This leads to repetitive cycles of layoffs and growing unemployment which leads to more wealth-deprived consumers leading to more overcapacity in production plants, more layoffs, more shrinking purchasing power.

The accompanying, and equally dangerous, problem is that concentrated wealth stifles the very innovation that is necessary to create new industries, new jobs and lead us out of the downward economic spiral.

Let's think about the individuals who tapped into Wall Street's rigged wealth transfer system and what they have done with their ill-gotten loot: typically, they own three or more homes, fancy cars, multiple country club memberships, airplanes, yachts, and numbered offshore bank accounts. The problem is, they just can't buy enough to compensate for the purchases they have deprived hundreds of thousands of other consumers from being able to make. ...........(more)

The complete piece is at: http://www.alternet.org/workplace/140394/our_economy_is_going_to_keep_tanking_until_we_stop_shoveling_billions_to_rich_people/

[Phoebe Loosinhouse]

1. When the wealthy run out of tangible things to buy, they buy fake things

mostly having to do with increasing their already too vast wealth, like hedge funds, or Bernie Madoff deals or whatever financial shenanigans they can involve themselves in to transfer EVEN MORE wealth into their coffers.

[hobbit709]

2. Sooner or later the American people will be fed up.

And the result won't be pretty. Think 1789 and 1917.

[snappyturtle]

3. I think you're right. How long do you think it will be until the American

people become fed up? We need leaders who aren't part of the wealth. imho

[patrice]

4. Where are we on the next round of Bailouts at this point? nt

[Demeter]

6. Congress Won't Sign Any More Checks

so Geithner is fishing coins out of the sofa cushions, and hitting up the Fed Reserve.

[patrice]

7. If Congress tries a 2nd round of Bailouts, EVERYONE should go into the Streets!

Peacefully, of course, we'll all just take those pots and pans and cooking spoons that Molly Ivins used to recommend.

[Name removed]

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[Name removed]

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[msongs]

9. we are the solution. if it's not made in the USA, don't buy it nt

[salguine]

11. You evidently haven't noticed that there isn't a whole lot made here anymore.

[bvar22]

10. More:

"What all of this means is that President Obama has precious little time left to stop rewarding failure and bad behavior before his own Presidency is deemed a failure. It was difficult enough to countenance the reappearance in his administration of all those Wall Street faces who failed to rein in the Wall Street abuses or, worse, aided and abetted the actual creation of the opaque system that permitted the looting and pillaging. But this past week's news that the President might be considering a pivotal role for the Federal Reserve in the new regulatory structure planned for Wall Street crosses the line, if true, from hubris to outright contempt for the American people.

The inherent cronyism of the Federal Reserve renders it utterly useless as a watchdog. (Why is it even necessary to have to state that obvious fact when no one can shake loose from the Fed what it's done with trillions in taxpayer dollars or why it failed to police these Frankenbanks in the first place.) The same thing is true of the U.S. Treasury, which can't auction its own debt without the goodwill of its Wall Street primary dealers."

<snip>

President Obama needs to do three things quickly to get the country back on course: he needs to separate investment banking/brokerage from commercial banks. This will restore risk taking and innovation to where it belongs, in non FDIC insured institutions. He needs to put new faces that Americans can trust in charge of real regulators with real powers. He needs to stop funneling money to zombie institutions that haven't created anything of innovative value in a decade and channel those funds into innovative research and development projects. {my bold}

President Obama needs to step up to the plate and stop listening to conflicted advisors. The fate of a nation, as well as his place in history, hangs in the balance.

http://www.alternet.org/workplace/140394/our_economy_is_going_to_keep_tanking_until_we_stop_shoveling_billions_to_rich_people

[MichiganVote]

12. The only thing the wealthy create anymore is mayhem for all of us.

[MasonJar]

13. I know zero about Economics, but even I could have figured that

one out.

[bertman]

14. But, but . . . the super-rich are consumers too. They consume a whole lot more than all

of us middle- and lower-class consumptives. And now they're consuming our future.

Recommend.

As long as they don't consume American Idol and Dancing with the Stars, the sheep will not bleat in the street.

[The Hope Mobile]

15. Yup! K & R nt