Economic Recession, Consumer Depression

Consumers gloomy?

Yes I'd say so. Because there are too many of us that have lost our jobs and are not seeing much out there to replace it. Employers that are offering jobs are swapped with applicants which makes it an employers market. They pick the best applicant for the least pay they can give.

Rebecca Hamilton of KS @ Jun 30, 2009 18:10:02 PM

Castro will show theway

Hey Mark of AK! Socialism all the way, baby! Marx and Castro in, Adam Smith and Greenspan, OUT! Get used to it!

HARDY CAMPBELL of TX @ Jun 09, 2009 13:45:15 PM

Lets see?

If I work for the Government, This is good, Good pay expense account and no need to worry about a pension and drive a Nissan. Then Wall street, I have made my money Hid it off shore Drive a Toyota and have three kids in School looking at 2.5 million on retirement. Then work for a News-Net have a good Job drive a Honda looking at a small pension and as long as the Auto industry is in turmoil I have a job. Then the Auto industry is now in a place ,that Part time workers in job shops making parts for GM Ford Toyota Chrysler Honda Nissan in America are looking at their Jobs Pensions and life Going down the Drain drive American cars built by GM Ford and Chrysler but can't afford to spend ? How are you confused,this must be 2 million people plus dealerships another million. 21 million on Drugs in the USA wouldn't care much ,60 million working for the Government would not care. Then guess your right no depression here.

Plano of FL @ May 28, 2009 12:06:25 PM

Taxes aren't helping

Sure the feds are cutting taxes on some Americans. What about the self employed? We pay taxes at the end of the year and a tax cut now won’t help until later if at all. The new sin taxes implemented by states in excess of 200% or more on smoking, alcohol and soon caffeine. Don't smoke or drink these liquids? Well over 50% of all consumers do and we spend less on goods and the states get more. In the end this is horrible for the economy because a $20-$50 dollar tax on a carton of smokes a week could have been spent at your non smoking establishment or business.

Ok let’s have an example shall we! I used to go out to eat with the wife every Friday but since the new taxes we stopped. We went in on a special day and the owner came to us and asked why we weren’t coming around any more? We explained about the tax hikes and how the Friday night out had to be cut and a little more. He replied that he supports the tax hike because smoking is bad for you. I said back that the tax is even worse for you because the additional tax cost you about 100 dollars a week and me nothing but a few dirty dishes at home and a walk in the park on Friday instead of a bar stool. I also said if it is so bad make it illegal not tax the HE!! Out of it (I support this because the states would offer free help to quite or reduced). They wont illegalize it because of the $$$$ they make and YOU not me loose. Next tax hike we are going to cut out the satellite bill and local video rental ((NETFLIX)) will be the new source.

Increases in alcohol taxes are on the way or are already in place. I now drink 6 beers a month and will cut out all soon. Fuel tax is also about 50 cents to the gallon before sales tax and has been so for years and for years now we have cut out our vacation outside our area.

I don’t know why idiot economists can't figure this out and recommend to cut taxes. You raise taxes either we move or we cut spending and the only ones hurt are the people. Don't like smoking? Neither do I! Then quite? Ok I am trying but just so you know how hard it is hold your breath for 60 seconds - EXHALE - Now repeat every time you want air. This is what it is like. Now let’s chuck a tax on that action and see if you quite or just cut bills. No matter what the tax benefits it will only hurt. Why not increase state speeding fines? I will tell you why it won’t work - in most cases speeding isn't an addiction but smoking is. People will just drive better/safer but smokers will change living style.

A lesson in simple economics is unless you make more you can’t spend more (unless you haven't learned loans and credit cards are BAD). If you tax me more I spend less and who benefits? The poor and I don't mind this but if you aren't receiving state aid in any way you GET NOTHING! Actually less than nothing because I won’t spend the money I paid in taxes because the state took it. A bill or a luxury have to be cut. So far we cut driving, took 1 car off the road to cut insurance, Cut our night out

Tim Olejar of MI @ Apr 24, 2009 08:17:22 AM

Ariely is way off track.

And to think that college graduates cannot find work! Perhaps it is because of all of the useless, socialistic, esteem-enhancing, victim studies pap that has passed for higher education for the last couple of decades. Blake's "We the People" are going to witness firsthand how ineffective the policies they have long been advocating really are. Go see a Penn or Sarandon movie, won't you? Or a Boss concert? Hey, travel to Cuba will be allowed soon - you can bask amongst their perfect system and then tell us everything we've done wrong.

Mark of AK @ Feb 11, 2009 17:58:18 PM

economy

I get a cost of living raise for my SSDI and then my food stamps get cut. The electric bill is high, so is the gas,and where do I cut corners. I have to pay rent,and all the utilites. So the way I figure "we the people need help or we will starve".

With the cost of food and the $217 food stamps don't even make it through the month. I don't have any extra money, so that leaves the food pantries---and they bearly have any food to hand out....so of it is expired or rotten.

So I hope Bush gets infested with fleas, cuz he's the one who started this whole mess.And Obama is trying his best to fix it.

But I hope they don't for the hungry right here in the USA.

Janine Cone of IL @ Feb 10, 2009 03:26:52 AM

The Great Depression Part II and The Cause

Here is an article about the fed chairman during the time of the Great Depression and what he thought caused it. The same thing is happening again for the same reasons. Please read:

In Review: America's Most Egalitarian Banker

Marriner S. Eccles, Beckoning Frontiers: Public and Personal Recollections. New York: Alfred A. Knopf, 1951.

At the start of the Great Depression, Marriner Eccles hardly seemed someone who might lead a charge against the economic orthodoxies that justified grand hoards of private fortune. By the early 1930s, after all, the Utah-born Eccles had become the top banker in the Mountain West, the organizer of the first multibank holding company in the United States.

But Eccles had also come to understand, after watching the great speculative bubbles of the 1920s pop into massive misery, that prosperity — to endure — needs to be shared. Eccles began speaking out on that theme, shortly after the Great Depression began, and soon caught the attention of the early New Dealers.

In 1933, Eccles would become an assistant secretary of the treasury. A year later, Franklin Roosevelt would appoint him to the Federal Reserve Board. He would become Board chair in 1935 and remain in that central position for the next 13 years. No one individual, over those years, had more of an impact on economic policy in the United States.

Looking back on those years, in his 1951 memoir Beckoning Frontiers, Eccles would do his best to explain the impact he set out to make. Mass production, he noted at the outset, demands mass consumption, but people can’t afford to consume if the wealth an economy generates is concentrating at the top.

In the years leading up to the Great Depression, that concentrating was accelerating. A “giant suction pump,” charged Eccles, “had by 1929-30 drawn into a few hands an increasing portion of currently produced wealth.”

“In consequence, as in a poker game where the chips were concentrated in fewer and fewer hands,” Eccles observed, “the other fellows could stay in the game only by borrowing. When their credit ran out, the game stopped.”

Sound familiar? The decade of the 1920s that Eccles describes in his 1951 memoir comes across today as eerily familiar. Then as now, the U.S. economy was floating on a sea of debt.

Then as now, inequality was hollowing out the nation. Eccles put the matter bluntly: “Had there been a better distribution of the current income from the national product — in other words, had there been less savings by business and the higher-income groups and more income in the lower groups — we should have had far greater stability in our economy.”

How would Eccles have reacted to our current debt-ridden, war-torn economy? We can’t, of course, know for sure what Eccles would do. But we do know what he did. In 1942, during World War II, a high-powered team of New Deal officials that included Eccles proposed to President Roosevelt that “a ceiling of fifty thousand dollars after taxes should be placed on individual incomes.”

In our current dollars, this $50,000 ceiling would equal about $700,000. What did FDR do with the Eccles proposal? He turned around and asked Congress to place a 100 percent tax on all individual income over $25,000.

Congress would eventually set the nation’s top tax rate at 94 percent on all income over $200,000, and that top tax rate would hover around 90 percent for the next two decades, years that would see the greatest period of middle class prosperity in U.S. economic history.

In 2005, the latest year with statistics available, America’s leading hedge fund managers and the rest of the nation’s top 400 income-earners faced a top tax rate of 35 percent. They actually paid, after loopholes, just 18.2 percent of their incomes in tax.

Marriner Eccles would not approve.

Stat of the Week

In the two decades between 1986 and 2005, America’s top 1 percent of taxpayers saw their share of the nation’s income jump from 11.3 to 21.2 percent. Over those same years, the federal income taxes the top 1 percent paid dropped by an equally stunning margin, from 33.13 percent of total personal income in 1986 to 23.13 percent in 2005, the most current year with IRS stats available. Taxpayers needed to report at least $364,657 in 2005 to enter the top 1 percent.

About Too Much

Too Much is published by the Council on International and Public Affairs, a nonprofit research and education group founded in 1954. Office: Suite 3C, 777 United Nations Plaza, New York, NY 10017. E-mail: editor@toomuchonline.org

John Petty of MD @ Oct 24, 2008 19:26:47 PM

The Great Depression Part II and The Cause

Here is an article about the fed chairman during the time of the Great Depression and what he thought caused it. The same thing is happening again for the same reasons. Please read:

In Review: America's Most Egalitarian Banker

Marriner S. Eccles, Beckoning Frontiers: Public and Personal Recollections. New York: Alfred A. Knopf, 1951.

At the start of the Great Depression, Marriner Eccles hardly seemed someone who might lead a charge against the economic orthodoxies that justified grand hoards of private fortune. By the early 1930s, after all, the Utah-born Eccles had become the top banker in the Mountain West, the organizer of the first multibank holding company in the United States.

But Eccles had also come to understand, after watching the great speculative bubbles of the 1920s pop into massive misery, that prosperity — to endure — needs to be shared. Eccles began speaking out on that theme, shortly after the Great Depression began, and soon caught the attention of the early New Dealers.

In 1933, Eccles would become an assistant secretary of the treasury. A year later, Franklin Roosevelt would appoint him to the Federal Reserve Board. He would become Board chair in 1935 and remain in that central position for the next 13 years. No one individual, over those years, had more of an impact on economic policy in the United States.

Looking back on those years, in his 1951 memoir Beckoning Frontiers, Eccles would do his best to explain the impact he set out to make. Mass production, he noted at the outset, demands mass consumption, but people can’t afford to consume if the wealth an economy generates is concentrating at the top.

In the years leading up to the Great Depression, that concentrating was accelerating. A “giant suction pump,” charged Eccles, “had by 1929-30 drawn into a few hands an increasing portion of currently produced wealth.”

“In consequence, as in a poker game where the chips were concentrated in fewer and fewer hands,” Eccles observed, “the other fellows could stay in the game only by borrowing. When their credit ran out, the game stopped.”

Sound familiar? The decade of the 1920s that Eccles describes in his 1951 memoir comes across today as eerily familiar. Then as now, the U.S. economy was floating on a sea of debt.

Then as now, inequality was hollowing out the nation. Eccles put the matter bluntly: “Had there been a better distribution of the current income from the national product — in other words, had there been less savings by business and the higher-income groups and more income in the lower groups — we should have had far greater stability in our economy.”

How would Eccles have reacted to our current debt-ridden, war-torn economy? We can’t, of course, know for sure what Eccles would do. But we do know what he did. In 1942, during World War II, a high-powered team of New Deal officials that included Eccles proposed to President Roosevelt that “a ceiling of fifty thousand dollars after taxes should be placed on individual incomes.”

In our current dollars, this $50,000 ceiling would equal about $700,000. What did FDR do with the Eccles proposal? He turned around and asked Congress to place a 100 percent tax on all individual income over $25,000.

Congress would eventually set the nation’s top tax rate at 94 percent on all income over $200,000, and that top tax rate would hover around 90 percent for the next two decades, years that would see the greatest period of middle class prosperity in U.S. economic history.

In 2005, the latest year with statistics available, America’s leading hedge fund managers and the rest of the nation’s top 400 income-earners faced a top tax rate of 35 percent. They actually paid, after loopholes, just 18.2 percent of their incomes in tax.

Marriner Eccles would not approve.

Stat of the Week

In the two decades between 1986 and 2005, America’s top 1 percent of taxpayers saw their share of the nation’s income jump from 11.3 to 21.2 percent. Over those same years, the federal income taxes the top 1 percent paid dropped by an equally stunning margin, from 33.13 percent of total personal income in 1986 to 23.13 percent in 2005, the most current year with IRS stats available. Taxpayers needed to report at least $364,657 in 2005 to enter the top 1 percent.

About Too Much

Too Much is published by the Council on International and Public Affairs, a nonprofit research and education group founded in 1954. Office: Suite 3C, 777 United Nations Plaza, New York, NY 10017. E-mail: editor@toomuchonline.org

John Petty of MD @ Oct 24, 2008 19:26:08 PM