Workers Rise; Seize Control In Cities
- NY Times headline, March 16, 1920
There has been nothing more inspiring to the working class than a popular movement of the people, taking over the streets, flexing their muscles by sheer numbers, and sweeping away all that oppose them. And nothing is more terrifying to the entrenched power than this scenario.
Class struggle has been with western society since the dawn of civilization, and it will continue as long as there is inequality in the world.
Huge majorities in both houses of Congress voted for legislation to allow the biggest bank heist of all time. But this time, it was the banks pulling the heist.
Even as the U.S. economy went into a tailspin, the median salary for CEOs of 200 large corporations increased by 4.5 percent to $1.08 million. On top of that, these corporations keep plying executives with generous freebies, despite the public outcry over private jets and other executive perks.
The 2009 AFL-CIO Executive PayWatch site, which launches today, points out that the perks for executives rose on average by 12.5 percent in 2008 to $336,248—or nine times the median salary of a full-time worker. Even more appalling is the practice of rewarding executives who drive their companies into the ground.
Same ole game, the executive class makes out like bandits all the while squeezing the middle class.
It was only a couple days ago the stock market shot up after Wells Fargo announced $3 Billion in profits. It was such good news it seemed too good to be true.
KBW expects $120 billion of “stress” losses at Wells Fargo, assuming the recession continues through the first quarter of 2010 and unemployment reaches 12 percent, Cannon wrote today in a report. The San Francisco-based bank may need to raise $25 billion on top of the $25 billion it owes the U.S. Treasury for the industry bailout plan, he wrote.
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This morning both March PPI and retail sales were released. The PPI was more negative than anticipated, suggesting a negative CPI tomorrow (Deflation is Here!).
Retail sales are more interesting. I've written several pieces about consumers coming back from the grave. At first blush, the March numbers seem to contradict what we saw from Shoppertrak re mall sales; and also same store sales, and to a very limited extent, auto sales -- all of which showed some improvement.
Retail sales were off -9.4% YoY. Ex-auto they were off ~6.0% YoY. A closer look suggests (1) Easter falling one week later in April may have much to do with the decline; and (2) almost all of the decline is in auto and gasoline sales.
Total retail sales from a year ago fell from 380.2 to 344.4. Almost all of that decline was autos, down from 67.0 to 49.7; and gasoline, down from 42.3 to 27.9.
It seems the AFL-CIO and the SEIU have made a deal. In the past the SEIU, insane as they are, have promoted illegal labor and the AFL-CIO has been more true to labor economic realities. Now it appears they struck a deal. No increases in guest worker Visas in exchange for amnesty for illegals.
The nation’s two major labor federations have agreed for the first time to join forces to support an overhaul of the immigration system, leaders of both organizations said on Monday. The accord could give President Obama significant support among unions as he revisits the stormy issue in the midst of the recession.
Reversing its role as the world’s fastest-growing buyer of United States Treasuries and other foreign bonds, the Chinese government actually sold bonds heavily in January and February before resuming purchases in March, according to data released during the weekend by China’s central bank.
Mr. Wen voiced concern on March 13 about China’s dependence on the United States: “We have lent a huge amount of money to the U.S. Of course we are concerned about the safety of our assets. To be honest, I am definitely a little worried.”
When Ben Sims, 57, showed up earlier this year for a job interview at a company in Richardson, Tex., he noticed the hiring manager — several decades his junior — falter upon spotting him in the lobby.
“Her face actually dropped,” said Mr. Sims, who was dressed in a business suit befitting his 25-year career in human resources at I.B.M.
Later, in her office, after several perfunctory questions, the woman told Mr. Sims she did not believe the job would be “suitable” for him. And barely 10 minutes later, she stood to signal that the interview was over.
How many know this story? Literally, on the phone, assumptions are made about my age and I hear I should talk to "so and so company" for the workers are "all my age".
Here are a few snips from an explosive article in Forbes magazine:
When oil prices spiked last summer to $147 a barrel, the biggest corporate casualty was oil pipeline giant Semgroup Holdings, a $14 billion (sales) private firm in Tulsa, Okla. It had racked up $2.4 billion in trading losses betting that oil prices would go down.... With the credit crunch eliminating any hope of meeting a $500 million margin call, Semgroup filed for bankruptcy on July 22.
But now some of the people involved in cleaning up the financial mess are suggesting that Semgroup's collapse was more than just bad judgment and worse timing. There is evidence of a malevolent hand at work: oil price manipulation by traders orchestrating a short squeeze to push up the price of West Texas Intermediate crude to the point that it would generate fatal losses in Semgroup's accounts.
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Regardless of whether the economy as a whole begins to improve, the malaise of working and middle class America will not be relieved until wages increase, and employment rates return to a robust level.
The news on that score is grim. Unemployment is a lagging indicator. Historically, it continued to rise right through to the end of recessions. The "jobless recoveries" from the 1990 and 2001 recessions were even worse: unemployment continued to rise for over a year after both recessions ended!
If that pattern is again true for any recovery from this recession, the forecast is grim indeed.
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