The Greed Over Patriotism party . . .

[Amskeptic]

We appear to be through the looking glass at this point.

John Boehner has decided that any revenue increase, including tax loopholes, is off the table as the sequestration takes hold.

Comments? Am I being unfair with my "inflammatory" subject header?
Colin

[yondermtn]

LOL @ a balanced approach.

I think the title is quite fitting.

[RSorak 71Westy]

A friend of mine made this point in regards to our local school system making some cuts and it applies just as well to the Feds. The comment was they cut the things most visible, loved and wanted by the public 1st and this makes us gun shy to ask for further cuts. There are a million invisible places for the gov't to make the cuts.

[Bleyseng]

Starting with Congress' health care, next oil company subsidies and then the farm subsidies.

[Amskeptic]

Starting with Congress' health care, next oil company subsidies and then the farm subsidies.

I just got a petition in my email to call on Congress to take a pay cut/benefits cut commensurate with what they are asking us to swallow. I think that is an excellent idea.

[yondermtn]

I just got a petition in my email to call on Congress to take a pay cut/benefits cut commensurate with what they are asking us to swallow. I think that is an excellent idea.

AGREED

[ruckman101]

Corporatists, not patriots.


neal

[Amskeptic]

Fresh off the NYT press:

Recovery in U.S. Is Lifting Profits, but Not Adding Jobs
By NELSON D. SCHWARTZ
Published: March 3, 2013

With the Dow Jones industrial average flirting with a record high, the split between American workers and the companies that employ them is widening and could worsen in the next few months as federal budget cuts take hold.

That gulf helps explain why stock markets are thriving even as the economy is barely growing and unemployment remains stubbornly high. With millions still out of work, companies face little pressure to raise salaries, while productivity gains allow them to increase sales without adding workers.

“So far in this recovery, corporations have captured an unusually high share of the income gains,” said Ethan Harris, co-head of global economics at Bank of America Merrill Lynch. “The U.S. corporate sector is in a lot better health than the overall economy. And until we get a full recovery in the labor market, this will persist.”

The result has been a golden age for corporate profits, especially among multinational giants that are also benefiting from faster growth in emerging economies like China and India.

These factors, along with the Federal Reserve’s efforts to keep interest rates ultra-low and encourage investors to put more money into riskier assets, prompted traders to send the Dow past 14,000 to within 75 points of a record high last week. While buoyant earnings are rewarded by investors and make American companies more competitive globally, they have not translated into additional jobs at home.

Other recent positive economic developments, like a healthier housing sector and growth in orders for machinery and some other durable goods, have also encouraged Wall Street but similarly failed to improve the employment picture. Unemployment, after steadily declining for three years, has been stuck at just below 8 percent since last September.

With $85 billion in automatic cuts taking effect between now and Sept. 30 as part of the so-called federal budget sequestration, some experts warn that economic growth will be reduced by at least half a percentage point. But although experts estimate that sequestration could cost the country about 700,000 jobs, Wall Street does not expect the cuts to substantially reduce corporate profits — or seriously threaten the recent rally in the stock markets.

“It’s minimal,” said Savita Subramanian, head of United States equity and quantitative strategy at Bank of America Merrill Lynch. Over all, the sequester could reduce earnings at the biggest companies by just over 1 percent, she said, adding, “the market wants more austerity.”

As a percentage of national income, corporate profits stood at 14.2 percent in the third quarter of 2012, the largest share at any time since 1950, while the portion of income that went to employees was 61.7 percent, near its lowest point since 1966. In recent years, the shift has accelerated during the slow recovery that followed the financial crisis and ensuing recession of 2008 and 2009, said Dean Maki, chief United States economist at Barclays.

Corporate earnings have risen at an annualized rate of 20.1 percent since the end of 2008, he said, but disposable income inched ahead by 1.4 percent annually over the same period, after adjusting for inflation.

“There hasn’t been a period in the last 50 years where these trends have been so pronounced,” Mr. Maki said.

At the individual corporate level, though, the budget sequestration could result in large job cuts as companies move to protect their bottom lines, said Louis R. Chenevert, the chief executive of United Technologies. Depending on how long the budget tightening lasts, the job cuts at his company could total anywhere from several hundred to several thousand, he said.

“If I don’t have the business, at some point you’ve got to adjust the work force,” he said. “You always try to find solutions, but you get to a point where it’s inevitable.”

The path charted by United Technologies, an industrial giant based in Hartford that is one of 30 companies in the Dow, underscores why corporate profits and share prices continue to rise in a lackluster economy and a stagnant job market. Simply put, United Technologies does not need as many workers as it once did to churn out higher sales and profits.

“Right now, C.E.O.’s are saying, ‘I don’t really need to hire because of the productivity gains of the last few years,’ ” said Robert E. Moritz, chairman of the accounting giant PricewaterhouseCoopers.

At 218,300 employees, United Technologies’ work force is virtually unchanged from seven years ago, even though annual revenue soared to $57.7 billion in 2012 from $42.7 billion in 2005.

The relentless focus on maintaining margins continues, even though profit and revenue have never been higher; four days after the company’s shares soared past $90 to a record high last month, United Technologies confirmed it would eliminate an additional 3,000 workers this year, on top of 4,000 let go in 2012 as part a broader restructuring effort.

“There’s no doubt we will continue to drive productivity year after year,” Mr. Chenevert said. “Ultimately, we compete globally.”

When companies do hire, it is often overseas, where the growth is. Take 3M, another company among the Dow 30 that is trading at a record high.

Unlike United Technologies, the work force at 3M, based in Minnesota, has grown substantially in recent years, rising to 87,677 last year from 76,239 in 2007. But of those 11,438 positions added, only 608 were in the United States.

Even as President Obama and Congress have battled over the budget in recent months and growth has slowed to a crawl in the United States, the economic picture has actually brightened overseas. Asia has rebounded and Europe stabilized, factors helping the kind of big companies that make up the Dow, said Julia Coronado, chief North American economist at BNP Paribas.

“You’re investing in the global economy,” she said, “and you’re getting access to stronger growth abroad.”

The Federal Reserve has also played a crucial role in propelling the stock market higher, economists and strategists say, even if that was not the intent of policy makers. The Fed has made reducing unemployment a top priority, but in practice its policy of keeping rates very low and buying up the safest assets to stimulate the economy means investors are willing to take on more risk in search of better returns, hence the buoyancy on Wall Street amid the austerity in Washington and gloom on Main Street. Of the broader market’s 13 percent rise in 2012, about half was a result of the Fed’s actions, Mr. Harris of Bank of America Merrill Lynch estimates.

“The Federal Reserve has done a good job stimulating financial conditions and lifting the market,” he said. “It’s been less successful in stimulating job growth.

. . .

Reader's Comments below:

Leilani Karp, Los Angeles, CA
"I realize empathy or respect towards lesser beings are signs of weakness in business and politics, but at long last, all of you 'Job Creators' ... have you no shame?"


A.P.New York, NY
"In the for-profit sector, jobs reduce the gain for shareholders; ergo, jobs are bad and are "created" only as a matter of necessity. There is no social contract. Poverty, homelessness, hunger, lack of access to health care, etc. are not important. Welcome to Dystopia, population millions."
March 4, 2013 at 7:38 a.m.

Eleanore1946Old Bridge NJNYT Pick
"Companies exist only to make money? Money that makes wealth for the Big Bois at the top? Sorry...that's not true. Companies exist to perform a valuable service to those who buy their products. After they pay ALL their bills from the revenue brought in by consumers, then and only then do they get to call what remains a "profit."

But, the Madoffers of the US Big Business don't see it that way. Their budget priorities are their own annual salary increases, bonuses and perks FIRST and then what remains pays the bills and if there's a shortfall, they look to the taxpayers who help with subsidies in the billions every year.

Most ethical business people know you don't go helping yourself first and then cross your fingers and beg bailouts from the very people making your wealth for you in the first place.

Talk about misguided ideas. Corporate profits are soaring because Mr. Corporate Exec figured out by hiring offshore cheap laborers he pays $11 a month without ANY employee benefit costs to worry about, he can profit big big big time. That's about as skankola as it needs to get. When corporations dare to take our tax dollars in subsidies, they better honor their obligations to THIS country first. After all, rolling boycotts are the stuff of CEO nightmares, aren't they?"
March 4, 2013 at 10:28 a.m.

[Spezialist]

Anti-socialists or socialists.

[Amskeptic]

Anti-socialists or socialists.

I don't know where to go with this . . .

[Bleyseng]

Here's a great video about how big the income inequity is in the USA.
http://mashable.com/2013/03/02/wealth-inequality/

Wow, this is unbelievable and this video must be commie/socialist media propaganda as it shows via money why the "rich" own America.

[denjohn]

Politicians from both sides of the aisle will swear pious oaths to protect and foster the well being of the middle class. They will say that their policies and proposals are all designed for its betterment. And yet the state of the middle class continues to dwindle into despair and disrepair. Why is this?

It is not because of the predominance of a right or left ideology, of taxation and deficits and austerity. It is not because of the re-emergence of a perversion of the gospel, in the predestination of prosperity. We have seen all this before. It is not because in our comfort we have lost the sense of the imperative of common cause.

It is because of the overwhelming corruption of power, and of the cynical amorality of thoroughly modern political managers who worship power and personal wealth as ends unto themselves. They distract the people with artificially divisive social issues and crises, while robbing them blind.

It is driven by the allure of the cartels, monopolies, and monied interests, and their corrupt political bargains. It is a child of the subornation of perjury on a massive scale. It is the unscrupulous servility to power of those who have sworn to uphold and protect the law. What is truth? Whatever suits us, whatever we say it is, by whoever has the power and the craft to define 'we.' It is not the triumph of evil so much as the absence of any sense of the good, of honor, honesty, and of simple common decency.

And it is marked by the daily subverting of the law as a matter of convenience and comfort to the insatiable few, and the cravenness of their enablers, driven by personal ambition, ignorance, and fear. It is the will to power, the elevation of the ascendant self and the system that supports it, above all else. Greed is good. Whatever works. And the enemy is all that is not the self, which is the other.

And where there is nothing sacred, the people perish.

Jesse

[Bleyseng]

This is NOT something new as it is a whole wide problem but in the USA the scale of money is unimaginable! The decent elected Representatives are outnumbered 4 to 1 in the government. We the People must wake up and Vote with intelligence not by being influenced by Fox, Nbc, Sean H, Russ L, etc. Think!

Some of my FB friends believe crazy stuff ie " That Obama has caused all of the 16 Trillion dollars of debt and that its the Dems who are also at fault". Where do they get these ideas?

[Sylvester]

Some of my FB friends believe crazy stuff ie " That Obama has caused all of the 16 Trillion dollars of debt and that its the Dems who are also at fault". Where do they get these ideas?

I hear this over here too. Believe it or not, we in the war on terror are bracing ourselves for this mandate before it happens! It is affecting us directly in many ways. And all I have heard is Obama's fault! Holy crap I could smack some around for that narrow minded thinking!

[glasseye]

Here's a great video about how big the income inequity is in the USA.
http://mashable.com/2013/03/02/wealth-inequality/

That's not great video, that's a SUPERB video.

Wanna guess the chances they'd run that on CNN?