New America on Economic Growth & the Current Crisis

Regular Harpers and Financial Times contributor Barry C. Lynn paints a genuinely alarming picture: most of our public debates about globalization, competitiveness, creative destruction, and risky finance are nothing more than a cover for the widespread consolidation of power in nearly every imaginable sector of the American economy.

There is widespread recognition that the financial crisis, which triggered the Great Recession, was significantly due to financial excess, particularly in real estate lending. Now, policymakers are looking to reform the financial system in hope of avoiding future crises. But like the drunk who looks for his lost keys under the lamppost because that is where the light is, policymakers remain fixated on capital standards because that is what is already in place.

Over the past several weeks, the US dollar's depreciation against the euro and yen has grabbed global attention.

In a normal world, a weaker US dollar would be welcome, as it would help the US come to grips with its unsustainable trade deficit.

But because China links its yuan to the US dollar at an undervalued parity, the US dollar's depreciation risks major global economic damage, complicating the recovery from the worldwide recession.

Even the administration's goal of creating 3.5 million jobs is far below what the economy really needs. With an official unemployment rate of 10.2 percent, the gap between the number of full-time job openings and the number of people who are unemployed has widened.

Where are tomorrow's jobs going to come from? The question is more urgent than ever, with official unemployment hovering around 10 percent and with nearly one in five Americans unemployed, if you count part-time workers who want full-time jobs and people so desperate that they have given up looking for work entirely.

Over the last several weeks, the dollar's depreciation against the euro and yen has grabbed global attention. In a normal world, the dollar's weakening would be welcome, as it would help the United States come to grips with its unsustainable trade deficit.

But, in a world where China links its currency to the dollar at an undervalued parity, the dollar's depreciation risks major global economic damage that will further complicate recovery from the current worldwide recession.

Here's the latest bold new idea for reconciling the costs of national defense with the need to avoid adding to federal deficits or raising taxes. A bipartisan coalition of "New Democrats" and moderate Republicans has proposed buying weapons for the U.S. military through the IRS rather than the Pentagon. Here's how it would work. Instead of being paid to deliver planes, missiles and tanks, defense contractors would receive "weapon supply tax credits" (WSTC). The defense contractors would be

According to official statistics, the unemployment rate in the United States is now 9.8 percent. But those statistics understate the severity of the jobs crisis. The official statistics do not include the 875,000 Americans who have given up looking for work, even though they want jobs. When these "marginally attached" workers and part-time workers are added to the officially unemployed, the result, according to another, broader governement measure of unemployment known as "U-6," is shocking. The United States has an… more

President Obama's Nobel Peace Prize has been justified by some because it draws attention to the goal he endorses of ridding the world of nuclear weapons. I share that goal, but not because nuclear weapons are uniquely horrible -- if you're a victim, it makes little difference whether you're killed or maimed by nuclear weapons or conventional weapons, which sometimes can create lingering illnesses and poison the landscape, too. I support the abolition of nuclear weapons because, if it were successful, it would lock in the advantages of… more

Over the past year the global economy has experienced a massive contraction, the deepest since the Great Depression of the 1930s. But this spring, economists started talking of "green shoots" of recovery and that optimistic assessment quickly spread to Wall Street. More recently, on the anniversary of the Lehman Brothers crash, Ben Bernanke, Federal Reserve chairman, officially blessed this consensus by declaring the recession is "very likely over".

The man who would be known as Patient No. 1 emerged from routine open-heart surgery at Columbia University Medical Center in stable condition. Then he began to bleed uncontrollably. Surgeons rushed him back to the operating room to reopen his chest, but by the time they could stop the hemorrhaging, Patient No. 1 was barely breathing and in a coma.

On Aug. 15, 2000, shortly before he was discharged on his way to a nursing home, a physician wrote a… more

Our guest today is Adam Smith, a major figure of the Enlightenment who is widely considered to be the father of modern economic theory. He is a former professor at the University of Glasgow and the author of "The Theory of Moral Sentiments" (1759) and "An Inquiry into the Nature and Causes of the Wealth of Nations" (1776), his best-known book. Professor Smith joins us from Scotland.

While the economic crisis continues to overshadow other topics, world politics is undergoing rapid and dramatic changes. In areas from national security policy to trade, the Obama administration has repudiated Bush-era precedents significantly, if not rapidly enough for some critics on the left. The pressures on the administration to continue in the path followed by U.S. administrations since the fall of the Berlin Wall are intense, particularly in light of the victory of the hard-liners in Iran and new revelations about Iran's nuclear program. Even so,

Stockman, who once served as Ronald Reagan's budget director, spent two decades on Wall Street preparing for this moment. After stints at Salomon Brothers and the Blackstone Group, Stockman in 1999 set up his own private investment fund, Heartland Industrial Partners. He then used Heartland to shape a set of companies -- mainly in the automotive sector -- each dedicated to dominating a particular group of production activities.

During last year's Republican presidential primary season, candidate Rudy Giuliani succinctly captured what millions of Americans think about health care abroad. "These countries that say they provide universal coverage -- they pay a price for it, you know," Giuliani told his audience. "They do it by rationing care, by long waiting lines, and by limiting, or I should say eliminating a patient's choice."

With official unemployment in the US hovering around 10 per cent, and actual levels much higher when the underemployed and discouraged are counted, the most urgent priority is job creation. But efforts to get America working again must be informed by the striking fact that most employment growth in the past decade has been concentrated in three sectors: healthcare, education and government, mostly state and local public services.

On Sept. 18, Irving Kristol died. On Feb. 27, 2008, William F. Buckley Jr. passed away. Kristol was known as "the godfather of neoconservatism," while Buckley was the founder of the "movement conservatism" of Goldwater and Reagan. The intellectual conservatism that they, in different ways, sought to foster had passed from the scene before they did.

Now and then a moment occurs that clarifies the nature of American politics like a flash of lightning over a prairie landscape. Such a moment occurred on Sept. 9 during President Obama's televised address to a joint session of Congress about healthcare. As the president explained that illegal immigrants would not be eligible for benefits under the plan he supported, Joe Wilson, a conservative Republican member of Congress from South Carolina, shocked the chamber and the television audience by shouting, "You lie!"

We are a full year removed from the September 15, 2008, bankruptcy of Lehman Brothers, which sent the global financial system into a tailspin, and yet just 10 days removed from one of the most dismal unemployment reports in 80 years.

On the one hand, this is no kind of celebratory one-year "anniversary," if you want to call it that, and it was certainly no kind of Labor Day either. And they are related.

Today is Labor Day, when we celebrate the wealth destroyers--at least if the libertarian right is to be believed.