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The U.S. Economy Is Down By 50% – Where Are the Job Programs It Needs?
The U.S. has a service economy. Some 70% of its gross domestic product is generated by personal consumption. The emergency measures taken to slow down the covid-19 pandemic decreased consumption by a huge margin. The GDPNow model by the Federal Reserve Bank of Atlanta shows the slump:
The growth rate of real gross domestic product (GDP) is a key indicator of economic activity, but the official estimate is released with a delay. Our GDPNow forecasting model provides a "nowcast" of the official estimate prior to its release by estimating GDP growth using a methodology similar to the one used by the U.S. Bureau of Economic Analysis.
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Latest estimate: -52.8 percent — June 1, 2020
The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the second quarter of 2020 is -52.8 percent on June 1, down from -51.2 percent on May 29.
Source: GDPnow via The Big Picture – bigger
The GDPnow model gives a snapshot of GDP on any given day. It is not the GDP for the year, which will be down much less, but just a moment in time.
With the lockdowns loosening the GDP will certainly increase again. But a haircut missed due to the lockdown will not result in a desire to get two haircuts. The meals not eaten in a restaurant during the last two month will not be made up by additional meals eaten after the reopening. The losses are for real.
With the end of the lockdown half of the 40 million currently unemployed will likely soon be back to work. The jobs of the other 20 million will not come back for a long time. The travel and hospitality sectors will be most effected. People who do not make money can not spend any.
The unemployed and the economy will not be impressed by Trump's current fake 'law and order' show or by his pandering to Evangelicals.
If Trump is as smart as he claims to be he will ask Congress for a huge amount of money to be spent on infrastructure programs over the next three years. That money should be shared for projects on the national, state and local level. There are plenty of bridges, roads and rails that need repairs or replacements.
But Trump isn't as smart as he claims and the people around him, as well as Trump himself, are from the FIRE economy – the Finance, Insurance, and Real Estate sectors. Such people do not value the real economy where real stuff is made and used.
The stock market, on which Trump is fixated, has long ceased to be a reflection of the real economy. Propping it up again and again, as the Fed and the Treasury do, may well enrich Trump's friends, but it does nothing for the voters he needs to get reelected.
Does he not understand that?
And why, by the way, ain't the Democrats out in front demanding that more be done to create new jobs? They seem to have totally vanished from the scene.
Richard Steven Hack #105
Re France in the ’60’s: Look at the numbers involved – shortly after this started, a *million people* marched. A strike produced 200,000 in one march. Also, look at the degree of violence the protesters were willing to engage in – pitched battles with the cops, not just looting. Not sure the US can produce that sort of response.
I thought it best to tackle this separately to the previous comment. The history of USA state and corporate violence against the union is simply appalling and right now likely to be much more vicious and sustained. The permanent state oligarchs don’t get 6 trillion in six months and smile sweetly and go away quietly. They could of course. But they want it all and they want it their way and they will kill to ensure that no smart arse tries to take the lolly back.
Sure the French penchant for a punch up with the police is deeply ingrained, but then they had the vichy fascist enforcers in their memory or their parents memory. The French were also occupied and humiliated by the Nazi gang of nations who plundered the place shitless. Not so USA. And so a sustained violent USA confrontation with the state enforcement thugs and saboteurs is less likely imo.
There are better ways right now to tackle the state Minotaur and that involves sustained struggle as it may not fall in this election round. It could with a candidate of sharp rhetoric and credible background and a public works platform to rebuild America. But it may take a four year cycle unfortunately and that gives the permanent state more time to sabotage. Time will tell.
I really do not see vigorous violent confrontation achieving anything other than more body bags than Covid-19. The USA state is vicious.
It would be good if the backers of Jesse Ventura can come up with a system to free him to run. And I have no doubt there are many more of his ilk who could if given the opportunity and backing. I know the election system in USA is crackpot etc but third party is the only way imo.
as an aside I have been thinking of Proudhon again:
“To be GOVERNED is to be watched, inspected, spied upon, directed, law-driven, numbered, regulated, enrolled, indoctrinated, preached at, controlled, checked, estimated, valued, censured, commanded, by creatures who have neither the right nor the wisdom nor the virtue to do so. To be GOVERNED is to be at every operation, at every transaction noted, registered, counted, taxed, stamped, measured, numbered, assessed, licensed, authorized, admonished, prevented, forbidden, reformed, corrected, punished. It is, under pretext of public utility, and in the name of the general interest, to be placed under contribution, drilled, fleeced, exploited, monopolized, extorted from, squeezed, hoaxed, robbed; then, at the slightest resistance, the first word of complaint, to be repressed, fined, vilified, harassed, hunted down, abused, clubbed, disarmed, bound, choked, imprisoned, judged, condemned, shot, deported, sacrificed, sold, betrayed; and to crown all, mocked, ridiculed, derided, outraged, dishonored. That is government; that is its justice; that is its morality.
Posted by: uncle tungsten | Jun 4 2020 10:22 utc | 113
America needs a major redistribution of wealth.by: Petri Krohn @ 8 but Red Rider @ 15 begs to differ with Krohm..
Wealth comes from growth, innovation, creativity.< maybe, says Snake, but its not from where it comes from but how it is distributed that counts. and I am not so sure growth is a part of wealth..
Simplest way[to distribute wealth] is Development Zones like China <= Snake says because China ignored copyright and patents, and used any invention, knowledge or know how from where ever they could get it, to compete with. that is why as you Say It has worked for China but it would never have worked if China had honored patents and copyrights.
Snake says long have the economist tried to hide the source and timing of the global economic problems we face today.. they ignore the books by John Brewer..below.. Hiding is necessary because if people understood that modern (since 1688) economic propaganda began in 1688, they would throw the bums involved with it off the end of the earth.
Snake says the simplest way to redistribute the wealth<= is to eliminate what caused the wealth skews in the first place "rule of law infringement into open, free, competitive competition", using force to install corporate constitutions that usurp the people's democracy, and using the governments and armed military force to help those corporate constitutions established governments that could be used to interfere with open free market competition. <= nationalize copyright and patent monopoly empires and return to the public domain all that has been captured by rule of law (nationalize all assets that belonged to or that should belong to government) <=anything granted by corrupted government to private enterprises should be retrieved back into government or made public right available to any and all to avail of. When government in America became the tool of the Aristocratic few, the few used the constitutional USA to make trillions off the backs and from the blood of the masses the USA governed, and the Aristocrats did it without doing hardly any work.
Snake Begs Karlof1 and RedRyder to remember it is the history of corporate economics that tracks the history of private corporations and wealthy Oligarchs who use government to create their wealth. In America it happened in the 2nd revolution 1788. This idea of predictive economics that can control competition is a false propaganda it has allowed the few to use the USA, and many other governments around the globe, to force Americans or those governed by the economic propaganda nation states that got into this mess in the first place.
Snake says The simplest way to restore America to its once great heights is to repeal all patents and copyrights and make everything protected by them public domain assets, do it now, right now, immediately (any body can use the X, or Y, or Z or whatever Operating System for free and amend it or strip parts from it as they please or anyone could make a drug and sell it for the lowest price in a highly competitive market place. ) Anything in private hands, that should be a government asset should be nationalized, take that part of private enterprise that consist of government services or that depends on government assets or contracts, or that delivers goods to government by contract back into the government and turn government into a monopoly cop. destroy anything that looks like a monopoly, there is just no place for a monopoly in a competitive sport (getting rich).
The government should produce what it needs outside of the competitive environment and it should tax business not private people for its source of funds. Capitalism is about competition between higly competitive private persons. One's back yard invention brings down yesterdays giant empire because the invention destroy the value of the old, and created a very new better new. Governments job is to be the referee. to deny any kind of monopoly power into the marketplace..
Karlof1 @ 18 and by: Lohmann 45 I agree the Rentier Class begain in Europe, but it was long before the 1848 Revolutions, it began in 1688 in the glorious revolution. following the GR came the copyright and patents became the European stock market conducted in the Aritocratic Coffee Houses in England, France, Holland, Scotland and places. see."the Pleasures of the Imagination, English Culture in the Eighteenth Century by John Brewer 0-226-07419-6 also by John Brewer, Party Ideology and Poular Politics: the Accession of George, III; the birth of a Consumer Society (with Neil Mckendrick and J. H. Plumb), The common People and Politics: 1750-1800: Popular Political participation Depicted in Cartoons and Caricature; the Sinews of Power: War, Money and the English State (1688-1783).
Neither Karloft1 or Lohmann recognize two American Revolutions (just as happened in Russia).. The first American Revolution 1776-1788, was the Continental Revolution.. there the every day citizen joined with American landed wealth to overthrow and toss out of British Corporate Power that dominated America (i.e. The British West Indies Company, the hundreds of British shipping and trading companies, and the government that protected the British Corporate Exploits in foreign nations and colonies).
Eleven years after the Continential Revolution, came the split between everyday democratic Americans and the ex British colonial landed estate owning Gentry, in what I call the "1788 Constitution by Ratification Revolution". read my comment at
Posted by: snake | Jun 3 2020 2:51 utc | 104
once again little is needed to fix the economy but to wipe copyright, patents laws off the books, and to retrieve those assets and services of government gifted by corrupt and misled elected leaders who used their positions in government to give to private owners the public domain and the assets and resources of government.
Government involvement in economic activity should be limited to playing referee between the competing private players. True the price of everything will fall to 1930 prices, and Wall Street Barons will shrink into their pots of gold, but America will be America again.. and a penny will buy a loaf of bread, but no one will need stocks, bonds, derivatives, or junk mortgage paper..
Posted by: snake | Jun 4 2020 13:03 utc | 130
What needs to be said in any parliament by any oppositon wirth the name. May e it is not perfect, but at least is something for a change. Said by Unidas Podemos representative directed to far-right party, Vox, funded by the US far-right.
In the previous days, the spokesperson of the Popular Party, ( another franchise of the multiple current myriad in which have expanded the Spanish far-right from a common nexus, the think tank FAES ), a foreign marquoise of French-Argentinian nationality, educated in Oxford, who had to fill for Spanish citizenship so as to be able to get the Spanish parliament representative´s wage, and who, during the past year sweated to fulfill her duty by making an ammount of 7 questions!, submitted in written form, not even asked in person at parliament, called the leader of Unidas Podemos, and current Minister of Social Issues at the coalition government, Pablo Iglesias, “terrorist” in Parliament, because his father had been jailed in the past for the “criminal activity” of spreading anti-francoist panphlets during Franco´s fascist dictatorship.
Notice, how this foreign woman, I would say foreign agent by how much she cares for the Spanish people, follows the script dictated from the US to the letter, on labeling the Spanish antifascist left as “terrorist”, because, for once, in half a century, there is someone in the government doing something for the masses in the middle of an economic crisis of unknown proportions, so as to try that nobody gets behind, abandoned, as happened during 2008 crisis exported from the US…
Yes, you can!
https://twitter.com/sacedator/status/1268188463024738305
Transcript:
Ladies and gentlemen of Vox, freedom is not freedom to insult trade unionists in Malaga, or members of the LGTBI community in Barcelona, nor to beat up a neighbor in Granada for hanging a republican flag on his balcony.
Freedom is not going to celebrate the Euro Cup, as Mr. Espinosa de los Monteros said, in the midst of collective mourning, with almost 30,000 deaths and the risk of contagion to others.
Freedom, ladies and gentlemen, is incompatible with having the saucepan in one hand, and the flag with a Francoist eagle in the other!
Freedom is incompatible with the fear that you want to inoculate people, to make them individualistic, conservative and suspicious.
Freedom is not given by your hoaxes, selfishness, or impotence.
Freedom is given by truth, hope, and rights, the rights that that generation of Pablo Iglesias’ father won, yes, but also those that we are now gaining with the Minimum Vital Income that you have said was a ration card. Camus again…. Stupidity insists….
That Minimum Vital Income will make almost 1 million homes freer. Rights such as those granted by ERTES, and the prohibitions of dismissals and evictions approved despite your vote against.
Because our obligation, ladies and gentlemen, is, precisely, to give citizens rights, which is what allows them to take away their fear, the fear of being left without an income, without a job, without a house, without a future.
Ladies and gentlemen, being free means that nobody has to ask permission from you or from any señorito ( note. tr. rentier Spanish class ) in order to survive.
Posted by: H.Schmatz | Jun 4 2020 13:50 utc | 134
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