Salon.com > Austerity

Today’s jobs report is a mixed bag

Fri, 04 Jan 2013 16:04:00 +0000

Today’s employment report shows steady employment growth, fast enough to keep the jobless rate from rising, but not fast enough to knock it down much.

December’s payrolls were up 155,000 and the unemployment rate held steady at 7.8 percent. Factories and construction sites added jobs — 25,000 and 30,000, respectively — an improvement over recent months. On the other hand, the public sector shed another 13,000 jobs, driven exclusively by local governments, the continuation of a longer-term negative trend as localities struggle with budget constraints.

Hourly wages and average weekly hours got a bit of a bump up as well, so weekly earnings are up 2.4 percent over the past year. Since inflation recently has been tracking at around 2 percent, that’s a slight gain in real pay (important, because starting this month, most workers will take a 2 percent hit to their paychecks due to the expiration of the payroll tax break, a casualty of the fiscal cliff deal). There was also some evidence of more folks moving from part-time into full-time jobs.

Austerity: The real “fiscal cliff”

Mon, 03 Dec 2012 14:42:00 +0000

“Debtpocalypse” looms. Depending on who wins out in Washington, we’re told, we will either free fall over the fiscal cliff or take a terrifying slide to the pit at the bottom. Grim as these scenarios might seem, there is something confected about the mise-en-scène, like an un-fun Playland. After all, there is no fiscal cliff, or at least there was none -- until the two parties built it.

And yet the pit exists. It goes by the name of “austerity.” However, it didn’t just appear in time for the last election season or the lame-duck session of Congress to follow. It was dug more than a generation ago, and has been getting wider and deeper ever since. Millions of people have long made it their home. “Debtpocalypse” is merely the latest installment in a tragic, 40-year-old story of the dispossession of American working people.

Europe’s debt crisis is greater threat than the “fiscal cliff”

Tue, 27 Nov 2012 16:43:00 +0000

While Democrats and Republicans prepare to wedge themselves over "fiscal cliff" fulcrums, a new report suggests that economic concerns should also be focused beyond U.S. borders. According to the Organization for Economic Co-operation and Development (OECD), Europe's debt crisis remains a far bigger threat to the world's economy, including U.S. recovery, than the "fiscal cliff."

“After five years of crisis, the global economy is weakening again. The risk of a major contraction cannot be ruled out,” OECD chief economist Pier Carlo Padoan said Tuesday in the organization’s semi-annual Economic Outlook report. The Paris-based OECD advises its 34-member governments on economic policy.

Eurozone slides back into recession

Thu, 15 Nov 2012 21:56:00 +0000

LONDON (AP) -- The 17-country eurozone has fallen back into recession for the first time in three years as the fallout from the region's financial crisis was felt from Amsterdam to Athens.

And with surveys pointing to increasingly depressed conditions across the 17-member group at a time of austerity and high unemployment, the recession is forecast to deepen, and make the debt crisis - which has been calmer of late - even more difficult to handle.

Official figures Thursday showed that the eurozone contracted by 0.1 percent in the July to September period from the quarter before as economies including Germany and the Netherlands suffer from falling demand.

The decline reported by Eurostat, the EU's statistics office, was in line with market expectations and follows on from the 0.2 percent fall recorded in the second quarter. As a result, the eurozone is technically in recession, commonly defined as two straight quarters of falling output.

The eurozone economy shrank at annual rate of 0.2 percent during the July-September quarter, according to calculations by Capital Economics.

"The eurozone economy will continue its decline in Q4 and probably well into 2013 too - a good backdrop for another debt crisis," said Michael Taylor, an economist at Lombard Street Research.

Krugman: Austerity metaphors matter

Wed, 14 Nov 2012 17:40:00 +0000

Across the European Union today, hundreds of thousands of workers have taken to the streets in the largest ever coordinated day of strikes and demonstrations against austerity budgets. General Strikes are underway in Spain, Portugal, Greece and Italy in protest of programs of raised tax and spending cuts. Meanwhile Nobel Prize-winning economist Paul Krugman used his column this morning to remind Americans that this country is facing an austerity crisis of its own.

Krugman argued for reframing the idea of a "fiscal cliff" in terms of an "austerity bomb" (a term he attributes to Brian Beutler). His (ever-Keynesian) point is that we do not risk tumbling off some metaphorical cliff of towering deficits -- far more threatening is an explosion of austerity. Krugman wrote:

The cliff stuff makes people imagine that it’s a problem of excessive deficits when it’s actually about the risk that the deficit will be too small; also and relatedly, the fiscal cliff stuff enables a bait and switch in which people say “so, this means that we need to enact Bowles-Simpson and raise the retirement age!” which have nothing at all to do with it.

Student group organizes global rally

Thu, 18 Oct 2012 21:17:00 +0000

The past few years have seen mass student uprisings against austerity in the U.K., Chile and Quebec. The International Student Movement (ISM) — a web platform created in 2008 — is helping these disparate scholars coordinate their local movements with global protest days. The idea is to fight the worldwide squeeze on education, as articulated in ISM's call to action:

No matter where we live, we face the same struggle against national state and profit driven interests, and their hold on education. Increasing tuition fees, budget cuts, outsourcing, school closures, as well as other phenomena are linked to an increasing commercialization and privatization of education.

This month, ISM hosted Web-based chats with students from Morocco, Bangkok, Vienna, New York and many other locales leading up to today's “Global Day of Action to Reclaim Education.” The blend of high tech and grass-roots activism is still being tested, but it has already emboldened students to coordinate a Global Education Strike for Nov. 14-22.

Clashes during Greek general strike

Thu, 18 Oct 2012 16:46:00 +0000

ATHENS, Greece – Hundreds of youths pelted riot police with petrol bombs, bottles and chunks of marble Thursday as yet another Greek anti-austerity demonstration descended into violence, less than a month after more intense clashes broke out during a similar protest.

Authorities said around 70,000 protesters took to the street in two separate demonstrations in Athens during the country's second general strike in a month as workers across the country walked off the job to protest new austerity measures the government is negotiating with Greece's international creditors.

A 65-year-old protester suffered a fatal heart attack during the demonstration but efforts to revive him failed. The organizers of the protest march he participated in said the man had fallen ill before any rioting had broken out.

The measures for 2013-14, worth €13.5 billion ($17.7 billion), aim to prevent the country from going bankrupt and potentially having to leave the 17-nation eurozone.

Riot police responded with volleys of tear gas and stun grenades in the capital's Syntagma Square outside Parliament as protesters scattered during the clashes, which continued on and off for about an hour. Another general strike in late September had also seen limited, but much more intense, clashes between protesters and police.

Four demonstrators were injured after being hit by police, volunteer paramedics said. The Health Ministry said two of the protesters were treated in hospital and that their injuries were not serious.

Hundreds of police had been deployed in the Greek capital ahead of the demonstration, as such protests often turn violent. Police said about 50 people were detained Thursday.

A similar demonstration by about 17,000 people in the northern city of Thessaloniki ended peacefully.

Thursday's strike was timed to coincide with a European Union summit in Brussels later in the day, at which Greece's economic fate will likely feature large.

The strike grounded flights, shut down public services, closed schools, hospitals and shops and hampered public transport in the capital. Taxi drivers joined in for nine hours, while a three-hour work stoppage by air traffic controllers led to flight cancellations. Islands were left cut off as ferries stayed in ports.

Athens has seen hundreds of anti-austerity protests over the past three years, since Greece revealed it had been misreporting its public finance figures. With confidence ravaged and austerity demanded, the country has sunk into a deep economic recession that has many of the same hallmarks of the Great Depression of the 1930s.

"We are sinking in a swamp of recession and it's getting worse," said Dimitris Asimakopoulos, head of the GSEVEE small business and industry association. "180,000 businesses are on the brink and 70,000 of them are expected to close in the next few months."

Higher taxes expected to be levied in the new austerity program will destroy many of the struggling businesses that have managed to weather three years of the crisis so far, he said.

"In 2011, only 20 percent of businesses were profitable. So these new tax measures present small businesses with a choice: Dodge taxes or close your shop."

The country is surviving with the help of two massive international bailouts worth a total €240 billion ($315 billion). To secure them, it has committed to drastic spending cuts, tax hikes and reforms, all with the aim of getting the state coffers back under some sort of control.

But while significantly reducing the country's annual borrowing, the measures have made the recession worse. By the end of next year, the Greek economy is expected to be around a quarter of the size it was in 2008. And with one in four workers out of a job, Greece has, along with Spain, the highest unemployment rate in the 27-nation European Union.

The country's four-month-old coalition government is negotiating a new austerity package with debt inspectors from the EU, International Monetary Fund and European Central Bank. The idea is to save €11 billion ($14.4 billion) in spending — largely on pensions and health care — and raise an extra €2.5 billion ($3.3 billion) through taxes.

After more than a month and a half of arguing, a deal seems close. On Wednesday, representatives from the EU, International Monetary Fund and European Central Bank, said there was agreement on "most of the core measures needed to restore the momentum of reform" and that the rest of the issues should be resolved in coming days.

Greece is also seeking a two-year extension to its economic recovery program, due to end in 2014. Without the extension, it would need to take €18 billion worth of measures instead of the €13.5 it is currently negotiating.

Athens hopes to get the next loan installment around mid-November. Prime Minister Antonis Samaras has said the country will run out of cash by the end of that month, meaning Greece would most likely have to default on its debt and potentially end its membership of the euro currency.

___

Costas Kantouris in Thessaloniki, and Elena Becatoros and Nicholas Paphitis in Athens contributed.

Responses to EU’s Nobel Peace Prize

Fri, 12 Oct 2012 15:50:00 +0000

The Nobel Peace Prize this year has been awarded to the European Union for promoting and upholding "60 years of peace in Europe." The (often controversial) award has again produced a mixed response, as critics question the honor in the midst the eurozone crisis, as austerity, unrest, unemployment and rising fascism plague member states.

The reasoning behind the award selection seems both transparent and politics-driven. Thorbjorn Jagland, the former Norwegian prime minister who is chairman of the panel awarding the prize, has openly expressed concern about the European Union's future in light of the debt crisis and attendant upheavals.

"There is a great danger ... We see already now an increase of extremism and nationalistic attitudes. There is a real danger that Europe will start disintegrating. Therefore, we should focus again on the fundamental aims of the organization,” said Jagland.

And indeed, following Jagland's logic, a number of commentators have praised the Nobel choice as an important boost and encouragement for the beleagured 27-nation bloc.

Heather Grabbe, director of the Open Society Institute in Brussels, told the BBC:

Video: Madrid on the brink

Tue, 02 Oct 2012 17:10:00 +0000

Tens of thousands of protesters swarmed around Madrid's parliament building last week for anti-austerity demonstrations that continued for over four days and were met with a brutal police response.

Documentarians Brandon Jourdan and Marianne Maeckelbergh of the Global Uprisings project have been making short films about unrest and dissent all around the globe in recent months, from Europe to Egypt to the U.S.. They put together this short film (below), chronicling the protests and the police response, and detailing the reasons why so many Spaniards took to the streets.

Greek general strike in pictures

Wed, 26 Sep 2012 21:35:00 +0000

Twitter users share images of marches, Molotovs and riot police

Greek general strike turns violent

Wed, 26 Sep 2012 16:13:00 +0000

ATHENS -- Police clashed with protesters hurling petrol bombs and bottles in central Athens Wednesday after an anti-government rally called as part of a general strike in Greece turned violent.

Riot police used tear gas and pepper spray against several hundred demonstrators after the violence broke out near the country's parliament. Protesters also set fire to trees in the National Gardens and used hammers to smash paving stones and marble panels to use as missiles against the riot police.

About 50,000 people joined the union-organized march in central Athens on Wednesday, held during a general strike against new austerity measures planned in the crisis-hit country. The action, the first large-scale walk-out since the country's coalition government was formed in June, closed schools and disrupted flights and most services.

Everyone from shopkeepers and pharmacists to teachers, customs workers and car mechanics joined the demonstration, seen as a test of public tolerance for more hardship after two years of harsh spending cuts and tax hikes.

"People, fight, they're drinking your blood," protesters chanted as they banged drums.

Thousands of protesters swarm Spain’s capital

Tue, 25 Sep 2012 20:55:00 +0000

UPDATED:

Thousands of protesters clashed with riot police in Spain's capital Tuesday in a showdown on the doorstep of the parliament building in Madrid.

Tuesday's march aimed to manifest rage against a new round of harsh austerity measures the government will announce in the 2013 budget on Thursday.

A manifesto for the day stated that "the current situation has exceeded all tolerable limits" and demanded a reconstitution of the entire Spanish government, including electoral and tax reform, and a moratorium on Spain paying national debts in the service of "private interests."

The Indignados, as the Spanish anti-austerity, anti-capitalist demonstrators are known, strongly influenced Occupy organizing models and tactics last year, including repurposing city squares for encampments and assemblies.

Losing the science race

Sun, 08 Jul 2012 13:00:00 +0000

The United States is the most religious country in the Western world, but it took a team of European heathens to prove the existence of God. On Wednesday, researchers in Geneva announced that they had discovered a new subatomic particle that they have not yet fully identified but they believe could be the Higgs boson, the so-called “God particle.” The Higgs boson is the manifestation of an invisible omnipresent force that is thought to be responsible for the existence of all physical mass in the universe. In layman’s terms, it’s the reason you’re a flesh and blood human being instead of a cloud of energy floating through space. So, you know, no big deal. But why is this groundbreaking discovery coming from Switzerland instead of the United States, which has long prided itself on being the world leader in scientific research (and pretty much everything else)? The answer, as it so often does, comes down to politics.

The Higgs boson was discovered through the use of a Large Hadron Collider, which is a 17-mile-long machine built to smash charged subatomic particles together so hard that they unlock the secrets of the universe. As you might imagine from the description, it comes with a hefty price tag: it cost the European Organization for Nuclear Research $10 billion to construct. As physicist Steven Weinberg points out in an essay flagged by Wonkblog’s Brad Plumer, American researchers were developing a similar particle accelerator in the 1980s until Congress cut their funding due to concerns about cost overruns. Plumer notes that “the United States could have had solid bragging rights for the Higgs, but Congress didn’t want to pay for a $10 billion particle accelerator after the Cold War ended.” Beating the Soviet Union to the moon was a national priority; beating Switzerland to God, not so much.