Saturday, March 21, 2009

Obama's Policies Are Like Herbert Hoover's

In September, 2008, when Bush’s Treasury Secretary Hank Paulson proposed the first giveaway of $800 billion to the banks I started writing articles against the giveaway as 99 out of 100 U.S. citizens were against the giveaway. Unfortunately, Obama has supported the first giveaway to the banks of $800 billion and then given away TRILLIONS more to the banks and AIG.

Let’s look at figures showing how the U.S. people are doing in the last six months. The U.S. Bureau of Labor Statistics said that the overall unemployment rate has risen from 6.0% in the third quarter (May-July) 2008 to 8.1% in February 2009. For blacks, the unemployment rate has risen from 10.7% in May-June 2008 to 13.4% in February 2009. For Hispanics, from 7.8 % in May-June 2008 to 10.9%. In Los Angeles, California, where I live, the Los Angeles Times reported that the overall unemployment in February 2009 for California was 10.5% while in Los Angeles County it is 10.9%.These are the worse unemployment numbers for the U.S since 1982-3.

As for foreclosures, the U.S. Foreclosure Market Report reported in 2008 foreclosures in the United States were a 81% increase over foreclosures in 2007 and 225% increase over foreclosures in 2006. From January 2009 to February 2009 foreclosures increased 6%. The U.S foreclosure rate of February 2009 forclosures increased 30% over February 2008 rates.

Declining real estate prices cause declines in school budgets. In Florida, the huge decline in real estate prices have meant a 20% decline in school budgets, so teachers get laid off. That pattern is appearing nationwide as declining real estate prices mean less funds for school budgets meaning over 400,000% teachers nationwide have gotten layoff notices this spring.

February 17, 2009, Obama’s $787 stimulus package was passed. According to CNN Money February 17, 2009, “The official benchmark estimates from the White House: 3.5 million jobs will be created or saved over the next two years, and over 90% of them will be in the private sector.” So the White House plans the $787 billion stimulus package to generate the federal government hiring a mere 350,000 people over the next 3 years.

Economist such as Mark Zandi, chief economy at Moody’s, disagrees, with White House estimates: “Indeed I expect the economy to lose another 3 million jobs with stimulus but over 4 million without it." So the U.S. economy could shed another 3 million jobs in the next 2-3 years. Most of the Obama stimulus spending on jobs in transportation or construction or updating health records won’t take place until 2010. If Zandi is right, the economy twill shed 3 million jobs throughout 2009 and 2011 while the government hires 350,000 people. That’s s really bleak unemployment outlook.

Obama has not imitated FDR in his economic stimulus program but Herbert Hoover in letting the masses of U.S. citizens lose their jobs , their homes and teachers for their children. FDR, in contrast, ordered in 1933 Harry Hopkins to have the government hire 4 million people; by January, 1934 Hopkins had hired 4 million people on government programs. According to National Review online FDR reduced unemployment from 33% in 1933 to 7% in 1936 to 3% in 1940 to 0.5 % in 1942. Another economist James K. Galbraith says, “The Roosevelt administration reduced unemployment from 25 per cent in 1933 to 9 per cent in 1936.” The federal government from 1934-1940 was the largest employer in the country.

What did all these people working for the federal government do? James Galbraith said that the workers on federal projects “built or renovated 2,500 hospitals, 45,000 schools, 13,000 parks and playgrounds, 7,800 bridges, 700,000 miles of roads, and a thousand airfields. And it employed 50,000 teachers, rebuilt the country's entire rural school system, and hired 3,000 writers, musicians, sculptors and painters, including Willem de Kooning and Jackson Pollock. Obama is not following FDR but in following Hoover in letting millions go unemployed along with a paltry stimulus with a tiny amount of jobs.

What we need now is a program like FDR’s that will hire 3 million people to do exactly what the WPA and CCC did in the 1930s: build bridges, roads, schools, parks, post offices etc. I’m looking for a demonstration to go to in Los Angeles to voice my opposition to Obama’s paltry stimulus and to ask for a jobs program to hire not 350,000 but 3 million in the next six months. Be like FDR! Hire 3 million people now!

2 comments:

dime's worth of difference said...

Nice concise overview/contrast of FDR's policies during the 1930's and the show that started with the election of 1980 --- an aspect of FDR's time not often considered with regard to the employment picture is the distribution of occupations -- an essay in HARPERS magazine published in the early 90's(?)cited the interesting statistic that 1/3 of the non agricultural work force was employed to some degree in domestic service --(my mother's parents were employed as such by a famous manufacturing family) ---compare that to today and you see that many aspects of "domestic service" oddly(?) enough have become corpotate profit centers or sourced to illegals (yes -a sore spot for some). interesting to see how this will all shake out --Writers such as Frank O'Hara and John Marquand would be astonished at the machinations of mechanized medieval United States in the 21st century --but then maybe not ;) . Hang on for the show on the way? --government underwritten loans and gurantees spell GULAG.
With each emerging budget problem and associated scandal the fascism in the deep South and lower middle west is only retrenching and confidently awaiting the next election ----- If Upton Sinclair had his "Oil" then perhaps the novel for "these here parts" would be "Ante-Bellum, Again?". Hope that Thomas Pynchon isn't busy and is paying attention. John Grisham? Anybody? In FDR's time the "free market" solution did not have the spectre of off shore consortiums owning the roads, water systems and other aspects of infra - structure much less manufacturing.

As others have noted, nice blog --

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