Re: [Marxism-Thaxis] Pension Fund Crisis in the US

[Waistline2]

<_waistli...@aol.com_ (mailto:waistli...@aol.com) >  12/15/2008 4:30 PM >>> 
Massive Pension Fund Crisis in the US 
 
 
 
>>> This article appeared in AToL on October 31, 2008 as: Black  Hole Gapes 
for Pensions 
Greenspan, the Wizard of Bubbleland that began on September 14,  2005,  I 
warned: 
 
Through mortgage-backed securitization, banks now are mere loan  
intermediaries that assume no long-term risk on the risky loans they make,  
which  are 
sold as securitized debt of unbundled levels of risk to  institutional 
investors 
with varying risk appetite commensurate with their  varying need for higher 
returns. But who are institutional investors? They are  mostly pension funds 
that manage the money the US working public depends on for  retirement. In 
other 
words, the aggregate retirement assets of the working  public are exposed  to 
the risk of the same working public defaulting on  their house mortgages. When 
 a homeowner loses his or her home through  default of its mortgage, the 
homeowner  will also lose his or her  retirement nest egg invested in the 
securitized mortgage pool, while the banks  stay technically solvent. <<< 
 
^^^ CB; Did the banks remain technically solvent ? If so, why did the  
federal government have to give them $ 8 trillion ?  Not arguing with the  
danger to 
pensions, but I don't think the banks have been solvent through all  this .
 
Comment 
 
 
To begin with the quote from Mr. Liu is taken from the article: “Greenspan  
the Wizard of Bubbleland” published back on September 14,  2005 or more  than 3 
years ago. The article can be found here and is worth reading: 
_http://www.atimes.com/atimes/Global_Economy/GI14Dj01.html_ 
(http://www.atimes.com/atimes/Global_Economy/GI14Dj01.html) 
 
The article is not pinpointing a specific bank or banks but explaining the  
double whammy faced by the workers. For instance what banks are being talked  
about? Well, banks in general and the impact of Greenspan. 


Consider the following two paragraphs taken from the aforementioned  article. 
 
“The growth of capital markets was responsible for the long boom that began  
with the Greenspan era in 1987, rather than bank lending. Banks' share of net  
credit markets, according Fed data on flow of funds, dropped from a peak of 
more  than 62% in 1975 to 27.5% in 2004 while securitization's share rose from  
negligible in 1975 to more than 60% in 2004. Securitization now stands at 
more  than $3 trillion, up from $375 billion in 1985. It shows the effect of a 
shift  of importance from banks as funding intermediaries to the capital/credit 
 
markets. Nasdaq companies rely less on banks for funds and are thus less  
affected by Greenspan's interest-rate policy. 
 
Greenspan has been vocal in explaining that his monetary policy of gradual  
moves of rising FFR was not specifically targeted toward the stock markets but  
toward the unsustainable expansion of the economy as a whole, although with 
the  same breath, he decried the dangers of the wealth effect if it ever ended 
up  heavier on the consumption side than on the investment side, which of 
course was  exactly what happened. Consumer spending has been holding up the US 
economy in  recent years, while most of the supply-side investment has gone 
overseas. This  has caused a separation between the dollar economy and the US 
economy. The  dollar economy expands from global dollar hegemony while the US 
economy is  hollowed out of manufacturing. Dollar hegemony has deprived the US 
economy of  real productivity from manufacturing and forced it into virtual 
productivity  from finance manipulation” (end of quote) 
 
Again . . . Repeat . . . . The passage quoted above is from 3 years ago. 
 
However, to answer the question. 
No the banks did not remain technically solvent. I have in mind say  
CitiiBank. 
 
I believe - my point of view, is that the roots of this particular outbreak  
of crisis goes back to 2006, rather than say 1946 as suggested on Pen-L.   By 
crisis is meant the crisis of profitability as it erupts on the basis of the  
existing business cycle. 
 

Waistline  
**Make your life easier with all your friends, email, and 
favorite sites in one place.  Try it now. 
(http://www.aol.com/?optin=new-dp&icid=aolcom40vanity&ncid=emlcntaolcom0010)

___
Marxism-Thaxis mailing list
Marxism-Thaxis@lists.econ.utah.edu
To change your options or unsubscribe go to:
http://lists.econ.utah.edu/mailman/listinfo/marxism-thaxis

Re: [Marxism-Thaxis] Pension Fund Crisis in the US

[Charles Brown]

>>>  12/15/2008 4:30 PM >>>
Massive Pension Fund Crisis in the US 

By 
Henry C.K. Liu 
 
This article appeared in AToL on October 31, 2008 as: Balck Hole Gapes
for  
Pensions
 
 

More than three years before the current financial crisis,  in a series

Greenspan, the Wizard of Bubbleland that began on September 14,  2005,
I warned:
 
Through mortgage-backed securitization, banks now are mere loan  
intermediaries that assume no long-term risk on the risky loans they
make, which  are sold 
as securitized debt of unbundled levels of risk to institutional 
investors 
with varying risk appetite commensurate with their varying need for 
higher 
returns. But who are institutional investors? They are mostly pension 
funds that 
manage the money the US working public depends on for retirement. In 
other 
words, the aggregate retirement assets of the working public are
exposed  to 
the risk of the same working public defaulting on their house
mortgages. When  a 
homeowner loses his or her home through default of its mortgage, the 
homeowner  will also lose his or her retirement nest egg invested in
the securitized  
mortgage pool, while the banks stay technically solvent. 
^^^
CB; Did the banks remain technically solvent ? If so, why did the
federal government have to give them $ 8 trillion ?  Not arguing with
the danger to pensions, but I don't think the banks have been solvent
through all this .

^^^


That is the hidden  
network of linked financial landmines in a housing bubble financed by 

mortgage-backed securitization to which no one is paying attention. The
bursting  of 
the housing bubble will act as a detonator for a massive pension 
crisis.
 
Now in October 2008, while the US government is busy bailing out
wayward  
banks, public pension funds operated by states and municipalities are
facing  
their worst year of loss in history, exacerbating cumulative funding
shortfalls  
of past decades of credit bubble and putting pressure on distressed
state  
governments to shore them up to avoid pending default. 
 
In the nine months to the end of September, the average state and
municipal  
pension fund lost 14.8% of its market value. The loss has deepened as
global  
financial markets fell sharply in October. The loss has more than
double  
previous highest loss for state funds, which registered 7.9% for the
full year  in 
2002. Few market analysts expect equity prices to bottom any time soon,
let  
alone a recovery, and many are resigned to the prospect of years of
asset  
deflation and economic stagnation. 
 
California’s Calpers, the biggest public pension fund in the US, in
the  week 
ending October 24 reported a loss of 20% of its asset value, or more
than  
$40 billion, in the quarter between July 1 and October 20, 2008. 
 
State and local pension funds comprise a patchwork of 2,700 funds that 

manage $1.4 trillion on behalf of 21 million public employees,
including  teachers, 
firefighters, policemen and other municipal workers. 
 
About 40% of these funds are under-funded, meaning that they would not
be  
able to pay the future pensions promised to public employees. State
governments  
have raised pension benefits to keep up with inflation, betting on a
growing  
wealth effect from fund investments to meet higher payments. It was
part of 
the  flawed rationale that called for the privatization of social
security. 
Just like  the social security trust fund, pension funds are money that
belongs 
to the  workers who are required to contribute into them out of their
payroll 
deductions  and matched by public funds as part of workers’
employment 
benefits. These funds  are not charity payments from government
employers. They are 
compulsory savings  of public sector workers. 
 
Richard Daley, mayor of Chicago, hometown of Democratic presidential  
candidate Barack Obama, has convened a taskforce to address the
shortfalls in  
Illinois funds. For example, funding for the Police Fund has fallen to
less than  
50% of requirement. The situation is actually more ominous. The
calculation is  
based on an assumption of annual returns of 8%, but very few funds will
reach  
that level of return in the next few years. Most funds will be lucky to

escape  further losses in the current market meltdown. 
 
The city of Chicago would have to start contributing substantially more
to  
the fund out of its general revenue and from Federal and state subsidy.
Public  
employees are faced with the prospect of being required to contribute
more 
from  their payroll deductions. And Chicago is not unique in its public
pension  
problem. Every city and state of the union is in similar difficulty. 
 
A vicious downward cycle is emerging as state and local governments
face  
lower tax revenue that put pressure to cut costs. Congress is pushing
for a  
second fiscal stimulus package, in part to alleviate pressures on state
pension  
funding. Nancy Pelosi, speaker of the House of Representatives, cited
money 
lost  from pension f

[Marxism-Thaxis] Pension Fund Crisis in the US

[Waistline2]

Massive Pension Fund Crisis in the US 

By 
Henry C.K. Liu 
 
This article appeared in AToL on October 31, 2008 as: Balck Hole Gapes for  
Pensions
 
 

More than three years before the current financial crisis,  in a series 
Greenspan, the Wizard of Bubbleland that began on September 14,  2005, I warned:
 
Through mortgage-backed securitization, banks now are mere loan  
intermediaries that assume no long-term risk on the risky loans they make, 
which  are sold 
as securitized debt of unbundled levels of risk to institutional  investors 
with varying risk appetite commensurate with their varying need for  higher 
returns. But who are institutional investors? They are mostly pension  funds 
that 
manage the money the US working public depends on for retirement. In  other 
words, the aggregate retirement assets of the working public are exposed  to 
the risk of the same working public defaulting on their house mortgages. When  
a 
homeowner loses his or her home through default of its mortgage, the 
homeowner  will also lose his or her retirement nest egg invested in the 
securitized  
mortgage pool, while the banks stay technically solvent. That is the hidden  
network of linked financial landmines in a housing bubble financed by  
mortgage-backed securitization to which no one is paying attention. The 
bursting  of 
the housing bubble will act as a detonator for a massive pension  crisis.
 
Now in October 2008, while the US government is busy bailing out wayward  
banks, public pension funds operated by states and municipalities are facing  
their worst year of loss in history, exacerbating cumulative funding shortfalls 
 
of past decades of credit bubble and putting pressure on distressed state  
governments to shore them up to avoid pending default. 
 
In the nine months to the end of September, the average state and municipal  
pension fund lost 14.8% of its market value. The loss has deepened as global  
financial markets fell sharply in October. The loss has more than double  
previous highest loss for state funds, which registered 7.9% for the full year  
in 
2002. Few market analysts expect equity prices to bottom any time soon, let  
alone a recovery, and many are resigned to the prospect of years of asset  
deflation and economic stagnation. 
 
California’s Calpers, the biggest public pension fund in the US, in the  week 
ending October 24 reported a loss of 20% of its asset value, or more than  
$40 billion, in the quarter between July 1 and October 20, 2008. 
 
State and local pension funds comprise a patchwork of 2,700 funds that  
manage $1.4 trillion on behalf of 21 million public employees, including  
teachers, 
firefighters, policemen and other municipal workers. 
 
About 40% of these funds are under-funded, meaning that they would not be  
able to pay the future pensions promised to public employees. State governments 
 
have raised pension benefits to keep up with inflation, betting on a growing  
wealth effect from fund investments to meet higher payments. It was part of 
the  flawed rationale that called for the privatization of social security. 
Just like  the social security trust fund, pension funds are money that belongs 
to the  workers who are required to contribute into them out of their payroll 
deductions  and matched by public funds as part of workers’ employment 
benefits. These funds  are not charity payments from government employers. They 
are 
compulsory savings  of public sector workers. 
 
Richard Daley, mayor of Chicago, hometown of Democratic presidential  
candidate Barack Obama, has convened a taskforce to address the shortfalls in  
Illinois funds. For example, funding for the Police Fund has fallen to less 
than  
50% of requirement. The situation is actually more ominous. The calculation is  
based on an assumption of annual returns of 8%, but very few funds will reach  
that level of return in the next few years. Most funds will be lucky to 
escape  further losses in the current market meltdown. 
 
The city of Chicago would have to start contributing substantially more to  
the fund out of its general revenue and from Federal and state subsidy. Public  
employees are faced with the prospect of being required to contribute more 
from  their payroll deductions. And Chicago is not unique in its public pension 
 
problem. Every city and state of the union is in similar difficulty. 
 
A vicious downward cycle is emerging as state and local governments face  
lower tax revenue that put pressure to cut costs. Congress is pushing for a  
second fiscal stimulus package, in part to alleviate pressures on state pension 
 
funding. Nancy Pelosi, speaker of the House of Representatives, cited money 
lost  from pension funds in her push for an additional $150 billion second 
stimulus  package. 
 
The public pension funds themselves have limited options. Many are under  
pressure to move away from the stock market into less risky investments, but  
that would mean suffering 

Re: [Marxism-Thaxis] Colossus with Feet of Clay

[Waistline2]

Speaking of feet and then shoes. 
 
The guy that threw his gym shoes - one at a time, at Bush W. 
 
I been laughing my ass off for the past two days, every time I think about  
it. 
 
Waistline 
**Make your life easier with all your friends, email, and 
favorite sites in one place.  Try it now. 
(http://www.aol.com/?optin=new-dp&icid=aolcom40vanity&ncid=emlcntaolcom0010)

___
Marxism-Thaxis mailing list
Marxism-Thaxis@lists.econ.utah.edu
To change your options or unsubscribe go to:
http://lists.econ.utah.edu/mailman/listinfo/marxism-thaxis

[Marxism-Thaxis] Remember, the recession isn't all bad

[Charles Brown]

Remember, the recession isn't all bad



To: pe...@xx 
Subject: [Pen-l] Remember, the recession isn't all bad 
From: Charlie  
Date: Sun, 14 Dec 2008 10:06:43 -0800 
Domainkey-signature: a=rsa-sha1; q=dns; c=nofws; s=s1024; d=sbcglobal.net; 
h=Received:X-YMail-OSG:X-Yahoo-Newman-Property:Message-ID:Date:From:User-Agent:MIME-Version:To:Subject:Content-Type:Content-Transfer-Encoding;
 
b=2XcjacgZ7b5yWxNmaUrc6SxkKSqHArxQZ2YZ6lKOEQNpsCuJmRMZU5+bFqFUkBP7pfu2Icg2f56HpEUCgrpfoGypEBzTUBkVCGXpeF4eWAcUHKiVgDRnSB4ZMphxc8/3wod/o9mi7EsoFzZvXPvA55GqX1ofAwvDBJlioO1Nxz8=
 ; 
User-agent: Thunderbird 2.0.0.18 (Windows/20081105) 


"Remember, the recession isn't all bad: Unsupportable debts are being erased. 
Consumers are rebuilding their savings and lowering their living standards to 
match reality. Workers are exiting dying industries. And through distress 
sales, foreclosures, and bankruptcies, assets are being taken away from weak 
hands and given to strong ones, creating the conditions for future growth."
--Peter Coy, "Is the Jobs Panic Justified?", Business Week, Dec. 22, 2008


Teachers might want to parse almost every phrase of this remark in class.
Charles Andrews




This message has been scanned for malware by SurfControl plc. 
www.surfcontrol.com

___
Marxism-Thaxis mailing list
Marxism-Thaxis@lists.econ.utah.edu
To change your options or unsubscribe go to:
http://lists.econ.utah.edu/mailman/listinfo/marxism-thaxis

[Marxism-Thaxis] Remember, the recession isn't all bad

[Charles Brown]

--
From: Doug Henwood 

On Dec 14, 2008, at 11:27 PM, Eugene Coyle wrote:


Henwood's two posts on this confuse me. Not sure what his position is.
Let me be clear about mine: The present financial crisis began in 1947
with the passage of the Taft-Hartley Act, a crippling blow to the labor
movemen 


That's clarifying. A 61-year crisis. Ok.


Doug


CB: Actually, the General Crisis of Capitalism starts in 1917 with the
Russian Rev.  The general crisis of capitalism is when it begins to
leave the "world stage".  There's the general crisis and cyclical
crises.  Lenin noted then that capitalism had "considerable reserves" (
I'll say !), but in the long run it's socialism or barbarism, comrades.



Australian Marxist Review No. 49, November 2008

Editorial Notes

With the present state of the world, it is timely to look at the
concept of "crisis", a most frequently used term nowadays. For Marxists,
"crisis" has multiple connotations.

There is the general crisis of capitalism, referring to our present
historical period, in which capitalism as a social system loses its
global monopoly. Another social system, socialism, based on the power of
the working people, makes its appearance. Some socialist countries are
no more, but the exploitation, brutality and poverty suffered by masses
of people at the hands of capitalism, especially in South America, is
seeing ever more countries extricate themselves from the imperialist
web. Socialist revolution is on the historical agenda.

A second use of the term "crisis", which actually pre-dates the first
use, is in "crisis of overproduction", which is one of the four phases
of the cycle of crisis, recession, recovery and boom, which is
characteristic of and intrinsic to the process of capitalist production.
Crises of overproduction have been regular features of capitalist
economies since the early 1800s.

Capitalist production is unplanned, anarchic, with each enterprise
aiming to make maximum profits. Capital must keep "turning over", with
goods continually sold, so the profits of exploitation, surplus value,
are constantly turned into money, ready for a new round of production
and exploitation.

If this turnover is interrupted, a crisis of overproduction can occur.
The turnover of capital can be impeded if there is an imbalance between
the two major branches of industry — capital goods and consumer goods
— or if the level of demand in the economy as a whole is insufficient,
relative to productive capacity, or if there are long-term trends at
work, altering the structure of capitalist economies and intensifying
the social contradictions within the system e.g. downgrading of
manufacturing in advanced capitalist countries.

Crises of overproduction (recessions, depressions) are inevitable under
capitalism and ultimately stem from the fundamental contradiction in
capitalist society, that between the social character of production and
the private appropriation of the product, which occurs because of the
private ownership of the major means of production.

The capitalist world has been heading towards recession for some time
but there is more to capitalism’s current economic troubles. We cannot
simply reduce the present economic state to just another crisis of
overproduction.

Capitalism is in a financial crisis. It also suffers an environmental
crisis, food crisis, housing crisis, a crisis of public health and other
secondary crises. The financial crisis is the result of wholesale
deregulation of capitalist economies (a response to the demands of
transnational corporations to "leave it to the markets") allowing the
enormous growth in speculation over the last two decades. The current
round of the financial crisis was triggered by predatory and fraudulent
lending practices associated with sub-prime mortgages in the US housing
market.

As the recent CPA Central Committee Executive resolution says: "In this
era of accelerated globalisation, massive amounts of capital, trillions
of dollars, are moved every day between electronically connected
markets, seeking profits. Speculation is rife. In fact, a main tendency
of today’s capitalism is to bypass the productive economy, the real
production process which generates all wealth, and to make huge amounts
of fast money through speculation."

It also says: "The consequences of the sub-prime mortgage scandal are
bringing hardships for many working people around the world. It is
typical of capitalism that billions of dollars of taxpayers’ money has
been used to bail out the banks. Privatise the profits and socialise the
losses is still capitalism’s guiding light. Not one person has been
saved from foreclosure and eviction by bailouts, not one pension fund or
superannuation scheme has been quarantined from the devastating effects
of the crisis."

In this way, the financial crisis is interwoven with and exacerbates
the crisis of overproduction. It is another main factor pushing

[Marxism-Thaxis] Colossus with Feet of Clay

[Charles Brown]

New book examines character of deepening crisis in capitalist
globalization
By Abayomi Azikiwe 
Editor, Pan-African News Wire 

Published Nov 13, 2008 7:38 PM 
  

Colossus with Feet of Clay:
Low-Wage Capitalism
What the new globalized, high-tech imperialism means for the class
struggle in the U.S.
By Fred Goldstein
Available at leftbooks.com.

This is a must-read book for those seeking answers to the current
crisis in world capitalism. With the economic meltdown of 2008, the very
future of the system of international finance capital has been thrown
into question.

Monumental write-offs of hundreds of billions of dollars by the
world’s leading banks and investment firms have occurred this year.
Names such as Bear Stearns, Goldman Sachs, UBS, HSBC, Wachovia,
Citigroup, AIG, Fannie Mae, Freddie Mac, etc., have become the focus of
attention of not only the bourgeoisie, but of working people who have
seen their jobs, homes, pensions and overall living standards plunge.

Official statistics on the U.S. economy indicate that over one million
jobs have been lost during 2008. Consumer confidence has declined while
signs of social discord have emerged, in part resulting in the
willingness of many whites to vote for the country’s first
African-American president.

What has generated profound anger among working people throughout the
U.S. is the response to this crisis by the capitalist class and the
bourgeois state, which have given over a trillion dollars in taxpayer
money to the very same financial institutions that created the crisis.

This crisis, however, is not confined to the U.S. The subprime mortgage
crisis and the “credit crunch,” as it was described during the early
months of 2008, are now being labeled-even by the corporate press-as a
major economic dilemma affecting billions of people around the globe.

The U.S. Federal Reserve Bank along with central banks throughout
Europe and the world have handed over hundreds of billions of dollars
and other units of currency to the bankers in order to stave off a rapid
collapse of the system. Despite all of these subsidies to the
financiers, many of these firms have not survived. Fannie Mae and
Freddie Mac have essentially been “nationalized” under capitalist
control by the U.S. government in order to soften the fall of the
multi-trillion-dollar housing market.

Yet there has been no bailout for the working people of the U.S. and
the world. Millions have lost their homes and jobs. Their pensions are
rapidly drying up because many of these funds were invested in the
gambling houses of Wall Street and its counterparts around the world.

Nonetheless, the resistance and fightback are developing. Workers in
Europe have staged general strikes against rising fuel and food prices.
There have been food rebellions in various countries throughout the
Caribbean and Africa. In the U.S., a burgeoning movement calling for a
moratorium on foreclosures has made a political impact and is
influencing the political dialogue taking place inside the country.

The source of the crisis

Goldstein, utilizing Marxist economic analysis, has approached this
crisis from the standpoint of those who are most seriously affected: the
working class, the nationally oppressed and women. The author makes the
case in very simple and straightforward language that the crisis is one
of capitalist overproduction.

According to Goldstein: “This cycle dictates that, during periods of
capitalist expansion, the powers of production increase ever more
rapidly while the powers of consumption of society expand only
gradually. Sooner or later production outstrips consumption. Profit does
not arrive in corporate bank accounts until sales take place. If
commodities cannot be sold at a profit, inventories pile up, production
stops, workers are laid off, and a crisis ensues. That is the crude
dynamic of the capitalist crisis of overproduction.” (pp. xi-xii)

The author explains: “The new international division of labor pits
workers all around the world against each other in a race to the bottom.
It depresses wages of the working class in imperialist countries and
expands the sweatshop, superexploitation of the workers in low-wage
countries. It makes each capitalist recovery more difficult and
undermines the historic advantages accruing to the workers in a
capitalist upturn. All this is aggravating the general crisis of
capitalism. High technology and low-wage capitalism on a world scale are
accelerating the crisis of overproduction and laying the basis for a
massive counterattack by the working class.” (p. xiii)

Women, race and the capitalist crisis

As it relates to the impact of the crisis on women and the nationally
oppressed in the U.S., Goldstein looks at this phenomenon within the
context of the historical development of the country. It was the stolen
land of the Native Americans and the slave labor of the African people,
along with the low-wage exploitation of Chinese workers in building the
railways to the

[Marxism-Thaxis] General crisis theory

[Charles Brown]

Why is "Nationalization" A Dirty Word in America?
CeJ jannuzi at gmail.com 
Sat Dec 13 04:46:35 MST 2008 

Previous message: [Marxism-Thaxis] Why is "Nationalization" A Dirty Word in 
America? 
Next message: [Marxism-Thaxis] Finance Capital 
Messages sorted by: [ date ] [ thread ] [ subject ] [ author ] 



SM:>>When the shareholders and top management (banks, auto) can hold on
only at public expense,  nationalization is not like asking for
unconditional surrender--it only takes the guts to "just say no."<<

I meant asking for bankruptcy before nationalization was like asking
for unconditional surrender.

Exactly what are you arguing for? Believe me, I have neither the time
nor the strong stomach to
visit Marxmal or LiberalBoredObserver Talk archives to find out. So
please, spell it out for us here on
MT.

I say no nationalization unless it is really nationalization. Nor
would I trust Rubin or Bernanke
to figure that out.

CJ

^^^
CB:  It seems to be that objective conditions, the objective tendencies of 
capitalism are causing a form of nationalization to occur "automatically".  
Time to revisit Marxist-Leninist general crisis theory.






This message has been scanned for malware by SurfControl plc. 
www.surfcontrol.com

___
Marxism-Thaxis mailing list
Marxism-Thaxis@lists.econ.utah.edu
To change your options or unsubscribe go to:
http://lists.econ.utah.edu/mailman/listinfo/marxism-thaxis

[Marxism-Thaxis] Blaming the workers

[Charles Brown]

Blaming the workers  
By Jack Lessenberry

Blame the workers. Especially, blame the United Auto Workers. That's what we've 
been hearing from the talking heads over the last several weeks as our auto 
industry skidded toward the brink of extinction and politicians debated a 
bailout.

Over and over again, I've heard people repeat that the trouble was that the 
average UAW worker costs the auto companies $73 per hour. Nice work if you can 
get it. Matter of fact, it made me want to pack a lunch bucket and trudge off 
to Dodge Main.
^^^
CB: Of course, Dodge Main was closed in 1979. It's a big empty hulk on Mt. 
Elliott now.

^^^

 Trouble is, when I checked, I found that this statistic is simply not true.

Unionized autoworkers, at least the relatively few still working, made about 
$28 an hour last year, according to Ann Arbor's respected Center for Automotive 
Research. Yes, they do get benefits, and benefits cost money. But how could 
they rack up another $45 an hour in bennies? The answer is that they don't.

Jonathan Cohn sagely reported in The New Republic how this figure was 
concocted: By taking the entire cost of health care and pensions for both 
active employees and retirees and adding it to the average hourly wage. Yes, 
health care and other benefits do cost the auto companies $42 an hour. But 
that's because they have so many retirees. General Motors has been around for 
almost a century. Ford, even longer. Toyota, which didn't open plants here 
until the 1980s, has very few retirees. Naturally their total labor costs are 
lower.

Yes, the United Auto Workers union did fight hard to win their workers decent 
salaries and benefits. (The nerve of those bastards!) Based on their real 
salaries, longtime autoworkers make about $60,000 a year. When you consider the 
physical stress and the repetitive motion injuries, that doesn't seem like such 
a good deal to me. And it is even worse now, since nobody working for the 
Not-So-Big Three knows if he or she will still have a job in a few months.

Yet life is not always fair. We need to ask the question: Are the unions and 
the salaries and the benefits paid their members really the reason the auto 
companies are on their knees?

Harley Shaiken is one of the most knowledgeable labor experts in the country. A 
Detroit native, he's now a professor at the University of California at 
Berkeley. I asked him if it's fair to blame the UAW for all, or even some, of 
the shape the domestic industry is in?

"No, I don't think so," he said. "I think the UAW has played an important role 
in rebuilding the industry. Were there excesses in the past? Of course. By 
everyone."

But that's not what has caused the present crisis; the credit crunch resulting 
from the Wall Street meltdown last September was the catalyst. "The automakers 
are asking Congress for $34 billion," Shaiken reminded me. "If the entire labor 
force volunteered to work for free next year, that would save them [only] about 
$18 billion.

"Of course, labor costs are critical," he explained. "But they aren't decisive 
in terms of the scope of the current economic meltdown."

Well, what about the so-called "jobs bank," whereby temporarily idled workers 
would still get paid until new jobs could be found for them?

"It's become the most falsely maligned thing in the industry, and it's gotten a 
bad rap," Shaiken said. "It was always capped in terms of financial liability 
for the companies. Ford, for example, was [paying] less than $200 million a 
year."

What was important about the jobs bank, however, was that it gave workers 
incentives to come up with laborsaving devices. Even if they cost jobs in the 
short run, they wouldn't be penalized. The union, however, has signaled it is 
to suspend the jobs bank, which now involves fewer than 4,000 workers.

But what about other concessions? Has the union been willing to step up and do 
its part?

"I think it has," Shaiken said. "Entering [UAW] workers at the Big Three are 
giving up two-thirds of their total compensation. They are being hired at $14 
an hour, and at considerably reduced benefits." That is far less than workers 
at Toyota or Honda. "That hasn't made much of a difference yet, because the 
auto companies are hiring so few workers," the professor added. "But over time, 
it certainly will."

Much of what we've heard about unions and their role in the industry is just 
plain wrong, he argued. "When people think of unions, they think of them as 
being sort of opposed to improvements in productivity. That simply isn't true."

Yes, there may have been a time when unions were part of the problem. But they 
get it today. Shaiken cited one recent study that showed that unionized labor 
forces were, by and large, better in terms of productivity than nonunion 
workers. In other words, the professor thinks much of what we thought we knew 
was wrong. ... Not for the first time.

Newspaper update: The latest buzz is that a momentous decision has been made 

[Marxism-Thaxis] Unemployment stories

[Charles Brown]

On the dole
Sacramento News & Review - Sacramento,CA,USA
By Seth Sandronsky 
On a late November afternoon, Elk Grove resident Melanie Nisewanger, 21, 
stopped by the state Employment Development Department on
...

 
Seth Sandronsky 
http://www.newsreview.com/sacramento/Archive?author=3348 






This message has been scanned for malware by SurfControl plc. 
www.surfcontrol.com

___
Marxism-Thaxis mailing list
Marxism-Thaxis@lists.econ.utah.edu
To change your options or unsubscribe go to:
http://lists.econ.utah.edu/mailman/listinfo/marxism-thaxis

[Marxism-Thaxis] Republic settlement

[Charles Brown]

Update #2: Vote is 'Yes' at Republic; Plant Occupation Ends
10 December, 2008
CHICAGO

After the conclusion of negotiations Wednesday evening, the membership
of Local 1110, more than 200 workers, met in the plant cafeteria to
hear and consider the tentative settlement that had been worked out by
UE negotiators over the past three days.

The settlement was approved by a unanimous vote.
'Justice - We Did It!'

Following the vote, the UE members, led by Local President Armando
Robles, marched out of the plant, chanting "We did it!" in English and
Spanish.

Pres. Robles stepped to the microphones outside the front entrance to
the plant, where a throng of reporters and cameras had been waiting.
He announced the end of the occupation and said that justice had been
achieved.

UE Western Region President Carl Rosen then described the
negotiations, summarized the settlement agreement, and commented on
the significance of the struggle and the achievement.
Pay, Health Care, Vacation Pay

The settlement totals $1.75million. It will provide the workers with:

* eight weeks of pay they are owed under the federal WARN Act;
* provided with two months of continued health coverage, and;
* pay for all accrued and unused vacation.

JPMorgan Chase will provide $400,000 of the settlement, with the
balance coming from Bank of America
Third Party Fund

Although the money will be provided as a loan to Republic Windows and
Doors, it will go directly into a third-party fund whose sole purpose
is to pay the workers what is owed them.

As the Local 1110 leaders characterized the settlement, "We fought to
make them pay what they owe us, and we won."
'Historic Victory'

UE Director of Organization Bob Kingsley spoke on behalf of the
National Union, describing the outcome of the occupation as "a victory
for workers everywhere," and as "an historic victory for America's
labor movement."

Kingsley went on to call the settlement "a win for all working men and
women who face uncertainty, unfairness and job loss in a troubled
economy."
'The Window of Opportunity' Foundation

Kingsley then announced the creation of a new foundation, dedicated to
reopening the plant. It will be initiated with seed money from the UE
national union and the thousands of dollars of donations to the UE
Local 1110 Solidarity Fund that have come in from across the country
and around the world in just the past five days.

Melvin Maclin of Local 1110 announced the name of the foundation,
which was chosen by the workers themselves: the Window of Opportunity
Fund. Maclin said that the fund will be open to receive donations from
all friends of the Republic workers and supporters of their struggle.

Rosen introduced U.S. Rep. Luis Gutierrez, praising the congressman
for his tireless work in behalf of the Republic workers and
indispensible role in bringing about the settlement. Gutierrez spoke
at some length, and then introduced David Rudis, Illinois State
President, Bank of America.




This message has been scanned for malware by SurfControl plc. 
www.surfcontrol.com

___
Marxism-Thaxis mailing list
Marxism-Thaxis@lists.econ.utah.edu
To change your options or unsubscribe go to:
http://lists.econ.utah.edu/mailman/listinfo/marxism-thaxis

[Marxism-Thaxis] Userer or rentier state

[Charles Brown]

The US today is a userer state in a slightly different sense today; and
from an "industrial state" to a "userer state".

Charles


From _Imperialism_
"For that reason the term “rentier state” (Rentnerstaat), or
usurer
state, is coming into common use in the economic literature that deals
with imperialism. The world has become divided into a handful of
usurer
states and a vast majority of debtor states. “At the top of the list
of foreign investments,” says Schulze-Gaevernitz, “are those
placed
in politically dependent or allied countries: Great Britain grants
loans
to Egypt, Japan, China and South America. Her navy plays here the part
of bailiff in case of necessity. Great Britain’s political power
protects her from the indignation of her debtors.” [2] Sartorius von
Waltershausen in his book, The National Economic System of Capital
Investments Abroad, cites Holland as the model “rentier state” and
points out that Great Britain and France are now becoming such. [3]
Schilder is of the opinion that five industrial states have become
“definitely pronounced creditor countries”: Great Britain,
France, Germany, Belgium and Switzerland. He does not include Holland
in
this list simply because she is “industrially little developed”.
[4]
The United States is a creditor only of the American countries. 

“Great Britain,” says Schulze-Gaevernitz, “is gradually becoming
transformed from an industrial into a creditor state. Notwithstanding
the absolute increase in industrial output and the export of
manufactured goods, there is an increase in the relative importance of
income from interest and dividends, issues of securities, commissions
and speculation in the whole of the national economy. In my opinion it
is precisely this that forms the economic basis of imperialist
ascendancy. The creditor is more firmly attached to the debtor than
the
seller is to the buyer. [5] In regard to Germany, A. Lansburgh, the
publisher of the Berlin Die Bank, in 1911, in an article entitled
“Germany—a Rentier State”, wrote the following: “People in
Germany are ready to sneer at the yearning to become rentiers that is
observed in France. But they forget that as far as the bourgeoisie is
concerned the situation in Germany is becoming more and more like that
in France.” [6] -"


This message has been scanned for malware by SurfControl plc. 
www.surfcontrol.com

___
Marxism-Thaxis mailing list
Marxism-Thaxis@lists.econ.utah.edu
To change your options or unsubscribe go to:
http://lists.econ.utah.edu/mailman/listinfo/marxism-thaxis