Striking public sector workers march in protest through central London (AFP Photo)
The UK has been going through its deepest recession since World War II, a report by the Institute for Fiscal Studies claims. Workers experienced unprecedented pay cuts of 6 per cent over the last five years since the Global Financial Crisis began in 2008.
Between 2010 and 2011, 70 per cent of employees who stayed in the same job fronted real wage cuts, while a third of those workers faced nominal wage freezes or cuts (12 per cent experienced freezes and 21 per cent experienced cuts).
The last time that such a high proportion of workers faced real wage cuts was between 1976 and 1977, when inflation exceeded 15 per cent. The proportions of nominal wage freezes and cuts are said to be the highest since the series of wage cuts began in the mid-1970s, according to the Institute for Fiscal Studies latest report.
The period since the recession began in 2008 has seen the longest and deepest loss of output in a century. Real wages have fallen by more than in any comparable five-year period; productivity levels have dropped to an unprecedented degree, the British think tank revealed.
Average real hourly wages amongst workers who stayed in the same job have fallen faster in the private sector than in the public sector over the last few years, such that the public-private sector wage gap has increased substantially over this period.
A demonstrator tries to keep the fire alive during a protest outside the National Stadium in Brasilia, Brazil, June 14, 2013. About 200 people burned tires and blocked the main road in front of the Brasilia stadium which will host the Confederations Cup opening match between Brazil and Japan on June 15.The protest was organized by several local groups complaining of the excessive costs of the Confederations Cup and the World Cup. (AP Photo/Andre Penner)
SAO PAULO—Protesters on Friday promised more organized action across Brazil in the days to come, following clashes in which police in Sao Paulo set upon thousands of young demonstrators angered by hikes in bus and subway fares.
Newspapers carried photos of bloodied protesters and journalists with battered, swollen faces, a young couple being beaten by police and videos of tear gas canisters and rubber bullets being fired into crowds chanting “no violence!” Protesters set fire to garbage bags piled in streets, broke windows and spray-painted graffiti on buildings and buses.
Protest organizers said more than 100 demonstrators were injured. Police would only say that 12 officers were hurt and that more than 230 people were detained and later released in the Thursday night demonstrations in Sao Paulo.
Similar protests were seen in Rio de Janeiro, the capital Brasilia and in Porte Alegre in southern Brazil. The conflicts come just as the Confederations Cup football tournament opens and the nation prepares to host Pope Francis next month on his first international trip as pontiff.
Police fire rubber bullets at demonstrators protesting a price increase for public transportation in Sao Paulo, Brazil, Thursday, June 13, 2013. Thousands of protesters are taking to the streets in Brazil’s two biggest cities, protesting against 10-cent hikes in bus and subway fares. (AP Photo/Nelson Antoine) — AP People protest the increase in bus and subway fares in Rio de Janeiro, Thursday, Brazil, June 13, 2013. Thousands of protesters are taking to the streets in Brazil’s two biggest cities, protesting against 10-cent hikes in bus and subway fares. (AP Photo/Nicolas Tanner) — AP
RIO DE JANEIRO — FIFA has “full confidence” Brazilian police can cope with the violent protests and disorder in the streets leading to the country’s warmup event for the 2014 World Cup.
There were clashes with police on Thursday in Sao Paulo and Rio de Janeiro after thousands protested rising bus and subway fares. Police said 40 people were detained in Sao Paulo, some with knives and gasoline bombs.
Wisconsin veterans groups are sharply criticizing a move by lawmakers to curtail and strip disabled veterans of property tax credit benefits.
The state provides a refundable income tax credit for the property taxes paid on principal dwellings by veterans who are 100% disabled and their surviving spouses. Spouses of veterans killed in Iraq and Afghanistan also receive the credit if they don’t remarry.
Last week the Joint Finance Committee voted to limit the amount of property taxes to be reimbursed to $2,500 a year. The committee also created a means test phase-out, so that if the income of 100% disabled veterans exceeds a certain amount, they will be dropped from the property tax credit program. This also would apply to their surviving spouses and spouses of Wisconsin service members killed in action.
Disabled American Veterans state legislative director Al Labelle called the committee’s action appalling.
“Apparently some committee members feel the sacrifices made by severely wounded, injured and ill veterans are just another budget item,” Labelle said.
Mike “Gunner” Furgal, a Marine who served in Vietnam, doesn’t qualify for the benefit, but he knows veterans who do, including an Afghan veteran suffering from a traumatic brain injury. The committee’s action will be a big topic at this week’s state VFW convention in Green Bay.
“I think it’s a shame when we have a budget surplus that they’re balancing the budget on the back of veterans,” said Furgal, legislative chairman for the Wisconsin VFW. “That’s really a slap in the face of veterans.”
In the fiscal year that ends June 30, the cost to the state for the property tax credit is $17.7 million. The program began as part of the 2005-’07 state budget.
Rep. Dale Kooyenga (R-Brookfield) pointed out that there are plenty of veterans programs, ranging from job training to education benefits, in the next biennial state budget. Lawmakers decided to put a $2,500 cap on the disabled veteran property tax credit and limit eligibility based on income, Kooyenga said, to make it more fair.
“Does it make sense to have a credit that could apply to a millionaire? You could have a million-dollar house but 100% of your property taxes would be paid by the state,” said Kooyenga, a CPA and Army Reservist who served in Iraq.
Republican-controlled states argued before the supreme court that the ACA law’s expansion of Medicaid is unconstitutionally coercive. Photograph: Justin Sullivan/Getty Images
If you want to get a sense of the enfeebled and wanton state of the modern Republican party, there really is no better place to start than on the issue of Medicaid, the federal program that provides healthcare coverage for the poor.
In a desperate effort to undermine the law they hate, Obamacare, Republican governors and state legislatures in half the states have either rejected or intend to reject a key part of the president’s signature domestic initiative – namely, billions in federal dollars to extend Medicaid coverage to their poorest citizens. While Republicans argue they are acting out of highminded fiscal rectitude, the reality speaks to something else altogether – petulance and hyper-partisanship.
Accepting billions in federal dollars and expanding care to the uninsured would mean tacitly accepting the reality of Obamacare. And that is tantamount to treason in the Republican party. So, as a result, when the law goes into full effect next year, millions of Americans will be left on the outside looking in, denied coverage for no other reason than the misfortune of residing in a red state.
If we lived in a country where both major political parties shared a sense of social empathy, the Medicaid expansion piece of Obamacare would be among its least controversial provisions. Under the law, Medicaid coverage would become available for those living below 138% of the poverty line. The federal government would fully pick up the bill for the first few years of the law, and then eventually cover 90% of the costs.
But when the US supreme court upheld Obamacare last year, it overturned the provision of the bill that gave the federal government authority to penalize states that did not agree to expand Medicaid coverage. Though this decision gave states the right potentially to reject the expansion, few at the time thought this would be an issue. Ron Pollack, director of the consumer group Families USA, expressed the views of many:
“I think the states are going to pick this up. It would be an act of fiscal malpractice for states to turn this down.”
Considering the billions of Medicaid dollars that would be pumped into state coffers, it was hard to disagree. But what liberals had not fully countenanced was the continued refusal of Republicans to come to grips with Obamacare.
Indeed, a year after the supreme court ruled on the legality of the law, congressional Republicans are continuing their futile struggle to scrap it. Earlier this month, House Republicans voted for the 37th time to repeal Obamacare. Beyond such peevish symbolic gestures congressional Republicans are trying to put as many roadblocks as possible in front of the healthcare law’s rollout. They refuse to consider any technical corrections to the bill in order to assist with its implementation.
Prominent Republicans, such as Senate minority leader Mitch McConnell, claim the bill is simply too broken to be fixed and repeal is the only option. But the unlikely possibility of repeal is a figleaf for the GOP’s real interest: sabotaging the bill in order to gain a political advantage in the 2014 midterm elections. The more Obamacare is seen as a disaster, the better chance of voters punishing Democrats at the polls, or so the political argument goes.
The problem is that this obstructionism is having real and enduing consequences. According to a survey maintained by the Kaiser Foundation (pdf), fewer than half the states have agreed to fully partake in the Medicaid expansion, with 20 not moving forward at this time.
What do all these states have in common? Either a Republican governor or a legislature controlled by Republicans. In some states, even the support of a GOP governor has not been enough to bring along recalcitrant legislators. In Arizona, Governor Jan Brewer – no friend of the Obama administration – is locked in a heated battle with her state legislature over the issue and has threatened to veto every bill that comes to her desk until the Medicaid issue is resolved.
Arizona Gov. Jan Brewer, shown here greeting delegates Aug. 28, 2012, at the Tampa Bay Times Forum in Tampa, Fla., is one of several Republican governors pushing state legislators to approve Medicaid expansion allowed under the federal Affordable Care Act.
By Sandhya Somashekhar, The Washington Post
Posted June 02, 2013, at 9:52 p.m.
Republican fissures over the expansion of Medicaid, a critical piece of the 2010 health-care law designed to provide coverage to millions of uninsured Americans, continue to deepen, with battles in Arizona and elsewhere showing just how bitter the divisions have become.
Despite expressing distaste for the new law, some GOP governors have endorsed an expansion of Medicaid, and three — Jan Brewer of Arizona, John Kasich of Ohio and Rick Snyder of Michigan — are trying to persuade their Republican-controlled legislatures to go along. The governors are unwilling to turn down Washington’s offer to spend millions, if not billions, in their states to add people to the state-federal program for the poor. But they face staunch opposition from many GOP legislators who oppose the health-care law and worry that their states will be stuck with the cost of adding Medicaid recipients.
In one of the most explosive of the internal Republican battles, Brewer, a firebrand tea party favorite who once famously wagged her finger at President Barack Obama, has declared a “moratorium” on all other legislation until her Medicaid plan, which would add 300,000 Arizonans to the program, is approved. She has backed up her threat by vetoing five unrelated bills.
In Ohio and Michigan, the governors are pressing for last-minute compromises before their legislatures adjourn this summer. In Florida, the legislature, which has adjourned, rejected Republican Gov. Rick Scott’s plan to expand Medicaid.
These conflicts over the health-care law illustrate a larger divide within the Republican Party over an array of issues, including immigration and automatic budget cuts.
The Medicaid expansion is one of the two main ways the health-care law would provide coverage to the uninsured. The other is through health insurance exchanges, which will sell policies to individuals whose incomes are too high for Medicaid; many of those people will receive subsidies to buy the health plans.
Medicaid eligibility varies from state and to state and depends on income and other factors. The health-care law, in an effort to make eligibility uniform, mandated that anyone earning up to 138 percent of the poverty level, or $15,856 in 2013 dollars, be eligible for the program. But last June, the Supreme Court, while upholding most of the health-care law, ruled that states could refuse to expand their Medicaid programs. That set the stage for bitter debates — ones ruled as much by ideology and politics as by financial realities — that have been occurring in state capitals nationwide.
Under the law, the federal government will pay 100 percent of the cost of newly eligible Medicaid recipients for the first three years, beginning in January. After that, the federal contribution will taper, leveling off at 90 percent for 2020 and beyond.
Twenty-three states and the District have agreed to the Medicaid expansion. Nineteen states have decided against the expansion and eight are debating it, according to Avalere Health, a consulting firm. States that decline to expand Medicaid now could still sign up in later years.
The debate over Medicaid has been emotional and vitriolic in many states. In Texas, Gov. Rick Perry, R, was heckled during a recent speech for opposing an expansion. In Montana, chaos erupted after a lawmaker accidentally voted against expanding the program, causing the measure to fail. Pro-Medicaid advocates in some states, frustrated by inaction from their elected leaders, are working to put the matter to voters in the form of ballot initiatives.
The hostility is evident in Arizona, where authorities are investigating a threatening phone call and emails directed at lawmakers who support expanding the program. Opponents of the expansion have condemned the alleged threats.
Irvine, California, where health insurance premiums for the average 25-year-old who purchases insurance for himself will nearly double under Obamacare. (Photo credit: Wikipedia)
Well, it’s been an interesting week in health care land. For a while now, independent analysts—and conservative critics—have raised concerns that Obamacare will dramatically increase the cost of individually-purchased health insurance for healthier people. This would, of course, contradict President Obama’s promises that “if you like your plan, you can keep it” and that the cost of insurance would go down “by $2,500 per family per year.” What’s new is that liberal columnists, facing reality, are conceding that premiums will go up for most people in the individual market. But they’re justifying it by saying that “rate shock” will help a tiny minority of people who can’t get insurance today. If they had said that in 2009, would Obamacare have passed?
Last month, progressive pundits were trumpeting news out of California that the cost of health insurance under Obamacare in that state was surprisingly low. “Well, the California bids are in,” wrote Paul Krugman on May 27. “And the prices, it turns out, are surprisingly low…So yes, it does look as if there’s an Obamacare shock coming,” the shock that Obamacare will work just fine.
It turns out, however, that Krugman was uncritically regurgitating California’s misleading press release. In fact, the average 25 and 40-year-old will pay double under Obamacare what they would need to pay today, based on rates posted at eHealthInsurance.com (NASDAQ:EHTH). More specifically, for the typical 25-year-old male non-smoker, the average Obamacare “bronze” exchange plan in California will cost between 64 and 117 percent more than the cheapest five plans on eHealth. For 40-year-old male non-smokers, it’s between 73 and 146 percent more.
Democrats now: It’s ok if premiums double for average people
Ezra Klein of the Washington Post, in response to my article on this topic, checked out the eHealth rates for plans in his hometown of Irvine, California, and compared them to a similar website sponsored by the government at healthcare.gov. He found that the third-cheapest plan there cost only $109 a month, “if they’ll sell it to you for that price.” According to the government, Ezra notes, 14 percent of people who tried to buy that plan—Health Net’s IPF PPO Value 4500—were turned away. Another 12 percent were asked to pay more than $109.
To Ezra, it’s galling that three-fourths of his compatriots can pay $109 for health insurance, because 12 percent were not eligible for the plan, and another 14 percent had to pay somewhat more. This is why Obamacare is a great achievement, he says, because Health Net will have to serve all comers, regardless of prior health status.
And I appreciate Ezra’s perspective. I, too, am a supporter of universal coverage, so I understand Ezra’s passion for providing health insurance to the sick. But what we didn’t know last week—and we do now—is how much more the healthy will have to pay for that insurance, under Obamacare. In Orange County, where Irvine is located, the three-fourths of the 25-year-old population that is in good health will have their premiums jacked by 95 percent.
And that’s for Obamacare’s “catastrophic” coverage; the more comprehensive “bronze” plan increases premiums by 130 percent. For the fraction—one-eighth of the total—who, under the old system, would have been charged more, the premium increase due to Obamacare will be somewhat less.
And the vast majority of those who were turned away are able to find insurance—albeit at a higher price—elsewhere. Based on enrollment in Obamacare’s high-risk pool program, the number of people in America who are truly uninsurable is closer to 150,000. That’s a pretty small number in a nation of 300 million. Previous estimates of the uninsurable population came in around 2 to 4 million people, but it’s likely that for many of these individuals, the principal problem is not that they’re denied coverage, but that the premiums are high.
Ezra makes another accurate point that is important to emphasize: these increased premiums affect people who shop for insurance on their own. If you get insurance through your employer, especially if your employer is large, you should be significantly less affected. But an increasing number of people shop for insurance on their own, because fewer and fewer employers are sponsoring health coverage. According to the Congressional Budget Office, in 2022, around 25 million people will be purchasing coverage for themselves, and another 25 million will be enrolled on the exchanges. That’s a lot of people. And it doesn’t include the 30 million that will remain uninsured.
Universal coverage, done right, can address these problems in a way that makes insurance affordable for everyone. But Obamacare’s sops to special interests—from the various services all plans are required to cover, to the fact that the law forces young people to pay more to subsidize well-established older people—is not the right way, because it makes insurance too costly.
Democrats then: Rate shock is a right-wing myth
The key thing to remember is that back when Obamacare was being debated in Congress, Democrats claimed that it was right-wing nonsense that premiums would go up under Obamacare. “What we know for sure,” Obamacare architect Jonathan Gruber told Ezra Klein in 2009, “is that [the bill] will lower the cost of buying non-group health insurance.” For sure.
In 2009, was Ezra saying that it’s ok that premiums will double for the average person, because a minority of people will pre-existing conditions will benefit? No.
Earlier that year, AHIP, the private insurer trade group, commissioned a report from PriceWaterhouseCoopers to analyze the impact of Obamacare on health insurance premiums in the individual market. That report, which I reviewed here and elsewhere, found that the version of Obamacare then being considered by the Senate Finance Committee would increase premiums by 14 to 32 percent, depending on the year you looked at. In retrospect, the PwC report was a bit optimistic.
But Ezra described the PwC analysis as “the insurance industry’s deceptive report,” comparing it to sham research put out by the tobacco industry and Big Oil. Ezra did concede at the time that “buying better insurance will cost somewhat more,” because insurers would no longer be able “to sell a deceptive and insufficient product.”
But high-deductible, catastrophic insurance isn’t cheaper because it’s dishonest. It’s cheaper because it’s more efficiently designed. And it’s precisely that sort of efficiently-designed insurance that Obamacare abolishes.
Businesses in competitive markets can’t survive by cheating
This idea that high-deductible insurance, freely purchased in a voluntary exchange, is a “dishonest” product is an article of faith in some quarters. My good friend and Forbes colleague Rick Ungar recently dedicated an entire blog post to the subject. The numbers that come out of eHealthInsurance.com, Rick says, are lies. What data does Rick cite to prove this? He doesn’t cite any actual numbers. Instead, he cites…anonymous reviews on the internet.
Rick went to epinions.com, and pulled out quotations from people who were unhappy with eHealth’s customer service. And eHealth should certainly do what it can to address customer’s complaints. (The company, however, isn’t directly responsible for the customer service of the insurers whose products it sells.) Remember that, unlike with Obamacare, eHealth is a private business. No one is forced to use their services. Those who do have a bad experience on eHealth can go elsewhere, like healthcare.gov. eHealth, unlike the government, has an economic incentive to make its customers happy. Indeed, the default setting at eHealth is to sort the listed plans by customer popularity.
Conservative Republican legislators in major states are trying to block efforts by more pragmatic governors of their own party to accept health insurance for more low-income residents under President Barack Obama’s health care law.
Unlike their congressional counterparts, who’ve misfired in repeated attempts to torpedo the law, state Republicans may well sink the expansion of Medicaid in populous states such as Florida and Michigan.
That would mean leaving billions of dollars in federal matching funds on the table and hundreds of thousands of the poor uninsured. Expansion opponents say it’s an issue that goes to their core beliefs.
“It’s an ideological principle piece to us on the conservative side,” said state Rep. David Gowan, majority leader in the Arizona House of Representatives. “We don’t believe in the expansion of Medicaid itself – it’s within the process of mandating health care. We don’t believe it’s the government’s duty to do that. It should be open for people to go get their health care.”
Nine Republican governors supported or accepted the Medicaid expansion, a major component of the health care law taking effect Jan. 1. It’s designed to provide coverage to about 20 million uninsured people if all states accept. Washington would pick up the full cost for the first three years and 90 percent over the long haul.
Those helped would mainly be low-income adults with no children at home, people working jobs that pay little and don’t come with health insurance. For uninsured adults below the poverty line, expanded Medicaid is the only way to get coverage under the new law. But middle-class people will be eligible for subsidized private insurance.
Overall, 23 states plus the District of Columbia, are planning to expand their Medicaid programs. About a dozen are undecided.
The nine GOP governors supporting expansion are Jan Brewer in Arizona, Rick Scott in Florida, Terry Branstad in Iowa, Rick Snyder in Michigan, Brian Sandoval in Nevada, Chris Christie in New Jersey, Susana Martinez in New Mexico, Jack Dalrymple in North Dakota and John Kasich in Ohio.
Initially, some observers saw a shift toward pragmatism among Republicans and predicted the governors would get their way. Now experts are not so sure.
Four of the GOP governors have run into real battles. Expansion prospects are flickering in Florida and Michigan. In Ohio, Kasich’s legendary deal-making abilities are being tested. In Arizona, Brewer is trying to stare down Republicans in the state House, and the coming week may determine who prevails.
PUBLISHED: 16:40 EST, 4 June 2013 | UPDATED: 16:41 EST, 4 June 2013
The number of families struggling to pay for their healthcare has come down slightly, but one in five families still struggles to pay for medical bills, federal researchers found.
Figures showed that 20.3 per cent of people under 65 are in families that had trouble paying a medical bill during the first half of 2012.
The figure was down from 21.7 per cent in the first half of 2011, the National Center for Health Statistics found.
Vital signs: The prognosis for affordable healthcare is not looking good, with one in five families struggling
The numbers will be closely scrutinized as the U.S. moves towards healthcare reform. The 2010 Affordable Care Act, known as Obamacare, is designed to get more people covered by health insurance and, in theory, take away some of the financial burdens.
In the health statistics study Robin Cohen and colleagues looked at data from national surveys for their report.
They excluded people who are 65 or older because they have the right to coverage by Medicare, the federal health insurance plan for the elderly.
However, a quarter of those who had public health insurance such as Medicare or Medicaid struggled to pay for their medical care, the survey found.
‘In the first 6 months of 2012, among persons under age 65, 36.3 per cent of those who were uninsured, 14 per cent of those who had private coverage, and 25.6 per cent of those who had public coverage were in families having problems paying medical bills,’ the report said.
Poor health: Researchers found 14 per cent of the wealthier families still struggled to pay for their medical bills
Fewer Families in U.S. Say Struggling to Pay Medical Bill
By Shannon Pettypiece – Jun 3, 2013 11:01 PM CT
Bloomberg
Fewer families are struggling to pay their medical bills, according to a report that suggests the cost of health-care may be starting to slow.
About 20 percent of people under 65 reported being in a family that was having problems paying for medical bills in the first six months of 2012, according to a survey by the National Center for Health Statistics. That’s a decrease from about 22 percent in the same period a year earlier, a drop of about 3.6 million people, the report found.
20:57
May 10 (Bloomberg) — U.S. President Barack Obama speaks at the White House about the Affordable Care Act and benefits of the law. The White House has stepped up efforts to market the law as it approaches the Oct. 1 debut of health-insurance exchanges, at which millions of Americans will begin purchasing coverage. (Source: Bloomberg)
Health-care costs have eased because of increased use of cheaper generic drugs, more efficient care from hospitals and people putting off procedures during the economic downturn, said Peter Cunningham, a senior fellow at the Center for Studying Health System Change. Though the drop in people struggling to pay medical bills isn’t related to the health-care law, the trend may continue when insurance coverage is expanded starting in 2014, he said.
“Based on the earlier trends we’ve noted, this really isn’t a surprise and it coincides with moderating health-care costs,” Cunningham said. “People just started pulling back on what they are using and spending in terms of health care, which isn’t too dissimilar to what we’ve seen in other sectors of the economy.”
A new government report finds about one in five Americans face problems paying their medical bills, but things may be improving.
Statisticians at the Centers for Disease Control and Prevention’s National Center for Health Statistics reviewed government survey data, and found 20.3 percent of U.S. adults under 65 had troubles paying medical expenses during the first six months of 2012. That’s down though, from 21.7 percent during the first six months of the previous year. The new statistics, however, still reflect that more than 54 million Americans are facing troubles meeting medical costs.
Expenses may include medication, equipment, home care, or trips to doctors, dentists, hospitals and therapists.
Children 17 and younger were more likely to be in families who had bill problems than adult-only homes.
Surprise: Americans are having less trouble paying medical bills.
By Sarah Kliff, Published: June 4, 2013 at 8:53 am
Washington Post
Here’s a rare bit of good news on health care costs: Americans are having an easier time paying their medical bills than they did just a year ago.
New data from the Center for Disease Control show there were 57.8 million Americans who had trouble paying their health care bills in the first six months of 2011. That number fell by 3.6 million, hitting 54.2 million in the same span of 2012.
Many of those gains accrued, perhaps surprisingly, to public health program enrollees, people signed up for programs like Medicaid.
Splice the data slightly differently, and you can see that families with children under 17 saw a statistically significant
18 Signs That Massive Economic Problems Are Erupting All Over The Planet
By Michael, on June 2nd, 2013
In fact, a whole bunch of recent polls and surveys show that the American people are starting to feel much better about how the U.S. economy is performing. Unfortunately, the false prosperity that we are currently enjoying is not going to last much longer. Just look at what is happening in Europe. The eurozone is now in the midst of the longest recession that it has ever experienced. Just look at what is happening over in Asia. Economic growth in India is the lowest that it has been in a decade and the Japanese financial system is beginning to spin wildly out of control. One of the only places on the entire planet where serious economic problems have not already erupted is in the United States, and that is only because we have “kicked the can down the road” by recklessly printing money and by borrowing money at an unprecedented rate. Unfortunately, the “sugar high” produced by those foolish measures is starting to wear off. We are going to experience a massive amount of economic pain along with the rest of the world – it is just a matter of time.
But for the moment, there are a lot of skeptics out there.
For the moment, there are a lot of people that are declaring that the problems of the past have been fixed and that we are heading for incredibly bright economic times ahead.
Unfortunately, those people appear to be purposely ignoring the economic horror that is breaking out all over the globe.
The following are 18 signs that massive economic problems are erupting all over the planet…
#1 The eurozone is now in the midst of its longest recession ever. Economic activity in the eurozone has declined for six quarters in a row.
“I’ve sent CVs everywhere, I come to the unemployment agency every day, for 3 or 4 hours to look for work as a truck driver and there’s never anything,” said 42-year old Djamel Sami, who has been unemployed for a year, leaving a job agency in Paris.
#7 Unemployment in the eurozone as a whole has just hit a brand new all-time record high of 12.2 percent.
#8 Youth unemployment continues to soar to unprecedented heights in Europe. The following is from an article that was recently posted on the website of the Guardian that detailed how bad things are getting in some of the worst countries…
In Greece, 62.5% of young people are out of work, in Spain it’s 56.4%, then Portugal with 42.5%, and then Italy with 40.5%.
#9 Youth unemployment is being partially blamed for the worst rioting that Sweden has seen in many years. The following is how the Daily Mail described the riots…
Sweden is reeling after a third night of rioting in largely run-down immigrant areas of the capital Stockholm.
In the last 48 hours violence has spread to at least ten suburbs with mobs of youths torching hundreds of cars and clashing with police.
It is Sweden’s worst disorder in years and has shocked the country and provoked a debate on how Sweden is coping with youth unemployment and an influx of immigrants.
#10 An astounding 10 percent of all banking deposits were pulled out of banks in Cyprus during the month of April alone.
#11 Economic growth in India is the slowest that it has been in an entire decade.
#12 Suddenly Australia is experiencing some tremendous economic challenges. The following quotes are from a recent Zero Hedge article…
The seasonally-adjusted rate for April was 12.2%, up from 12.1% the month before.
An extra 95,000 people were out of work in the 17 countries that use the euro, taking the total to 19.38 million.
Both Greece and Spain have jobless rates above 25%. The lowest unemployment rate is in Austria at 4.9%.
The European Commission’s statistics office, Eurostat, said Germany had an unemployment rate of 5.4% while Luxembourg’s was 5.6%.
The highest jobless rates are in Greece (27.0% in February 2013), Spain (26.8%) and Portugal (17.8%).
In France, Europe’s second largest economy, the number of jobless people rose to a new record high in April.
“We do not see a stabilisation in unemployment before the middle of next year,” said Frederik Ducrozet, an economist at Credit Agricole in Paris. “The picture in France is still deteriorating.”
‘Social crisis’
Youth unemployment remains a particular concern. In April, 3.6 million people under the age of 25 were out of work in the eurozone, which translated to an unemployment rate of 24.4%.
Figures from the Italian government showed 40.5% of young people in Italy are unemployed.
Europe’s already dismal jobs situation has deteriorated further. If we needed a reminder of the lingering effects of the eurozone financial crisis, it is to be seen in the jobs data.
The general pattern is that the largest increases in unemployment over the last year were in countries at the centre of the crisis – Greece, Cyprus, Spain and Portugal. There was also a sharp increase in Slovenia, a country seen as a possible future candidate for a financial rescue.
The main exception to the pattern was Ireland, another country receiving a bailout, where unemployment nonetheless fell by almost one and half percentage points in twelve months.
The figures also highlight the “lost generation” concern that is, or should be, causing some lost sleep for political leaders. Unemployment among young people is approaching one in four across the eurozone and it is 40% or higher in a few countries – Greece, Spain, Portugal and Italy.
“We have to deal with the social crisis, which is expressed particularly in spreading youth unemployment, and place it at the centre of political action,” said Italy’s President Giorgio Napolitano.
In the 12 months to April, 1.6 million people lost their jobs in the eurozone.
While the jobless figure in the eurozone climbed for the 24th consecutive month, the unemployment rate for the full 27-member European Union remained at 11%.
The eurozone is in its longest recession since it was created in 1999. At 1.4%, inflation is far below the 2% target set by the European Central Bank (ECB).
Consumer spending remains subdued. Figures released on Friday showed that retail sales in Germany fell 0.4% in April compared with the previous month.
Greece’s young: Dreams on hold as fight for jobs looms
By Mark LowenBBC News, Athens
Mark Lowen looks at the toughest equation Greece has to solve
Greece’s school exam season has arrived. But for many now facing the final-year tests known as the Panhellenics, the stress is twofold: last-minute cramming and the knowledge that they’ll soon enter the worst jobs climate in Europe.
At 64.2%, youth unemployment in Greece is the highest in the continent. Those between the ages of 16 and 25 are now the crisis generation.
At the Spoudi school in Athens, dreams have been put on hold. The school leavers longed for a stable job, for a future full of opportunity. But instead, unemployment and uncertainty beckon.
The economy won’t recover because the educated ones will go abroad and only the older people will stay here”
Christina ZahagouLaw graduate, 23
In a final maths class, students pore over complex algebra problems. But how to stay positive in today’s Greece might just be the most difficult equation to solve.
“I’m not sure about my future,” says Nathalie Scholden, an 18-year-old who hopes to study economics. “I think I won’t stay in Greece because there’s high unemployment and bad salaries. A lot of kids my age feel the same. If we’re here and nobody gets the life they want, why should we stay?”
Among the other students, few are optimistic. One thinks of leaving Athens for the countryside, another of going into farming because of a lack of opportunities.
“In Greece today you can’t do what you want,” says Alexandros Delakouras, 17. “It will be very difficult to get a job in my country but I will try hard.” He adds with a smile: “Maybe, with God’s help, I’ll succeed.”
Before Greece’s first bailout three years ago – and the spending cuts that ensued – unemployment in the country was under 12%. Now it’s at 27%.
And among the youth, it’s more than doubled from around 31% in May 2010. Recession has hit hard but it’s the austerity demanded by the country’s international lenders that has had such a devastating impact.
Brain drain
Doing the sums
In Greece, 64.2% of 16 to 25-year olds are out of work
This has risen from 31.2% three years ago when Greece received its first international bailout
The economy is expected to stay in recession for the sixth consecutive year in 2013
Unemployment continues to rise and is not expected to start falling until 2015, the Greek central bank says
And so the brightest, like 23-year-old law graduate Christina Zahagou, are leaving. Greek emigration to Germany jumped by more than 40% last year. She is now following suit after failing to find work.
Sweden Riots Put Faces to Statistics as Stockholm Burns
By Niklas Magnusson & Johan Carlstrom – May 27, 2013 2:25 AM CT
A week of riots in Stockholm has torn a hole in Sweden’s image as a beacon of social harmony.
In Husby, a suburb north of the capital where 60 percent of residents were born outside Sweden and unemployment is twice the national average, youths torched cars, schools and other buildings in a show of anger that has unsettled one of Europe’s richest nations. The riots spread to more than 10 other suburbs in Stockholm.
A burning car set on fire in the Stockholm suburb of Kista after youths rioted in several different suburbs around Stockholm for a third executive night, late May 21, 2013. Photograph: Fredrik Sandberg via AP Photo/Scanipx Sweden
People exit Husby subway station to attend a demonstration against police violence and vandalism in the Stockholm suburb of Husby on May 22, 2013. Sweden’s youth unemployment rate was 23.6 percent last year– about three times the national average — according to the statistics office. Photographer: Jonathan Nackstrand/AFP/Getty Images
“Exclusion, poverty and unemployment” are the main causes of the riots, Yves Zenou, a professor at Stockholm University who has done research on urban economics and migration issues, said in a May 24 interview. “They feel excluded from Swedish society. Many are not in employment, many because of discrimination, and many have low education levels.”
The unrest has shocked Sweden, where the economic policies of Prime Minister Fredrik Reinfeldt helped the AAA rated nation emerge as a haven from the debt crisis raging across southern Europe. Yet Sweden’s aggregate wealth has hidden rifts in the economy as polices have failed to catch a demographic now taking to the streets to show its desperation.
Young people need “jobs as well as something to do in their spare time,” Iqra Siddiqui, a 16-year-old living in Hallunda, a suburb in south Stockholm, said yesterday in an interview outside the Skaerholmen subway station. “Another problem is that parents don’t know what their kids are up to.”
Police Detentions
Sweden’s youth unemployment rate was 23.6 percent last year — about three times the national average — according to the statistics office. A report this month by the Public Employment Services showed that about 77,000 people between 16 and 29 years haven’t studied or worked over the past three years, suggesting even larger hidden unemployment. By comparison, youth unemployment was about 153,000 last year, according to the agency.
Police, who as of May 24 had detained 29 people since the riots started on May 19, say most of those involved are about 20 years old. Their plight underscores how Europe’s economic pain is hitting young people hardest. According to Luxembourg-based Eurostat, youth unemployment in the 27-nation European Union reached 23.5 percent in March, versus 16.2 percent in the U.S.
Scenes outside Stockholm this week replayed images of youth unrest across Europe since the global economic crisis started. In 2011, riots that started in north London also spread to Manchester and the Midlands, in the worst youth unrest in the U.K. since the 1980s. Paris has seen similar violence.
‘Ordinary Night’
While unrest also spread to other towns over the weekend, including Oerebro and Linkoeping, violence in the Swedish capital have started to subside.
Last night was like “an ordinary night,” according to police spokesman Kjell Lindgren. Fewer than 10 cars were set on fire and there were no reports of stones being thrown at emergency services and no major vandalism. Between Saturday and Sunday, about 20 cars were set on fire and a school in a southern suburb was vandalized. Rocks were also thrown at police in the Vaarberg neighbourhood.
Reinfeldt, who gained power in 2006 on promises of bringing more people into the labor market, has struggled to carry that pledge over to immigrants and young adults. In Husby, an area dotted by concrete high rises, the number of people relying on state assistance is more than triple the average for Stockholm.
Sweden has suffered similar episodes of violence before, including in the southern city of Malmoe in 2008 as well as Gothenburg.
The Cause
Megafonen, a Husby advocacy group, traces the outbreak of Stockholm’s riots to the police shooting of a local 69-year-old man originally from Portugal. Police brutality and racist slurs have exacerbated tensions, the group says.
Dagens Nyheter, Sweden’s largest daily newspaper, has questioned those claims, as a columnist asked for specific examples of brutality and proof of racial insensitivity. The newspaper reported on May 24 that about half the people arrested on suspicion of rioting in Husby came from outside the neighborhood, and half of them had criminal records.
In response, the advocacy group posted witness accounts of police brutality and racism on its website.
“Megafonen doesn’t start fires, we don’t believe this is the right method for long-term change,” said the group. “But we know that it’s a reaction to deficiencies in society. Unemployment, inadequate schools and structural racism are reasons behind what we are seeing today.”
Small Group
The largest immigrant group in Sweden is from Finland, followed by Iraq and Poland. In Husby, of residents with a foreign background, those who were born abroad or have two non-Swedish parents, 80 percent have heritage from either Asia or Africa, according to city statistics.
Residents are quick to point out that the violence is being carried out by a small group that doesn’t speak for most people living there. Community groups have taken to the streets to help ease tensions and restore calm, which was successful over the weekend.
Jeannette Wicks-Lim: According to official figures 15 percent of Americans live in poverty, real numbers are over 33 percent of Americans cannot meet basic needs
http://www.democracynow.org – As Republicans move to cut billions of dollars in funding for food stamps, a new report finds one in six Americans live in a household that cannot afford adequate food. In “Nourishing Change: Fulfilling the Right to Food in the United States,” the International Human Rights Clinic at New York University’s School of Law reports that of these 50 million people going hungry, nearly 17 million are children. Food insecurity has skyrocketed since the economic downturn, with an additional 14 million people classified as food insecure in 2011 than in 2007. The report comes as Congress is renegotiating the Farm Bill and proposing serious cuts to the Supplemental Nutrition Assistance Program (SNAP), formerly known as the Food Stamp Program. Millions of Americans currently rely on the program to feed themselves and their families. The report’s co-author, Smita Narula of the International Human Rights Clinic at NYU’s School of Law, joins us to discuss her findings and why she is calling on the U.S. government to ensure that all Americans have access to sufficient, nutritious food.
To hear Republicans — and some Democrats — in Congress talk, you’d think food-stamp dollars just disappear into a black hole. The prevailing debate in the Senate and House versions of the farm bill, which contains funding for food stamps (the Supplemental Nutrition Assistance Program, or SNAP), is over how much to cut.
But when more than 15 percent of Americans remain impoverished, slashing food assistance for the poor makes no sense in humanitarian, economic or public-health terms.
The House bill which is gaining steam after passage by the Agriculture Committee last week, is the more draconian of the two. It would chop $20 billion over 10 years from SNAP, and its changes to food-stamp eligibility rules would cut off vital sustenance for about 2 million low-income people, including seniors and families with children.
According to the Congressional Budget Office, 210,000 children in low-income families would lose their free school meals under the House plan.
The Senate version would cut far less, though a final figure will be hashed out by a conference committee in June. But the attacks on food assistance for the poor are deeply misguided and are only going to get worse.
The proposed House budget from Rep. Paul D. Ryan, R-Wis., seeks to gut food stamps by an additional $135 billion through block grants to states.
Yet government and other studies clearly show that food stamps are among the most wisely spent public dollars, providing essential nourishment and public health benefits to low-income people as well as economic stimulus to rural and urban communities.
These are returns on spending that you won’t find in the corporate tax giveaways and military spending boondoggles routinely supported by both political parties. even as they scream for austerity when it comes to slashing “entitlements” and food assistance for the poor.
The Trust for America’s Health, a health advocacy organization that focuses on disease prevention, warned recently of the consequences of cutting food stamps: “If the nation continues to underfund vital public health programs, we will never achieve long-term fiscal stability, as it will be impossible to help people get/stay healthy, happy and productive.”
Indeed, According to a 2011 study by the U.S. Department of Agriculture, “research shows that low-income households participating in SNAP have access to more food energy, protein and a broad array of essential vitamins and minerals in their home food supply compared to eligible nonparticipants.”
The mainstream media never talks about that. They are much too busy covering the latest dogfights in Washington and what Justin Bieber has been up to. And most Americans seem to think that if the Dow keeps setting new all-time highs that everything must be okay. Sadly, that is not the case at all. Right now, the U.S. economy is exhibiting all of the classic symptoms of a bubble economy. You can see this when you step back and take a longer-term view of things. Over the past decade, we have added more than 10 trillion dollars to the national debt. But most Americans have shown very little concern as the balance on our national credit card has soared from 6 trillion dollars to nearly 17 trillion dollars. Meanwhile, Wall Street has been transformed into the biggest casino on the planet, and much of the new money that the Federal Reserve has been recklessly printing up has gone into stocks. But the Dow does not keep setting new records because the underlying economic fundamentals are good. Rather, the reckless euphoria that we are seeing in the financial markets right now reminds me very much of 1929. Margin debt is absolutely soaring, and every time that happens a crash rapidly follows. But this time when a crash happens it could very well be unlike anything that we have ever seen before. The top 25 U.S. banks have more than 212 trillion dollars of exposure to derivatives combined, and when that house of cards comes crashing down there is no way that anyone will be able to prop it back up. After all, U.S. GDP for an entire year is only a bit more than 15 trillion dollars.
But most Americans are only focused on the short-term because the mainstream media is only focused on the short-term. Things are good this week and things were good last week, so there is nothing to worry about, right?
Unfortunately, economic reality is not going to change even if all of us try to ignore it. Those that are willing to take an honest look at what is coming down the road are very troubled. For example, Bill Gross of PIMCO says that his firm sees “bubbles everywhere”…
We see bubbles everywhere, and that is not to be dramatic and not to suggest they will pop immediately. I just suggested in the bond market with a bubble in treasuries and bubble in narrow credit spreads and high-yield prices, that perhaps there is a significant distortion there. Having said that, it suggests that as long as the FED and Bank of Japan and other Central Banks keep writing checks and do not withdraw, then the bubble can be supported as in blowing bubbles. They are blowing bubbles. When that stops there will be repercussions.
And unfortunately, it is not just the United States that has a bubble economy. In fact, the gigantic financial bubble over in Japan may burst before our own financial bubble does. The following is from a recent article by Graham Summers…
First and foremost, Japan is the second largest bond market in the world. If Japan’s sovereign bonds continue to fall, pushing rates higher, then there has been a tectonic shift in the global financial system. Remember the impact that Greece had on asset prices? Greece’s bond market is less than 3% of Japan’s in size.
For multiple decades, Japanese bonds have been considered “risk free.” As a result of this, investors have been willing to lend money to Japan at extremely low rates. This has allowed Japan’s economy, the second largest in the world, to putter along marginally.
So if Japanese bonds begin to implode, this means that:
1) The second largest bond market in the world is entering a bear market (along with commensurate liquidations and redemptions by institutional investors around the globe).
2) The second largest economy in the world will collapse (along with the impact on global exports).
Both of these are truly epic problems for the financial system.
If you know someone that actually believes that the U.S. economy is in good shape, just show them the statistics in this article. When you step back and look at the long-term trends, it is undeniable what is happening to us. We are in the midst of a horrifying economic decline that is the result of decades of very bad decisions. 30 years ago, the U.S. national debt was about one trillion dollars. Today, it is almost 17 trillion dollars. 40 years ago, the total amount of debt in the United States was about 2 trillion dollars. Today, it is more than 56 trillion dollars. At the same time that we have been running up all of this debt, our economic infrastructure and our ability to produce wealth has been absolutely gutted. Since 2001, the United States has lost more than 56,000 manufacturing facilities and millions of good jobs have been shipped overseas. Our share of global GDP declined from 31.8 percent in 2001 to 21.6 percent in 2011. The percentage of Americans that are self-employed is at a record low, and the percentage of Americans that are dependent on the government is at a record high. The U.S. economy is a complete and total mess, and it is time that we faced the truth.
The following are 40 statistics about the fall of the U.S. economy that are almost too crazy to believe…
#1 Back in 1980, the U.S. national debt was less than one trillion dollars. Today, it is rapidly approaching 17 trillion dollars…
#3 The U.S. national debt is now more than 23 times larger than it was when Jimmy Carter became president.
#4 If you started paying off just the new debt that the U.S. has accumulated during the Obama administration at the rate of one dollar per second, it would take more than 184,000 years to pay it off.
#5 The federal government is stealing more than 100 million dollars from our children and our grandchildren every single hour of every single day.
#6 Back in 1970, the total amount of debt in the United States (government debt + business debt + consumer debt, etc.) was less than 2 trillion dollars. Today it is over 56 trillion dollars…
#7 According to the World Bank, U.S. GDP accounted for 31.8 percent of all global economic activity in 2001. That number dropped to 21.6 percent in 2011.
#8 The United States has fallen in the global economic competitiveness rankings compiled by the World Economic Forum for four years in a row.
#9 According to The Economist, the United States was the best place in the world to be born into back in 1988. Today, the United States is only tied for 16th place.
#10 Incredibly, more than 56,000 manufacturing facilities in the United States have been permanently shut down since 2001.
#11 There are less Americans working in manufacturing today than there was in 1950 even though the population of the country has more than doubled since then.
#13 When NAFTA was pushed through Congress in 1993, the United States had a trade surplus with Mexico of 1.6 billion dollars. By 2010, we had a trade deficit with Mexico of 61.6 billion dollars.
#14 Back in 1985, our trade deficit with China was approximately 6 million dollars (million with a little “m”) for the entire year. In 2012, our trade deficit with China was 315 billion dollars. That was the largest trade deficit that one nation has had with another nation in the history of the world.
#15 Overall, the United States has run a trade deficit of more than 8 trillion dollars with the rest of the world since 1975.
#16 According to the Economic Policy Institute, the United States is losing half a million jobs to China every single year.
Gregory Wilpert: In spite of a new audit of election results that shows a win by Maduro that is recognized by all countries of Latin America, the US supports opposition
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By Michael, on June 2nd, 2013
