On Sunday, 5 July, voters in Greece will head to the polls on an utterly unique referendum on a proposed bailout. The process is non binding, the question itself is strange, and the consequences of it are completely unknown.
What does any of it mean? The short answer is that Greece, and all of Europe, are in completely uncharted territory at this point. The five year crisis has gone from slow simmer to a full boil in the hot summer sun. Greece is calling Europe’s bluff, and Europe is not backing down. The only thing we can be sure of is that there will be a resolution shortly, one way or the other. What exactly that means is itself completely up in the air as well.
Here are a few questions and answers on the Greek Crisis based on a variety of news sources. Follow the links for more information in each question.
Robert Reich is a great leader in the Democratic Party. After serving as Secretary of Labor from 1993 to 1997 he became a fixture in thoughtful magazines, speeches, and talk shows. He is currently a Chancellor’s Professor at the Goldman School of Public Policy at UCal, Berkeley.
Reich has recently collaborated with moveon.org to create a series of short videos describing “The Big Picture” – things which need to be done to transform our economy into a more dynamic, fair, and productive new economy for a post-depression world. Taken together, I believe these make up a new platform for the Democratic Party which must be a central organizing piece for the elections in 2016.
Whether or not you agree with Reich, he and this platform are a force to be reckoned with.
Since I have yet to see them presented together in one place as a coherent work, I have taken the liberty of doing so myself. Each item is presented here with the title as a link to the original post on Reich’s blog, with the short video above it. Please follow the links for more information in Reich’s own words.
Initially, this project was billed as “Ten Ideas to Save the Economy”. There are now 12 videos in the series, branching out a bit into political reform. If there are more they will be added later.
Trans-Pacific Partnership, or TPP. It sounds like a great idea on the surface of it – lower trade barriers and require trade partners to improve working conditions in developing nations. There’s only one problem with it – no one knows what it is. That’s partly due to it being negotiated in secret and partly due to the fact that the negotiations are not done.
But many are against it for a wide array of reasons that span left and right. On the right, there is a good chance the sovereignty of the US will be diminished based on treaty obligations that, based on discussion, reach very far. On the left there seems to be yet another assault on good US jobs. And that secrecy? There are rumors that it will remain secret long after the treaty is passed.
It’s time to take a step back and sort out what TPP is and what is actually true about it.
Are you not working a full 40 hours a week, though you would like to? A solid 4.1% of all workers report that they are, in technical terms, “Part Time for Economic Reasons”, which is to say that they’d jump at the chance for a full time job but don’t have one yet. It’s a decent improvement from the 5.3% in this position two years ago, when we last looked at the problem, but it’s still not good.
Worse, the San Francisco Federal Reserve, who studies the phenomenon, has come to believe that it’s a feature of the new economy.
The forecast calls for the cold and stormy June to resume here in the middle of this vast continent after a brief heat wave. We’ve come to rely on weather forecasters to at least give us a guess as to what it will be like as the lazy days demand outdoor fun. Tomorrow night, for example, they tell us there is a 25% chance of rain.
But such forecasts are usually limited to the weather. Why not stocks?
The short answer is that when there’s a lot of money riding on something a busted forecast could be cause for a lawsuit. No one wants to stick their neck out too far beyond the herd because anything unprecedented is a risk not worth taking. But we’re here among friends, right? Barataria makes forecasts from time to time and this month is a good one for it. The reason is that we can see a storm brewing as stocks have gotten pretty far ahead of the “recovery” so far.
Where are the jobs? Job creation has been the hot economic topic since the big downturn in 2008. The sooner we have full employment the sooner demand for goods and services will turn around and there will be a net upward pressure on wages. But in 2015 the rate of increase in jobs has slowed somewhat, barely hitting 200k net every month from a solid run of 220k the year before. What happened?
The data is even more confounding when you look at the net good news on jobs – that initial claims for unemployment per week are at an all-time low as a percent of total jobs. We’re not creating jobs as fast as we should, but we also aren’t losing them. Along with a large backlog of unfilled job postings there is substantial evidence that something is wrong. Is it a skills gap? Or something else?
The first revision for Gross Domestic Product (GDP) for the first quarter (1Q15) came out negative. The economy is contracting! Is it time to panic? The White House attributed the slowdown to weak exports, which are quite well known to be a problem. But is that all?
As we have commented on at length before, the GDP numbers are full of fudge, so it may be hard to know just what to make of them. A cynic would say, and probably does say, that they the Bureau of Economic Analysis (BEA) is making the numbers up as they go to make everyone happy.
Perhaps you are a bit too diabetic to handle all the fudge, either, but this problem is a bit more savory than sweet. It’s all about the seasoning – or, rather, the “seasonal adjustment”.