This was the week that World War III was supposed to erupt across Europe if you listened to the most alarmist reaction to the Russian occupation of Crimea. Ukraine mobilized their reserves and prepared for the worst while the whole world held its breath. So far, however, nothing has happened.
That is, the missiles aren’t flying and the troops aren’t advancing. There has been action, which is to say a lot more than a visit to Kiev by Secretary of State Kerry and some sternly worded European Union (EU) missives. The money has clearly been bet that there won’t be a war and even more money has been put down on making sure it doesn’t happen.
Think of it like the currency war that is going around the globe right now. This is the primary way that wars are fought now – with money.
President Obama came to St Paul to propose an aggressive new investment in transportation infrastructure, $300B over 4 years. It was a good show that messed up traffic throughout the city, which was only fitting. That increase of $75B per year comes on top of the current $48B per year, or a 150% increase. It’s needed, and as we’ve noted before investments in infrastructure have a great payback for the economy.
But what’s new about this is that the money to pay for it is to come from an overhaul of the corporate tax system, which is also badly needed. The details have yet to be announced, but the overall hike is $150B per year, with half going to infrastructure and the rest to deficit reduction. So what’s not to like about this plan?
It’s a half-step at best, and in so many ways.
If you pay attention to social media, or even just talk amongst your friends, you may have heard some awful things about the economy. Many people, Republican and Democrat, are convinced that things are simply not improving. The feeling tends to be stronger among Republicans, especially Tea Partiers, who believe that socialist policies are still killing us. But the mood crosses party lines rather fluidly.
It boils down to six persistent myths about our economy today. Some are based on old news, taken from horror stories from the depths of this depression around 2010. Some are simply wrong. But all of them reinforce the emotional reason why this is indeed a depression, a dark feeling shared across society. It’s also rather wrong. Let’s run them down.
The workers at the plant are voting on whether or not to join a union. The vote is controversial, setting the company and local politicians at odds with each other in a bitter struggle playing out in the press and even on billboards around town. If you think you’ve seen this story before, hold on a moment.
In Chattanooga Tennessee the workers are finishing up voting to possibly join the United Auto Workers (UAW) today. Volkswagen, the owner of the plant, has no official position on the vote but were the ones who initiated the process last October. The opposition comes from local officials who are terrified of unions coming in. They’ve made it clear that if the UAW successfully organizes the plant they will cut off all future tax breaks and generally make life difficult for VW. Welcome to a new world of global companies meeting the strange cultural war of the USA in 2014.
The Congressional Budget Office (CBO) report has a simple title, “The Budget and Economic Outlook: 2014 to 2024”. If the whole thing sounds about as cut and dried as possible, you’d be completely wrong. After all, the is the US in 2014, a place where absolutely anything can become a political football. A nonpartisan report from a respected institution which is full of detail and hard to read makes a perfect game ball.
The last week has been nothing but back and forth on the topic of how many jobs are destroyed, er, left behind with glee because of the Affordable Care Act (aka Obamacare). Nevermind that the bulk of the report was indeed a warning about what will happen if we don’t straighten the budget out in the next decade. That’s hard work, however, and no one will look good on teevee talking about that. So let’s get to the garbage that filled the airwaves instead.