Robert Reich, former U.S. labor minister under Bill Clinton and currently include Professor at the University of California has, in his new book, "aftershocks. America at a turning point," the crisis of the U.S. economy are analyzed and solutions presented.
Persistently high unemployment and bobbing in front of him to make economic growth of the democratic U.S. government of Barack Obama to create hard and have provided during the recent congressional elections to significant losses for the Democrats. For months the U.S. rages a violent dispute about what the appropriate action to cause the U.S. economy from the crisis. Not only between the parties crashing together the different views, but also within them, which paralyzes the policy after the new majorities in Congress. Even within the Fed of dissent is large, which is increasingly perceived as a Council-and orientation-lessness. Because of the failure of all measures taken so far against the high unemployment and weak growth, and by disagreement over the einzuschla-tion rate, have the same number as high economic adviser to Barack Obama left the service - including Christina Romer and Larry Summers. (1)
No wonder that the book by Robert Reich provides a lot of excitement and commercial paper in the book review almost euphoric headline "How the U.S. economy can be saved." (2)
Reich's thesis that the U.S. not because of the financial crisis so bad, but given the enormous differences in income. The super rich share an increasing portion of the assets among themselves. All that you desire, while only A limited amount is available, has become unaffordable for the majority of American citizens, as the purchasing power concentrated at the top of the income scale.
This is a problem that is true. Arloc Sherman and Chad Stone have shown in an analysis of data that the income differentials between the one percent of the richest Americans and the middle and poorest fifth of the population in the last three decades more than tripled. (3) The concentration of income at the top of the income scale according to their analysis since 1928 have never been higher than today (as of 2007).
Specifically, results after the analysis of Sherman and Stone, following the U.S. image: (4)
- reached the period from 1979 to 2007, the share of the top 1 percent of U.S. income after tax at 17.1 percent in 2007 to the highest value, while the share of the middle-income quintile during the same period of 2007 dropped to its lowest value (14.3 percent).
- rose between 1979 and 2007 the average income of the top 1 percent adjusted for inflation by 281 percent, representing an increase of 971 300 U.S. dollars per household. The top fifth of income realized an income increase by 95 percent. Other hand, posted only a fifth of the average income increase of 25 percent (11,200 US-Dollar/Haushalt) the bottom fifth of income even only an increase of 16 percent (2,400 US-Dollar/Haushalt).
- would have increased the income (after taxes) 1979-2007 in the three groups (top 1 percent, middle and lower fifth) with the same percentage rate, it would have the middle-class households from 2007 13 042 U.S. dollars higher located and that of the poorest families by 6010 U.S. dollars.
- Income (after taxes) for the top 1 percent of the income pyramid nearly quadrupled 1979-2007, it rose from 347 000 to U.S. $ 1.3 million U.S. dollars (plus 281 percent). In contrast, increased the income of middle class only 44 100 55 300 in U.S. dollars (plus 25 percent) and only the poorest households from 15,300 to 17,700 U.S. dollars (up 16 percent).
- The top 1 percent of budget in 2007 had on average an income of 1.3 million U.S. dollars - $ 88,800 more than the year before. But the wage increase is well above the average income of middle-class households (55.3 thousand U.S. dollars).
- The share of the top 1 percent of total U.S. income (after taxes) increased from 1979 to 2007 from 7.5 percent to 17.1 percent. The proportion of the three middle-fifth - 60 percent of income recipients so - however, decreased from 51.1 to 43.5 percent. The share of the poorest Fifth was at the bottom of the pyramid in the same period from 6.8 to 4.9 percent.
- The proportion of the bottom four-fifths of the income distribution in the U.S. total income (after taxes) fell from 1979 and 2007 from 58 to 48 percent.
The data speak for themselves, it is evident how much the income (and assets) shear in the United States and gapes open as fast as they continued to open.
For Robert Reich is the cause of this social gradient for the crisis in the U.S.. There must be stated in its opinion.
Reich wrong. He confused cause and effect.
The distribution of income and wealth is at its core always the result of market processes and not the cause of the crisis.
markets and economies develop. They mature. And signs of aging is that there is a continuous concentration trationsprozess there. The best you can see the concentration in the company. Many markets are now dominated only by a few large corporations. It is quite clear that in mature markets and mature economies Competitive processes are different and produce according to income and assets other than in emerging markets and in young economies. The problem with this is that the group is the winner of competition processes in the development of markets and economies and the continuing focus on markets typically smaller and smaller. Most recently, the ratios tend to solidify and are then often in competition processes not changed significantly - one winner, always a winner. So there are cumulative effects.
Consider, for example, at the time of Ludwig Erhard in postwar Germany. During this time the markets were in their infancy, there was a lack of everything, and demand was high all over. There were shows excellent conditions for entrepreneurship and the motto "Prosperity for all", as this situation with regard to the impact of income and wealth distribution.
Today we have many mature markets, with high business concentration, excess capacity, enormous pressure on costs and intense price competition. Many markets are dominated by a few very large corporations. This is a completely different situation than in the 50s and is the result of development, and the competition itself has changed. (5) All this is reflected today in the same income and wealth distribution - and this also applies to the United States.
Such development processes are not considered by mainstream economists as well as Keynesians. The give their theories is not applicable. And yet these relations are not perceived - even by not Robert Reich.
And just for completeness: In the U.S. there were up to the crash of 1907, a sharp business concentration process with strong monopoly tendencies (Keywords: Standard Oil - the society was broken up because of this); Unternehmenskon same high concentration there was also before the Crash of 1929 - even after concerns were smashed in the U.S.. And everyone knows that we are once again in recent years, a deterioration of corporate concentration in many markets, pushed again by the crisis, with sierungstendenzen Monopoli (such as Intel, Microsoft, Google, BHP Billiton, etc.). The really big crash is probably yet to come.
The cause of the U.S. crisis and the extremely unequal income and wealth distribution are therefore the national economy in the Width changes, mature market structures and as a result of this change now dominant form of competition, (6) is also undermined in many cases by the great influence of lobbyists. (7)
The low purchasing power of most of the Americans is also a result of the described development process. It is trivial to identify the low purchasing power as a problem. But Reich's solution proposals that rely primarily on redistribution, show that he has not understood the underlying problem.
If the identified problems - wants to remedy that must ensure that in the U.S. on all markets again a dynamic and innovative form of competition is possible - extremely unequal income and wealth distribution, and low purchasing power. As far as I can see it, they will, given the advanced stage in some markets no longer alternative but to dismantle groups.
that an empire and his proposals received so much attention, shows that the U.S. is in crisis management is still missing the orientation. The Americans do not see what is the cause of their problems and why they find a suitable solution. The economy languishes in front of him, and unemployment remains high and for more than 40 million Americans whose survival depends on food stamps, the outlook remains bleak. It is abshebar that will exacerbate the problems in the face of so much economic and political helplessness of the guild. Empire proposals are not a bright spot.
The Heads of State and Government of the European Union in turn have not understood that all developed countries have the same core problem as the United States - even though they are sometimes at other points of development. For all developed countries are highly dependent on the major global Players dependent.
However, the problem for the EU is different than the U.S.: The strength of big business column in the major industrial countries (the so-called National Champions), which over the last four decades to the current crisis reliably generated growth, was in the European Union also the guarantee for the growth of the smaller EU states. The economy of countries like Greece, Hungary, Ireland and Portugal went, supported by massive financial support from the EU, in the wake of heavy industrial sites in the EU. This - in simplified form - European Growth Model has collapsed with the crisis and is currently the biggest problem of the so-called debts States: they have no viable growth concept more. Austerity is not a growth concept. The Germans have known for Heinrich Brüning. Without growth, the approach they will not be able to free them from their debts. (8) to find This is not the sole responsibility of those countries. On the contrary, the EU as a whole must find a new growth model when they want to survive in its current form.
also for Europe, the solution can only lie in a concept that dynamic and innovative competition possible and therefore the dependencies-from large corporate segment again significantly reduced. On either side of the Atlantic, the central part of the problem is the same: The increasing weakness of demand (9) , the systematic deprivation of the segment of small and medium-sized companies and banks (10) by the given conditions as well as by the one-sided take on the big and efficiency-focused economic policy, excessive influence of lobbyists (11) .
The current crisis is different from earlier and they can is therefore not used to be successful concepts such as the Keynesian (in the 1st Great Depression and in Germany in the late 60's), or liberalism (such as in post-war Germany) overcome. (12)
Links: Can
(1) Obama on Larry Summers Council waive (v. 22:09:10)
(2) book by Robert Reich: How the U.S. economy is to save (v. 18:12:10)
(3 +4) Arloc Sherman and Chad Stone, "Income Gap Between Rich And Everyone Else Very Trippled More Than In The Last Three Decades, Data Show," Center on Budget and Policy Priorities, June 25.2010 ;
(5) Stefan L. Eichner, competition, industrial development and industrial policy ", Berlin 2002 .
(6) capitalism in crisis: farewell to the free market economy - Farewell to the competition? (v. 20:09:09)
(7) financial crisis and economic system: resistance and show the success of the lobbyists that a free market economy, there is neither the goal nor is (v. 02.01.10);
(8) test of the European Union: Between Greece crisis, plunging stock prices on Wall Street Plunge Protection Team (by 5:07:10);
(9) crisis management: The forgotten power of customers. From Utopia.de to Stuttgart 21 (v. 14:11:10)
(10) Ireland crisis: governments remain a hostage to the financial markets (v. 22:11:10)
(11) financial crisis and economic system: resistance and success of lobbyists show that a free market economy, there is neither the goal nor is (v. 02.01.10);
(12) first and second Great Depression: A different situation, other measures, but the same crucial mistake - Hisory Repeating? (v. 21.03.10).
The dependence of economies of corporations:
- export surpluses: The German trade surplus is one of the auto industry (by 24/01/11).
0 comments:
Post a Comment